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Cultivating Innovation & the Breeder´s Exception to Patent Rights: Finding a Link

19/5/2015

 
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Today we bring you a post written by one of our Academic Advisors, Dr Viola Prifti, who recently completed her PhD thesis on plants and intellectual property law. We set her the challenge of explaining her work in a way that most general readers could follow. Our sincere thanks to Viola for taking the time to do so.

When I was first asked to be an academic advisor for “Cultivating Innovation”  I had just finished my doctoral thesis, which focused on a legal and economic analysis of the compliance of the breeder´s exception to patent rights (so-called breeding exception) with article 30 of the Trade-Related Intellectual Property Agreement (TRIPS Agreement). This may appear to some as insignificantly related to “Cultivating Innovation’s” aim of increasing public awareness on the role of intellectual property in plant science and farming. The breeder´s exception to patent rights is, indeed, an exception mainly used by breeding companies that need to freely use patented materials in their breeding lines for the development of commercial products. Analyzing its compliance with the TRIPS Agreement may additionally appear as a pure legal issue. So, what room for public awareness, plant science, and farming? In an interconnected world as the one we live, every legal issue deserves public awareness. This is especially so when legal issues affect an important component of our daily life, such as food. As a matter of fact, the majority of our diet, including the meat we eat, is based on cultivated plants. The link with plant science is equally evident; plant breeding started as a trial and error process and it evolved into an industry.  Plant science and its industrial applications can only exist in symbiosis. Therefore, laws of interest for commercial plant breeders also affect plant breeding as a science. But what about farmers? Farmers are not the beneficiaries of the breeding exception. The exception allows only plant breeders to freely use patented biological material into their breeding lines, and to commercialize the end products if they are free from patented elements. Farmers, however, may indirectly benefit from the breeding exception. This exception facilitates breeders to undertake more breeding programs and consequently, put more varieties into the market. This means that farmers can have access to a greater number of varieties.

So what of my thesis?  As mentioned above, my research concerned an analysis of compliance of the breeding exception with article 30 of the TRIPS Agreement. This article allows countries to adopt patent exceptions provided that they are limited, do not unreasonably conflict with a normal exploitation of the patent and do not unreasonably prejudice the interests of the patent owner, taking account of the legitimate interests of third parties. The vagueness of the language of article 30 is the main problem I identified in order to proceed with the analysis of compliance. This is one of the most important roles that legal scholars take on in their work. To offer a solution to this problem, I proposed to analyze the following research question: "What type of breeding exception to patent rights is compliant with article 30 of the TRIPS Agreement?" My conclusion was that a limited breeding exception (that allows breeders to use patented material to breed new plant varieties) as incorporated into the national patent laws of France, Germany, the Netherlands, and Switzerland is compliant, whereas a comprehensive breeding exception (that allows breeders to commercialize varieties with patented material) currently under discussion in the Dutch Parliament may be compliant with article 30 of the TRIPS Agreement under certain conditions. One important condition is its limitation to the 64 crops covered under the Multilateral System of the International Treaty for Plant Genetic Resources for Food and Agriculture. These conclusions are founded on a methodological approach which rests on the concept of balance between the incentive to innovate granted by intellectual property rights and the benefits that accrue to society by accessing patented material for plant breeding purposes. This concept was applied to the study of legislation, case law, and legal principles. An elaboration of this concept as found in economic theory, allowed me to conclude that the adoption of a limited breeding exception to patent rights does not diminish the incentive to invent. On the contrary, it increases innovation in plant breeding and does not negatively affect the biotechnological sector. With respect to the comprehensive breeding exception, I observed several concerns on the preservation of the incentive to innovate by patent holders. I identify the lack of empirical studies that can shed light on a relationship between patent protection, R&D decisions, innovation, and breadth of patent exceptions as one important reason for an inconclusive argument on the incentive to innovate.

Another relevant element for the analysis of both hypotheses was based on the characteristics of national innovation systems. I opted for a flexible reading of the TRIPS agreement in order to allow countries to promote issues of public interest in plant breeding and human rights considerations such as the right to food. This interpretation finds support in the principles and objectives of the TRIPS Agreement as well as in international agreements which highlight the importance of plant breeding for society. Moreover, it takes account of the concept of balance in patent law between the concern to recoup R&D investments and benefits of disclosing innovations for the benefit of society. This approach allowed me to conceptualize the breeding exception as a new type of permissible exception to patent rights. This exception is an example of how intellectual property rights can be amended in order to promote innovation and make its outputs available to society. You can learn more about the breeding exception, its legal and economic justifications as well as its compatibility with the TRIPS Agreement in my upcoming book, which will be published by Springer in 2015.

You can read more from Viola on her blog 'Plant Variety Protection: discussing, sharing, and advancing research'. She is currently working on a paper discussing US free trade agreements with South American countries on plant variety protections.


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