Why Are Genetically Engineered Crops Patented? Does This Affect Farmers in the United States?

Companies developing the new GE crops invest substantial amounts of time and money in the research, development, and regulatory approvals (see “Who Is Commercializing Genetically Engineered Crops and What Is the Outcome? “) needed to bring products to market. IP rights provide legal protection for ideas and products (1) and these rights have been key to securing the economic returns necessary to compensate for the substantial investments required to market GE crops (2). Patents can also ensure that results and techniques needed for inventions are ultimately made public, although actual use of the IP is restricted to license holders of the technology. Without this protection, situations could arise where findings are not published and processes are kept secret. The legal system provides ways to protect IP through patenting of not only GE crops, but also the tools (e.g., genes, methods) used to create them.

To ensure that investments made in creating these crops are recouped, seed producers require purchasers of patented GE seeds to sign agreements stating that they will not reuse or sell the seed, and thus growers must repurchase seed each year. This situation is not the first instance of farmers’ not being able to reuse seed. In the United States in the 1920s the introduction of hybrid maize seed (3) meant that farmers had to buy seeds each year to capture yield benefits (see “Will Plants with Terminator-Type Genes Prevent Replanting of Genetically Engineered Crops?“). Although legal agreements were not involved, the hybrid was a type of “biological patent” that prevented replanting because farmers were unable to create hybrid seeds without the inbred parents, which were protected by the companies that produced the hybrid seed.

Despite potential benefits, patenting in many cases has impeded the use of technologies and development of commercial products. It has often been difficult or impossible to obtain the multiple rights needed to develop and market GE crops. One widely publicized example is Golden Rice, where a large number of IP issues had to be resolved before the engineered genes responsible for provitamin A production could be introduced into local varieties in developing countries (1; see “Is Golden Rice the Only Way to Provide Vitamin A to People in Developing Countries? “). However, it should be noted that the major problems actually related to material transfer agreements rather than patents because very few relevant patents had been issued in major rice-consuming countries (4).

In the private sector, obtaining enabling rights has often been accomplished by bringing key technologies and materials under the control of the company through mergers and acquisitions (5). Large agricultural biotechnology companies amassed IP assets through these means or through their own research efforts into the development of new GE crops (6). However, the development of GE agricultural products for farmers in developing economies and of GE seed for low acreage crops in developed countries will most likely be performed, if at all, by nonprofit organizations with public funding (7).

The patenting of living organisms was first realized in 1980 when the Supreme Court decided in Diamond v. Chakrabarty that living, man-made microorganisms could be patented. In the same year, the Bayh-Dole Act enacted by Congress encouraged U.S. universities to patent innovations and license them to the private sector (8). These decisions led to striking increases in public sector patents and licensing of patents to the private sector. Licensing of inventions to the private sector often prevents public institution researchers from using materials and methods invented within their own walls to further innovate and create improved commercial agricultural materials (9).

No single public institution has the complete set of IP rights needed to ensure the freedom to operate (FTO) to develop a GE product (10). Although problems with regulatory costs (see “Who Is Commercializing Genetically Engineered Crops and What Is the Outcome?”) and public acceptance also exist, FTO is a major barrier to having all the necessary tools to commercialize a GE product. In a study aimed at better understanding this problem, it was revealed that approximately one quarter of patented agricultural biotechnology inventions were actually created in public sector institutions, which is substantially larger than the IP portfolio of any individual agricultural biotechnology company (11). However, that IP is often scattered among institutions and is often licensed exclusively to entities that restrict its use. In general, public sector scientists have patents on most of the technologies needed to develop GE plant varieties; however, in the past these technologies and other materials necessary to create GE varieties have not been protected properly for public sector use. Open publication or careful reservation of patent rights for public and nonprofit use can address this deficiency. Public sector institutions need to systematically retain rights to inventions that can be used for subsistence and specialty crop development and make them available to others for such purposes (7).  

To this end, a number of public sector institutions established PIPRA, the Public Intellectual Property Resource for Agriculture. PIPRA developed a public IP assets database, established best practices to guide development of research innovations, and created specific, pooled public sector IP technology packages to facilitate humanitarian and special use objectives. This effort encourages collaborative research efforts among agricultural scientists at different institutions while recognizing the need to protect and share key IP to make contributions to research for the public good. By 2009 PIPRA has brought together IP from more than 40 universities, public agencies, and not-forprofit institutes (12).

References:

1. Kryder RD, Kowalski SP, Krattiger AF. 2000. The intellectual and technical property components of pro-vitamin a rice (Golden Rice^TM): A preliminary freedom-to-operate review. ISAAA Briefs No. 20-2000

2. Anonymous. 2000. Report of seven academies from developing and developed countries. Transgenic Docket 08/00. plants and World agriculture. June 2000. Washington, DC: R. Soc. London, U.S. Natl. Acad. Sci., Brazilian Acad. Sci., Chinese Acad. Sci., Indian Natl. Sci. Acad., Mexican Acad. Sci., Third World Acad. Sci.

3. Smith CW. 1995. Crop Production: Evolution, History and Technology. New York:Wiley

4. Binenbaum E, Nottenburg C, Pardey PG, Wright BD, Zambrano P. 2003. South-North trade, intellectual property jurisdictions, and freedom to operate in agricultural research on staple crops. Econ. Dev. Cult. Change 51:309–55

5. Wright BD, Pardey PG. 2006. Changing intellectual property regimes: implications for developing country agriculture. Int. J. Technol. Globilisation 2:93–114

6. Huang J, Rozelle S, Pray C,Wang Q. 2002. Plant biotechnology in China. Science 295:674–76

7. Atkinson RC, Beachy RN, Conway G, Cordova FA, Fox MA, et al. 2003. Intellectual property rights: Public sector collaboration for agricultural IP management. Science 301:174–75
Describes a new paradigm by major U.S. agricultural universities and other public sector institutions to manage intellectual property to facilitate commercial development of GE crops.

8. Mowery DC, Nelson RR, Sampat BN, Ziedonis AA. 2001. The growth of patenting and licensing by U.S. universities: an assessment of the effects of the Bayh–Dole act of 1980. Res. Policy 30:99–119

9. Comm. Intellect. Property Rights. 2002. Integrating intellectual property rights and development policy. http://www.iprcommission.org/papers/pdfs/final_report/ciprfullfinal.pdf. Last accessed 2011-11-26. PDF

10. Delmer DP, Nottenburg C, Graff GD, Bennett AB. 2003. Intellectual property resources for international development in agriculture. Plant Physiol. 133:1666–70

11. Graff GD, Cullen SE, Bradford KJ, Zilberman D, Bennett AB. 2003. The public-private structure of intellectual property ownership in agricultural biotechnology. Nat. Biotechnol. 21:989–95

12. PIPRA. 2008. The Public Intellectual Property Resource for Agriculture. http://www.pipra.org. Last accessed 2011-12-12. PDF

Updated 2/16/12