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Experts Brief US Lawmakers on ‘Broken’ IP System Believed to Curb Biotech Innovation

A pair of researchers from the International Expert Group on Biotechnology, Innovation, and Intellectual Property took to Capitol Hill this week to brief policy makers and representatives from industry and academia on what they see as a broken IP system in the US, and to recommend ways to fix it.
The researchers, Richard Gold of McGill University and Robert Cook-Deegan of Duke University, described case studies and data supporting their assertions that “hardball” patent protection and enforcement tactics in the biotech industry stifle innovation and prevent the developing world from accessing potentially life-saving biomedical products.
According to Gold and Cook-Deegan, universities, non-profit research institutes, and the governments that provide funding for much of the underlying research are as responsible as industry for ensuring that biotech patents are used responsibly and ethically, and to better foster innovation.
“Our findings suggest that patent holders are not doing a good job of sharing information and biotechnological tools to foster innovation and access to vital genetic data, and government must be prepared to intervene when they do not,” Cook-Deegan said in a statement.
The International Expert Group, chaired by Gold, was formed in 2001 to study how technology-transfer policies and activities affect biotechnology innovation around the world. Their briefing expanded on findings that Gold and Cook-Deegan have presented to the tech-transfer community and general public over the past several months.
Comprising international experts in science, law, ethics, and economics, the group interviewed international policy makers, industry representatives, scientists, and academics over several years, and conducted multiple biotech patenting case studies.
The group released the results of its study last month in a report entitled, “Toward a New Era of Intellectual Property: From Confrontation to Negotiation,” at a press event in Ottawa (see BTW, 9/10/2008).
The report, found here, argues that the biotech industry needs to adopt a “new IP” strategy that focuses on cooperation and collaboration at all levels; and makes several recommendations to government, industry, and university officials to help implement such a strategy.
Its recommendations include the need for universities to develop clear IP-licensing principles to promote greater access to biotechnology innovations and to develop better measures of tech-transfer success based on social returns; for industry to participate in more public-private partnerships and to be transparent about their patent holdings; and for governments to take a more active role in encouraging and mediating public-private partnerships and to collect standardized patent-related information, including licensing data.
At the time, Gold told BTW that the group planned to release more data supporting the report’s claims at this week’s policy briefing in Washington, DC.
Meantime, Cook-Deegan, who helped author the expert group’s report, has also been conducting research independently at the Center for Genome Ethics, Law, and Policy within the Institute for Genome Sciences and Policy at Duke over the past several years, and has specifically focused on the relationship between gene patenting, IP licensing policies, and patient access to genetic tests.
Most recently Cook-Deegan and colleagues presented preliminary findings of a study in March at the Association of University Technology Managers annual meeting in San Diego (see BTW, 3/5/2008).

“The solution in the United States is not to prevent patenting activity, but for government to make clear it will step in and exercise rights that it already has.”

That study analyzed 93 patents that are the basis for a suite of DNA-based diagnostics offered by reference laboratory Athena Diagnostics, and concluded that university tech-transfer offices and federal agencies that help underwrite the research behind genetic tests should both wield their influence more often to influence the tests’ dissemination.
Athena, a specialty brand of Thermo Fisher Scientific, has been criticized in the past for zealously enforcing its patents against infringers at other companies, universities, and hospitals, even those who would use the patents for research purposes only. In August, Boston University’s Center for Human Genetics said it would stop offering 16 genetic tests for which Athena Diagnostics holds an exclusive license, citing tightened intellectual property restrictions by the firm (see BTW, 8/20/2008).
This week, in their briefing on Capitol Hill, Cook-Deegan and Gold took aim at Myriad Genetics — another US company that has been a lightning rod for biotech IP policy — by fleshing out a case study that was touched upon briefly in the International Expert Group’s September report.
The full case study, entitled “Myriad Genetics: In the Eye of the Policy Storm,” documents “mistakes” that the company made in protecting and enforcing patent rights on the BRCA family of breast cancer genes in the US and abroad.
“The mistakes in the Myriad case were not illegal actions, but political and strategic errors,” Gold said. “In the United States this meant the company failed to reassure those conducting research on breast cancer that they would not be sued.
“Internationally, in nations with public health care systems, Myriad’s hardball tactics led to resistance from governments and in most places prevented Myriad from being able to license its diagnostic tests.”
Gold and Cook-Deegan also argued that Myriad’s IP-enforcement tactics are too often replicated in the biotech and pharmaceutical industries. In the case of the US, they also lay blame on the federal government and academic institutions that license biotech innovations to companies. The bulk of the claims in Myriad’s gene patents were originally discovered at the University of Utah.
“The solution in the United States is not to prevent patenting activity, but for government to make clear it will step in and exercise rights that it already has,” Cook-Deegan said. He explained that under the Bayh-Dole Act, universities, small businesses, and non-profits are allowed to control their inventions and other IP that result from federal funding.
However, the government retains the right to ‘march in,’ or intervene on behalf of the public and grant additional licenses if it sees the need. “The fact is, in the 28 years since the Bayh-Dole Act was enacted, the government has never asserted its right to march-in, whether for health or safety reasons, or to push for action to achieve practical application of a given invention,” Cook-Deegan said.
In Myriad’s defense, the new case study, which can be found here, asserts that Myriad may have somewhat unfairly become a poster child for a broken IP system.
“The media, government reports, academic literature and even Michael Crichton’s book Next, all portray Myriad as a greedy, self-absorbed, unconcerned and inflexible company,” the report’s authors wrote. “While differing on how best to address Myriad’s actions – by changing patent law or altering licensing practices or creating research exemptions or creating compulsory licensing authority – the public record provides a strong condemnation of the company.
“Myriad is certainly guilty of many mistakes: it failed to fully understand and perhaps even respect the nature of public health care, it allowed hostile attitudes to persist in the scientific community without seriously attempting to correct the public record and it too quickly attributed hostile motivations to those working in government,” the authors wrote.
“However, Myriad was caught up in a debate inspired and sustained by much broader concerns than those relating to it alone including, general hostility to human gene patents, concern about the sustainability of public health systems and anxiety at the apparent demise of ‘open science,’” they added.
As such, Myriad became “a lightning rod for these debates: a necessary foil for an already-assembled opposition,” the authors conclude.

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