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4-Patents: Uncertainty reigns as biotech patents remain unharmonised in the EU

                                  PART I
-------------------------------- GENET-news -------------------------------

TITLE:  Uncertainty reigns as biotech patents remain unharmonised
SOURCE: Europabio, Belgium
DATE:   19 Jul 2005

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Uncertainty reigns as biotech patents remain unharmonised

The EU Commission has published its long awaited 2nd report (1) on the EU
Biotechnology Patents Directive (Directive 98/44/EC). The report deals
with "Developments and implications of patent law in the field of
biotechnology and genetic engineering", and specifically investigates the
issues of (i) patenting of human DNA, and (ii) patenting of human stem
cells. These issues have for a long time been at the centre of a debate
as to whether inventions comprising human gene sequences or human stem
cells can be patented. On both issues the Commission recommends to
continue monitoring the developments, and has refrained from taking a
position, judging it premature to do so at this stage.

Implementation of Directive 98/44

The Directive entered into force in July 2000, and 21 Member States of
the EU have now implemented the Directive with Italy, Luxembourg,
Lithuania and Latvia still remaining. Furthermore the EEA states Norway
and Iceland have implemented the Directive, and the Candidate State of
Croatia. It seems that the Commission is unaware that the Candidate
States of Bulgaria, Romania and Turkey have all actually implemented the
Directive. Finally, the Commission does not mention that the European
Patent Organisation, including France and Germany implemented the
Directive as early as 1999. Thus a total of 27 States and one
international patent organisation have implemented the Directive, while
four EU Member States and Switzerland/Liechtenstein still are in the process.

On gene sequences

Two EU Member States, France and Germany, have in different ways limited
the scope of patent protection for human gene sequences to the specific
use disclosed in the patent application - generally known as "purpose
bound protection". France has outrightly banned the patenting of human
gene sequences.

The remaining countries provide absolute product protection for human
gene sequences that gives a scope covering possible future uses of that

While the Commission considers that there are no objective grounds for
limiting the protection relating to sequences or partial sequences of
human genes, it has decided to withhold judgement on whether these Member
States have correctly or incorrectly implemented the Directive and
instead monitor whether there are any economic consequences arising from
such divergences.

EuropaBio (2) - the European association for bioindustries is
disappointed that the Commission has not taken a firmer stand on the
deviating implementation of the Directive in respect of the patenting of
human gene sequences.

"The main objective for introducing the Directive in 1988 and in 1995 was
to harmonise the patent laws of the EU Member States in respect of
biotechnological inventions and clarify certain aspects in this respect
in order to support the internal market," says Bo Hammer Jensen, Chair of
EuropaBio's Intellectual Property Working Group. "We have to conclude
that the actual result is a situation with more disharmony than ever, and
with the possibility that the four remaining states may implement the
Directive in yet unknown ways."

"Patent rights are of extreme importance in the biotech industry,
especially for SMEs that often only have these rights as their most
important assets. The divergences in how certain Member States have
implemented the Directive and the uncertainties about how national courts
in these Member States will interpret a company's patent may discourage
investment in developing promising research into commercial products,"
adds Bo Hammer Jensen. "Industry requires predictable rules across all
Member States in order to attract the large R & D investments to meet
societal needs."

On embryonic stem cells

A distinction is drawn between totipotent stem cells which are capable of
developing into a human being and pluripotent stem cells which are not so
capable. The Commission confirms that the Biotech Patents Directive is
clear regarding totipotent cells arguing that such cells cannot be
patented as each cell could develop into a human being.

However with regard to pluripotent stem cells where cells may one day be
used to treat a patient for example suffering from Alzheimer's disease,
the Directive is less certain. The Directive allows Member States to
refuse patents on ethical grounds. Given that there are differences
between Member States on the issue of embryonic stem cells, the
Commission has decided not to take a position on harmonising rules on the
use of pluripotent stem cells.

In the EuropaBio position on human stem cell research (3) the biotech
industry considers that embryonic stem cell research must be allowed in
order to advance knowledge in biomedicine and its applications in
healthcare. The industry considers that Member States and their
constituencies should remain free to decide about the acceptance and
applicability of embryonic stem cell research and to adopt appropriate rules.

Patents crucial to R & D investment

Patents are an essential element in an investor's decision to back a
biotech company. "In the knowledge based economy, intellectual property
is the only real form of protection to inventors and investors who invest
in R & D to meet society's needs. It is important for Member States to
provide security to those that are willing to take the investment risks
to address the 10 000 plus diseases that still have no solution today,"
says Johan Vanhemelrijck, EuropaBio Secretary General. "The importance of
patents to develop treatments has also been recognised and understood by
some patient groups who are themselves using patents to develop new

According to Alastair Kent, Director of the Genetic Interest Group (4), a
national alliance of patient organizations: "It is important that there
is parity of incentives on both sides of the Atlantic, otherwise
investors will place their money where there is the best protection and
the most likelihood of securing a return on their investment."

In a separate development, an EU Commission report published today
reveals that the growth rate of R & D intensity (R&D expenditure as a %
of GDP) has been declining in Europe since 2000 and is now close to zero.
The Commission is especially concerned about slow down in business
funding of R & D. As one of Europe's most research intensive industries,
Biotechnology needs predictable patent rules to secure some of those
increased investments. (5)

For further information, please contact

Adeline Farrelly, EuropaBio Email: Tel:
+32 2 735 0313 Mobile: +32 475 93 17 24

Notes to Editors

(1) Link to EU Commission report on Directive 98/44/EC

(2) About EuropaBio EuropaBio, the European Association for
Bioindustries, represents almost 50 member companies operating worldwide,
8 associate organisations, 2 regions and 25 national biotechnology
associations. Through our associations EuropaBio is also the voice of
1500 small and medium-sized enterprises involved in research,
development, testing, manufacturing and commercialisation of
biotechnology applications.

(3) EuropaBio position paper on human stem cell research (October 2003)

(4) About GIG The Genetic Interest Group (GIG) is a national alliance of
patient organisations with a membership of over 130 charities which
support children, families and individuals affected by genetic disorders.

Stagnation of R&D - Commission
press release


Directive 98/44/EC (The Biotechnology Patents Directive) was adopted
after a long and constructive debate lasting about 10 years in both the
European Council and the European Parliament. It entered into force in
2000 but as of July 2005, four member states (Italy, Latvia, Luxembourg
and Lithuania) have still to implement the Directive.

It is important to note that only inventions which combine a natural
element with a technical process, resulting in a useful application, can
be patented. A human gene sequence in itself or stem cells are not
patentable inventions without the provision of a function or application
that indicates the industrial applicability of the invention.

In 2002, the European Commission formed a group of experts to clarify two
key topics in the Directive: - the scope to be conferred to patents on
sequences or partial sequences of genes isolated from the human body, -
and the patentability of human stem cells and of cell lines obtained from

The discussions of the Expert Group were based on background papers
produced by Dr. Sven Bostyn (DNA patenting) and Prof. Geertrui Van
Overvalle (stem cell patenting). Dr. Bostyns paper is available at:

In Europe, patents are excluded if their publication or exploitation is
in conflict with the 'ordre public' or morality. The prohibition of
making profits from the human body and its elements, as stated by Article
3 of the Charter of Fundamental Rights, is grounded on the principle of
non commercialisation of the human body. It follows that under Directive
98/44/EC the human body and any stage of its development is not
patentable. This had led to concerns about whether stem cells are patentable.

The EU Directive goes into detail to specify what is contrary to 'ordre
public' and morality in the biotechnology sector, namely Article 6 states
in particular that the following are considered to be not patentable for
these reasons. processes for cloning human beings; process for modifying
the germ line genetic identity of human beings; uses of human embryos for
industrial or commercial purposes, processes for modifying the genetic
identity of animals which are unlikely to cause them suffering without
any substantial medical benefit to man or animal, and also animals
resulting from such processes.

In the US, patents can be awarded on the discovery of a gene, gene
sequence or partial sequence that is useful, if the use is specific,
substantial and credible, whereas in Europe genes and sequences can only
be patented if they are part of an invention that uses a technical
process, and results in a specified useful application.

                                  PART II
-------------------------------- GENET-news -------------------------------

TITLE:  Biotechs concerned over patents
SOURCE: The Scientist, UK, by Stephen Pincock
DATE:   21 Jul 2005

------------------- archive: -------------------

Biotechs concerned over patents
Industry group says EU 'wait and see' approach to gene patents causes

Europe's biotech trade group, EuropaBio, responded with dismay this week
to news that the European Commission has no intention of taking action to
further harmonize the way that different EU states implement a directive
on patenting of human gene sequences or stem cells.

In a report released Monday, the commission discussed developments in the
patent field that relate to the EU Biotechnology Patents Directive of
1998. Since 2000, all EU member states except Italy, Luxembourg, Latvia,
and Lithuania have implemented the directive into national law.

However, while most countries have implemented the directive in a similar
way, France and Germany-two countries with big biotech sectors-have
interpreted the patent protection offered on gene sequences in a more
restricted manner. Those two countries have limited the scope of patent
protection for human gene sequences to the specific use disclosed in the
patent application.

In the report, the commission acknowledges variations in the way the
directive is implemented, and concludes that there are no objective
grounds for restrictions on traditional patent protection for inventions.
However, it adds that it "does not intend to take a position on the
validity of member states' implementation on the basis of whether they
have chosen a classical or a limited scope of protection for gene sequences."

Bo Hammer Jensen, chairman of EuropaBio's intellectual property working
group, told The Scientist that his group was disappointed that the
commission did not use this opportunity to take a position on the issue.

"We would have preferred that the commission had clearly stated that what
Germany and France have done is not what the directive says," said
Jensen. "What they do is not only a deviation from the words of the
directive, but also its spirit," he added.

"The main objective of the directive was to harmonize the patent laws of
the EU member states," he said. "We have to conclude that the actual
result is a situation with more disharmony than ever."

When EU member states do not properly implement an EU directive, the
commission can file suit at the European Court of Justice in Luxembourg.
In 2003, it took such action against eight countries that had not
implemented the directive. EuropaBio would like to see the commission
take this action in the case of France and Germany, Jensen said.

However, the commission said that it would limit itself to monitoring
events and seeing whether there are any consequences of divergence
between member states' legislation.

On the subject of stem cell patents, it took a similar line. While
totipotent stem cells-those capable of developing into a human being-are
excluded from patentability on the grounds of human dignity, the
commission has decided that it is premature to come to a definitive
conclusion when it comes to pluripotent cells.

"The field of biotechnology research is rapidly developing," said EU
Internal Market and Services Commissioner Charlie McCreevy in a
statement. "It is important that the European Union continues to monitor
developments in patent law in this complex and sensitive area."

Links for this article


Report from the Commission to the European Parliament and Council --
Development and implications of patent law in the field of biotechnology
and genetic engineering

EU Biotechnology Patents Directive!celexapi!prod!

Industrial property: eight member states referred to court for failure to
implement directive on legal protection of biotechnological inventions


European NGO Network on Genetic Engineering

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D - 38116 Braunschweig

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