The US Patent and Trademark Office recently essentially closed the book on a long-standing patent dispute between licensees of IP from the Roslin Institute and the University of Massachusetts by issuing notices of allowance for two Roslin patent applications related to animal cloning.
The Roslin patent applications are owned by Start Licensing, a company formed by Roslin licensees Geron and Exeter Life Sciences to manage the companies’ patents in the area of non-human animal cloning.
Separately this month, the USPTO granted two additional animal cloning patents from the Roslin portfolio and also owned by Start Licensing, decisions that further strengthen Start’s firm hold in the hotly contested animal cloning arena.
The notices of allowance are a direct result of decisions handed down by the USPTO in 2005 in favor of Geron in patent interference proceedings the company had initiated in 2000 against animal-cloning patents owned by the University of Massachusetts that had been licensed to Geron rival Advanced Cell Technology.
The patent applications (Nos. 09/650,194 and 09/989,126) and the newly awarded patents (Nos. 7,304,204 and 7,307,198) are part of a broad IP portfolio developed at Roslin and directed to methods of cloning ungulate animals, fetuses, and embryos, and of producing mammalian (the ‘194 patent application predated USPTO publication rules established in 1990, and therefore is not published in the USPTO database).
The IP was developed primarily by the Roslin Institute’s Keith Campbell and Ian Wilmut and served as the basis for the cloning of Dolly the sheep. Geron acquired Roslin spinout Roslin Bio-Med in 1999, which gave Geron an exclusive license to Roslin Institute's cloning-related IP portfolio in all areas of application except for the use of protein production in the milk of transgenic animals. Roslin licensed this application to a company called PPL Therapeutics.
As part of its license, Geron “obtained prosecution control over the patents,” Cameron King, an executive with Start Licensing, told BTW last week. “So the interferences were conducted at the direction of Geron at that time.”
The patent-interference proceedings pitted the ‘194 and ‘126 Roslin patent applications against US Patent Nos. 5,945,577 and 6,235,970 — technology developed in the laboratory of Steven Stice at the University of Massachusetts and exclusively licensed to ACT. The Stice patents were filed several years before the Roslin patents, but Roslin claimed prior invention.
By 2005, the USPTO had found in favor of Geron. Also around that time, PPL Therapeutics had sold its rights to the Roslin patents in the area of protein production to Arizona biotech Exeter Life Sciences.
After the USPTO’s decision that year, Geron and Exeter created a joint venture, Start Licensing, into which they folded their respective rights to use the Roslin patents in animal applications, while Geron retained rights to use the patents in human applications.
“We have always felt very comfortable that those patents would come out – it was just a matter of bureaucratic timing.”
“We were formed to be a licensing entity,” King said. “So we are actively licensing these patents and the technology here for commercial and industrial use. There are a lot of applications for the technology — agriculture being a big one — but there are also biomedical applications.
King stressed that Geron retains all rights to the patents in human uses. “Their motivation for doing this joint venture with Exeter was to put these assets into another company that would be working to license the patents in the animal field,” he said.
Exeter owns a 50.1 percent stake in Start and Geron a 49.9 percent stake. The companies receive distributions of any profits derived from licensing Start patents to other companies proportionate to their equity interests. Geron and Exeter also have undisclosed financial obligations back to Roslin institute under the prior licensing agreements.
Closing the Door on a Dispute
The USPTO’s 2005 decision in the patent interference didn’t quite put an end to the dispute between Roslin’s licensees and ACT, as ACT still had the right to challenge the USPTO’s decision, and did so that year in the US District Court for the District of Columbia.
In September of the following year, ACT settled its dispute with Start Licensing. Under the terms of the settlement, Start agreed to pay ACT an initial payment of $500,000 and milestone payments of up to $750,000.
Also under the settlement, Start, Geron, Exeter, and Roslin agreed not to sue ACT or UMass under the involved Roslin patent applications. In exchange, ACT and UMass dismissed their appeals with prejudice, transferred control of related UMass patent applications to Start in the non-human animal field, and paid certain legal fees. However, ACT and UMass retained rights to the patents in the human field.
The USPTO’s decision to issue notices of allowance for the Roslin patents was merely a matter of tying up loose ends by declaring that the Roslin patents were indeed fit to be awarded, King said.
“You’re always waiting for the final approval of the patent office,” King said. “There wasn’t really any practical risk or jeopardy [of not being awarded the patent]. In the interference process, the board takes a very close look at all the arguments that the opposing side brings against patentability of the application at issue, so before you even get to a patent interference, the patent examiner has to indicate that the patent would be ready for allowance except for this interfering subject matter issue.”
King added that “we have always felt very comfortable that those patents would come out – it was just a matter of bureaucratic timing.”
The Roslin IP has endured other scrutiny and survived, most notably in 2004 when the USPTO upheld the patentability of the claims in certain patent applications in the Geron/Roslin portfolio following a patent interference proceeding initiated by Wisconsin firm Infigen.
These patent interference wins for Geron, coupled with the allowance of the ‘204 and ‘198 patents, arguably give Start Licensing the strongest animal cloning patent portfolio in existence, and a resulting revenue stream that will trickle back to Roslin.
It is unclear what the impact of the patent interference decision and settlement has had on ACT and UMass, which happens to be one of ACT’s major IP licensors. ACT has said that the US patents that were overturned in the patent interference proceedings are only two of an unspecified number of patents the company has licensed from UMass related to somatic cell transfer and cloning techniques.
Meantime, complicating matters is the fact that Start Licensing owns rights to other UMass patents related to chromatin transfer and other technologies developed at the school that had originally been licensed to Exeter, and fell under the Start umbrella when Exeter and Geron formed the IP management entity. Therefore, UMass still stands to benefit if Start outlicenses any of those patents in the future.
Calls to ACT and the UMass Office of Commercial Ventures and Intellectual Property were not returned in time for this publication.