KAZAKHSTAN: GOVERNMENT WANTS TO SEE STEPNOGORSK

C O N F I D E N T I A L ALMATY 001846

SIPDIS

SIPDIS

DEPT FOR SCA/CEN (J. MUDGE),ISN/CTR (E. CAMERON),ISN/NDF
(R. SMITH)

E.O. 12958: DECL: 05/24/2016
TAGS: KNNP KSCA PARM PREL TBIO TSPL KZ
SUBJECT: KAZAKHSTAN: GOVERNMENT WANTS TO SEE STEPNOGORSK
VACCINE FACILITY SUCCEED

REF: A. ALMATY 1583

B. 5-11-06 MENNUTI-CAMERON EMAIL

Classified By: CDA Mark Asquino, reasons 1.4 (e) and (h).


1. (C) Summary: Kazakhstani officials dealing with
biotechnology issues are eager to see the veterinary vaccine
production facility that Betta Star is setting up in
Stepnogorsk succeed, as it has the potential to commercialize
innovations resulting from Kazakhstani research. According
to the director of the National Center for Biotechnology, the
GOK has found the Stepnogorsk facility to be in full
compliance with Kazakhstani laws, and does not believe that
it presents a proliferation or public health threat.
Although there is little chance of forcing Betta Star to
abandon plans to manufacture veterinary anthrax vaccine, the
NCB director thinks the company might be open to discussion
of USG support for alternative activities. End summary.


2. (C) Following the transmission of Ref A update on plans
for veterinary vaccine production in Stepnogorsk, POEC chief
discussed the issue with National Center for Biotechnology
(NCB) director Yerlan Ramanculov on the margins of Vice
President Cheney's May 5-6 visit to Astana. Ramanculov
emphasized that he and the other leaders of the NCB, as well
as Ministry of Education and Science (MES) officials, are
eager to see the Betta Star facility in Stepnogorsk succeed.
The NCB is working hard to develop new technologies, and sees
the new facility as the only company in Kazakhstan with the
potential to commercialize the new ideas. GOK officials with
knowledge of the situation very much want to avoid the
destruction of the facility, according to Ramanculov. He
also mentioned that, after reviewing Betta Star's plans and
inspecting the facility, MES had found the operation in full
compliance with Kazakhstani laws.


3. (SBU) Underscoring the importance the GOK attaches to the
success of the project, Ramanculov told POEC chief that at
Betta Star director Gaisha Kashikova's request he had
seconded one of his assistants to help with the start-up
planning. Unfortunately, that individual left Betta Star
when Kashikova disagreed with his advice.


4. (SBU) Ramanculov said that as he understood the
privatization agreement, at the end of the five-year period
(i.e. October 2006) Betta Star must be able to show that it
has a functioning production facility operating "more or less
along the same lines" as the old Biokombinat plant. He
explained that for that reason, Betta Star cannot afford to
delay its efforts to get a vaccine production facility up and
running.


5. (C) Ramanculov stressed that there was little leverage to
force Betta Star to drop anthrax vaccine production plans, as
production would present no proliferation or public health
threat. He thought there was a small chance that Betta Star
might agree to do so, however, if the USG funded some other
activity that would be compatible with the firm's expertise
and equipment, and that would broaden the company's economic
base. Ramanculov expressed willingness to help convey any
proposals to Betta Star's shareholders, as well as to meet
with any USG group that visited Kazakhstan for dicussions.
ASQUINO