By Kevin E. Noonan --
The problem, according to the academics and the pundits, is that patent exclusivity in certain areas (such as gene patents) could result in a "tragedy of the anti-commons," inhibiting innovation. One of the many manifestations of this tragedy, according to such august bodies as the National Academy of Science and the Federal Trade Commission, was expected to be an increase in litigation as patentees protected their exclusive rights. A related issue is the exposure to patent infringement liability for university researchers in the aftermath of the Madey v. Duke case, where the Federal Circuit ruled that university research did not fall under the "common law" experimental use exemption enunciated by Judge Story in Whittemore v. Cutter, 29 F. Cas. 1120, 1121 (C.C.D. 1813), because university research was not performed for "for amusement, to satisfy idle curiosity or for strictly philosophical inquiry," but as part of the university's "business objectives" (teaching and research). The fear of this liability has led to proposals for basic research to be entitled to a broad exemption.
The underlying grounds for both types of concerns have once again been found to be non-existent, in a study published in the April 4th edition of Nature Biotechnology. The study, by Ann E. Mills and Patti M. Tereskerz from the Center for Biomedical Ethics and Humanities, program in Ethics and Policy in Heath Systems at the University of Virginia, and entitled "Empirical analysis of major stem cell patent cases: the role of universities" is limited to stem cell patents and litigation involving such patents. The authors identified these patents as being relevant to questions about the existence of an anti-commons tragedy because such patents were expected to become more important with the policy change on embryonic stem cell research by the Obama administration, and because "there are few or no alternatives to patented technologies that enable embryonic or adult stem cells to be directed into specific cell lineages" and "[t]he interdependence of the technologies involved with these stem cell patents and the fragmentation of their ownership across many organizations could make the task of coordinating access to key technologies an intensive as well as costly process, and so create an anti-commons in the field."
The study builds on earlier work by Bergman and Graf (2007, Nat. Biotechnol. 25:419–24), who indentified three International Patent Classes where most stem cell patents can be identified. Mills and Tereskerz reviewed these IPCs from U.S. Patent and Trademark Office records for the number of patents in the PTO database in each class claiming stem cells and the number of these patents involved in litigation. The authors report identifying 67 cases involving 23 patents, where one patent (U.S. Patent No. 5,352,605, owned by Monsanto) was involved in 32 lawsuits. Of the three IPCs, one (C07K 14/peptides having more than 20 amino acids; 605 relevant patents) showed no patents involved in litigation, while the other two (C12N 5/undifferentiated human, animal or plant cells, e.g., cell lines; tissues; cultivation or maintenance thereof; culture media, 1,163 relevant patents, and C12 15/mutation or genetic engineering; DNA or RNA concerning genetic engineering vectors, their isolation, preparation or purification, 2094 relevant patents) showed no statistically-significant difference in litigation when the fact that some patents are involved in multiple litigations was taken into account.
Turning to the specifics of the parties, 7/67 cases involved university plaintiffs, and 5/28 plaintiffs were universities (18%). In contrast, only 1/89 defendants were universities. One plaintiff, Monsanto, showed a decided preference for suing on "older" patents, with U.S. Patent No. 5,352,605 being litigated 32 times, and U.S. Patent 4,940,835 being litigated three times. Excluding cases involving Monsanto as a plaintiff, there were between one and five litigated cases per year between 1986 and 2007 involving patents from these IPCs, with the trend being markedly downward since 1998.
The authors conclude from their data that for these (stem cell) patents, "the rate of litigation to issued patents in the categories studied is extremely small, which calls into question the claim that a large amount of litigation is causing an anti-commons" (while noting that a patent from these IPCs that was litigated tended to be litigated several times). The authors also note that, contrary to the popular belief that universities would be defendants, in a significant number of cases universities were plaintiffs, defending their own intellectual property. (Not noted in the main body of the article was whether industry defendants were involved in suits where universities were plaintiffs, a result expected if university protection of intellectual property was being used to prevent commercial expropriation of technology developed by universities with public monies.) In this regard, seven of twelve cases involving patents that had been litigated multiple times had university plaintiffs.
Regarding the effects of the Madey decision, the authors state that "it appears that the post-Madey fears of opening a floodgate of litigation against universities is not being realized at the moment." The authors also compare their results with the results of two earlier studies by Walsh and colleagues (National Research Council, Committee on Intellectual Property Rights in Genomic and Protein Research and Innovation, Reaping the Benefits of Genomic and Protemic Research: Intellectual Property Rights, Innovation, and Public Health, National Academies Press, 2006; and Walsh et al., in Patents in the Knowledge-Based Economy (eds. Cohen W. & Merrill, S.) 285–340 (National Academies Press, Washington, DC, 2003). These studies showed that university researchers were not sued by patentees for performing basic research (a result supported by several other studies, including Walsh et al., 2003, "Science and the Law: Working Through the Patent Problem," Science 299: 1020; Walsh et al., 2005, "Science and Law: View from the Bench: Patents and Material Transfers," Science 309: 2002-03; Straus, 2002, Genetic Inventions, Intellectual Property Rights and Licensing Practices; Nicol et al., 2003, Patents and Medical Biotechnology: An Empirical Analysis of Issues Facing the Australian Industry, Centre for Law & Genetics, Occasional Paper 6; Nagaoka, 2006, "An Empirical Analysis of Patenting and Licensing Practice of Research Tools from Three Perspectives," presented in OECD Conference in Research Use of Patented Inventions, Madrid).
The authors cite the Walsh studies for the proposition that patentees in industry "welcomed" academic research, because it advanced knowledge about the patented technology. Indeed, traditional concerns were cited by scientists as being greater impediments than patents: "'unreasonable terms for obtaining research inputs' was cited by 10% of survey respondents and 'too many patents covering needed research inputs' was cited by only 3% of survey respondents as a reason for project abandonment."
The authors conclude as follows:
We find no evidence that Madey is unleashing a floodgate of litigation in the areas we studied, despite the worry voiced by the three reports cited above. We also find that for the stem cell patents studied, universities are proactive (and have been before Madey) in protecting their intellectual property, supporting the Madey contention that the boundary between industry and academia is blurring.
And yet, like an urban legend, the myth that university researchers are at risk for patent infringement liability, or that patents cause university researchers to abandon research areas for fear of litigation, or that there is a tragedy of the anti-commons, persist, despite all evidence to the contrary. The only rational conclusion is that these fantasies support a political agenda that is antithetical to patenting. Recognizing that these problems do not exist may be the first step in rejecting the several solutions proffered for these purely political reasons.
For additional information regarding this and other related topics, please see:
• "Science Progress Article Examines Impact of Gene Patents on Research," December 21, 2009
• "The Tragedy of a Bad Idea," August 25, 2009
• "Author of Nature Article Provides Rebuttal; Patent Docs Provides Surrebuttal," March 26, 2009
• "Genetic Diagnostic Testing: The 'Anti-Commons' Revisited?" March 25, 2009
• "The Effects of Intellectual Property Protection on Agricultural Research: Patents Are Not the Problem," February 3, 2009
• "Newsweek Joins the Anti-patent Bandwagon," January 26, 2009
• "Science Article Should Help Allay Gene Patenting Fears," December 17, 2008
• "Once Again, The New Yorker Gets It Wrong on Patents," August 10, 2008
• "Once Again, The New Yorker Gets It Wrong on Patents," August 7, 2008
• "BIO Report Indicts 'Patent Reform' Proponents," February 13, 2008
• "The True Tragedy of the Anti-Commons," October 8, 2007
• "The Future of DNA Patenting," February 20, 2007
• "The 'Anti-Commons' Aren't So Tragic, After All," October 27, 2006