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CRISPR Patent Pools Pop Up, But Participation Uncertain as IP Holders Continue Legal Battles

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NEW YORK – The patenting of CRISPR-Cas9 genome editing technology has never been a clear-cut issue. The constant back-and-forth litigation over the past few years has caused some confusion for researchers and companies who want to license the technology for their own purposes. Some organizations have tried to solve the problem by creating patent pools, where the owners of CRISPR intellectual property could bring their IP together and license it out under one set of terms.

An initiative by licensing agreement middleman MPEG LA to create a large pool encompassing most of the foundational CRISPR IP is still struggling to launch. In the meantime, however, smaller license collaborations have started to pop up.

The fight over CRISPR patents began in 2012, shortly after University of California, Berkeley researcher Jennifer Doudna and the Broad Institute's Feng Zhang and their colleagues published papers on their discoveries of CRISPR-Cas9 systems. Just about the only thing the two sides have agreed on since then is that one of them should be able to control the intellectual property rights arising from the discovery of CRISPR-Cas9. After all, holding such IP comes with the ability to license it to research institutions and companies throughout the industry.

In 2017, New York Law School Associate Professor of Law Jacob Sherkow calculated that the foundational CRISPR-Cas9 patents were worth between $100 million and $265 million. Given the variety of applications the technology could be used for — from human therapeutics to agriculture — some experts believe the patent rights could eventually be worth billions of dollars.

It's no wonder, then, that the parties have fought so hard for control. In September 2018, it seemed as though the Broad had scored a decisive victory. After a series of proceedings and appeals in front of the US Patent and Trademark Office (USPTO) Patent Trial and Appeal Board (PTAB), the United States Court of Appeals for the Federal Circuit issued a ruling upholding a judgment from the PTAB that gave the Broad and its partners control of key CRISPR patents, leaving UC and its co-litigants in the cold.

But this June, the fight flared up again as the USPTO initiated a new patent interference. The proceeding, which was started by the USPTO rather than one of the parties, involves one patent application filed by and 13 patents issued to the Broad in 2014, 2015, and 2017, and 10 patent applications filed by UC Berkeley in 2018, all on the use of CRISPR-Cas9 to edit eukaryotic genomes.

Meanwhile, in January 2018 the European Patent Office denied the Broad's reliance on a US priority provisional application for a CRISPR-related patent in Europe, based on a technicality.

Despite all the upheaval, however, the licensing of CRISPR-related IP is, and always has been, a booming business — so much so, that MPEG LA decided at the end of 2016 to create a licensing pool for CRISPR patents.

"CRISPR is a groundbreaking discovery, and we recognized early on that this was an important platform for commercial use and development, and that there would be many patents being filed — and that the patents would, in all likelihood, overlap to some degree," said Kristin Neuman, executive director of biotechnology licensing at MPEG LA. "We also knew that there would be a large market for it. So, all of those indicators point to a pool being a very efficient way to provide patent license rights to a large marketplace."

As the field was developing in its early days, Neuman noted, MPEG LA heard from both patent holders and potential licensees who expressed that a pool format might be the best way to license a large amount of IP in a way that was less burdensome than trying to do it in an individual manner.

MPEG LA's pool hasn't launched yet, however. All patents in the pool would be licensed under the same preset terms, and until the participants can agree on those terms, the pool won't come to market. Once the pool is open, the terms of the license, all the patents in the pool, and the list of participants will be made publicly available.

"The patent pool would be open to all patent holders worldwide," Neuman said, though it is restricted to patents for Class 2 CRISPR-Cas systems, which includes Cas9, Cas12, Cas13, and a few others. "The patents come into the pool non-exclusively. The patent holders grant MPEG LA a non-exclusive license as the independent pool manager for the purposes of licensing the patents together in a pool. MPEG LA handles the signing of licensees. We collect royalties, we distribute royalties that come in to the patent holders, and then all licenses out of the pool are non-exclusive to one or more defined fields of use yet to be determined."

The level of transparency provided by MPEG LA's format " as far as I know, is not available in CRISPR patent licensing today," Neuman said. And it would be a valuable contribution to the market because it would enable businesses to have an understanding of what they're getting in the license, and predictability about being able to get the license which is needed for their own business planning and decision making. We also believe that a transparent license of this nature would create the opportunity for a level playing field within the commercial use and development of CRISPR."

Even patent lawsuits between parties wouldn't preclude their mutual participation in the pool, according to Neuman.

"If a patent were voluntarily cancelled by one of the patent holders, or invalidated by a court or an administrative tribunal, then that patent comes out of the pool," she said. "The pool structure that we're creating is flexible enough to accommodate, should the parties wish to, the setting of royalty distribution rules and various parameters that would take effect if and when certain patents were cancelled or invalidated. So, there's no reason the pool can't go forward on a parallel path with all of the existing or even future disputes between the various parties."

As for MPEG LA, its business model calls for a compensatory fee based on the royalties it collects for the patent holders in its pool.

Unfortunately, it hasn't been easy for MPEG LA to attract every major patent holder to its pool. Although the Broad announced in 2017 that it intended to join, a UC spokeswoman confirmed for GenomeWeb that the university is not part of the pool.

Though patent holders would have the option to join the pool even after it closes and is made available to licensees, Neuman said, the pool's closing is predicated on the participants agreeing to terms for the license. In other words, if the participants can't agree to terms on which they can all license their various CRISPR patents, the pool won't close.

In the meantime, some patent holders have decided to try creating miniature versions of MPEG LA's pool, in the hopes of simplifying access to CRISPR IP. Most recently, the Broad and MilliporeSigma announced that they have developed a framework to streamline the way they offer non-exclusive licenses to the CRISPR research tools IP under their respective control.

Under the terms of their agreement, the Broad will now offer licenses to its own CRISPR IP portfolio, as well as MilliporeSigma's, to potential licensees for internal research uses and for commercial research tools and kits. The framework is also designed to allow other CRISPR patent holders to participate in the future, either through this agreement or through a third-party patent pool or collaboration. MilliporeSigma's IP for CRISPR technology will be available royalty-free to non-profit academic institutions, non-profit business communities, and governmental agencies for their internal research.

In October 2017, the Broad created a similar collaboration with DuPont Pioneer to jointly provide non-exclusive licenses to CRISPR IP under their respective control to any entities wanting to use the technology for commercial agricultural research and product development.

"Over the past five years, we've tried to really simplify access to the technology," Broad Chief Business Officer Issi Rozen said. "The technology is remarkable. It has transformative influence on biology, and we wanted it to be used by as many people as possible, as many companies as possible. So, part of what we've been trying to do is really simplify access to key patents that the market thinks are important."

Supriya Shivakumar, head of strategy for gene editing and novel modalities at MilliporeSigma, added that researchers had voiced their concerns to the company regarding the confusion about the patent landscape. Since MilliporeSigma and the Broad Institute have foundational IP in complementary geographies, Shivakumar said, "we felt joining forces would advance research and culminate in better therapeutic approaches," while taking away the distraction of licensing.

Rozen noted that it's still too early to tell if other CRISPR patent holders will decide to join the mini-pool the Broad and MilliporeSigma have started, although he hopes they will.

"The more patents represented in this framework will result in a clearer and simplified path for access to more CRISPR technologies," Shivakumar added. "We are excited about the possibility of growing the patent pool."

Rozen is also hopeful that patent holders will join MPEG LA's pool, and that "MPEG LA will be successful in bringing the entire market together." But, he also noted that the organization's task is not a simple one, and that its pool idea is more likely to be a long-term solution for the industry rather than an immediate fix.

"In the meantime, we thought that this [deal with MilliporeSigma] is an interim [way] to simplify access to the [CRISPR] estate," Rozen said.

Shivakumar noted that while MilliporeSigma is in "ongoing discussions with MPEG LA," the company is not currently participating in the patent pool.

As for UC, the university does participate in one of the Broad's licensing agreements, in a limited fashion and not directly. The framework for the Broad's agreement with DuPont Pioneer to license CRISPR technology for agricultural purpose provides non-exclusive access to IP from the Broad co-owned with its collaborators, and provides non-exclusive access to foundational IP from Pioneer and to IP from the licenses that Pioneer gained access to through Caribou Biosciences and ERS Genomics. UC has an exclusive license with Caribou for its CRISPR IP, and ERS Genomics was founded to provide access to CRISPR IP held by Emmanuelle Charpentier, Jennifer Doudna, UC, and the University of Vienna.

Rozen said he'd also be happy to have UC participate in the licensing deal with MilliporeSigma, which involves CRISPR for research use. "We would be thrilled if they decide they want to work with us to enable the field," he added. "We've made a number of attempts to reach out to them over the years. We would be very excited to work with them on some kind of joint framework."

The sentiment was echoed by MilliporeSigma Senior Patent Counsel Benjamin Sodey, who said the company would "welcome" UC and any other relevant patent holder to the collaborative framework it has developed with the Broad.

The welcome may be a bit premature, however. In addition to the new interference proceeding between UC and the Broad, MilliporeSigma this month also threw its hat into the patent interference ring, filing a petition asking the PTAB to start a proceeding against UC also on the matter of CRISPR-Cas9-based methods and compositions of matter in eukaryotic cells.

"On Monday, June 24, 2019, the PTAB declared a patent interference directed to CRISPR-Cas9-based methods and compositions of matter in eukaryotic cells," the company wrote in its brief. "Sigma-Aldrich's pending patent applications are also directed to CRISPR-Cas9- based methods in eukaryotic cells. Of critical importance here, Sigma-Aldrich's benefit applications pre-date the earliest possible benefit applications involved in the UC v. Broad Inst. interference with respect to their respective disclosures of CRISPR-Cas9 in eukaryotic cells. For the effective administration of justice, efficiencies of the USPTO and the parties, conservation of considerable valuable resources, and the public interest, Sigma-Aldrich respectfully requests that the PTAB declare a parallel interference between Sigma-Aldrich and UC."

An interference would determine the true inventor of CRISPR in eukaryotes, Sodey said.

"The first Broad-Berkeley interference didn't even get to that point because there was a decision of no-interference-in-fact," he added. "There is no guarantee that the patent office will grant our petition, but we felt we needed to say something so that we are part of the conversation."

The PTAB has yet to make a decision about whether to allow the interference to proceed.

"We remain confident that the USPTO will ultimately recognize that the Doudna and Charpentier team hold the priority of invention specific to the CRISPR-Cas9 gene editing technology in eukaryotic cells, as well as other settings covered by the Doudna-Charpentier team's previous patents," responded a UC spokeswoman.

As to whether the university would join the Broad and MilliporeSigma's mini-pool, Eldora Ellison (lead patent strategist on CRISPR-Cas9 matters for UC and a director at the law firm of Sterne, Kessler, Goldstein & Fox, noted that UC allows nonprofit institutions — including academic institutions — to use its CRISPR technology for non-commercial educational and research purposes, consistent with the university's open-licensing policies. The university has also encouraged widespread commercialization of the technology through its exclusive license with Caribou, she added.

Ellison would not speculate on whether UC would enter a wider patent pool in the future.

For MPEG LA's part, Neuman noted that one of its most attractive attributes is neutrality.

"What really sets MPEG LA apart from the other big players in the CRISPR patent licensing field are three attributes," she said. "Our independence — we're not aligned with any commercial CRISPR interests nor with any given CRISPR patent holder or licensee; our neutrality — we are an honest broker at arm's length from all the patent holders; and transparency — and I think that's a big one, because right now there is very little transparency around CRISPR licensing."

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