Invitrogen said last week that it is now the exclusive worldwide provider of one of the most widely used tools in basic biological research and drug discovery — cloning vectors for fluorescent proteins derived from the jellyfish Aequorea victoria.
Researchers at either for-profit or non-profit entities can now purchase the clones for the ubiquitous green fluorescent protein, as well as its cousins cyan and yellow fluorescent proteins, from one supplier only: Invitrogen.
The A. victoria proteins had historically been commercially available primarily from BD Biosciences Clontech through a sublicensing agreement from PanVera, a subsidiary of then-Aurora Biosciences.
In 2001, Vertex Pharmaceuticals acquired Aurora Biosciences along with PanVera, and Vertex continued to operate the two companies as its subsidiaries. At this point, PanVera technically held the right to sell the valuable A. victoria fluorescent protein technology, and BD Biosciences Clontech still sublicensed that right.
Things began to shift, however, in 2003, when Invitrogen acquired the PanVera subsidiary from Vertex, and with it, the right to commercialize fluorescent proteins based on A. victoria. At that point, Invitrogen and BD Biosciences Clontech had the right to sell the product; however, Clontech’s original agreement — which was for a finite period of time — was beginning to run out.
The time period of that agreement ran out this year, and according to Lisa Eldridge, Invitrogen’s product manager for fluorescent proteins, Invitrogen became the sole supplier as of March 5.
“We acquired those rights with the [PanVera] acquisition,” Eldridge told Inside Bioassays last week. “Clontech actually had an agreement with certain rights to sell these products for a finite period of time, and that period of time has ended. So we’ve become the exclusive provider.”
Mark Lewis, vice president of BD Biosciences, last week confirmed with Inside Bioassays that its right to sell A. victoria-derived fluorescent proteins had ended, and that the company chose not to renew its licensing agreement because to do so was fiscally unfeasible for Clontech, and because it has its own line of alternative fluorescent proteins in which it feels confident.
“This is really a long-standing licensing agreement that goes back to the days of Aurora, and it did have a time frame to it,” Lewis said. “We felt that we had a competitive product line, and we also couldn’t come to an agreement to extend the terms to make it a reasonable business proposition for us.”
Looming in the background of this recent announcement is the pending sale of Clontech, which BD Biosciences announced late last year it was putting on the block (see Inside Bioassays, 10/12/2004), which may have had something to do with the company deciding not to renew its license to the A. victoria fluorescent proteins.
It is difficult to gauge the financial windfall Invitrogen might receive — or Clontech might lose — from being the sole supplier of cloning vectors of GFP and its variants. Neither Invitrogen nor BD Biosciences were willing to place a market value on GFP, but both said the value of the fluorescent proteins is not a secret.
“The use of fluorescent proteins — and I don’t just mean from Aequorea victoria — is an important biological tool, there’s just no question about it,” Lewis said.
Although Eldridge declined to estimate the market potential of the fluorescent proteins, she said theywould be an integral part of Invitrogen’s cellular analysis tool set.
“Fluorescent proteins as a reporter really have the highest utility when you look at the different reporters that are available to researchers today,” Eldridge said. “We really see potential for folding this platform into not only our drug-discovery products, but also our cell-imaging technologies that we acquired through our Molecular Probes acquisition; and our general research reagent market for RNAi and expression.”
A 2003 report from market research firm Research and Markets estimated that the past decade has seen increases in GFP-related scientific publications from single-digit numbers in 1992 to more than 10,000 in 2003.
In some ways, the news that Invitrogen will now solely supply A. victoria GFP clones mirrors an announcement from GE Healthcare last year that it would be the sole provider of licenses for the use of GFP in specific commercial research applications — which is where the real monetary value of GFP lies.
Invitrogen holds a stake in the underlying GFP patent estate, as well, along with Danish drug-discovery firm BioImage and Columbia University — each of which holds patents relating to specific uses of GFP, which GE Healthcare then sublicensed to provide what it called “one-stop shopping” for all for-profit entities wanting to use GFP in their research (see Inside Bioassays, 6/15/2004).
Therefore, for-profit institutions wishing to use GFP for commercial research can buy it from Invitrogen on relative cheaply, but pay GE Healthcare for the right to use it.
“My understanding at this point is that if you want to buy GFP, and you’re a commercial entity, then you have to buy a license [from GE], which would cost some substantial money,” Len Pagliaro, vice president of business development for BioImage told Inside Bioassays. “Once you have the license, you can just pick up a catalog and go to Clontech, and I think it costs [several dollars]. It’s a case where you’re not really paying for the stuff; you’re paying for the license to use the stuff.”
Non-profit institutions need only pay the cost of the cloning vectors to use GFP in their experiments.
“The only customers that are required to obtain a license from GE Healthcare are for-profit entities,” Eldridge said. “The not-for-profit entities can buy these products as catalog items as they would any other research reagent.”
Last week, Sian Godwin, GE Healthcare’s product manager for cellular analysis reagents, corroborated Eldridge’s statement, telling Inside Bioassays that the licensing situation does not change, regardless of who the product’s commercial provider is.
“Any for-profit entity that uses GFP will still require a license from GE Healthcare,” Godwin said. “Previously they would have bought the [vectors] from Clontech, and they’re now buying them from Invitrogen.”
The Clontech Sale
Despite the relative discrepancy in value between selling GFP and licensing its use, there is still a pretty penny to be made when one considers that almost every cell biologist in the world is purchasing your product. Considering this, one would have to think that the A. victoria fluorescent proteins were likely a big money-maker within Clontech’s stable of products.
In light of BD Biosciences’ plans to sell Clontech, does the loss of the GFP product line indicate that perhaps BD will be doing so in a piecemeal fashion?
Lewis firmly dispelled such notions last week.
“There is no intention to sell of pieces of Clontech,” Lewis said. “It’s a fully functioning entity, and that’s not our intention. What has been publicly stated is that we felt that we would conclude a purchasing arrangement sometime in our third quarter, which means between April and June of this year, and that’s what has been publicly disclosed. And we’re still going through the process.”
To make up for the loss of the GFP product line, Clontech has been busy launching its own alternative fluorescent proteins that, while not as widely accepted in the literature, could provide it with a competitive product line.
“We have a licensing program as well, but it covers our reef coral fluorescent proteins and also our alternative GFP, which is from Aequorea coerulescens,” Lewis said. “We also have a monomeric form of dsRed, which has extremely good spectral characteristics that allow you to multiplex with it efficiently with green fluorescent proteins such as those from A. coerulescens.
“So there’s a combination of things — we feel we’ve got a very strong product line there, in particular with the dsRed monomer, because it’s very well-differentiated,” Lewis added.