By Jennifer McEntee
San Diego Daily Transcript via Checkbiotech.org

Executives for Diversa Corp. said Friday that Syngenta's increased 2004 investment in "biopharming" -- to an estimated $30 million, from a reported $12 million in 2002 -- was in line with their expectations.

Diversa has a number of research programs with Switzerland-based Syngenta, including a joint venture to develop animal feed additives and formulations, and a discovery program focused on altering genes in crops.

In fact, Syngenta is Diversa's almost exclusive partner for agriculture-related research, according to Diversa Chief Financial Officer Karin Eastham. Diversa similarly has chemical research collaborations with Dow Chemical Co. and DuPont.

Syngenta has an ownership stake in Diversa, estimated at about 18 percent.

Eastham said Diversa doesn't discuss all of its work with Syngenta, but that the collaboration runs far and wide. Under a seven-year, $118 million deal that began in 2003, Syngenta and Diversa have combined their biopharma research activities in genomics and selected antibody generation.

That relationship prompted Syngenta's decision last year to relocate its plant genomics programs, including its work with the rice genome, from the Torrey Mesa Research Institute in La Jolla to Syngenta Biotechnology Inc. in North Carolina. About 77 Torrey Mesa Research Institute employees were transferred to Diversa, Eastham said.

Biopharming falls under the still murky category of genetic modification. Syngenta has taken the position that human and animal genes in plant biotechnology could open up new medical paths, but has stressed that none of its genetically modified crops so far use human or animal genetic material.

Syngenta spokespeople couldn't specify Friday how the company's increased spending on plant-based drug research might impact Diversa, but said the existing arrangement with Diversa has so far been advantageous.

"We view this as a long-term commitment to a relationship that's already producing some good results," Syngenta spokeswoman Sarah Hull said Friday.

Diversa reported last week 2003 revenues of $49 million, up from $31.7 million in 2002.

"The increase in revenues was primarily due to additional research funding from the company's most recent research collaboration with Syngenta," according to a statement issued by Diversa.

Diversa reported in January that it received milestone payments of $1.7 million as part of its Syngenta joint venture, called Zymetrics. The payments were reportedly triggered by Diversa's delivery of several product candidates for feed and food processing applications, and the regulatory approval of Zymetrics' Quantum Phytase animal feed enzyme in Mexico.

Quantum, designed to improve how chickens and pigs absorb nutrients from their food, is awaiting a potential marketing approval from the U.S. Food and Drug Administration.

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