A sledgehammer to crack a nut
Life sciences and biotechnology are delivering treatments for an increasing number of unmet medical needs, while infectious diseases are being eradicated through innovative vaccines. Proper protection of intellectual property is a crucial factor for meeting the needs of our society in the near future.
By announcing her intention to amend Directive 98/44/EC on the legal protection of biotechnological inventions in order to benefit just a few Dutch breeders, the Dutch minister for agriculture, Sharon Dijksma, is directly leaving the 600 innovative biotech companies in the Netherlands out in the cold. Amending the biotech directive will block innovation and diminish the global position of the whole European biotech sector. What is the motivation for the change? To solve an alleged problem that is solely based on fear and fable.
Dutch life sciences sector is booming
Although small in surface area, the Netherlands is a major player in life sciences. The Dutch life sciences sector is home to 1,200 companies, including 600 research and development (R&D) biotech companies. These companies are active in all applications of biotechnology, including health, agrifood and industrial. The industry builds on a solid scientific backbone, consisting of eight university medical centres and as many as 12 universities engaged in life sciences research.
Strong local life sciences clusters operate on a national and global scale, each with their own focus and strengths. The Dutch cluster is in pole position to deliver future innovations in medicine, food production and sustainable fuel for the world—that is, if we are able to avert the Dutch government’s plan to enforce amendment of the directive.
Proper protection of IP is a crucial success factor for biotech companies. Without protection by a patent, for example, biotech companies could not recover the high investment costs of R&D. For start-up companies, IP is often their only asset. Investors carefully assess IP portfolios before deciding to back a company.
From a societal perspective, patents are just as valuable. Without patents new innovations will reach neither patients nor consumers. Patents stimulate innovation by enforcing transparency and enabling knowledge-sharing and technology transfer. Without proper IP protection, open innovation and public-private partnerships would never get off the ground. This means the directive is the basis for innovation in the life sciences sector.
Instead of being praised as a driver of innovation in the Netherlands, however, biotech patents are under fire. Ever since the directive entered into force in the Netherlands in 2004, a number of Dutch plant breeders have climbed the barricades to express their fear of plant biotech patents. The breeders claim that patents would block access to new varieties and therefore would hinder innovation. To date, no such effect has been seen. More than that, so far we’ve been unable to obtain even a single example of a plant patent blocking innovation.
Despite a lack of solid arguments that support the existence of a problem, a limited breeding exemption in the Dutch Patent Act was introduced last year to allay the breeders’ concerns. This exemption allows breeders to freely experiment with patented plant material without a licence from the patent owner. Only when the breeder starts commercial exploitation of a new variety that uses the patented trait will it need a licence. This system secures incremental innovation, while allowing the patentee to be rewarded for its invention.
“The breeders claim that patents would block access to new varieties and therefore would hinder innovation. To date, no such effect has been seen.”
In addition, the sector itself set up the international licensing platform (ILP), under which listed companies and family businesses have worked together. The ILP aims to provide plant breeders around the world with faster, more efficient and cost-effective guaranteed access to crucial vegetable plant traits that are currently covered by patent claims by ILP member companies.
Even if breeders would have encountered barriers in accessing plant traits, these problems would be solved today by the introduction of both the limited breeding exemption and the establishment of the ILP.
Fuelling society’s fear
The plant breeders are still not satisfied, however. They believe they are entitled to freely access all plant characteristics with no reservations. They want free access not just to the base material with the original characteristic, but also to the plant in which that characteristic was used. In demanding this access, they are disregarding the fact that the creation of these new species requires many years of research and considerable investments.
With a smart lobby, and taking advantage of the limited public knowledge and complexity of the subject, these plant breeders have falsely linked patents to food security and food supply by way of consolidation and monopolisation. Their approach fuels anti-industry movements and adapts to society’s latent fear of patents. In this way, the plant breeders have found a sympathetic audience.
Dutch members of parliament almost without exception strongly oppose ‘patents on plants’. As a result, the Dutch minister for agriculture has pledged to employ her influence before and during the Netherlands’ EU chairmanship in 2016 to accelerate amendment of the directive. The minister wants to safeguard access to plant traits either by introducing a full breeders’ exemption or by restricting the patentability of biotech inventions. Either would be extremely damaging to the entire biotech sector.
By announcing her intention to amend the directive, the minister is leaving the 600 innovative Dutch biotech companies out in the cold. Those companies are working on important projects such as the development of medicines, vaccines and therapies, bio-based products and improved crops. We are talking about well-established companies such as Crucell, Galapagos, Avantium and DSM, and also many companies that have a bright future, including Treeway, ProQR Therapeutics, Merus, DCPrime and Solynta. Without patents, these companies would have no future. On a European level, the minister’s plans affect approximately 2,100 companies generating yearly revenues exceeding $21 billion and providing 55,000 high-grade jobs.
Renegotiating the directive would cause legal uncertainty for many years to come. The establishment of the current directive in 1998 took over a decade of negotiating. And despite 44 last-minute amendments, which to this day severely limit the effectiveness and quality of the directive, the sector welcomed the finalisation of the directive with a sigh of relief.
After years and years of uncertainty, academia and industry had a directive to work with and to build upon, allowing the biotech sector to compete globally. Re-opening the directive would send the sector back to square one. In the best case, it would lead to a brake on innovation, and in the worst case it would bring product development to a total standstill.
Risk of a standstill
Today, the limited number of patented plant traits are freely available to advance plant breeding innovation, safeguarding the future introduction of new varieties. For commercial exploitation, the sector has established the ILP to obtain licences.
Of all European plant patent applications, 75% are filed by US-based companies. Eroding the directive would merely result in the relocation of the activities of these companies. The US, China and other booming plant breeding regions will reap profit from the worsening European business climate, adding to the global trend of consolidation. It would not put a global stop to ‘patents on plants’, and it will definitely have no effect on global food security or food safety.
Why on earth then are we risking a total standstill of European biotech innovation? Just 5% of the patents that the European Patent Office granted in 2011 are for applications covering plants. Of the patents that were granted, 32% are for industrial applications, while 63% are for medical applications. Amending the directive would be like using a sledgehammer to crack a nut.
The Dutch lobby to amend the directive is now expanding into Europe. Let’s hope Europe will be less receptive to fear and fables and will stick to the facts. Before even considering any intervention, Europe should demand solid data that prove the existence of the problem, for biotech companies are the ones delivering innovations that help to sustainably heal, fuel and feed the world.
Annemiek Verkamman is managing director of HollandBIO, the Dutch biotech industry association. She can be contacted at:annemiek.verkamman@hollandbio.nl
