The BioDesign Newsletter

Issue #032

What if those that benefitted from nature, paid back their dues? - That is exactly the proposition (and deal) made at the United Nations biodiversity conference, COP16

What Is DSI?  

Many companies across sectors, such as pharmaceuticals, biotechnology, agriculture and cosmetics, use nature’s genetic data to guide their R&D processes. This data is known as digital sequence information (DSI). For example, Moderna used over 176 publicly available genetic sequences from viruses to rapidly develop its COVID-19 vaccine, generating over $30 billion (£23.1 billion) in sales.

The Cali Fund

During this year’s COP16 at Cali, Columbia, a deal was struck that established a new fund - the Cali Fund. This fund will channel revenue from the industries that profit from the use of nature's data, to support environmental protection and conservation efforts. 

The Cali Fund is an approach aimed at redistributing some of the financial benefits that industries gain from nature back to the ecosystems and communities that house the biodiversity being tapped into. The plan suggests that companies contribute either 1% of their profits or 0.1% of their revenue to the fund, though this structure remains flexible and completely voluntary. 

Balancing the Global North and Global South 

The Cali Fund is intended to address a long-standing imbalance and point of tension between the Global North and Global South, with the financial gains from genetic resources extracted from the natural world often benefiting corporations and developed nations, while the countries and communities rich in biodiversity see little return. 

A portion of the Cali fund is earmarked for Indigenous peoples and local communities in low-income countries. These are often the regions most affected by biodiversity loss, yet they have the least financial and technical support to protect their natural environments. The fund will support conservation projects, ecosystem restoration, and efforts to support and protect local biodiversity.

This fund aims to encourage the companies benefiting from nature, to also contribute to its preservation. By linking profits to protection, the Cali Fund could provide a steady stream of financial resources for biodiversity conservation, potentially raising billions annually.

What Are the Realities?

While the vision behind the Cali Fund is ambitious, there are several practical challenges that could hinder its success. One significant concern is its reliance on the benevolence of corporations. Companies are not required to contribute, and without mandatory regulations, there’s no guarantee that industries benefiting from DSI will participate at the necessary scale.

This echoes the difficulties seen in prior biodiversity agreements, such as COP15 in Montreal, where countries pledged to provide $200 billion (£154 billion) annually for biodiversity protection —a target that remains unmet. Voluntary contributions for the Cali fund may face similar shortfalls, especially given resistance from some key global players.

The execution and success of this fund will determine the continued trust and strength between the Global North and Global South. As countries from the Global South, rich in biodiversity, argue that they have been historically excluded from the economic benefits of their genetic resources, they see this fund as a way to address this imbalance. However despite the consensus being reached on the Cali Fund, developed nations like the European Union, Japan, and Canada opposed the creation of a dedicated biodiversity fund.

If all goes well and the contributions are made, the next debate will be on the distribution of funds, which will present logistical challenges. The precise formula for allocating the money between regions and projects has yet to be decided. Ensuring that contributions are effectively used for conservation efforts and community support will require careful oversight and transparency.

Conflicting Views Among Potential Contributors 

Public awareness of the Cali Fund remains low, but the idea has sparked diverse reactions within the industries it targets. Pharmaceutical companies, in particular, are wary of the additional costs and regulatory complexities the fund may introduce. David Reddy, (Director General of the International Federation of Pharmaceutical Manufacturers and Associations,) expressed concerns that the fund might impose unnecessary burdens on research and development, complicating access to genetic data for both companies and scientists.

On the other hand, some companies see the fund as a necessary and fair initiative. Basecamp Research, a London-based startup with a vast database of genetic sequences, has expressed support for the fund, recognizing the importance of contributing to biodiversity conservation. According to Bupe Mwambingu, (Biodiversity Partnerships Manager, Basecamp,) Basecamp is "comfortable and willing to contribute" since its business relies on the genetic resources the fund seeks to protect.

Will it Work?

While the challenges are significant, especially with its voluntary structure and geopolitical complexities, it offers a pathway to a more just and sustainable relationship between industry and nature. If successful, the Cali fund could set a precedent for how the world shares the benefits of its natural heritage, ensuring that the profits from biodiversity are reinvested in its protection.

The reality is that, yes the Cali Fund provides a mechanism for companies benefiting from the world’s biodiversity to play a part in ensuring its survival, but the voluntary nature of the fund and the wider (lack of) political actions surrounding biodiversity and climate change don’t provide much of an optimistic foundation for the fund. 

For the fund to be truly impactful, it will need broad participation, clear rules on how funds are allocated, and strong political backing from the world’s wealthiest nations.

What goes into a designer and innovator collaboration?

Clara Nicholson, one of our writers, spoke to Patrick McDowell about his SS25 collection which featured the pilot of OctarineBio’s PurePalette as well as a collaboration with Forager by Ecovative.
Stay tuned for this piece, it will be released in the Behind the Breakthroughs series!

If you are interested in being featured in the Behind the Breakthrough series, email us at: [email protected]

Until next week,

Ariyana & the House of BioDesign Team

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