In the marketplace of this sweltering Amazon city, where cans of giant fish tongues compete for space with jars of pickled tree bark, Judith Formoso, 62, promises cures of every sort. Treat diabetics without insulin, she advises, by using the leaves of the Cow's Hoof plant. Got asthma? Stop that troublesome wheezing with a paste made from the fat of pink river dolphins.

"This," she says conspiratorially, clutching a bunch of dried cat's nail leaves, "is the cure for cancer."

"And they want our secrets," whispers Formoso, who has sold traditional indigenous cures here for 40 years. "Foreigners come around asking me all sorts of questions. You can tell they're not tourists--they're scientists!

It's not just the sun getting to her. Somewhere among the snake oils of the Amazon--the world's largest rain forest and home to one-tenth of Earth's plant and animal life--scientists believe they may find secrets to curing everything from migraine headaches to noxious modern plagues. For instance, several international drug manufacturers are analyzing the mysterious cat's nail, a dark green leaf with a rich, herbal odor, to understand its fascinating ability to fight prostate tumors.

But as pharmaceutical firms and foreign institutions conduct research on promising extracts found in this and other tropical regions, a global controversy has ignited over who gets the profits.

Brazil is among an increasing number of tropical nations trying to prevent what they call "biopiracy" by the West. These countries are pushing governments to ratify the Convention on Biological Diversity adopted by participants in 1992's United Nations Conference on Environment and Development. When nations ratify the convention, it becomes a legal means to economic benefits when the biomaterials of countries such as Brazil are used abroad. In the United States, ratification of the treaty has been stalled in Congress, however, partially because of opposition by Washington's pharmaceutical lobby.

So this continent-size nation of 168 million people is trying another route. Two Brazilian states in the Amazon recently passed laws forcing foreign researchers here to sign contracts requiring them to pay "bioroyalties" on any income they derive from local plants. The Brazilian Congress is close to approving a national version of the law--including a provision that would forbid foreigners from conducting research without a local partner, a law already on the books in neighboring Colombia.

Experts say the movement in the Amazon could have implications in the effort to distinguish ownership of biomaterials from that of raw materials. What developing tropical nations are saying is that if the West cries foul over piracy of intellectual property, say, or computer software, then "biopiracy" in Western labs of jungle extracts should also be considered a high economic crime.

"We want to turn biopiracy into bioprospecting," said Mary Allegretti, Brazil's secretary of the Amazon region. "We want to be partners, not victims. We want recognition that the raw biomaterials and the knowledge of how to use them from our indigenous communities is worth as much as the research money spent on developing new products abroad."

If any place hates biopiracy, it's Brazil and, more specifically, Manaus--a city of 1.5 million people in the middle of Amazon. Henry Wickham, a 19th-century British explorer, filched rubber-plant seeds from the Amazon, nipping in the bud the lavish lifestyles of Brazil's famous rubber barons. (They were so rich they sent their laundry to be washed in Lisbon and built an opera house in the middle of the rain forest.) Their monopoly snapped, Manaus went bust and Wickham became the first of many "biopirates" to rob Brazil of its organic treasures.

"Even now, it's happening every day," said Frederico Arruda, a regional chief for Brazil's environmental enforcement agency. Arruda pointed to a letter from scientists at the Institute of Pharmacological Medicine at the University of Rome, who asked him to ship the skins of several Amazonian frogs for research on the use of their mucus as a pain killer.

There are many cases of biomaterial theft in Brazil. In one, researchers disguised as a film crew drew blood from Indians on the Rio Negro and then offered the genetic samples for sale. However, many cases the Brazilians have claimed to be biopiracy are legal under international patent law.

Routinely, companies and institutes from the United States, Japan and Europe collect samples here, decipher their properties and then patent their uses abroad for financial gain. Since the discoveries are made in foreign labs, Brazil gets little or no compensation.

The University of Cincinnati, for example, has the U.S. patent for an extract of the bright reddish-orange guarana seeds of the Amazon for use against blood clots and is shopping the patent to pharmaceutical companies. A Japanese firm has patented and is marketing a byproduct of an Amazonian plant as a component of an anti-inflammatory drug, Brazilian authorities say.

Advocates of tougher laws insist they do not want to close the Amazon to foreigners, and acknowledge the need for expensive research and development that only Western institutions can afford. The federal government has even created an environmental-economic initiative called Probem to recruit foreign companies as partners at a biotechnology lab to be built in Manaus beginning this year.

Proponents of tougher laws also argue that they would aid preservation of the Amazon--which is being devastated by slash-and-burn agriculture and intensive logging--by making the land worth more with its plants and animals than without them.

Some corporations have shown a willingness to cooperate with such demands elsewhere. Merck & Co. has launched a cooperative research program in Costa Rica, promising to share profits should it uncover an economically viable drug.

But skepticism remains, especially in the United States, about such agreements. They argue that Brazilians too often misinterpret international patent law as biopiracy, scoffing at the notion that the inventors of the tire would have had to pay royalties to Brazil because that is where rubber came from. They further argue that it would be nearly impossible to decide who would receive bioroyalties, especially since several varieties of Amazonian plants occur in more than one nation in the region, as well as in tropical countries in other parts of the world.

"I think this could definitely have a backlash," said Norman M. Pollack, director of intellectual property at the University of Cincinnati. "These [extracts] are not easy to research, and if you have to pay some long-term fee on new uses you discovered in your own lab, it immediately cuts down on the economic viability of research."

CAPTION: Foreigners trying to isolate healing powers of Amazon plants visit Judith Formoso in Manaus market to study her array of cures for human afflictions.