Impact of EPA TSCA Biotech Regulations on the Use of Modified Microorganisms in Biofuel Production

The previous entries in this blog described  U.S. Environmental Protection Agency (EPA) regulations under the Toxic Substances Control Act (TSCA) that may cover the use of certain genetically modified microorganisms in biofuel production.  In this final posting about these EPA regulations,  I’ll cover some practical issues about how these regulations have affected biofuels projects to date, with some implications for the future. 

To summarize the prior entries, the TSCA Biotech Rule covers certain modified microorganisms,  specifically those containing deliberate combinations of coding nucleic acids derived from more than one taxonomic genus, but only when those organisms are used for commercial purposes not regulated by other federal agencies. The use of microorganisms or algae to produce ethanol, butanol, biodiesel or other biofuels is an industrial application that would almost certainly fall under TSCA jurisdiction. For those modified microorganisms falling under the rules, most R&D uses (including pilot plants) would probably be exempt, but applicants contemplating commercial use of a covered microorganism must notify EPA at least 90 days before commencing manufacture or import, filing a notification document called a Microbial Commercial Activity Notice (MCAN).   

Examples of Prior MCANs for Biofuel Microorganisms 

EPA has been receiving MCANs and other notifications of biotechnology products under its interim TSCA policy since 1987 and under the current rules since 1997, and these regulations have not proven to be a barrier to industrial biotechnology companies, including those developing biofuel products or processes. Most of the notifications EPA has received have been for uses of intergeneric microorganisms to manufacture industrial enzymes and specialty chemicals.  Among the MCANs filed for industrial enzyme production, the following notifications from Genencor and Novozymes are for enzymes that are applicable to the production of cellulosic ethanol or other biofuels. 

  • Genencor International Inc. MCAN No. J04-0005. Modified Trichoderma reesei for the production of an alpha-amylase. Submitted September 28, 2004. Notice of Commencement filed February 28, 2008.
  • Genencor International Inc. MCAN No. J05-0001. Modified Trichoderma reesei for production of a beta-glucosidase preparation. Submitted January 24, 2005. Notice of Commencement filed August 29, 2006.
  • Novozymes North America, Inc. MCAN No. J07-0001. Modified Trichoderma reesei for the synthesis of a cellulose-degrading protein preparation. Submitted December 1, 2006. Notice of Commencement filed May 9, 2007.
  • Novozymes North America, Inc. MCAN No. J09-0002. Modified Trichoderma reesei to produce a cellulolytic protein preparation for ethanol production. Submitted February 27, 2009. Notice of Commencement filed September 18, 2009.
  • Novozymes North America, Inc. MCAN No. J09-0004. Modified Trichoderma reesei to produce cellulose-degrading enzymes for ethanol production.  Submitted September 3, 2009. 

In recent years, EPA has received other MCANs for genetically modified production organisms where the organism itself is designed for use in cellulosic ethanol production. I’m aware of at least these three MCANs covering such production organisms (note that there are a few MCANs where so much information is claimed as “confidential” that the proposed use of the strain is not available to the public, so it is possible that there are additional MCANs for biofuel production organisms).  

  • Verenium Corporation. MCAN No. J08-0001.  Escherichia coli strain BD26981, engineered to express Zymomonas mobilis genes for the conversion of pyruvate to ethanol: pyruvate decarboxylase (pdc), alcohol dehydrogenase I (adhA) and alcohol dehyrodgenase II (adhB). In addition, the strain carries certain deletions of endogenous genes and also expresses green fluorescent protein.   Submitted May 14, 2008.
  • Verenium Corporation. MCAN No. J08-0002. Klebsiella oxytoca strain BD26985, engineered to express Zymomonas mobilis genes for the conversion of pyruvate to ethanol: pyruvate decarboxylase (pdc), alcohol dehydrogenase I (adhA) and alcohol dehyrodgenase II (adhB). In addition, the strain carries certain deletions of endogenous genes and also expresses green fluorescent protein.   Submitted May 14, 2008. These two Verenium organisms are intended to be used with a naturally occurring, nonmodified strain of Trichoderma reesei in a multi-step ethanol production process in which lignocellulosic biomass is broken down into two streams – a liquid stream including sugars and a solid stream including cellulose and lignin, both of which are then fermented for further production of sugars (e.g. from the cellulosic material) and conversion of the sugars to ethanol and carbon dioxide.
  • E.I du Pont de Nemours and Company. MCAN No. J09-0003.  Zymomonas mobilis strain ZW801, modified to express four genes to enable the strain to utilize xylose as a substrate: xylose isomerase (xylA), xylulokinase (xylB), transaldolase (tal) and transketolase (tkt). Submitted September 2, 2009.  The engineered strain will be capable of converting xylose into intermediate byproducts that can be fermented into ethanol, to supplement the natural ability of wild type Zymomonas strains to convert glucose, fructose and sucrose into ethanol.

Note that MCANs are reviewed by EPA, but no formal “approval” is needed. If the Agency does not identify any unusual risks or any reason to extend its review during the 90 day review period, the MCAN is deemed to be cleared  (or “dropped from review” in the terminology used at the EPA website) and the applicant can proceed to commercialization. Applicants must submit a Notice of Commencement when commercial use (or importation) is to begin, and as can be seen from the above, not all of the microorganisms covered by these MCANs have yet progressed to commercial use. 

Practical Impact of the Biotech Rule on Biofuel Production

I expect that EPA will see more MCAN submissions as more cellulosic ethanol firms and companies developing other biofuels begin to move towards commercial production using modified microorganisms and algae. As more companies begin to go through the regulatory process, or to consult with EPA to determine how their processes might be regulated, I think we’ll see a number of trends and common themes developing, and in addition, some interesting issues may arise which were probably not contemplated when the TSCA regulations were drafted in the 1980s and 1990s. 

Many production strains may be exempt from, or not covered at all by, the regulations. As described in the previous entries, there will be some biofuel production organisms that will fall completely outside the TSCA regulations, because they will not be intergeneric – the genetic modifications may consist only of gene deletions or insertion of heterologous genes from a donor organism of the same genus as the host – and such microorganisms would not be covered at all by the TSCA Biotech Rule. Other organisms may qualify for an exemption from MCAN filing under the regulations, because modified microorganisms based on certain common host strains with a history of safe industrial use may be eligible for either the Tier I or Tier II exemptions. In particular, E. coli and S. cerevisiae (both likely host organisms for fermentation of ethanol or other fuels) are both among the listed recipient organisms, and many modified strains of these species could qualify for an exemption. But remember that in order to qualify for the exemption, the applicant either has to certify that it will strictly comply with the containment requirements of Section 725.422 of the regulations (for the Tier I exemption) or to have EPA judge the proposed containment conditions to be equivalent to those requirements (for the Tier II exemption), so being “exempt” from the need for MCAN filing does not make an applicant exempt from the rule itself. 

Most pilot and demonstration plant use will not require MCAN reporting, but this may not be the case in all situations. The TSCA Biotech Rule provides an exemption from MCAN reporting for uses of intergeneric microorganisms used in “small quantities solely for research and development”, if used in a “contained structure”. This provision within the regulations was created largely to apply to small-scale laboratory use and benchtop fermentations and possibly also to relatively small pilot-scale fermentations, and when applied to such scenarios the definition of the exemption is fairly straightforward. However, there is more ambiguity when applied to the types of pilot plants and demonstration plants that are more common in the biofuel field, particularly as the scale gets larger, and particularly depending on the disposition of the fuel that is produced in such plants. Specifically, if the ethanol or other fuel that results from pilot-scale or demonstration-scale production is sold for commercial use, or otherwise disposed of in a commercial manner, it is likely that the process would no longer be judged to be “solely” for R&D purposes, and thus may cross the line into “commercial use”. Companies planning pilot or demonstration plants should obtain legal advice or should consult with EPA to determined if the R&D exemption would apply to their situation. It is also worth noting that the pilot or demonstration plant must meet the definition in the regulations of a “contained structure”, and while this definition is broad enough to cover most microbial production processes, there are potentially more important considerations for algal bioreactors, which leads to the next topic … 

Open bed algae reactors may not be considered as “contained structures”. Historically, many industrial processes using algae have been carried out in reactors that are very different from those used in microorganism fermentations. Many algal processes have made use of open-bed reactors, where the algae are grown in large open ponds to maximize exposure to sunlight and carbon dioxide, but it seems likely that such reactors would not meet the definition of “contained structure” under the Biotech Rule. The term “structure” is defined in the rule as any “building or vessel which effectively surrounds and encloses the microorganism and includes features designed to restrict the microorganism from leaving”, and it is doubtful that an open-bed reactor would meet this definition. This would probably cause EPA to treat any use of intergeneric algae in such a reactor as a “deliberate release” into the environment, subjecting the application to a higher level of regulation, not only at commercial stages but during R&D as well (under the Biotech Rule, R&D uses of intergeneric organisms outside of a contained structure, such as in an agricultural field test, do not qualify for the R&D exemption and instead require reporting to EPA under a process known as the TSCA Environmental Release Application). On the other hand, due to concerns about contamination of the reactor vessel and industrial espionage to steal proprietary algal strains, it is unlikely that many companies would consider using a novel, engineered algal strain in an open-bed reactor, and most would opt for some of the better-contained vessels that are becoming more common. 

Use of a modified microbial strain by a company other than its developer.  Several companies in the biofuel industry are adopting business models under which they develop modified production microorganisms but do not intend to themselves use them to commercially produce fuel. Instead, the goal of such companies is to license these production strains to commercial biofuel producers, for use in the licensee’s facilities. This model potentially raises issues of “second party” use that may not have been fully contemplated by the framers of the Biotech Rule, because part of the MCAN process requires the developer of a modified strain to inform EPA of the process steps and containment conditions it intends to use for the strain. The Rule is clear that, for “single party” use of modified microorganisms (i.e., where the company creating the organism is the one that will be using it in commerce), the developer must follow the procedures specified in the MCAN, but the requirements are far less clear in the situation where a first party technology developer licenses or sells a modified microbial strain for commercial use by second party licensees or purchasers after the strain has been reviewed by EPA. The regulations do specify, in Section 725.155(h)(2), that the submitter of an MCAN must provide certain information about the intended commercial use of the modified microorganism, both in its own facilities and also “for sites not controlled by the submitter”. This requirement seems straightforward when “second party” sites are known at the time of MCAN filing, but the regulations do not make it clear what needs to be done if additional second party sites are proposed to be added after the MCAN has been filed and reviewed by EPA. Bear in mind that, once EPA reviews and clears an MCAN, the microbial strain covered by the MCAN is placed on the TSCA ”Inventory” of chemical substances and microorganisms that are allowed to be used in commerce, and under TSCA once a substance is on the Inventory, any party other than the developer can use that substance in commerce. 

I’ve actually consulted with EPA on this question, and an EPA official in the TSCA biotech program confirmed that once a microorganism is on the Inventory, other parties could use it freely, without necessarily being restricted by whatever process and containment conditions were specified in the developer’s MCAN. So, theoretically, if an ethanol producer wishes to license an engineered microbial strain from a technology developer that had filed an MCAN for that strain, the ethanol producer could be free to use the strain under any conditions it wanted. Of course, it may not be that simple, because the developer of the strain could require its licensees to abide by the same containment procedures as specified in the MCAN, a requirement the developer might include in its license agreements to protect its liability. In addition, when reviewing an MCAN, if EPA felt that a given strain posed some unusual risk, it is possible that the agency could find the authority under the regulations to impose restrictions on its use either by the MCAN submitter or by another party, but this seems unlikely for the industrial strains that would most commonly be used for biofuel production. Another possible scenario is where the technology developer obtained either a Tier I or Tier II exemption for a novel strain: in this case, the microorganism is not placed on the TSCA Inventory, and any second party licensee of that strain would be required either to certify compliance with the Tier I containment provisions; or file a Tier II exemption petition to have alternate containment provisions reviewed and accepted by EPA. Actually, the licensee could even decide to file its own MCAN for the strain, even if its biological make-up qualified it for one of the exemptions. 

In summary, there is beginning to be some track record with applicants successfully navigating the TSCA Biotech Rule to enable commercial use both of microorganisms engineered to produce novel biofuel enzymes, and also for novel microbial production strains for use in biofuel production. The applications to date have not been viewed as posing any unusual risks to health or the environment, and reviews of these applications appear to have been straightforward. As more biofuel organisms are submitted to EPA, no doubt certain trends will begin to emerge, and some of the uncertainties discussed above may well be settled. In any event, I feel quite strongly that the TSCA biotech regulatory process is one that can easily be managed and successfully navigated by companies that are able to plan in advance. 

D. Glass Associates, Inc. is a consulting company specializing in several fields of biotechnology. David Glass, Ph.D. is a veteran of nearly thirty years in the biotech industry, with expertise in industrial biotechnology regulatory affairs, patents, technology licensing, and market and technology assessments. This blog provides back-up and expanded content to complement a presentation Dr. Glass made at the EUEC 2010 conference on February 2, 2010 entitled “Prospects for the Use of Genetic Engineering in Biofuel Production.” The slides from that presentation, along with more information on D. Glass Associates’ regulatory affairs consulting capabilities, are available at or at