Government pushing us out says Diatranz

By KEVIN TAYLOR

An Auckland company investigating diabetes treatments says it is being "legislated out of the country" by the Government.

Controversy has surrounded Diatranz over its application to transplant insulin-producing cells from 2-week-old piglets into 12 New Zealand diabetics.

The proposed research has been greeted enthusiastically in the Cook Islands, where diabetes is a major problem, and by diabetics in this country.

But last Thursday a supplementary order paper amending the Medicines Act was tabled in Parliament banning xenotransplantation (the transfer of living animal cells, tissue or organs into humans) until June 30 next year, with a provision to extend it two more years.

In a majority decision the finance and expenditure committee decided not to exempt Diatranz from the ban, although the committee's press release failed to reveal that Diatranz is the only New Zealand company doing such work.

The ban also comes as the company waits for an appeal date over the decision last year by the Director-General of Health to decline its application for the work.

Diatranz managing director Dr Bob Elliott said he would still appeal as a matter of principle, but the company - which employed 23 staff, including 20 scientists - would now have to go overseas.

He said that Diatranz had not even proposed a GM procedure.

"We are not doing anything to do with genetic modification."

Elliott said it was extraordinary that the Government was singling out one company to legislate against.

"We can't continue to exist here. We have been legislated out of the country," Elliott said.

"We have been delivered a vital blow, but it won't stop xenotransplantation. It's happening elsewhere.

"The risks are now that it's going to become unregulated."

Since the appeal against the Director-General's decision was filed last July the company had heard nothing.

The next it knew the paper had been created, he said.

"We can't really operate within New Zealand under these sorts of circumstances ...

"Our investors could not tolerate operating in a country which has, in effect, singled out one company for a ban. We are the only ones doing xenotransplantation."

The paper was reported back to Parliament with the Hazardous Substances and New Organisms (Genetically Modified Organisms) Amendment Bill, which gives effect to Government GM policy decisions announced last October.

Committee member and National MP Annabel Young said the Diatranz case was a warning to the biotech sector.

"They are still in the process of appeals, and in the middle of all that this legislation comes in over the top and says regardless of your success in the current process, you are going to be stopped anyway."

Young said that was a warning to business that even though they were going through the proper processes, the rules could change mid-process.

She also criticised the Government for on the one hand lauding its innovation framework and its emphasis on the biotechnology sector, but on the other driving a biotech company out.

A spokeswoman for Health Minister Annette King referred the Herald to the office of Environment Minister Marian Hobbs for comment. Hobbs' office said it was a matter for the Minister of Health.

The Health Ministry said it was not a matter its officials would comment on.

The paper gives the Minister of Health authority to grant an exemption from the xenotransplantation ban, but that has to involve public consultation.

The Cook Islands has one of the world's highest rates of diabetes.

The Cook Islands MP representing New Zealand Islanders in the Cooks Parliament, Dr Joe Williams, approached Diatranz several months ago on behalf of his patients desperate for a cure for their diabetes.