Media release
Australian Law Reform Commission
31 August 2004
Patent law reforms needed to boost biotech: ALRC
Australia ’s billion-dollar biotechnology industry risks being stunted by a 400-year-old patents system that struggles to keep pace with cutting edge technology, the Australian Law Reform Commission (ALRC) said today.
ALRC President Prof David Weisbrot said extra flexibility must be built into the patent system to accommodate genetic technology or there could be a ‘chilling effect’ on research and development—and the commercialisation of that research—with adverse implications for advances in healthcare.
The ALRC has completed a major inquiry into the controversial subject of gene patents, culminating in the release of its 700-page report Genes and Ingenuity: Gene Patents and Human Health (ALRC 99), tabled in federal Parliament today.
The aim of the ALRC review was to ensure Australia ’s intellectual property laws can withstand the challenges posed by the rapid advances in genetic science and technology. The inquiry followed from the ALRC’s groundbreaking work on genetic privacy and discrimination (Essentially Yours, ALRC 96), which highlighted the need for a review of Australian gene patenting laws and practices.
“While we found there’s no need for a radical transformation of the patents system, the ALRC has made 50 recommendations for significant reform to customise the current system to accommodate emerging scientific breakthroughs,” Prof Weisbrot said.
“ Australia needs to promote investment in research and development—biotechnology is hugely expensive and patent rights are the main way of rewarding innovation and investment.
“This is already a highly globalised field—investment and expertise flows across borders, thousands of gene patents already have been granted around the world, and Australia is a party to a number of major international agreements.
“The ALRC conducted extensive research and consultation in developing this report. Many overseas governments and key international organisations—such as UNESCO, the OECD, the Human Genome Organisation (HUGO) and the American Association for the Advancement of Science—are awaiting our final recommendations, and will be keen to see what Australian policymakers do in response,” Prof Weisbrot said.
ALRC Commissioner Brian Opeskin said the report uncovered a high level of anxiety among researchers that overly broad gene patents and aggressive licensing practices might stifle further research and cause problems for governments in providing access to high quality and cost-effective healthcare.
“However, we are confident that if the ALRC’s recommendations are adopted, there will be sufficient flexibility, monitoring and oversight of gene patents to ensure that won’t happen.
“One of our key findings is that our governments—and health departments in particular—need to be more active and strategic in using the available mechanisms, including the courts where necessary, to challenge dubious patents or questionable licensing practices,” Mr Opeskin said.
“In extreme cases, they also need to be willing to step in and use a patented invention under existing ‘Crown use’ provisions, where this is necessary to promote human health or medical research.
“Government funding and purchasing power are also powerful tools that could be used to moderate the cost of goods and services that are subject to gene patents—in much the same way as the Pharmaceutical Benefits Scheme operates successfully to contain the costs of medicines,” he said.
ALRC Commissioner Prof Anne Finlay said the inquiry had recommended the creation of a statutory exemption from patent infringement for ‘experimental use’, to make it clear that researchers are entitled to study and experiment further upon a patented invention.
“Universities and other research organisations also must raise the awareness of researchers about patenting issues and the commercialisation of research. Similarly, Australian research organisations and biotechnology companies must be adequately skilled to deal with issues concerning commercialisation and the licensing of patented inventions.
‘The Australian public could miss out on the maximum benefit of our world-class genetic research unless scientists and universities develop a more sophisticated understanding of intellectual property rights and licensing practices,” she said.
Prof Finlay said other specific reforms in the ALRC report were directed towards:
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increasing the burden of proof on applicants to prove the ‘usefulness’ of their claimed genetic invention before being granted a patent;
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enhancing the education and training available for patent examiners, who by definition have to operate in cutting-edge areas;
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recognising that the widespread dissemination of fundamental research through public access databases—the approach favoured by the international Human Genome Project—may sometimes better serve the public interest than commercialisation;
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encouraging a more active role for the Australian Competition and Consumer Commission (ACCC), by issuing guidelines indicating which licensing practices would not be unduly anti-competitive;
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adding a competition test to the grounds under which a compulsory licence over a patent can be ordered by the courts;
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clarifying the ‘fair dealing’ exception in the Copyright Act to provide that (a) research with a commercial purpose or objective nevertheless may come within that exception, and (b) in relation to databases protected by copyright, the operation of the fair dealing provisions for the purpose of research or study cannot be excluded or modified by contract; and
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developing model licence agreements and other industry initiatives to facilitate the smooth and fair licensing of gene patents.