Genetic Patents and Health: Recent Policy Discussions

For the Canadian Biotechnology Advisory Committee

August 2003

By E. Richard Gold
Bell Chair in e-Governance
Faculty of Law
McGill University

Table of Contents

1. Abstract

2. Introduction
3. Background to this Report
4. The Impact of Genetic and Related Patents
5. Impact of January 2001 USPTO Utility Guidelines

6. Conclusions

7. Appendix A:  CBAC Interim Report
8. Appendix B:  CBAC Final Report

Abstract

Since the release of CBAC's final report on the Patenting of Higher Life Forms in June 2002, several other organizations, including the OECD, the Nuffield Council and the UK Commission on Intellectual Property Rights, have discussed the issue of gene patenting. While in general supporting CBAC's conclusions, these other reports further deepen the discussion of the social and ethical issues surrounding these patents. While all agree that genes can be patented, they also recognize that some limitations on the number or scope of patents granted may be necessary. In addition, an important policy development in the United States – the development of patent guidelines – may have an impact on Canadian researchers and companies wishing to sell products or services in the United States.

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Introduction

This report has been prepared at the request of CBAC. Its purpose is to provide a brief summary of policy developments related to DNA sequence patents, since the issuance of CBAC's final report on the Patenting of Higher Life Forms in June 2002. It describes the reports of several organizations touching on this issue, as well as government initiatives around the world touching on gene patents. The report is not intended to provide a review of recent academic writing in the area.

The patent offices of all developed countries grant patent rights over DNA sequences, the use of those sequences and methods of making or isolating those sequences. These patents apply to the use, making or selling of these sequences (or methods) in the particular country in question. (For example, a Canadian patent applies to activity in Canada while a US patent applies to the use or sale of the sequence in the United States). While patent rights do not cover DNA sequences as they exist in nature (e.g., in a person's body), they do apply to the sequences in isolated or modified form.

While the issue of granting patents over DNA sequences has been settled by patent offices, controversy still continues over the wisdom of this and of its implications. There is opposition, for example, to the very notion of patenting life or a component of the human body. In addition, there is substantial concern over the implications for health care and agriculture of permitting these patents.

CBAC has, at least since the beginning of its project on the Patenting of Higher Life Forms, been interested in the legal and ethical dimensions of the patenting of human and animal DNA sequences. While CBAC has only briefly addressed DNA seque nce patents in its reports to date, developments in this area have been closely followed. In 2002, for example, it commissioned a report outlining current developments regarding DNA sequence patents. That report discussed concerns and reactions to DNA sequence patents in Europe, the United States and Canada and also as surveyed conventions and international reports related to these patents. This report represents a follow-up to that report.

Specifically, this report examines developments with respect to the patenting of DNA sequences, since the release of CBAC's November 2001 interim report on the Patenting of Higher Life Forms, particularly on the health care sector. Specifically, it will address the following two topics:

1. The impact of genetic and related patents on
   1. research activity

   2. access to health services (e.g., diagnostic tests); and

2. The impact of the January 2001 United States Patents and Trademark Office (USPTO) utility guidelines on the amount of patenting of genetic innovations, including on Canadian practice.

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Background to this Report

CBAC noted, in Draft Recommendation 10 of its November 2001 interim report on the Patenting of Higher Life Forms (the “Interim Report”), “that a systematic program of research [should] be undertaken on the impact of biotechnology patents on health services.”¹ This recommendation was not retained in its final report on this issue because the provinces and the federal government had by then started a process to address these issues. The final report on the Patenting of Higher Life Forms (the “Final Report”), released in June 2002, stated:

We believe Ontario's suggestion that the provinces and the federal government work together to identify and then respond to negative effects of the patenting sys tem on the public health care system is the appropriate mechanism to address such issues. As noted in the Interim Report, while these issues are very important, they are not central to our particular project on biotechnological intellectual property (p. 20).

The Final Report also noted, in Recommendation 7, that “the federal government, in consultation with other levels of government and other stakeholders, develop policies and practices that encourage the sharing of the benefits of research involving ge netic material.”²

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The Impact of Genetic and Related Patents

Since the release of the Final Report, there have been developments on several fronts with respect to DNA sequence patents. First, several organizations have released reports touching on the issue of DNA sequence patents. These include the Nuffield Council on Bioethics' report entitled “The ethics of patenting DNA: a discussion paper,” ³ the report of the United Kingdom's Commission on Intellectual Property Rights entitled “Integrating Intellectual Property Rights and Development Policy” ⁴ and the OECD's report entitled “Genetic Inventions, Intellectual Property Rights and Licensing Practices: Evidence and Policies.”⁵ Second, some governments and international governmental organizations are currently investigating various aspects of DNA sequence patents and, in particular, their impact on health care systems. Third, various national and provincial governments have been discussing DNA sequence patenting, particularly with respect to healthcare.

The Reports

Two of the three reports cited above deal specifically with the issue of DNA sequence patenting, while the third, that of the Commission on Intellectual Property Rights, deals with DNA sequence patents as part of an overall review of the intellectual property concerns affecting the developing world. In this section, I summarize the conclusions of each of the three reports.

Nuffield Council Report

The Nuffield Council on Bioethics released its report on the ethics of DNA sequence patents in July 2003, one month following the release of CBAC's Final Report. The report was prepared over a two-year period in conjunction with meetings of experts. The aim of the report was as follows:

• to examine ethical and legal issues within the current regulatory framework;

• to provide an ethical framework and policy recommendations to assist policy-makers and others, particularly the courts, patent lawyers and patent offices (p. 6).

The report identified the following three ethical arguments raised in relation to DNA sequence patents:

1. patents that assert rights over DNA sequences, in particular human DNA sequences, should not be allowed by virtue of the special status or nature of DNA;
2. patents that assert rights over DNA sequences should not be allowed because they do not meet the legal criteria for patenting;

3. patents that assert rights over DNA sequences should not be allowed by virtue of the possible deleterious consequences for healthcare and research related to healthcare (p. 21).

Based on these concerns, the analysis in the report can be summarized as follows:

• The patent system is, in general and given existing knowledge, defensible.
• Many of the patent rights currently granted over DNA sequences are of doubtful validity due to the inadequa te application of patent criteria to them.
• As technology improves, there will be ever fewer patents granted over DNA sequences.
• The criterion of inventiveness (non-obviousness in Canada) should be stringently applied in the area of genetic diagnostic tests so as to reduce the number of product patents granted over DNA sequences; these should be increasingly replaced by use patents that are limited to a particular way of using the sequences.
• Compulsory licensing may be required in respect of diagnostic tests where existing patents make access difficult or costly.
• The criterion of utility should be stringently applied in the area of DNA sequencebased research tools so as to limit the number of patents granted.
• The research exemption ought to be clarified (a conclusion similar to CBAC's Recommendation 5 in its final report concerning the need for a statutorily-defined experimental use exemption).
• As the use of a DNA sequence to replace a mutated gene is obvious once the gene is identified, patenting should be limited to gene delivery mechanisms and not to the genes themselves).

• Patent claims over DNA sequences used to make therapeutic proteins should be narrowly defined and be limited to the protein itself.

Commission on Intellectual Property Rights

The Commission on Intellectual Property Rights in the United Kingdom issued its report on intellectual property rights and developing nations in September 2002. The Commission was comprised of experts on intellectual property rights and ethics. The report dealt with several issues including health, agricultural and genetic resources, traditional knowledge and geographical indications, software and the Internet, patent reform, institutional capacity and international architecture.

In the report, the Commission asked itself how intellectual property rights could be made to play a role in “reducing poverty, helping to combat disease, improving the health of mothers and children, enhancing access to education and contributing to sustainable development” (p. 1). The Commission concluded that, while issues relating to intellectual property were important for the developed world, the cost of responding incorrectly was even greater in the developing world. The Commission thus turned to policy and empirical data, where the latter existed, to formulate recommendations aimed at assisting the developing world in health and other fields.

While the Commission accepted the general benefits provided by intellectual property rights, at least for developed nations, the Commission concluded that patent rights ought to be granted with care. Like the Nuffield Council, the Commission argued that patent criteria ought to be subject to strict standards and that patent scope ought to be limited. It also stated that competition needed to be encouraged and that safeguards needed to be implemented to ensure that patent rights are not inappropriately exploited.

In terms of DNA sequence patents, the Commission recommended as follows:

If developing countries allow patents over genes as such, regulations or guidelines should provide that claims be limited to the uses effectively disclosed in the patent specification, so as to encourage further research and commercial application of any new uses of the gene (p. 118).

This recommendation is similar in nature to that of the Nuffield Council report. It also supports the general approach to guidelines suggested by CBAC in Recommendation 10 of its final report.⁶

The OECD Report

Based on a meeting of experts held in Berlin in January 2002 under the sponsorship of the German government, the OECD issued a report on DNA sequence patenting in December 2002. The report both provides a background on the application of patent law to DNA sequences and provides a summary of what participants at the meeting said. Based on this, the report concluded that there was no serious question about whether DNA sequences are patentable and that there is no evidence as of yet indicating that the patent system as a whole is breaking down. The report also noted that the fact that there is no systemic breakdown does not mean, however, that the patent system may not be retarding research and development. This may be particularly true in the area of diagnostic genetic tests, although more evidence is required. The report warned, however, that as licensing practices evolve, policy-makers must be careful to understand the role that licensing plays on access to genetic technology. Finally, as did CBAC in its Draft Recommendation 10 in its interim report, the OECD report concludes that more research is required to better understand the effect of patenting and licensing of genetic technology.

The OECD report noted some challenges that needed to be addressed with respect to DNA sequence patents, including:

• the gap in perception between the “experts” and the public. The report noted in particular that: “It is critical to engage public opinion in order to tease out underlying concerns about gene patenting and to address those concerns, if public trust in the patent system and its application to biotechnology is to be rebuilt” (p. 78).
• the increased risk, with the increasing number of gene patents granted, of patent thickets (the existence of many patents covering the same area of research or development) and royalty stacking (the need to purchase licences from and pay royalties to many different patent holders to commercialize an invention).
• the scope of patent claims granted over DNA sequences, although opinions differed on this.
• the role and nature of research exemptions.

• the need for licensing guidelines to assist the private and public sectors in avoiding patent thickets and royalty stacking.

It is interesting to note that the OECD report took for granted the existence of certain protective aspects of patent law that, as the CBAC final report Patenting of Higher Life Forms, pointed out, do not exist in a sufficiently developed form in Canada. For example, the OECD report highlighted the role of an opposition process (called for in Recommendation 13 of CBAC's Final Report) and of compulsory licences (in cases of a danger to health) that are less developed in Canada than in many other countries.

Conclusion Regarding the Reports

Although written from different perspectives, the three reports are consistent in highlighting three needs related to genetic patents:

1. the need to ensure that the scope of patent rights granted over DNA sequences is sufficiently narrow as to permit both research and clinical access.

2. the need to develop methods of ensuring equitable access to new technologies, whether as between two private sector enterprises, the private sector and the public sector or between developed and developing nations.

3. the need to implement clear research exemptions, licensing guidelines and clear and harmonized standards for applying the patentability criteria of novelty, inventive step (non-obviousness) and industrial application (utility).

There are clear echoes of the recommendations of the final CBAC report in these conclusions, although suggestions differ in their particularities.

Governmental Research Projects

The Australian government has taken the lead in investigating the links between DNA sequence patents and the health care system. At the request of the government, the Australian Law Commission is investigating “the impact of current patenting laws and practices - including licensing - related to genes and genetic and related technologies” on research, the biotechnology industry and “the cost-effective provision of healthcare in Australia.”⁷ The Commission is to report back to the government by June 2004.

The Canadian Department of Justice commissioned a study on gene information, gene patents and human rights from Richard Gold and Timothy Caulfield. The study examines the human rights aspects of genetic information, including how the granting of patent rights may affect the attainment of international human rights. The authors concluded:

A human rights approach to considering the many economic, social and ethical concerns relating to human genetics innova tion does not automatically and inevitably lead to public policy formation. It does, however, provide a common framework within which to assess and balance these various concerns…

Through our analysis, we have seen that, while the patent system may encourage innovation, it must be carefully circumscribed so as to both permit second generation research and ensure that patients have access to personal health information coded in their own DNA. We have also noted that primary reliance on the patent system as the engine to encourage innovation – especially with respect to developing world health needs – is inconsistent with human rights requirements. While, given the current state of empirical knowledge, it would be unreasonable to abandon patent systems in the genetics field, it is nevertheless clear that states must use public funds to encourage innovation aimed at solving the health problems of the bulk of the world. This failure both tarnishes the patent system (wrongly, in our opinion) and governments of the developed world (correctly).

The OECD has commenced a project to draft licensing guidelines in respect of the licensing of DNA sequence and related technology between the private and public sectors.⁸ This project was approved by the Steering Group in charge of the project in May 2003 and is to provide a final version of the guidelines by the spring of 2004.

Government Discussions

As discussed in CBAC's Final Report, the European Community attempted to deal with the issue of biotechnology patenting through its Directive on the legal protection of biotechnological innovations. The Directive was to be implemented in all 15-member countries of the Community by July 2000. Despite the passage of that deadline, many countries, including France and Germany, have yet to amend their national legislation in compliance with the Directive. Germany is now said, however, to be contemplating transposing the Directive without substantial change, but legislation has yet to be introduced. In France, the Directive has encountered more difficulty with the appointment of Jean-François Mattei as the Minister of Health. Mattei has long been opposed to the Directive, particularly its provisions requiring that patents be granted over human DNA sequences. Thus, any transposition of the Directive into French law is on hold.

As noted in the Final Report, Ontario proposed that the provincial and federal governments meet to discuss certain health policy concerns that arise from the granting of human DNA sequence patents. CBAC was supportive of this suggestion in its Final Report when it stated the following:

We believe Ontario's suggestion that the provinces and the federal government work together to identify and then respond to negative effects of the patenting system on the public health care system is the appropriate mechanism to address such issues (p. 20).

Since Ontario made its proposal, federal and provincial health officials have met on a couple of occasions to discuss their concerns. These officials have largely agreed that further study is required but that, in the meantime, governments ought to explore the policy options available to them, including legislation aimed at amending the Patent Act to ensure access to diagnostic genetic tests. Despite this agreement, there is still considerable resistance to amending the Patent Act, particularly within certain branches of Industry Canada, without overwhelming evidence that this would be the only solution to address the health care system's concerns. Ontario and the other provinces continue to press their concerns nevertheless.

Analysis

There is currently very little empirical work on the links between DNA sequence patents and research and access to health services. Two studies, conducted by the research group headed by Jon Merz and Mildred Cho, have indicated that DNA sequence patents both lessen research into the development of new genetic tests and limit access to those tests.⁹ Anecdotal evidence from researchers suggests, for example, that researchers are unwilling to disclose new mutations in patented DNA sequences for fear that such disclosure may expose them to patent infringement suits.

Both the Nuffield Council study as well as that of the OECD took seriously concerns over possible negative effects of DNA sequence patents on clinical research efforts. The OECD study in particular noted that there was a need for further research in this area. This echoes the CBAC conclusion reached in its Draft Recommendation 10 from its interim report. The OECD project on drafting licensing guidelines as well as recommendations concerning the research exemption (similar to CBAC Recommendation 5) may provide a route forward.

The work to be conducted by the Australian Law Commission promises to provide both empirical evidence and policy recommendations concerning the link between DNA sequence patents and health.

On the academic front, Gold et al. have called for the creation of 'transdisciplinary' methods to approach the issue of biotechnology patents in general and DNA sequence patents in particular.¹⁰ Such an approach would bring together experts from various disciplines including law, economics, ethics, philosophy, management and political science with representatives from government, industry and civil society to investigate the role of biotechnology patents nationally and internationally.

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Impact of January 2001 USPTO Utility Guidelines

The Guidelines

In January 2001, the United States Patent and Trademarks Office (USPTO) released new guidelines specifically addressing the application of the utility criterion to DNA sequence patents (the “Utility Guidelines”).¹¹ At the same time, it issued new written description guidelines (the “Description Guidelines”) in respect of the same patent claims. ¹²

The Utility Guidelines expressed the view of the USPTO on how the utility criterion in US patent law ought to be interpreted and applied to DNA sequence patents. The Utility Guidelines are not legally binding, since the courts have the final say on the interpretation of patent law, including over the meaning of the utility criterion. Nevertheless, the Utility Guidelines provide a clear message to inventors on the way the USPTO will interpret the US Patent Act. Based on case-law, the USPTO stated that any invention, including one involving a DNA sequence, must have a credible, specific and substantial utility. As these matters are discussed in the CBAC Final Report (p. 12), there is no need to provide a long explanation here. What is important to know, however, is patents are only awarded where the patent application discloses a clearly identifiable, non-trivial function and that, based on existing knowledge in the field, it is reasonable to believe (is credible) that the invention works in the way discussed in the application. Given that computer modeling of the function of DNA sequences is not yet considered reliable in the field, claims concerning the function of such sequences based only on computer models are not currently accepted. In addition, the Utility Guidelines require that the application disclose a clear function of the gene; merely stating that it is interesting is not sufficient.

The Description Guidelines represented a stricter interpretation of the description requirement in US patent law. As these Guidelines were not described in the CBAC Final Report, the following is a synopsis of the principal points. Essentially, the Description Guidelines require applicants to demonstrate that they are fully 'in possession' of the claimed invention. An inventor has 'possession' of an invention when he or she can show with some particularity each aspect of the invention and the limitations on the invention. In the words of the Description Guidelines:

An applicant shows possession of the claimed invention by describing the claimed invention with all of its limitations using such descriptive means as words, structures, figures, diagrams, and formulas that fully set forth the claimed invention.

The Description Guidelines set out several ways for an applicant to demonstrate possession of the invention. They suggest that patent examiners go through the following process to assess possession (which I paraphrase except the portions in quotations):

1. Determine whether the invention has been “reduced to practice” through either the construction of the invention or the deposit of the (biological) invention at an authorized site.
2. If not, has the inventor reduced the invention to drawings or structural chemical formulae?
3. If not, has the inventor given a sufficient description of the invention to demonstrate possession? This involves two sub-tests as follows:
   1. Does the application describe the complete structure of the invention?

   2. If not, does the applicant describe the identifying characteristics of the invention in sufficient detail? Disclosure “of only a method of making the invention and the function may not be sufficient to support a product claim other than a product-by-process claim” (p. 1106).

The Description Guidelines also provide that an applicant can claim a “genus” of invention by providing the above type of description with respect to a “representative number of species” of that genus. The important term is “representative number,” which the Description Guidelines define as follows:

A "representative number of species" means that the species which are adequately described are representative of the entire genus. Thus, when there is substantial variation within the genus, one must describe a sufficient variety of species to reflect the variation within the genus. On the other hand, there may be situations where one species adequately supports a genus. What constitutes a "representative number" is an inverse function of the skill and knowledge in the art (p. 1106).

One of the implications of the Description Guidelines may be that it will be harder for applicants to claim more than the particular DNA sequences they fully set out in their applicants. That is, they may not be able to claim mutations to those sequences unless they can also demonstrate that they know whether the mutations included have the same identifying characteristics as the sequence the applicants have fully disclosed.

Effect of Guidelines in the United States

There is some controversy over whether the Utility Guidelines actually represented a change of practice at the USPTO. Some claim, anecdotally, that the Utility Guidelines merely confirmed USPTO practice. Be this as it may, most would agree that the Utility Guidelines represent a more strict interpretation of the utility criterion than was used by the USPTO in the early 1990s. Whether the USPTO had developed a stricter interpretation of the criterion prior to the actual issuance of the Utility Guidelines (in either draft or final form) does not undermine the fact that, at some point during the late 1990s, the strictness of the interpretation given to the criterion intensified.

There is no good statistical evidence in existence that demonstrates the effect of the Utility Guidelines and Description Guidelines on DNA sequence patentin g in the United States. A study conducted by Robert Cook-Deegan's group (now at Duke University) based on the DNA Patent Database created by LeRoy Walters indicates that, as of December 2001, the total number of DNA-based patents in the United States is steadily rising. Nevertheless, the statistics indicate a slight drop in the number of patents granted in 2000, perhaps due to uncertainty over the Utility Guidelines and Description Guidelines that were then being formulated. Patenting activity resumed its steady upward movement in 2001.

Although there is no statistical evidence regarding the effect of the Utility Guidelines and Description Guidelines, there is anecdotal evidence from the patent community that DNA patents are harder to obtain and narrower in scope than had been true previously. This is due more to the Description Guideline requirements that have been used to limit claims over DNA sequences to the exact sequence listed than to the Utility Guidelines. It may also be due to the progress of scientific expertise that makes the identification of DNA sequences more obvious. However, in light of US jurisprudence on this matter,¹³ obviousness may not present much of an impediment in the United States.

Effect of Guidelines Outside the US

The statutory and jurisprudential bases for the industrial application (or utility) criterion in Europe and in Canada are much less developed than in the United States. While, again anecdotally, both the European Patent Office (documented in the Nuffield Council report) and the Canadian Intellectual Property Office (CIPO) seem to take the position that they apply the same standard of utility as is set out in the Utility Guidelines, this is hard to demonstrate as neither patent office provides an authoritative statement to this effect (see CBAC Recommendation 10 from its final report on Patenting of Higher Life Forms). One reason for this is that, unlike in the United States where there exists a firm jurisprudential basis for the utility criterion, the lack of jurisprudence, particularly in Canada, may discourage CIPO from taking a clear position, since this may open its decisions to appeal.

The legal basis for the description requirement in the United States is different from that in other jurisdictions, given that the US also has a related enablement requirement. This makes any generalizations from US practice more difficult.

Despite any changes (or lack thereof) in Canada or in Europe due to the Utility Guidelines and Description Guidelines, it is important to note that, if Canadian inventors want to be sure of having access to the world's most important market, the United States, they will likely seek US patents. Thus, whether or not the CIPO follows US practice in issuing Canadian patents, Canadian inventors and companies will have to follow the US guidelines to effectively protect the value of their inventions.

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Conclusions

Questions concerning the patenting of DNA sequences have become more sophisticated in the last couple of years. Policy makers now seem to have agreed with the academic community¹⁴ that DNA sequences can be patented. Attention has now been turned to the way in which patent-holders are using their patents and, in particular, how easy or difficult it is to obtain licences from them at reasonable prices. All of the studies released over the past year follow this approach, although they differ in the extent to which they perceive that the patent system has a negative effect on research and health care.

One overall conclusion can be reached. All those who have examined the issue of links between DNA sequence patents and the health care system agree in general that some adjustments, perhaps through the issuing of non-binding guidelines, through statutory reform or a combination of the two, may be required.

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Appendix A
CBAC Interim Report

Draft Recommendation: Research on Impact of Biotechnology on Health Care

10. CBAC recommends that a systematic program of research be undertaken on the impact of biotechnology patents on health services, including on:

    • the incentive or disincentive effects of patents on biotechnological inventions on the conduct of basic and applied research on preventive, diagnostic, therapeutic, epidemiological and service delivery aspects of health care.

    • the effect of patents on the incentives and ability of patent holders or companies to commercialize their inventions, thus making them available to the health care system.

    • the effect of patenting of biological inventions on the net cost of health care, including comparative risk-benefit analyses of biotechnological and alternative methods.

    • the effect of patenting of biological inventions on factors, other than cost, affecting accessibility to important preventive, diagnostic and therapeutic innovations.

    • methods to address concerns about the impact of the cost of new inventions for the health care system (for example, licences, mandatory access, large buyer groups, assessments of medical/health value to support provincial formularies or analogous systems used for other kinds of medical technology).

    • the effect of Canada's international obligations on the various options for addressing the impact of biotechnological patents on the health care system.

    • whether there are features of biotechnological or biological patents that suggest they should be treated differently from other patented inventions used in health care.

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Appendix B
CBAC Final Report

Human Beings Not Patentable

1. We recommend that the Patent Act be amended to include the following statement: No patent shall be granted on human bodies at any stage of development.

Patentability of Higher Life Forms

2. We recommend that higher life forms (i.e., plants, seeds and non-human animals) that meet the criteria of novelty, non-obviousness and utility be recognized as patentable. The scope of the patent rights in respect of these higher life forms is to be determined in accordance with Recommendations 3, 4 and 5.

Farmers' Privilege

3. We recommend that a farmers' privilege provision be included in the Patent Act. It should specify that farmers are permitted to save and sow seeds from patented plants or to breed patented animals, as long as these progeny are not sold as commercial propagating material or in a manner that undermines the commercial value to its creator of a genetically engineered animal, respectively. The drafting of this provision must be sensitive to the differences that exist both in the nature and use of plants and non-human animals.

Innocent Bystanders

4. We recommend that the Patent Act include provisions that protect innocent bystanders from claims of patent infringement with respect to adventitious spreading of patented seed or patented genetic material, or the insemination of an animal by a patented animal.

Research and Experimental Use

5. We recommend that the Patent Act be amended to include a research and experimental use exception that includes the following statement:

   It is not an infringement of a patent to use a patented process or product either:

   1. privately and for non-commercial purposes, or

   2. to study the subject-matter of the patented invention to investigate its properties, improve upon it, or create a new product or process.

Liability for Damages

6. We recommend that Canada actively participate in international negotiations to address issues of liability and redress for adventitious spreading of patented seed, genetic material, or the insemination of an animal by a patented animal.

Access to Genetic Resources and Benefit-Sharing

7. We recommend that the federal government, in consultation with other levels of government and other stakeholders, develop policies and practices that encourage the sharing of the benefits of research involving genetic material. In particular, we recommend that:

   1. the benefits of medical and pharmaceutical research based on human genetic material (including its commercial exploitation) be shared with the groups or communities who provided the material. All bodies (public, private, and corporate) involved in funding research and/or establishing guidelines or codes of conduct for the ethical conduct of research should ensure that benefit-sharing is addressed. Health Canada should lead an initiative to engage all stakeholders in developing best practices in regard to benefitsharing for research involving human subjects.

   2. with respect to research based on plant and animal genetic material, Canada :
      • continue to participate in the ongoing processes of the Convention on Biological Diversity to address outstanding issues with respect to the voluntary Bonn Guidelines on Access to Genetic Resources and Fair and Equitable Sharing of the Benefits Arising out of their Utilization (such as user country obligations and consideration by the Working Group on Article 8(j) of the Guidelines by Indigenous and Local Communities);
      • encourage and facilitate compliance with the Bonn Guidelines within Canada as well as internationally;
      • sign and ratify as soon as possible the International Treaty on Plant Genetic Resources for Food and Agriculture, participate in the development of the standard material transfer agreement, including provisions requiring benefit-sharing, and encourage and facilitate their use within Canada; and

      • generally encourage and facilitate benefit-sharing arrangements between the users of genetic resources and traditional and local communities within Canada.

Traditional Knowledge and Intellectual Property

8. We recommend that Canada support the efforts being undertaken in the World Intellectual Property Organization working group on Genetic Resources, Traditional Knowledge and Folklore to determine whether a form of intellectual property could be developed with respect to traditional knowledge.

9. We recommend that the Canadian Intellectual Property Office provide guidance to patent examiners on assessing as “prior art” traditional knowledge that has been made public through oral as well as written or published transmission.

Guidelines for Biotechnological Patents and Processes

10. We recommend that the Canadian Intellectual Property Office develop and publish interpretative guidelines concerning biological inventions. The guidelines should be updated on a regular basis and should provide direction to applicants and examiners, notably on:
    1. the interpretation of the criteria for issuing a patent (i.e., novelty, non-obviousness, utility and breadth of claims) as they relate to biological inventions, and
    2. the process to be followed by patent applicants and the benchmark time frames for each step, to the extent (if any) that these may differ from other patent applications.

Service Standards and Performance Reporting

11. We recommend that the Canadian Intellectual Property Office :
    1. regularly update its service standards, based on best international practice, for processing patent applications, and
    2. report regularly on its performance with respect to those standards and the steps being taken (such as increasing capacity and/or expertise) to meet them.

International Harmonization

12. We recommend that Canada pursue further harmonization of patent policies and procedures at the international level by:
    1. continuing to participate in international initiatives to harmonize patent law policy, such as reform of the Patent Cooperation Treaty, the work of the Substantive Patent Law Committee, and work under the Agenda for Development of the International Patent System (the Patent Law Agenda), and
    2. ratifying, as soon as possible, the Patent Law Treaty, which addresses the formal requirements for filing patent applications and maintaining patents.

Opposition Procedure

13. We recommend that the government introduce an opposition procedure into the Patent Act to permit a patent to be opposed on the grounds that it is invalid or void. As it is essential that this process be faster, less cumbersome and less expensive than the procedures currently available, we recommend that the time limit for filing oppositions be six months from the date the patent was granted and that procedures be established and resources provided to ensure that proceedings are concluded within 18 months from the date the patent was granted.

¹ See Appendix A for the text of this recommendation.
² See Appendix B for the text of the Final Report's recommendations.
³ Available on-line (accessed 28 May 2003).
⁴ Available on-line (accessed 28 May 2003).
⁵ Available on-line (accessed 28 May 2003).
⁶ It should further be noted that the Commission agreed with CBAC's Recommendation 3 that a farmers' privilege ought to be incorporated within patent law (p. 66). The Commission also agreed with the principles behind CBAC's Recommendation 7 relating to benefit sharing (p. 69,).
⁷ Terms of Reference: Intellectual Property Rights Over Genetic Materials and Genetic Related Technologies, available on-line (accessed 16 February 2003).
⁸ Information about this can be found on-line (accessed 29 May 2003). The report of the January 2002 workshop, Genetic Inventions, Intellectual Property and Licensing Practices: Evidence and Policies can be downloaded from this page.
⁹ M.K. Cho, S. Illangaskekare, M.A. Weaver, D.G.B. Leonard & J.F. Merz, “Effects of Patents and Licenses on the Provision of Clinical Genetic Testing Services” (2003) 5 Journal of Molecular Diagnostics 3; J.F. Merz, A.G. Kriss, D.G.B. Leonard & M.K. Cho, “Diagnostic testing fails the test: The pitfalls of patents are illustrated by the case of haemochromatosis” (2002) 415 Nature 577.
¹⁰ E.R. Gold, D. Castle, L.M. Cloutier, A.S. Daar & P.J. Smith, “Needed: Models of Biotechnology Intellectual Property” (2002) 20 Trends in Biotechnology 327.
¹¹ United States of America, “Patent Office's Utility Examination Guidelines” (2001) 66 Fed. Reg. 1097.
¹² United States of America, “ Guidelines for Examination of Patent Applications Under the 35 U.S.C. 112, ¶ 1, 'Written Description' Requirement'” (2001) 66 Fed. Reg. 1099.
¹³ In re Deuel, 51 F.3d 1552 (Fed. Cir. 1995).
¹⁴ See, T. Caulfield, E.R. Gold & M. Cho, “Patenting Human Genetic Material: Refocusing the Debate” (2002), 1 Nature Reviews Genetics 227.