A vote last week by the European Competitiveness Council may pave the way toward strong software patent protection in the European Union, but the potential impact of this decision on bioinformatics patenting patterns in Europe remains unclear.
Last week, the council said it had reached a “common position” on a draft directive to grant patent coverage for computer-implemented inventions. The vote was not unanimous, however — the Austrian, Italian, and Belgian delegations abstained, while Spain voted against the proposal. In a move criticized by opponents of the directive, the Council removed several amendments to the proposal that the European Parliament added in the fall to limit the scope of protection.
The European Commission said in a statement that it “supports the text adopted by [the] Council, which it believes restores the overall balance between the interests of the rights holders and other parties (competitors and consumers) struck by the original Commission proposal presented in February 2002.” [BioInform 03-11-02] The EC statement acknowledged, however, the “differences between the positions of the Council and European Parliament” over the directive, which will return to the Parliament for a second reading after it has reconvened in September following the June 2004 elections.
The proposed directive is intended to harmonize the way in which national European patent offices address software patents. Currently, some EU member states allow broad protection for software, while others prohibit it. The European Patent Office does grant software patents already (see p. 7), but enforcement of these patents is still handled by national courts, which means the level of actual protection can vary widely across Europe.
The original proposal was intended to codify existing EPO policy across Europe, with the goal of protecting novel inventions while still steering clear of more lenient US-style policies that have granted patents for business methods or “computer programs which do not provide any technical contribution to the state of the art,” according to the Commission.
This “technical contribution” requirement was a cornerstone of the original directive, but critics argued that the definition of what was considered “technical” was so vague as to permit a patenting free-for-all that would stifle innovation and restrict research among small firms, while allowing large corporations to dominate the IP landscape. Aiming to address these concerns, the European Parliament in September added a number of broad exclusions that limited the scope of protection — exceptions that would, for example, permit users to decompile software to make it interoperable with their existing systems. However, the Commission and Council decided that these steps went too far, and they removed most of the changes in last week’s vote.
Frits Bolkestein, EU internal market commissioner, said in a statement that Parliament’s version went “beyond what was required to set the right balance between rewarding inventors for their efforts and allowing competitors to build on these inventions, and could ultimately harm EU competitiveness.”
“The agreed text contains provisions, in accordance with the practice developed within the European Patent Organization, for patentability of computer-implemented inventions stipulating, inter alia, that a computer program as such can not constitute a patentable invention,” the Council said in a statement. “For a computer-implemented invention to be patentable it must be susceptible of industrial implication and involve an inventive step,”
George Moore, an attorney with Bristows in London, said that last week’s vote is good news for those in favor of strong patent protection, but for proponents of open source software, it could be considered a “backwards shift.”
For the bioinformatics sector, the decision is either a victory or immaterial, depending on whom you speak to. Patenting remains a relative rarity among bioinformatics firms, which still prefer to protect their software-related intellectual property via trade secrets or copyright. “Nothing is easier to circumvent than a software patent,” said Klaus May, director of sales and marketing for Genomatix of Munich, Germany. May said that publishing the guts of an algorithm in a patent exposes it to competitors who could easily change a few features and rewrite the software in a form that is different enough to avoid infringement. Genomatix has filed for several patents, May said, “but those are more for procedures and processes using the software” — not the software itself. Furthermore, he said, for those companies that do decide to patent their software, they usually file for protection in the US first, “although Europe is nice, too.”
May said that Genomatix is keeping an eye on the directive as it works its way through the complex EU lawmaking process, but added that he doesn’t think the final policy will have much impact on the company’s IP strategy, either way.
Lion Bioscience, meanwhile, is “following the directive closely,” according to a company spokeswoman, and plans to align its patent policy with the final ruling. The company declined to comment further, however, until the directive is finalized.
Klaus Heumann, CEO of Martinsried, Germany-based BioMax, said that his company is also following the progress of the directive quite closely, and has filed for several patents on its software. Heumann noted that the company “appreciate[s] that the current practice as it is conducted is being put into a more solid legal framework that will be harmonized throughout the different European states,” but added that the latest version of the directive still fails to address the “gray area” in software patenting that allows some very “generic” software patents to slip through the system. In addition, he said, “For the bioinformatics space, there is a lot of open source software available, and how that relates to [the directive] is not really clear to me at this point. … If you use some public algorithm, and that’s in violation to some software patent, what does that mean?”
Duncan Curley, an attorney with McDermott, Will, and Emory in London, said that the directive’s current form is “a good thing” for bioinformatics patenting. “Parliament’s version basically took a piece of relatively benign legislation and changed it into something it was never intended to be,” he said. Although the open source community has been a vocal opponent of the directive in Europe, Curley said that users and developers of open source bioinformatics software should not be affected by any policy changes. “The open source lobby was concerned that if people got broad patents, then patent rights might be asserted against software developers and make the process of software development more expensive,” he said. Under the current version of the directive, “people who want software patents can have them, and will know with better precision what they have to do to get them. … Open source software will not be affected.”
For bioinformatics firms weighing the pros and cons of patenting their software as opposed to sticking with copyright protection, Curley said that the “technical contribution” requirement for patent protection in Europe may tip the balance in favor of patenting. “When you have a software program that has a technical effect, patent protection is stronger than copyright,” he said. “If you mark out the specific technical benefit, then the claims that you have for your patent will not be confined to that specific technical benefit,” he said. Copyright, however, “only protects the precise program.”
Moore said that if the directive were to pass as written — something he does not think is likely to happen any time soon, due to the “stalemate” that exists between the Parliament and the Council — “it will make patents stronger for bioinformatics.” But, he added, “The question of the value of those patents is a much bigger and trickier question.”
Large firms with enormous patent portfolios like IBM and Microsoft have certainly benefited from an aggressive IP strategy, Moore noted, but the benefits of software patents in bioinformatics remain to be seen. “A lot of software technology becomes outdated in five years,” he said, and in an emerging field like bioinformatics, that timeline is even more accelerated. “Sometimes it’s just not worth patenting your software. Sometimes you’re best off keeping it a secret,” he said.
In addition, Moore noted, the size of the potential market for a technology often determines the value of patent protection. For fields like consumer electronics, therefore, it’s a no-brainer to maintain a strong patent portfolio, but in an area like bioinformatics, where the market is still relatively small, “it may not be worth the fight,” he said.
Some Recent Bioinformatics Patents in the European Database
- Title: Polypeptide Fingerprinting Methods, Metabolic Profiling, and Bioinformatics Database
Inventor: Luke Schneider, Michael Hall
Applicant: Target Discovery
European Patent No: EP1194768
Date issued: 04-10-02
- Title: Method and Apparatus for Predictive Cellular Bioinformatics
Inventor: Donald Oestreicher, James Sabry
European Patent No: EP1309848
Date issued: 05-14-03
- Title: Application of Bioinformatics for Direct Study of Unculturable Microorganisms
Inventor: John Kilbane
Applicant: Gas Technology Institute
European Patent No: EP1352090
Date issued: 10-15-03
- Title: Computer Method and Devices for Biomolecule Analysis
Inventor: Tyuji Hoshino
Applicant: Fairways Informatix
European Patent No: EP1355256
Date issued: 10-22-03
- Title: Method of Operating a Plurality of Electronic Databases
Inventor: David Croft, Eric Minch
Applicant: Lion Bioscience
European Patent No: EP1366427
Date issued: 12-03-03
- Title: Method and Apparatus for Automated Cellular Bioinformatics
Inventor: Eskinder Kiros, Ping Ling
European Patent No: EP1379855
Date issued: 01-14-04
- Title: Pharmacokinetic Tool and Method for Predicting Metabolism of a Compound in a Mammal
Inventor: Julie Doerr-Stevens, Kevin Holme
Applicant: Lion Bioscience
European Patent No: EP1386274
Date issued: 02-04-04
- Title: Method and Apparatus for Providing a Bioinformatics Database
Inventor: David Balaban, Arun Aggarwal
European Patent No.: EP1396800
Date issued: 03-10-04