Transcript Presentation - Consumer Project on Technology

The “Anticommons” Effect: What is the
Evidence?
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•
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Definitions: commons/anticommons
Examples
Evidence?
Responses of stakeholders to Real or
Perceived Anticommons Effect
• Summary
Take Home Messages
• There are many examples freedom to
operate/access issues that lead to
underutilization of biotech IP resources
• Little evidence to date that this effect has
actually stopped new R&D
• Stakeholders have evolved different kinds
of transactions to deal with the issue
• New and creative solutions are needed to
reduce IPR transaction costs under
“anticommons” conditions.
Definitions
“Tragedy of the commons”
- Hardin: Science, 162:1243 (1968)
- Too many owners of a common resource, each
having the right to use … leads to overuse
The “anticommons”
- Heller & Eisenberg: Science, 280: 698 (l998)
- Multiple owners, each having the right to
exclude others from a resource, leads to
underuse since no one person can use the whole
Genomics R&D Expenditures ($)
(JIEE: Bjornstad & Dummer http://www.jiee.org/pdf/2002_05_patent.pdf)
Year
Celera, HGS,
Incyte,
Millenium
U.S.
Government
1994
49,457,000
190,300,000
1996
116,139,000
243,200,000
1998
268,667,000
303,800,000
2000
720,583,000
360,600,000
“Cost of doing business” disrupts
efficient patent practices
- ‘Upstream’ IP owners can be public
entities with limited IP licensing resources
- Many IP stakeholders drives up the cost
of establishing value for the IP
- Incompatible ownerships require
individual negotiations
- R&D costs increase and incentives
decrease if licensing is required before
research undertaken
The “Anticommons”:
Sources of under-utilization (I)
• Multiple/conflicting IP ownership
leads to multiple access
requirements
– Ag biotechnology (vitamin A Golden rice)
– Assays/diagnostics (TB, malaria)
– Fixed dose combinations (ARVs)
• Between zero and 44 patents apply.
• USA and most EU countries: (40)
• In the 10 top rice producing countries:
China (11); India (5), Indonesia (6),
Bangladesh (0), Vietnam (9), Thailand (0),
Myanmar (0), Japan (21), the Philippines
(1) and Brazil (10).
• In the top ten rice importing countries:
Iran (0), Brazil (10), Nigeria (0), Philippines
(1), Iraq (0), Saudi Arabia (0), Malaysia (0),
South Africa (5), and Côte d'Ivoire (10).
•
ISAAA Briefs: 20 – 2000: Kryder, Kowalski, Krattiger
Patents with "Tuberculosis" in claims
80
70
60
Number of Issued Patents
Vaccines and Antigens
Assays
50
rDNA compositions
Chemical Therapeutics
40
Other
30
20
10
0
1993-1997
1998-2002
2003-2007
2008-2012
post-2013
"Plasmodium"/"Malaria" Patents
160
140
Therapeutic Compounds
120
Vaccines
Number of Patents
Assays
100
rDNA Compositions
80
60
40
20
0
before
1993
19931997
19972002
20032007
20082012
after
2013
Fixed Dose Combination Drugs
• Components of FDCs may be patented
separately and owned by different parties
• All components may be owned by the same
party
– Requiring a license to even one component of
an FDC is enough to block access to the whole
Source: UNAIDS (2000)
Attaran (JAMA: 2001)
TRIZIVIR ®
TRIMUNE
lamivudine +
zidovudine +
abacavir
stavudine +
lamivudine
+ nevirapine
Adults and
children
Botswana
+
+ (n,l)
330,000
Zimbabwe
+
+( n,l)
2,300,000
Swaziland
+
+ (n,l)
170,000
Lesotho
+
+ (n,l)
360,000
Zambia
+
+ (n,l)
1,200,000
South Africa **
+
Aspen license?**
5,000,000
(Source UNAIDS 200;
Attaran, (JAMA: 2001)
TRIZIVIR ®
TRIMUNE
lamivudine + Stavudine +
zidovudine + lamivudine
abacavir
+ nevirapine
+ (n,l)
HIV + Adults
and children
Cote d'Ivoire
+ ( l)
770,000
Rwanda
+ (combivir )
500,000
Burundi
+ ( z)
390,000
United Rep. of
Tanzania
+
+(n, l)
1,500,000
Congo
+ (l)
+ (n, l)
110,000
Sierra Leone
+ (a)
170,000
The “Anticommons”:
Sources of under-utilization (II)
• Presence of broad, “dominating” IP
– MIT/Harvard/Ariad: modulating NFkappa B transcription factor activity
– Housey patent: drug screening
technology- “reach through” to
screened drug?
MIT/Harvard 6,410,516 (June 2002)
• Transcription factor NF-kB is present in many, if
not all, cell types
• Acts as an intracellular messenger capable of
playing a broad role in gene regulation
1. A method for inhibiting expression, in a
eukaryotic cell, of a gene whose
transcription is regulated by NF-kappa B, the
method comprising reducing NF-kappa B activity
in the cell such that expression of said gene is
inhibited.
Housey Patent: 5,688,655 (exp. 2017)
• A screening method to determine if substance X
modulates the activity of any protein:
• provide cell which overproduces the protein
relative to a control cell
• make sure the protein is “readable” in some
type of assay
• treat the test cell containing the overproduced
selected protein with substance X, and
• check the test cell to determine whether it exhibits
a change in the assay in response to substance
X.
CAIP Patent: 6,423,824 (exp. 2016)
• A purified preparation of a polypetide, the
sequence of which comprises the sequence of a
CD2 associated intracellular polypeptide (CAIP),
wherein said polypeptide (i) has at least 80%
sequence identity with at least 20 contiguous
residues of the amino acid sequence of SEQ ID
NO: 2; (ii) is at least 20 amino acids in length; and
(iii) is capable of binding to the intracellular
domain of CD2.
What’s the Evidence that the “Anticommons”
Problem is Real
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Historical Precedent: Airplane patents
Anecdotal
Theoretical models
Empirical Studies
– Walsh et al. (interviews w/pharma, academe, biotech)
– Herz et al. (clinical researchers using patented tests)
• Behavior/perception by relevant stakeholders
– Consistent with a perception of a real anticommons
effect
• Walsh: Is the “anticommons” severe enough so that
R&D/commercial progress is literally stopped?
PROBABLY NOT
– Vast majority of respondents (over 90%) say: “Never happens”
• Walsh: Does the “anticommons” encourage sufficient
IPR access “costs” such that R&D/commercial progress
is slowed down? YES
– Increased IP due diligence
– Litigation costs
– Increased transactional costs for licensing
Responses of Stakeholders
• Put the ‘invention’ into the public domain
The genomes of major parasites are being sequenced and
the data released into the public domain.
Blackwell and Melville, Parasitology 1999; 118 (Suppl): S11-4.
Degrave et al. Int J Parasitol, 2001; 31 (5-6): 532-6. (trypanosomes)
http:// www.tigr.org/tdb/parasites/
http://www.sanger.ac.uk/Projects/Protozoa/
Gardner, M.J., et al. 2002. Nature 419(Oct. 3):498. (Plasmodium)
Hall, N., et al. 2002. Nature 419(Oct. 3):527-531. (Plasmodium)
Genome Web Sites
Sanger Center: http://www.sanger.ac.uk/
TIGR Center: http://www.tigr.org/
Washington University, St. Louis:
http://genome.wustl.edu/est/leishmania_esthmpg.html
Leishmania Genome Network: http://www.ebi.ac.uk/parasites/leish.html
Monsanto rice genome: http://www.rice-research.org
Responses of Stakeholders
• Rely on existing IP law and courts:
– Housey: written description/enablement of
downstream products
• “Design around”
– Do users (NGOs, developing countries) have
the means?
• Make patents harder to get
– “utility requirements”
• Kaplan and Krimsky (J. Biolaw & Busines, Supp. 2001)
4500
4000
435 (chemistry, molecular biology)
524(therapeutic drugs)
536 (organic compounds including DNA, RNA)
3500
3000
2500
ISSUED PATENTS
2000
1500
1000
500
0
1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Responses of Stakeholders
• Ignore IP entirely
– Universities (research exemption?) or
those very sure of victory in lawsuit
– For those not so sure:
• Wait until research is further along, then
license
• Make sure you don’t divulge your methods
to IP owner…ever
Responses of Stakeholders (II)
• Create a common cause
– Cre-lox Dupont/NIH
• Infringement exceptions
– Bolar safe harbor
– Research exemption: “Universities are special”
– Compulsory licenses
• Manage risk by licensing
– Cross licensing
– “set off” language
Third Party Patent Offsets (“Anti-stacking”
language)
• For licensees’ benefit:
– “ If I need any patent from a third party that is
not part of this license package, I will pay the
‘rent’ but decrease my rent to you (licensor) by:
• “Fully creditable”
• Same as above but no more than X % as a floor
• Some fixed % (Y) regardless of how much the third
parties get
New directions?
– Carve out infringement/licensing exceptions for
those who may not have the IP expertise to
perform FTO “due diligence”: an IP “means”
test
– Create a dedicated group of IP specialists who
provide advice on FTO issues to NGOs,
developing countries
• CAMBIA (ag biotech) : non-exclusive, fees
determined by ability to pay.
– http://www.cambia.org.au/main
– Contractually or legislatively require non-exclusive
licenses for critically needed IP
• Golden rice: non-exclusive licenses to developing
world/NGOs
– Create voluntary or compulsory patent pools
– Move offshore so the products are made where they
are not patented
• Bayer v. Housey (selling a drug identified by screening
method is NOT the same as infringement of a
manufacturing process)
• LEGAL RESPONSE: include “manufacturing steps” in
screening patents to create a starting material?
– Create an IP clearinghouse to reduce costs of
transacting for IP rights, stimulate private sector
incentives, education in practical policy/legal IP
issues, conduct objective “due diligence”, coordinate
IP policies
• February 2001: “IP Clearinghouse Mechanisms for
Agriculture”
• http://www.farmfoundation.org/pubs2/berkeleyagbioworksh
op.pdf
SUMMARY
• “Anticommons” is a problem of ACCESS
• Perceptions of the IPR stakeholders have
lead to the evolution of different kinds of
transactions
• For developing countries, IP- resource poor
inventors, NGOs, end users: creative ways
are needed to reduce IPR transaction costs.