Government-owned AgResearch has partnered with Dutch transgenic animal specialist, Pharming Group, to create a dairy herd that produces milk containing recombinant human lactoferrin (rhLF).
AgResearch estimated that initial global sales from orally-taken lactoferrin supplements could be around US$100m. It said the development could be a significant medical advance.
Lactoferrin is a protein already found in the whey fraction of cow's milk and also in humans, especially mother's milk. Studies have suggested the protein plays an important role in stimulating the body's immune system and acting as a first line of defence against infection.
It is believed these functional properties show promise in fighting diseases that compromise the body's immune system, such as cancer, HIV and AIDS.
AgResearch claims it may also combat osteoporosis by helping bone regeneration. The group said milk containing human lactoferrin could be used in a range of products, including hospital food, baby food and sports supplements.
How rhLF will be made
An extra gene will be inserted into cow embryos, modifying their genetic make-up. The calves that are born will then produce transgenic milk.
AgResearch said it also planned to mate 'normal' cows with genetically modified bulls so that the next generation of calves will produce the lactoferrin protein.
The firm added "the herd will be kept in a state-of-the-art containment facility at Ruakura, designed to stop any inadvertent release of genetic material. The facility is approved and regularly inspected by ERMA [New Zealand's Environmental Risk Management Authority]."
Further tests and the need for regulatory approval from ERMA means production of transgenic milk is probably still two or three years away.
If recombinant human lactoferrin is approved safe by the ERMA, AgResearch will develop market-scale production and purification capabilities in New Zealand. The group will also seek domestic partners, while Pharming Group will conduct market research.
Pharming Group is also in the process of registering recombinant human lactoferrin as safe with the US Food and Drug Administration. The firm said it had completed studies showing rhLF was safe if consumed orally in "high amounts".
Anti-genetic engineering campaigners have expressed concern that AgResearch's project would harm the reputation of New Zealand's dairy industry in a world where many consumers distrust genetically modified products.
They also argued that lactoferrin can already be isolated from whey, a bi-product of 'normal' cows milk, and that farmers have a lucrative market selling this product.
One group, GE Free New Zealand, said it was dangerous to give everyday foods pharmaceutical-like properties: "Just as exposure to antibiotics in animal feed has knock-on effects in the food chain, so could active ingredients shift the balance in bacterial populations and even increase the factors causing disease."
The group also claimed that the costs of maintaining segregation of genetically modified herds and avoiding mis-labelling or mixing had not yet been addressed.