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 Polar: Collaboration between public and private institutions
By
Arnoldo Pirela
  
Keywords:  Polar; Venezuela; Relation public-private sector.
Correct citation: Pirela, A. (1997), "Polar: Collaboration between public and private institutions." Biotechnology and Development Monitor, No. 32, p. 10­12. 

The Venezuelan company Polar is one of the largest industrial conglomerates in Latin America. The company distinguishes itself from other Latin American companies by actively stimulating collaborations with the academic world. Polar has shown an entrepreneurial ability by its appreciation of the role of scientific and technological knowledge in business.

Latin American governments have invested considerably in encouraging relations between universities and business. So far, the results have been very limited, especially in the area of the transfer of research results and products from universities to companies to facilitate production and commercialization. The lack of transfer may be due to the small size of the Venezuelan scientific community, which is not considered to be a relevant factor in commercial and industrial development. Science and scientists are generally believed to have no political or economic importance. Consequently, the promotion of their welfare and development are merely expressions of tolerance and even considered a waste of money.
At the same time, most firms are poorly informed on technological matters and buy imported technology without much sense of selection. Many firms have no clear idea about information, training and transfer which would enable them to make better use of the research capacities of universities.
The firm Polar, established in 1941, seems to have broken with this tradition. From 1986, a process of building capacity in biotechnology was initiated. This culminated in 1994 in the creation of the Biotechnology National Department (GNB) as a part of Polar Technological Centre. From its start, more than US$ 10 million has been invested in biotechnological research. GNB relies on a regular staff of 10 plant researchers and a chain of local and foreign academic connections through which the company has access to the laboratories, equipment and specialized personnel in various fields. 50 Per cent of its income is provided by two types of contracts, both self­financed from a commercial point of view. The first one is destined to cover specific needs, essentially in the beer department. The others involve long­term research contracts which are part of the Group's future strategies. The other 50 per cent is supported by Polar with no clear identification or relation to actual revenue.

Polar's biotechnology programme
Polar's biotechnology programme represents a combination of academic interests and the demands of an industrial group with an awareness of technological trends. As recommended by GNB, in 1986 Polar visited biotechnological centres in Europe and North­America to collect information regarding the latest developments in the food and beverage sector. Subsequently, Polar formed an industry­academic network of laboratories with the Simon Bolivar University, the Central University of Venezuela (UCV) and the Venezuelan Institute of Scientific Research (IVIC­Caracas). The network carried out projects on biomedical diagnostics making use of DNA probes, recombinant proteins, and monoclonal antibodies. The purpose of this network was to create, on the basis of capacities developed in universities and other centres of public research, a biotechnology potential directly applicable to agriculture and industry (especially the beer industry).
In 1990 the network's first project was directed to stabilize the taste of beer (i.e. aiming for longer shelf life). The stabilization technology is a combination of biochemistry of beer oxidation and genetic engineering of beer yeast. Currently Polar has three patents pending at the US Patent Office.
The following years new projects on pollution control, genetic mapping of barley, molecular genetics of beer yeast, and the transformation of residuals of the beer process into nutritious foods for humans were undertaken. At the same time, through joint ventures with foreign companies Polar hopes to boost its technological knowledge. For example, through collaboration with Gist Brocades, the Netherlands, advances in the production of natural flavours derived from yeast in beer plants have been made.
In the field of agricultural biotechnology, Polar is working on transgenic rice and maize. Rice is transformed to increase resistance to the white leaf virus. Polar's interest in the rice and maize projects is to improve productivity, since the company is the largest national buyer of maize, and a major one in rice and malted barley.
In the biomedical area, Polar has developed and patented three biomedical diagnostics kits: an in situ hybridization kit to detect human papilloma virus (HPV) on cervical smear test; a monoclonal antibody ELISA for human hepatitis B virus; and several antigens of Trypanosoma cruzi that can be used for diagnosing Chagas, found in Andean communities.
 
Facts about Polar
 

Polar is an industrial corporation employing more than 20,000 people worldwide in production and distribution of beverages, food products, animal feed, packing materials and mechanical products. Its main product is Polar Beer. In addition, it has a 38 per cent share in the largest Venezuelan bank. The company also has investments in petrochemicals. Polar continuously diversifies, as is illustrated by the steady growth downstream from a basis of capital assets, engineering, technology of farming and industrial products and processes, technological supplies for agriculture up to the final level of consumer goods.
In 1997, its worldwide sales were estimated to be US$ 2 billion, which is 4  per cent of Venezuela's GNP (excluding oil).


Polar's Market share in the Venezuelan production of various
consumer goods (in percentages) 
 
maize oil
90 %
beer
87 %
snacks
80 %
pre-cook maize flour
67 %
ice cream
60 %
malted beverages (alcohol free)
60 %
rice
35 %

Polar's opportunities in Venezuela
According to Rangel­Aldao, who is both general manager of GNB and president of the National Commission of Biotechnology (CNB), the only reliable opportunity for commercial, scientific and technological development of biotechnology in Venezuela lies in Polar's core sectors, i.e. technology applied to agriculture and the food and beverages industry. In the field of medicine the research potential of the universities and other research centres is too weak to compete with the multinational enterprises that work in the field of drugs or biodiagnoses. For example, the clinical tests that need to be conducted before the introduction of a drug or a diagnosis kit into the market are extremely slow and costly. The aim of CNB for the coming years is to push for the creation of an international biotechnology school at the Simon Bolivar University, supported by the United Nations University and the Venezuelan Government for researchers in Latin America. This would be the connecting link of the agricultural sector and industry with the university. This reflects Polar's opinion on the development of biotechnology in Venezuela, namely that commercial biotechnology only survives when it is nationally supported.
However, critics point at scientists who are attracted to work for Polar by higher remuneration and better research resources. These scientists are supposedly lured away from research on serious tropical diseases that affect an important part of the Venezuelan population. In addition, some researchers in non­industrial fields fear a radical redefinition of policies and priorities on the part of the CNB, because of financial and political support by Polar. However, Polar's position is quite firmly established within the larger part of the scientific community, and because of its economic solidity.

The advantage of Polar
Long­lasting competitive advantages of companies depend on their own research and development (R&D) capacity. Their in­house R&D enables the integration of the research results obtained from universities and other public research centres, and is incorporated in the companies' production process. However, most enterprises operating in Venezuela in traditional industrial fields like metalworking, mechanics, food, beverages, textiles and clothing are often too small to accomplish anything other than incremental innovations. At the same time, most academics will not see their research  result materialize in anything visible if they do not approach the business community and advance into organizational reforms. Understanding this is what has made Polar different.
Arnoldo Pirela

Centro de Estudios del Desarrollo, Universidad Central de Venezuela, Edif. ASOVAC, Ave. Neverí, Colinas de Bello Monte, Caracas­Venezuela. Phone (+57) 5827533475; Fax (+57) 5827512691;
E­mail apirela@reaccium.ve

Sources
Rafael Rangel­Aldao, (1996), "South American starter cultures". Nature Biotechnology, vol. 14, August 1996.

Philip A. Roussel, et al. (1991), Third Generation R&D. Managing the link to corporate strategy. Boston, M.A.: Harvard Business School Press.



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