VANCOUVER - Close to 200 tonnes of a genetically modified seed, which is not allowed anywhere near Canadian dinner tables or farm fields, is sitting at a Chilean port waiting to be loaded onto a ship for Vancouver.

The safflower seed, laden with fish growth hormone, was due to leave Monday, April 30, slip into Vancouver in a few weeks and be trucked to Calgary for processing, say the Canadian entrepreneurs who engineered the seed for use in aquaculture.

But their plan is in limbo because the federal government late this week refused to issue the permit needed to import the seed into Canada.

"All of a sudden all these red flags have gone up at CFIA (Canadian Food Inspection Agency)," says Rick Keon, of SemBioSys Genetics Inc., whose shipment is stuck on a dock.

Welcome to molecular farming, or biopharming, in which plants are used to "grow" pharmaceuticals. It's a world in which Canadian officials are being asked to allow large quantities of drug-producing seed, which cannot be commercially grown in this country, to move back and forth across the Canadian border.

And it's a world in which entrepreneurs at SemBioSys, one of the darlings of Canada's biotechnology sector, say they have had little choice but to grow their high-tech crops offshore because of the endless and unresolved debate about whether to allow molecular farming in Canada.

"The discussion has gone on for years," says Mr. Keon, SemBioSys' manager of planting operations and field regulatory affairs.

Millions of Canadian tax dollars have been spent engineering drug-producing plants, long touted as one of the boons of the genetics era. SemBioSys' safflowers, which produce growth hormone, human insulin and drugs for heart disease, have been developed through government-funded research at the University of Calgary.

Everyone agrees drug-producing plants should not get loose in the environment or become mixed in the food supply. "Just by definition, drugs are harmful to humans and animals unless they're administered in a controlled fashion," says Stephen Yarrow, director of CFIA’s plant biosafety office.

But there is no end of discussion about how best to control plants that carry genes derived from microbes, animals and humans.

Many critics want biopharming restricted to greenhouses and non-food crops. Proponents say drug-producing plants can be safely grown outdoors.

And CFIA officials say they are waiting for "guidance" from the government policy makers and public consultations to gauge "how comfortable Canadians are with this new form of agriculture."

Meantime SemBioSys is keen to move beyond the confined field trials CFIA now allows, which are restricted to isolated plots no larger than one hectare.

The Canadian system "essentially keeps it in a research phase, it keeps the whole thing academic," says Mr. Keon. Scientists working with SemBioSys have run small trials in B.C., Alberta and Saskatchewan over the last 10 years. But they have been stymied in their bid to increase production, resulting in what Mr. Keon describes as the company's "slow migration out of Canada."

Along with the 200 tonnes of seed the company has just harvested from 300 acres of fish-hormone-producing safflower in Chile, Mr. Keon says SemBioSys has been growing its high-tech plants in Washington State in acreages much bigger than those allowed in Canada.

Mr. Yarrow is well aware the burgeoning industry is expanding and says there is a need for a "broader regulatory framework" in Canada and internationally. The issue "is definitely going to be on the agenda" when CFIA officials meet with their U.S. counterparts in a few weeks, he says.

The U.S. department of agriculture has in recent years approved more than 100 applications to grow drugs in corn, rice, barley and tobacco, most of them small trials. The U.S. is also open to larger proposals, such as an application from SemBioSys to grow up to 404 hectares of hormone-producing safflower in Washington State this summer, which is currently under review.

The U.S. reviews applications on a case-by-case basis, an approach many would like to see adopted in Canada along with a clearer policy on the types of molecular farming that will be allowed.

"Everybody is waiting," says Louis-Philippe Vezina, co-founder and chief scientific officer at Medicago Inc., a biotech company growing flu vaccines in alfalfa in Quebec City. Viral compounds from the plants can be purified into vaccines that stimulate the body to produce antibodies against disease.

Because of the "confusing" situation in Ottawa, Mr. Vezina says Medicago opted to confine its plants to a high-security greenhouse and sidestep the regulatory uncertainty that spooks investors.

And since a square metre of alfalfa can generate 1,000 to 5,000 doses of vaccines, he says the company's kilometre-square greenhouse can produce all the alfalfa they need at this stage. But Medicago is working on genetically engineered alfalfa that can produce industrial enzymes for the biofuel industry that Mr. Vezina says would have to be grown outdoors.

While critics like Josh Brandon at Greenpeace oppose the notion of growing industrial enzymes and drugs in plants, it appeals to farmers like Brian Otto, who grows safflowers for birdseed.

Mr. Otto has grown SemBioSys plants as part of CFIA-approved field trials on his acreage south of Lethbridge, Alta., and had hoped to increase production of the hormone-producing safflowers. Instead, he has watched the opportunity migrate out of the country.

"I am just baffled," says Mr. Otto about the way the Canadian government invested so much in research and development only to nip biopharming in the bud.

Not only are farmers missing out on the opportunity to grow value-added crops, he says, but the related drug processing facilities are sure to follow the crops out of the country.

Mr. Keon says SemBioSys, with a staff of about 60 and headquarters in Calgary, is still keen to grow crops here. Within weeks, Mr. Otto will seed a small CFIA-approved experimental plot with safflower SemBioSys has engineered to produce the precursor of human insulin. The "pro-insulin" in the seed is a "completely benign protein" and only becomes biologically active after it has been purified and chemically manipulated, says Mr. Keon.

Symbiosis has approached U.S. Food and Drug Administration about starting human trials of its insulin next year. Company scientists say a few thousand hectares of the safflower should be enough to meet a substantial portion of the world’s demand for insulin at a much lower cost than current industrial processes. The plan is to "scale up here in Canada, or the U.S., or both, depending on at the status of the regulations," says Mr. Keon.

Meantime, he is working overtime to convince CFIA to allow the 200 tonnes of seed now stuck in Chile into Canada.

The CFIA wants SemBioSys to spell out how it plans to transport and process the seed "without spilling a drop" before it will be granted the necessary import permit, says Mr. Yarrow.

Greenpeace's Mr. Brandon says allowing seed that cannot be grown in Canada to be shipped into the country makes no sense, and poses risks of contamination to the environment and food supply. "This is something the Canadian government needs to take seriously and act upon immediately. I definitely want them to stop it," he says.

Transporting genetically engineered crops is one of the main ways contaminations occur, he says, highlighting several instances where genetically engineered seed and plant material has accidentally gone astray in the U.S.

Mr. Keon says plenty of safety precautions have been taken to contain the Chilean seed. It has been poured into double nylon bags, labelled as genetically modified and placed in lined containers that would be transferred onto trucks once it reached Vancouver. Chilean inspectors have sealed and quarantined the containers, says Mr. Keon.

SemBioSys’ plans to process and grind up the seed in Calgary to make feed for shrimp at aquaculture farms in Mexico. Mr. Keon says the carp growth hormone does not make shrimp grow bigger or faster, but has been shown to boost the immunity of shrimp prone to viral infections.

The company insists carp growth hormone does not affect mammals and poses no dangers to animals or the environment. And Mr. Keon says some of the seed from Chile is to be sent to a Saskatchewan lab and fed to broiler chickens "to show once and for all" there is no ill effect.

While the CFIA has in the past allowed SemBioSys to import seed grown in Chile into Canada, Mr. Yarrow says the latest shipment is on "a whole different scale."

"It's one thing to process a few tonnes, it's a whole other matter to be dealing with hundreds of tonnes," he says.

Mr. Yarrow adds the CFIA may issue an import permit once SemBioSys clearly details its plan for transporting and processing the seed without releasing any into the environment.