Biotech and the rise of the patent troll

The phrase ‘patent troll’ was first popularised by the information technology industry, when a lawyer for IT company Intel despaired at companies which acquired patents purely with a view to extracting money through dubious infringement claims.

These trolls may now be stalking the biotechnology industry and, according to senior lecturer at the ANU College of Law, Dr Matthew Rimmer, the potential to hinder or retard scientific research and development means fundamental changes are needed to the international patent system.

Rimmer’s new book, Intellectual Property and Biotechnology: Biological Inventions, is a very thorough and wide-ranging look at IP law and how it is struggling to deal with 21st century biological discovery. It is primarily written for patent attorneys, scientists and the biotech industry and presupposes a familiarity with the terminology of both law and biotech, but it also touches on some very important ethical and social issues of far-reaching consequences.

The book charts the beginnings of the law’s brush with biotechnology – the Diamond v Chakrabarty decision by the US Supreme Court in 1980. While Louis Pasteur was granted a patent on yeast by the US Patent and Trademark Office way back in 1873, Rimmer notes that it was long-standing practice of the USPTO to refuse claims to living systems as not being patentable subject matter.

That all changed in 1972 when Dr Ananda Chakrabarty applied for a patent to a new strain of bacteria produced artificially. The 1980 decision by the US Supreme Court – a majority decision of five to four – to deem Chakrabarty’s bacteria a patentable invention thus opened the way for patent applications in living things.

Rimmer then proceeds to detail the history and effect of international patent law with respect to plant breeders’ rights, animals, the human genome, genetic testing and human embryos, with case studies such as Myriad Genetics’ BRCA1 and BRCA2 patent applications. It is a thorough analysis and is extensively footnoted, and while it predominantly takes an objective view, Rimmer does have his recommendations.

He contends that there is a need to reform IP and biotechnology to better accommodate scientific and technological developments, that the boundaries of patentable subject matter need to be better demarcated and delimited, that the thresholds for the criteria of novelty and utility should be raised and that there should be an expansion of the defence of experimental use. He’s also rather keen on doing something serious about patent trolls.

“Some suggest that the patent troll is a mythological creature but the Supreme Court of the US has recognised their existence,” Rimmer says. “Justice Kennedy in the case of eBay v MercExchange said an industry had developed in which firms use patents not as a basis for producing and selling goods but instead for obtaining licensing fees.

“There has been a clear recognition – especially in fields like biotechnology and information technology – about some of the potential abuses involved in the patent system.”

Rimmer says his particular concern is that patent offices and the courts have too little problem-solving capacity and while he does not agree with those who think patents for biological invention should be banned, he does believe that patents should be much harder to obtain and should only be granted to truly innovative research.

“Novelty and utility are the criteria used to judge whether something is inventive or not and it is really those doctrinal concepts that need to be tightened,” he says. “That’s my first suggestion. My second related suggestion is that there should be scope for post-grant review of patent applications.

“At the moment the opposition system is very much before the patent is granted. There is a concern that the validity of patents have not been fully tested because there haven’t been other interested parties involved in assessing the prior art and whether it is art or not. And then it becomes incredibly expensive to contest the patent in court.”

He would also like to see the introduction of a defence of experiment use law in Australia to further research and development. This was suggested to the previous government by the Australian Law Reform Commission and the Australian Centre for Intellectual Property in Agriculture, of which he is a member, but some reason that government decided to sit upon it.

“That’s of relevance both to public researchers and private researchers,” he says. “Australia’s big push to invest public money in a range of frontier technologies in flagship areas of research could be in jeopardy if such basic research was subject to patent infringement claims. For corporations too – if you want to encourage corporations to do research and development in Australia, fear of litigation in relation to such initial research means you need a broader flexibility in terms of experimental use.”

With a foreword by Justice Michael Kirby of the High Court, Rimmer’s new book is a timely and very thought-provoking analysis of patent law and biotechnology and asks a very serious question: can a 19th century patent system adequately deal with a 21st century industry?

Intellectual Property and Biotechnology – Biological Inventions, Edward Elgar Publishing, ISBN: 978-1-84542-947-8