BIOtech NOW: The Role of Intellectual Property in Global Health

The Role of Intellectual Property in Global Health

BIO is committed to increase access to biologic medicines for patients throughout the world.  As BIO President and CEO Jim Greenwood said last year when announcing our policy statement on Options for Increasing Access to Medicines in the Developing World, “We believe that the goals of increasing access to medicines, respecting intellectual property rights, and maintaining commercial viability are mutually supportive.”

While there are frequent misguided calls to circumvent intellectual property (IP) rights in order to provide therapies to undeveloped countries, BIO and many policy experts understand that IP rights are necessary to bring innovative new therapies to market and into the hands of patients.  Medicines cannot be utilized if they are not developed, and IP rights are often the only asset emerging biotech companies can leverage in order to attract the investment necessary to fund the lengthy and expensive research and development and clinical review processes.

Bill Gates has been an ally in our efforts to increase access to medicines in developing countries.  In 2004, BIO launched BIO Ventures for Global Health (BVGH) with a start-up grant from the Bill & Melinda Gates Foundation to speed the development of medicines for unmet diseases of developing countries. 

In a recent interview with Intellectual Property Watch, Bill Gates discussed the important role of IP in his Foundation’s work on global health:

“We fund research and we actually ourselves or our partners create intellectual property so that anything that is invented with our foundation money that goes to richer countries, we’re actually getting a return on that money.”

“By doing that we have more money to devote for research into neglected diseases and the diseases of the poor,” he said. “Now when our medicines go into the poor countries, they are always going in without any intellectual property fee, at very lowest cost pricing.”

 “But,” he said, “the intellectual property system has worked very well to protect our investments so that when they are used in rich countries we get a payback and then we have the control to make sure that it is not creating any financial burden on the countries that are the poorest.”

You can read the full article on Intellectual Property Watch’s website (subscription required).

Advertisement

Foley & Lardner article on the history of the Chinese Bayh-Dole Act

China Bayh-Dole Act: A Framework Fundamental to Achieving the Economic Potential of China’s National Patent Development Strategy (2011 – 2020)

By Max Lin, Foley & Lardner LLP

This article is part of our Spring 2011 edition of Legal News: China Quarterly Newsletter, Eye on China.

China’s National Patent Development Strategy (2011 – 2020) (Plan) was announced in November 2010. The proposed measures focus on enhancing China’s IP system and encouraging local individuals, institutions, and companies to pursue IP protection domestically and abroad. By the end of 2015, the number of Chinese patent applications are projected to double. Chinese authorities clearly view patents as vital commercial assets central to the country’s development.

Fully achieving the Plan’s potential economic value depends upon establishing an effective framework for the commercialization of government-sponsored technology through licensing and transfer. Those seeking to buy or license cutting-edge technologies from Chinese universities or scientific research institutes should be familiar with China’s regulation governing such technology transfers or licenses — the so-called “China Bayh-Dole Act.”

Before 2002, China’s regulatory system did not address regulating the intellectual property ownership of technology developments sponsored by government funding. As a result of China’s booming economy, there was increased demand for advanced technologies by private individuals or companies, who then sought the commercial development of technologies that remained in universities or research institutes. As a result, technology licensing or transfer activities began to emerge from universities or research institutes. The primary challenge for those activities was the intellectual property ownership of the technologies. Most Chinese universities or research institutes are state-owned, and the cost of research is sponsored by government funding. As such, it was unclear and undefined under the law who owned the involved technology.

In March 2002, the Ministry of Finance and the Ministry of Science and Technology co-issued Several Regulations Concerning Intellectual Property Management of State Scientific and Research Program Result (Regulations) to improve the process of technology licensing or transfer. The Regulations first emulated the core spirit of the U.S. Bayh-Dole Act and set forth the ownership of intellectual property. Except in cases where national security, national interests, or significant public interests are involved, the state granted the intellectual property developed in scientific research programs sponsored by government funding to the performing organization so that it can implement, license, or transfer the intellectual property independently. The state retained the right to use the intellectual property freely. If the performing organization — as the intellectual property owner — does not implement the intellectual property or obstructs the public from utilizing the intellectual property, the state can intervene by licensing a designated party to implement it freely or by paying royalties to the performing organization, depending on the specific circumstances. The Regulations do not detail the circumstances, leaving the decision up to government discretion.

In December 2007, China passed the Scientific and Technological Progress Law, which upgrades the provisions of the Regulations with respect to intellectual property ownership to the level of national law. The law sub-divides intellectual property rights into four items, namely, invention patents, computer software copyrights, exclusive rights to layout-design of integrated circuits, and new variety right of plant. Utility model patents and design patents as well as other intellectual property are excluded from the scope of intellectual property defined in the law. In addition, the law uses the name “project undertaker” to refer to units undertaking a project, such as scientific institutions, universities, enterprises, and so forth, but it does not exclude individuals.

The law grants the intellectual property ownership that is formed though a project sponsored by treasury money to the project undertaker, which encourages the project undertaker to continue being innovative. With intellectual property ownership in hand, the project undertaker has more motivation for the highly efficient commercial development of the intellectual property. Besides implementation by the project undertaker himself, the project undertaker can transfer or license the intellectual property. However, there is restriction on such transfer or license: Because the state has paid for the formation of the intellectual property, the state encourages such intellectual property to be utilized domestically. It is noted that such encouragement does not forbid transfer or license outside of China. However, the transfer of intellectual property rights to overseas organizations or individuals, or the licensing of exclusive use rights to overseas organizations or individuals, is subject to governmental approval. No approval is required for the licensing of non-exclusive use rights.

It is important for companies to secure key positions in their intellectual property. The acceleration of IP creation and protection for Chinese innovation under the Plan creates increased commercial opportunity for licensing and technology transfer. For companies seeking to acquire government-funded technology through license or technology transfer in China, it is important to become familiar with the regulations governing such transactions.

Scientists oppose European stem cell patent ban

 Great article about leading stem cell scientists stating that the ECJ Advocate’s recommendation to ban stem cell patents will block development of stem cell-based therapeutics in Europe.  Here are the highlights from the article:

By Kate Kelland, Health and Science Correspondent

LONDON | Wed Apr 27, 2011 1:05pm EDT

LONDON (Reuters) – Research scientists hit out on Wednesday at a European Court of Justice (ECJ) case they say could block development of embryonic stem cell-based therapies in Europe.

The ECJ’s advocate general has said all patents on embryonic stem cell-related technologies should be banned on moral grounds, but in a letter in the journal Nature and during a briefing in London, leading stem cell scientists said that could spell disaster for drug firms seeking treatments for conditions such as blindness and spinal chord injuries.

“If the ECJ was to follow this opinion, the reality is that all patents in Europe that relate to human embryonic stem cells will be eliminated,” said Austin Smith of the Center for Stem Cell Research in Cambridge, one of letter’s 13 signatories.

“This will put Europe at a huge disadvantage.”

…

Smith and his fellow signatories — who include leading stem cell researchers from all over Europe — argued that patenting is a key step in the development of new medical treatments.

Without the protection of patents, they said, drug companies will not invest in the research or in the cell manufacturing technologies needed to develop stem cell therapies.

“Innovative companies must have patent protection as an incentive to become active in Europe,” they wrote.

The International Society for Stem Cell Research (ISSCR) said a move to ban patents “will preclude investment in potentially life-saving treatments.”

USPTO Remains Open for Six Business Days if Government Shuts Down

Press Release, 11-26

USPTO Prepares for Possible Government Shutdown

In the event of a government shutdown on April 9, 2011, the United States Patent and Trademark Office will remain open and continue to operate as usual for a period of six business days – through Monday, April 18, 2011 — because the USPTO has enough available reserves, not linked to the current fiscal year, to remain in operation until then. Should a shutdown occur and continue longer than the six-day period, we anticipate that limited staff will be able to continue to work to accept new electronic applications and maintain IT infrastructure, among other functions.  More information will be posted on this website as it becomes available. Thank you.

BIO Hosts U.S./China Biotechnology Examiner Workshop with U.S. Patent and Trademark Office and China’s State Intellectual Property Office

Press Release:

WASHINGTON, D.C. (Tuesday, April 05, 2011) – The Biotechnology Industry Organization (BIO) hosted a U.S./China Biotechnology Examiner Workshop with U.S. Patent and Trademark Office (PTO) and China’s State Intellectual Property Office (SIPO) on March 28, 2011 in Beijing, China. The workshop which was organized by BIO for SIPO examiners, focused on biotechnology patenting and encouraged bilateral cooperation between SIPO and the USPTO.“BIO recognizes the commitment on behalf of the Chinese Government and SIPO to spur innovation in the biotech industry and, together with the PTO, we pledge to partner with Chinese leaders to move the industry forward to benefit patients and other consumers worldwide,” said Jim Greenwood, CEO and President of BIO.The workshop was the first of a series of meetings intended to open communication and establish a relationship between the two groups. BIO will work with the SIPO to strengthen China’s regulatory system to encourage innovation and protect intellectual property within the country. The commitment of SIPO will be critical for sending a message to companies that want to do business in China. “Robust development of the biotech industry in China depends on an advanced intellectual property and patent system,” said Scott Sindelar, Minister Counselor of Agricultural Affairs. “Today’s workshop is timely in sharing experience and regulations of patenting and IP both in the U.S. and China, and establishing greater understanding of each other.” “Since most Chinese attendees are examiners of intellectual property, [the workshop] provides an opportunity to share experiences and ideas with our American counterparts,” said Yang Xiaowei, deputy Director General of International Cooperation Department of SIPO. In each of three panels, USPTO and SIPO speakers discussed how each issue is handled by the pertinent provisions in their current patent law and rules. They also addressed office practice and shared practical experiences with the different technical arts in biotech.  Industry and academic speakers provided user perspectives in their interaction with the patent law and practice in each country. The workshop featured the following panels: ·         The first panel focused on taking a balanced approach to written description and enablement requirements, which are necessary for preventing impediments to patenting activity. Panelists also discussed the type of information that is required for an invention to satisfy the written description and enablement requirements. ·         The second panel focused on issues arising from claims with sequence homology. Panelists discussed the scope of claims using homology or percent of sequence identity language and issues that often arise during examination. ·         The third panel addressed meeting discussed China’s new requirements for patent disclosure for genetic resources, stakeholders’ experiences with China’s new genetic disclosure requirement, and alternative ways to ensure appropriate access and benefit sharing. The three groups (BIO, PTO and SIPO) are looking forward to future opportunities to work together on issues of common interest.   Upcoming BIO Events  BIO Intellectual Property Counsels Committee Spring Conference and Committee Meeting April 13-15, 2011 Seattle, WA World Congress on Industrial Biotechnology & Bioprocessing May 8-11, 2011 Toronto, Ontario, Canada Partnering for Global Health Forum 2011 June 27, 2011 Washington, DC BIO International Convention June 27-30, 2011 Washington, DC 2011 BIO Human Resources Conference June 26-28, 2011 Washington, DC The Business Forum at the BIO International Convention June 28-30, 2011 Washington, DC BIO India International Partnering Conference September 21-22, 2011 Hyderabad, India BIO China International Conference October 12-13, 2011 Shanghai, China About BIO BIO represents more than 1,100 biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and in more than 30 other nations. BIO members are involved in the research and development of innovative healthcare, agricultural, industrial and environmental biotechnology products. BIO also produces the BIO International Convention, the world’s largest gathering of the biotechnology industry, along with industry-leading investor and partnering meetings held around the world. BIO produces BIOtech Now, an online portal and monthly newsletter chronicling “innovations transforming our world.” Subscribe to BIOtech Now. ###

BIO’s Amicus Brief: Microsoft v. i4i

The Biotechnology Industry Organization, along with AUTM and CropLife International, filed an amicus brief in the Microsoft v. i4i Supreme Court case.

This case is widely viewed as one of the most fundamental and important patent cases to reach the Supreme Court in probably a decade. Most basically, this case is about the level of certainty a jury or judge must have before finding a patent invalid in litigation. Historically, the law has required a high level of proof, “clear and convincing evidence,” before a patent that has been examined and issued by the US Patent and Trademark Office can be declared invalid by a court. In the Microsoft v. i4i case, the Supreme Court is now being asked to adopt a lower burden of proof, under which patents can more easily be found invalid by a lower “preponderance of the evidence.”

In our joint brief, BIO, AUTM and CLI explain that the current high burden of proof has deep historic roots in Supreme Court law, and has been consistently applied by the lower courts for many decades. Under the current standard, issued patents benefit from a clear and meaningful presumption of validity that cannot be easily overcome. In this way, patents play their intended role as enduring legal instruments that confer real rights, and that developers and investors can rely on for investment and product development decisions. The importance of being able to rely on patent rights is illustrated very clearly in the biotech industry, which would not be able to make large investments over very long development times without assurances that the fruits of their investments are protected by robust patent rights. Lowering the standard for patent validity would frustrate decades of investment-backed reliance interests and would negatively impact biotechnology innovation going forward. Our brief explains that the existing high burden of proof to invalidate a patent is entirely consistent with other instances where the law imposes high burdens of proof to protect the public’s reliance on existing property rights.

In our brief, we also point out that Congress permits patents to be invalidated on a lower burden of proof only by the expert Patent Office, and then only on certain kinds of reliable evidence. Litigants who prefer to argue to a lay jury or generalist judge, or who want to use less reliable evidence, can do so only under a higher burden of proof. Any change to this carefully-crafted balance would have to be made by Congress, not the courts.

The United States’ brief in this case forcefully argues against changing the current standard of patent validity.

Biotech, Gates Foundation, and Global Health

Great interview by Gene Quinn with Erik Iverson, Associate General Counsel with the Bill & Melinda Gates Foundation.  A summary article is on BIOtech Now and the full interview can be found on IPWatchdog.com.

 Highlights:

Iverson told me in no uncertain terms, “[A] fundamental premise at the foundation is that we absolutely respect intellectual property rights.  We recognize their importance and we certainly recognize the importance of companies and their involvement in developing products and having them commercialized both in developed and developing countries.”  But how can the Gates Foundation balance the intellectual property rights of those who create live saving technologies and treatments while at the same time ensuring the humanitarian mission? 

According to Iverson, this requires a different approach to each situation taking into consideration the unique factual circumstances involved, such as the disease at issue, the marketability that may exist in developed countries and the need to incentivize the desired outcome.  Iverson explained, “[T]he life science community is all about helping people and saving lives… [we are] trying to figure out how to balance them to push the development of products that well, very few people historically have put much effort into…”

BIO Hails Senate Passage of America Invents Act

BIO Hails Senate Passage of America Invents Act

Bipartisan, consensus-oriented approach will strengthen nation’s patent system and spur innovation, job creation

Washington, D.C. (March 8, 2011) – Biotechnology Industry Organization (BIO) President and CEO Jim Greenwood released the following statement on the passage today of the America Invents Act (S. 23) by the U.S. Senate:

“BIO commends the Senate for its overwhelming passage of the America Invents Act by a vote of 95-5.  We appreciate the dedication of Senate Judiciary Chairman Patrick Leahy (D-VT), Ranking Member Charles Grassley (R-IA) and the bill’s other cosponsors for their tireless efforts to build bipartisan consensus on the legislation.  Once enacted into law, it will strengthen and improve our nation’s patent system, spurring innovation and job creation.

“Patents are often the main assets of small biotech companies, and they rely on this intellectual property to attract investors to fund the lengthy and expensive research and development process necessary to bring breakthrough new therapies and other biotech products to patients and consumers.

“The improvements made by the America Invents Act would benefit all sectors of the U.S. economy by enhancing patent quality and the efficiency, objectivity, predictability, and transparency of the patent system. 

“BIO encourages the House of Representatives to consider patent reform without delay, and we look forward to working with Chairman Lamar Smith (R-TX) and the members of the House Committee on the Judiciary.  We are committed to ensuring that patent reform legislation preserves and enhances the incentives necessary to sustain our nation’s global leadership in biotechnology innovation and to spur the creation of high-wage, high-value jobs throughout the country.”

IP Position Critical to Biotech Investment

A great article from Genetic Engineering and Biotechnology News written by Lisa Haile reviewing the Myriad case and its implications for future medical advances.

Interesting Quotes:

“While it is unfortunate, I have seen quite a few technologies over the years that would be of potential great benefit to patients, but the intellectual property was simply not there to support protecting the product from fast followers in the market place,” explains Robert More, a general partner at Frazier Healthcare Ventures.

“Unfortunately, because of the enormous sums of money required to discover, develop, test, and approve anything in the healthcare sector, quite aside from the time it takes, IP is critical.” More further states that since “patents have definitive lifetimes, 20 years or less of exclusivity, and then an infinite time in the public domain, I think that is a small price for us to pay for innovation.”

“When evaluating opportunities to determine whether we will come in and underwrite the deal, we look at the IP position as one of the key questions,” explains Robert Dentice, head of life sciences investment banking at Cantor Fitzgerald. “We know that if the IP position is not strong, it is unlikely that we will pursue the opportunity further, knowing that the IP strategy and position will be one of the top three questions that the investors will ask about.”

Takeaways: The Case for Gene Patents

 Gene patents are the foundation of the biotech industry and precluding them would halt forward progress.

The patent system promotes innovation and stimulates investment in R&D.

If there were no exclusive rights in the final product, there would be little incentive to invest time and money into developing it.

Without the incentives offered by the issuance of patents, the industry and, ultimately, patients would suffer. 

BIO submits comments on Australian Senate Patent Amendment

The Australian Senate has proposed the Patent Amendment (Human Genes and Biological Materials) Bill 2010 that aims to ban ‘gene patents’. 

From the BIO Submission to Australian Senate Legal Committee on Patent Amendment:

This amendment would exclude from patent protection “any” biological material, whether a human gene or otherwise, that is substantially identical to a naturally-occuring biological material.  Specifically, the amendment states that the following materials would be catergorically declared unpatentable:

            “biological materials including their components and derivatives, whether isolated or purified or not and however made, which are identical or substantially identical to such materials as they exist in nature.”

“Biological materials” broadly “include,” but apparently not limited to, such fundamental biotechnology building blocks as “DNA, RNA, proteins, cells and fluids.”

As almost any biological material can be said to be “substantially identical” to some other natural biological material, this change would have the effect of banning large swaths of previously patentable innovative biological discoveries – thus, removing the protection needed to incentivize investment in biotechnology-related innovation in drugs and biological therapies, preventative treatments such as vaccines, animal healthcare products, renewable energy production and other “green” technologies, environmental mitigation and remediation, biodiversity, farming, food, nutrition, household cleaners, and industrial fermentation for food and fuel production.

BIO and its members believe that excluding biological inventions from patent protection is inconsistent with the demonstrated evidence of social benefit from isolating and purifying active compounds from previously ineffective mixtures occurring in nature. For example, the invention of isolated polymerase from certain thermophilic bacteria has provided valuable methods for amplifying DNA that enables forensic DNA analysis to establish guilt or innocence of crimes, the development of life-saving medical diagnostics, and molecular breeding for improved plants. If the amendment had been law, it would have prevented the patenting – and thus development – of significant advances in human health, like purified insulin, adrenaline, and antibiotics; vitamin D and B-12 compositions; human growth hormone; erythropoietin, and numerous vaccines and anti-cancer treatments on the market today.

Accordingly, BIO believes that this amendment, if adopted, would fail to affect its intended purpose of advancing medical and scientific research and the diagnosis and cure of human illness and disease. Indeed, it would slow such progress immeasurably. The public demands continuing the patent incentive for such biologic innovation.