Biotechnology, research and intellectual property law andrew j allen



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Validation of claims


In the seventeenth century the Royal Society required confirmation of any remarkable finding by qualified members before it could be recorded as fact.93 The use of a patented invention for the purpose of testing the validity of the claims can be justified. The public is entitled to ensure that the consideration of a patent monopoly is not awarded where it is not earned. This is consistent both with patent law and with the normal scientific process. It acts as a check on the adequacy of the disclosure for facilitating working of the invention by a person skilled in the relevant art.

Scope of exclusion


It may be that the exclusion should apply to the use of patented inventions in purely non-commercial research, or in research that does not compete with the commercial interests of the patent holder. However, to define the exclusion purely in terms of use that does no harm to the interests of the patent holder is problematic. Any unlicensed use of the invention will harm the patent holder if he or she would otherwise have received a licence fee. The difficult area to evaluate is where the patented invention is used in research aimed at developing improved alternative products. This approach may benefit the public by accelerating the introduction of better products. It may also harm the interests of the patent holder by curtailing the period in which his product enjoys market competitiveness. The patent system aims to promote further development of, and improvements upon, the current state of the art. To this end, patent holders ought not to be able to block research aimed at making improvements to a patented invention.94 However, a broad experimental user exclusion that facilitates the rapid development of improved and competing commodities will reduce the potential returns on the inventor's research and development outlay, and thus weaken the incentive provided by the patent. On the other hand, free access to the raw materials of research would help to keep down the costs of doing the research.

It is difficult to judge how significant a wide scope for the experimental use exclusion would be for the incentive function of patent law. In support of a broad experimental use exclusion, it is claimed that innovators may be reluctant to license competitors to use the invention.95 However, in order to benefit from a patented invention, the patent holder is usually encouraged to license use of the invention as widely as possible. This will include market competitors.

Eisenberg asserts that the experimental use exclusion should apply to the use of a patented invention in research leading to improvements in the patented technology, or to development of alternative means of achieving the same purpose.96 Yet, it is arguable that this very use is damaging to the pecuniary interests of the patent holder. A broad exclusion, enabling improvements or substitute technologies to be developed on the back of patented inventions, limits the ability of the patent to guarantee a patentee appropriate returns on his or her investment in research and development.97

Karp maintains that any reduction in the scope of the patentee's exclusive rights will act as a disincentive to innovators. One strong argument advanced in support of a narrow scope for the experimental use exclusion is that it is the patentee's inventive effort that provides the foundation for competitors' development of alternative or improved inventions. In comparison with copyright law, the patent term is very limited. Twenty years is the term of a patent monopoly, whereas copyright subsists for the life of the author plus seventy years. One reason for this difference is that there is a greater likelihood of more than one person achieving the inventive step required to develop a patentable invention. Another reason is that copyright protects only the form of the creation and not the idea, whereas a patent may protect, from commercial exploitation by others, the idea encapsulated within the invention. By awarding the patent to the first inventor, a second inventor who was slower to lodge a claim may be harshly treated in gaining no reward at all for his or her efforts. Thus, the patent system promotes early application for patents, often before the invention is ready for full commercialisation.98 The patent grant plays a role in enabling the inventor to seek the investment necessary to fully develop the invention into marketable commodities. Prospective investors will seek assurance from the existence of patents before investing the funds to facilitate ongoing development of the invention. Consequently, there is often a time lag between the securing of a patent and the commercial exploitation of the invention. A wide experimental use exclusion, allowing competitors to develop improvements and alternatives at the same time as the patentee was working on bringing the invention to market, may discourage this investment.99

Another factor to consider is the inherent uncertainty of research. Only a fraction of all research will lead to marketable innovations. If the developer of the improved mousetrap had failed to create an innovation, there is little to be gained by imposing a cost for the use of the pioneer mousetrap in his research. It is when the subsequent research is realised as a commercial product that the commercial interests of the pioneer inventor are threatened. Uncertainty about the eventual success of a pathway of development may dissuade a researcher from incurring the cost of obtaining licences to use patented research tools.

A workable compromise may be to use a form of compulsory licence in which the royalty is linked to the commercial success of any subsequent innovation.100 This would leave pure scientific research free and unhindered. It is possible that patent holders may form similar private agreements with researchers. In return for the immediate free use of a patented research tool, a licence agreement may confer upon the patent holder rights in subsequent downstream discoveries. One possible drawback to this scheme is that where multiple pieces of intellectual property are required for the development of one marketable product, the division of the ultimate profits among too many owners could become a disincentive to undertake the development process.101

The suggested linkage between the royalties due to the patentee of research tools, and the commercial success of downstream products that result from research utilising those tools should be approached with caution. The social contract underlying patent law calls for the inventor to be able to reap the rewards of his or her own effort, and that alone. The market for the invention largely determines the size of the reward which is influenced by such factors as consumer demand. A licence that enables the patent holder to participate in the commercial development of other innovations would extend the scope of the patentee's reward beyond the original contribution to the art. An example would be DuPont Corporation, which holds the patent on the Harvard oncomouse, licensing the use of the mouse in research in exchange for the right to participate in future negotiations to develop commercial therapeutic cancer treatments well beyond the scope of the oncomouse patent claims. Agreements such as these will make it difficult to establish clear titles to downstream products.

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