ICTSD Outputs and Activities on Biotechnology, Trade and Sustainble Development

Biotechnology: Addressing Key Trade and Sustainability Issues

B.4 Intellectual property rights

Q24 Are scientists allowed to use patented GM seeds for research purposes?

As noted, since innovation in agriculture has traditionally been a collective process, its incorporation into intellectual property regimes has been controversial. In particular, as new plant varieties are often the product of generations of breeding, plant breeders and researchers have emphasised the need to freely access genetic material, including that which is protected by intellectual property (QMIPRI, 2004). PVP systems, therefore, have tended to provide exceptions for acts conducted with experimental purposes or with the objective of breeding and commercialising other varieties. Nevertheless, the tendency towards increasing levels of intellectual property protection is also evident in these systems, at the expense of experimental and research exceptions.

UPOV, for instance, provides for a breeder's exemption, implementing the basic principle of the international PVP regime that the right holders cannot prevent other breeders from using the protected plant varieties in research and development. If the use of protected varieties for the purposes of developing new varieties were an infringement, the ability to develop new varieties would be restricted, which would run counter to the objective of granting rights to the breeders of new plant varieties. The 1978 UPOV Convention thus stated that the authorisation of the breeder of a plant variety was not required for its use as an initial source for the purpose of creating other varieties or for the marketing of such varieties.

In the 1991 UPOV Convention, however, although the breeder's right still does not extend to acts done for the purpose of breeding other varieties, it excludes situations relating to "essentially derived varieties" which may significantly limit the research exception. The notion of "essentially derived varieties" is vague and includes, for example, varieties that derive from others while retaining the expression of the essential characteristics that result from the genotype of the initial variety, even if it is clearly distinguishable. Moreover, in the 1991 UPOV Convention, the acts that require the authorisation of the breeder increase to include any production or reproduction of propagating material; its conditioning for the purpose of propagation; its selling, exporting and importing; and its stocking for any of these purposes. Finally, UPOV 1991 allows the double protection of plant varieties, that is, both by specific systems and by patents. In countries that grant this double protection, the patent protection of a gene or other biological material would extend to all derived biological material, and thus trump the breeders' exemption provided by the PVP system (Le Buanec, 2003). The EU Directive on Biotechnology, for example, has tried to overcome this situation by the possibility, under certain conditions, of compulsory licenses in cases where a plant variety right cannot be exploited without infringing a prior patent (Moufang, 2003).

Patent law, indeed, tends to have much narrower research exceptions. Although research as such is not enumerated as an exclusive right of the patent owner, it is normally necessary to make or use the patented product or process to conduct research, which is why a research exception may be necessary (Correa, 2004). As a result, patents can significantly limit access to GM seed for research purposes. For instance, in Monsanto v Stauffer, courts in the UK interpreted the research exception in regard to biotechnology narrowly, considering the size, scale, recipient and methodology of the experiments (QMIPRI, 2004). Another example is the case of Golden Rice (see Biotech Headline 8), in which a complex legal arrangement was necessary to overcome patent restrictions on the tools used to create Golden Rice and conduct the necessary further research.

International patent rules recognise that the information protected by patents is an essential input to the knowledge production process, and should be available for further experimentation and research for the sake of scientific and technological progress (Correa, 2004). Article 7 of the TRIPS Agreement states: "The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations." In addition, Article 30 of the TRIPS Agreement allows countries to establish "limited exceptions" to the rights conferred by a patent, as long as such exceptions "do not unreasonably conflict with a normal exploitation of the patent and do not unreasonably prejudice the legitimate interests of the patent owner, taking account of the legitimate interests of third parties." Research exceptions, which were analysed by the WTO dispute settlement panel on Canada's patent protection of pharmaceutical products, can easily fulfil this "three-step" test (Canada - Patent Protection of Pharmaceutical Products, 2000). For instance, research exceptions are limited because they involve using the patented products or processes on a laboratory scale and are relatively short in duration. Moreover, research exceptions do not conflict with the "normal" exploitation of the patent because they do not deprive the patent owner of the benefits generated by the market exclusivity s/he enjoys.

Research exceptions are particularly important in biotechnology, given the increasing number and scope of related patent claims. Nevertheless, the OECD recently noted concerns that "the present patchwork of national research exemptions is both ill defined and may be breaking down due to legal challenges" (OECD, 2002:23). In this regard, the OECD recommended that countries clarify and enhance research exceptions. Breeders' associations agree. The European Seed Association (ESA), for instance, has stated that the research exception is frequently unclear or far too narrow. In particular, it proposes that acts done for the purposes of breeding and developing other plant varieties should be excluded from the scope of patent protection of biotechnological inventions, and consequently, the commercial use of new plant varieties no longer expressing the function of patented elements should be allowed (ESA, 2004). Biotechnology companies, however, consider that such changes would be undesirable and ineffective on several grounds, including: (1) inventors in the area of plant breeding and development should be rewarded to the same extent as inventors in other fields; (2) US law does not provide or support a research exception under patents; and (3) any support for a research exception would appear to support research exceptions in general, as well as other exemptions, such as farm-saved seed (Donnenwirth et al., 2004).