Patenting Genetically Engineered Plants

The US perspective

It has been a long-standing practice in the US to allow the grant of utility patents for plants. The large biotech companies have sought to patent their genetically engineered ("GE") hybrids or lines in order to protect and exploit their investment in the technology. The outcome of the recent case of Pioneer¹ has therefore provided reassurance to the agri-bio industry after the Supreme Court of the United States reaffirmed its earlier decision in Chakrabarty (supra) that utility patents are available for plants.

Pioneer Hi-Bred International ("Pioneer"), a subsidiary of DuPont, and the world’s largest producer of seed corn, had obtained 17 utility patents for its inbred and hybrid corn seed products under the US Code at 35 U.S.C. Section 101 (1994 ed) ("Section 101")². Pioneer sells its patented hybrid seeds to merchants and growers under a limited licence, the terms of which only permit the production of grain and/or forage from that seed and prohibits re-sale and use of that seed for propagation, seed multiplication or the production or development of a new hybrid or variety.

J.E.M. Ag Supply (trading as "Farm Advantage") bought patented seed from Pioneer under the above licence and then resold it. Pioneer bought proceedings against Farm Advantage alleging patent infringement by Farm Advantage in selling or offering for sale the patented seed outside the scope of the licence agreement. In reply, Farm Advantage counterclaimed, arguing that Pioneer’s patents were invalid, because sexually reproducing plants were not patentable subject-matter within the scope of Section 101. In particular, Farm Advantage argued that the exclusive statutory means for the protection of plant life were set out in the Plant Patent Act 1930 ("PPA") and the Plant Variety Protection Act 1970 ("PVPA"): in effect, there was no residual discretion for the grant of plant patents under Section 101. Farm Advantage sought this restrictive ruling on the basis that the PVPA’s coverage is generally less extensive (for example, it allows exemptions for research and also for a farmer replanting farm saved seed) and also for the tactical reason that Pioneer had not obtained protection for the hybrid seed under the PVPA.

The District Court granted Pioneer summary judgment relying upon the broad construction of Section 101 in Diamond v. Chakrabarty³ in finding that Section 101 covered plant life and that in enacting the PPA and PVPA, Congress had not expressly or impliedly removed plants from Section 101’s ambit. In fact, it found that there was no conflict between the two statutes. The United States Court of Appeals for the Federal Circuit affirmed this decision. Farm Advantage then appealed to the Supreme Court.

The majority decision of the Supreme Court referred to its previous decision in Chakrabarty that: "Congress plainly contemplated that the patent laws would be given broad scope" by casting the provisions in broad terms to fulfil the constitutional and statutory goal of promoting the progress of science, and the associated social and economic benefits envisaged by Jefferson. The Supreme Court had in its earlier decision found nothing in the PPA or PVPA to limit the application of Section 101 to living things. Similarly, the fact that Congress could not have foreseen genetic engineering did not mean that the wide language of the provision could not embrace living things, without the need for further express authorisation from Congress.

The Supreme Court then went on to examine the relevant sections of the PPA and PVPA. It saw no reason why these various forms of protection for plants should not co-exist.

The PPA⁴ expressly allows protection for the asexual reproduction of a variety of plant (i.e. a clone produced, such as by grafting, budding or the like)⁵. Less stringent requirements are provided than for Section 101 utility patents, in that no plant patent can be declared invalid on the basis of non-compliance with the section, provided the description is made as complete as reasonably possible. The Supreme Court concluded its analysis by finding that nowhere did it state that plant patents are the exclusive means of granting intellectual property protection to plants.

In 1970, Congress expressly authorised limited patent-like protection for certain sexually reproduced plants under the PVPA⁶. Akin to UK The Plant Varieties Act 1997 (and driven by UPOV⁷) a plant variety certificate will be granted if the variety is new, distinct, uniform and stable (as opposed to the higher hurdles required for a utility patent of being useful and non-obvious). The PVPA is also subject to exemptions (such as research). A utility patent for a plant requires the plant to be described with sufficient specificity to enable others to make use of the invention after the patent expires, including a deposit of biological material which is available to the public, whereas the PVPA merely requires the deposit of seed in a public depository.

Accordingly, Justice Clarence Thomas found for the majority that neither the PPA nor the PVPA limited the scope of Section 101 to protect newly developed plant breeds. The Supreme Court saw no reason to upset the unbroken practice of the US PTO in having issued some 1800 utility patents for plants over the last 20 years.

The European perspective - the EPO Novartis Decision⁸

In 1995⁹, the Technical Board of Appeal ("TBA") revoked the claims for individual plant varieties from a patent issued to Plant Genetics Systems BV of Belgium for the production of a herbicide-resistant plant on the grounds that the EU already had a system for protecting plant varieties (by granting Community plant breeders’ rights¹⁰) and the effect of Article 53(b)¹¹ of the European Patent Convention ("EPC") was to prohibit the grant of patents on plant varieties. This decision appeared to conflict with the decision of the TBA in the earlier Oncomouse¹² case where a literal interpretation of Article 53(b) allowed the TBA to uphold claims provided they did not claim protection for specific animal or plant varieties.

In the Novartis¹³ case, the Technical Board referred several questions to the EPO Enlarged Board of Appeal concerning claims in European Patent EP0448511, relating to certain plant varieties that were the result of a process to create transgenic plants by the insertion of the genes for lytic peptides and other hydrolytic enzymes in order to confer a pathogen resistant phenotype on the resultant organisms.

The main question considered by the Enlarged Board in case G01/98 was whether or not Article 53(b) EPC prohibited the protection of plant varieties through the patent system (and therefore whether the correct and only intellectual property right with which to protect plant varieties was the plant variety right).

The Enlarged Board commented that they thought it would be an odd anomaly, and a concept alien to patent law in general, if the application of the EPC were to prevent the patenting of specific embodiments of an invention (i.e. individual plant varieties), whilst allowing a broad claim to plants, the scope of which would include many such varieties. The Enlarged Board charted the development of Article 53(b) EPC through its drafting stages and concluded that its aim corresponded to that of Article 2(b) of the Strasbourg Convention¹⁴. The reason that the drafting of the two Articles differed was that the EPC draftsmen were working within in the constraints of the old UPOV ban on dual protection of plant varieties (which was abandoned in UPOV 1991), the desire to unify patent law throughout the EPC contracting states and the varying availability of plant variety right protection in the various EPC contracting states.

Significantly, between the time that the TBA in Novartis referred its questions to the Enlarged Board, and the Enlarged Board’s decision in G01/98, the EC adopted the EC Biotechnology Directive¹⁵. This Directive expressly allowed for the patenting of inventions concerning animal and plant life (Article 4) and the products of inventions concerning procedures, by which novel animals and plants (e.g. GE organisms) could be created (Articles 8 and 9). The Appellant in these proceedings (Novartis), naturally, submitted that the interpretation of the EPC (and, in particular, Article 53(b)) should be brought into line with this Directive.

The Enlarged Board ruled that a plant variety produced by genetic modification was a plant variety for the purposes of Article 53(b) and ultimately came to the conclusion that true purpose of Article 53(b) EPC was to define the partition between plant variety right protection and the patent system, i.e. a plant variety that qualified for plant variety right protection could not be patented, although if such a plant variety were an embodiment of a patentable invention, then the plant variety was also protected via the patent.

Therefore, the present position in Europe is that, a plant variety, or a group of plants that could be defined as a variety, cannot form the subject matter of a patent application no matter how they are generated, but can be patent protected if they are embodiments of inventions that independently qualify for patent protection.

Indeed, there is recognition of this overlap in Europe between patents and plant variety rights in Article 12 of the EC Biotechnology Directive (ante). That article provides for compulsory licensing of plant breeders’ rights and patent rights where the existence of one right hinders the acquisition or exploitation of the other right. Implementation of that objective is to be achieved in each Member State via a new regulatory framework for compulsory licences and cross-licences between holders of patents and plant breeders’ rights. In the UK, for example, implementation will be by means of the Patents and Plant Variety Rights Compulsory Licensing Regulations 2002, intended (at the time of writing) to take effect from 28 February 2002¹⁶.

The joint EU/US Biotechnology Consultative Forum was launched at the Quelez Summit in May 2000 and delivered its report to the following EU/US Summit in Washington in December of that year¹⁷.

The report centred on suggestions for improvements in the regulation of the introduction of genetically modified crops. It also addressed the issue of how better to accommodate the concerns of the consumer, whilst satisfying the need to increase yields in general to feed a rising world population and alleviate the poverty suffered by millions in the world at present. The report recognised the concern that was felt in a number of quarters concerning the application of the patents system to the protection of plant varieties (both directly in the USA and indirectly in the EU as embodiments of patentable biotechnological inventions) and the potential conflict that exists between offering sufficient reward to the inventor or researcher by the grant of intellectual property rights and, what is seen by some as, the erosion of food security for the world’s poor.

The report made three recommendations and suggested a global dialogue be established concerning the creation of a new regime that could sufficiently reward inventors, whilst maintaining food security in poorer areas of the world. Those recommendations included:

1. the protection of the farmer and research privileges;
2. the rewarding of traditional or indigenous medical/agricultural knowledge utilised in any inventions; and
3. the provision of incentives in developed countries for private companies to engage in research beneficial to developing countries.

The report is still under consideration by the European Commission and the recent Goteborg Conference suggested that areas are being identified in the report upon which are EU and US parties wish to work further.

The large agri-bio companies face a dilemma in exploiting the advent of new GE plants in the global arena. Whilst the US permits agri-bio companies to file for (and obtain) patent protection for newly-developed hybrid or inbred plants or GE cell lines for introduction into conventionally-bred plant varieties, the position in Europe remains confused.

Similarly, whilst the US regulatory authorities have backed the wholescale introduction and commercialisation of GE crops, the regulatory authorities in the EU remain nervous in the face of considerable public opposition and consumer indifference as to the benefits which GE crops have to offer. In the UK, whilst the Government in partnership with industry (SCIMAC¹⁸) nears the end of the program for limited farm-scale plantings of certain GE crops, it is unclear whether the moratorium on the commercialisation of GE crops will be lifted. The "log-jam" of applications caught up in the EU regulatory approval process under Directive 90/220/EC and its successor, Directive 2001/18/EC for a Part C marketing consent has caused many agri-bio players to pause and think whether further investment in GE plants is warranted.

On the global stage, relations between large US agri-bio players and the developing world remain strained. In 1999, Larry Proctor obtained a US patent¹⁹ for an Enola bean described as: "a new field bean variety that produces distinctly coloured yellow-seed which remain relatively unchanged by season". It is reported that Mr. Proctor (through his seed company) then demanded royalties upon the import of all Mexican beans into the US. Such was the outrage by Mexican bean farmers, that the Mexican Government announced that it would contest the grant of the US patent. The International Center for Tropical Agriculture (CIAT) has sought re-examination of the patent on the basis that it lacks novelty and obviousness, the subject-matter being, it is claimed, merely derived from material of the native dry bean imported from Mexico²⁰. CIAT holds the germplasm for over 27,000 samples of dry bean seed in its genebank as part of efforts to safeguard resources for the world’s farming community and to preserve biodiversity.

The developing nations regard such attempts to patent material, of crops they see as part of their cultural heritage, as "biopiracy"²¹. A similar outcry occurred last year in relation to the registration by US company RiceTech, Inc. of JASMATI as a US trade mark for a Texas-grown version of jasmine rice from Thailand. RiceTech, Inc. also obtained US patent protection in the form of a plant variety protection certificate under the PVPA. Although, the hybrid is in fact derived a cross of the American "della" and Italian "bertone" varieties, evidence has been produced that over half the US consumers bought Jasmati believing it to be a cross-breed of jasmine rice from Thailand and basmati rice from India/Pakistan. The Thai Government are reported as being extremely concerned at the potential damage to the Thai rice industry. Various legal moves have been made. Whilst this episode concerns the adoption of a name suggestive of a geographical indication, the depth of feeling is clear amongst developing countries which are heavily dependent upon farming communities for valuable export revenue.

In practice, the issue of whether GE plants should be patentable and, therefore, whether growers should be required to pay a technology licence fee for access to the new generation of crops is linked to the public’s perceived suspicion of GE plants and the technology in general. The other side of the equation is that without investigating the advances in food production, which biotechnology could bring, poverty and malnutrition can only increase as the global population swells. These issues should not be lost in the sensationalised media coverage of this area: there is a continued need for sensible, informed debate upon these issues drawing together the views of industry, consumers, environmental organisations and the governmental authorities.

What is clear is that there are still some large policy decisions for the EU Commission and Member States to address in order to clarify the position on patenting plant life (and, indeed, other forms of biotechnology). As with many things, this side of the transatlantic pond continues to be fringed with "weed" whilst the shore appears clearer in the US.

© Herbert Smith 2002

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