22.30 Chapters 17 and 18 discuss the programs that exist to support commercialisation of research by Australian entities, including programs directed specifically to the Australian biotechnology sector. To date, the focus of government initiatives has been to provide support (including funding) to aid the commercial development of innovation in biotechnology research.
22.31 The National Biotechnology Strategy, released by the Australian Government in 2000, included as one of its overall objectives ‘strengthening capabilities for the commercial and strategic management of Intellectual Property in biotechnology’. Pursuant to this objective, Biotechnology Australia and the Department of Foreign Affairs and Trade (DFAT), among others, have published educational materials to promote understanding of intellectual property issues in biotechnology, including about how intellectual property rights in biotechnological inventions can be used and managed most effectively.
22.32 In 2001, Biotechnology Australia released a manual providing a practical guide to the identification, protection and management of biotechnology-related intellectual property (Biotechnology IP Manual). The manual is a resource for research organisations, companies and entities funding biotechnology research, to be used in conjunction with their existing intellectual property management policies and practices. The Biotechnology IP Manual includes a separate chapter on commercial exploitation of intellectual property, which addresses topics such as conducting due diligence, valuation of intellectual property, factors relevant to a decision whether to license patent rights, as well as common terms in patent licences and their significance. Views expressed in a number of consultations indicated that the Biotechnology IP Manual is a very useful resource.
22.33 DFAT has also published the Intellectual Property and Biotechnology: A Training Handbook (DFAT IP Handbook). Its purpose is to provide an introduction to key intellectual property concepts, and an understanding of how they apply in practice. The DFAT IP Handbook includes a section on licensing and enforcing intellectual property rights, which provides an overview of issues that Australian organisations may encounter in negotiating licences to gene patent rights. The section outlines factors relevant to the decision to commercialise an invention and the various ways in which patent rights can be exploited. It also includes information relating to negotiating biotechnology licences—from conducting due diligence on a potential licence partner, to the type of provisions that commonly appear in patent licence agreements and the purpose of these provisions.
22.34 The Department of Industry, Tourism and Resources (DITR) informed the ALRC that Biotechnology Australia, in conjunction with certain patent attorney firms, has conducted intellectual property education programs—such as the Australian Biotechnology Intellectual Property Management Seminar Series.
22.35 Organisations have been established to develop the commercial skill base of Australian entities, including those in the biotechnology sector. These organisations and the type of programs offered in this regard include the following.
AusBiotech Ltd (AusBiotech) is the peak national industry body whose membership includes entities from all aspects of the Australian biotechnology sector. AusBiotech provides its members with access to training and information resources, and is also actively involved in government and industry initiatives relevant to the biotechnology sector.
The Australian Institute for Commercialisation Ltd (AIC) offers programs to improve commercialisation of research in Australia. These include the ‘AIC Know-How’ program, which focuses on courses for public and private sector organisations for the purpose of improving knowledge about technology commercialisation practices.
The Licensing Executives Society (LES) is involved in activities related to licensing and other transfers of intellectual property, including: educating members in licensing skills; monitoring licensing developments; and conducting research on issues related to domestic and foreign licensing.
22.36 In addition, as discussed in Chapter 17, Knowledge Commercialisation Australia (KCA) represents Australian public sector organisations involved in technology transfer. It has organised a series of conferences on technology commercialisation.
Submissions and consultations
22.37 DP 68 proposed that Biotechnology Australia, in consultation with state and territory governments and other relevant stakeholders, should continue to develop and implement education programs to assist research organisations and biotechnology companies in licensing and commercialising inventions involving genetic materials and technologies. Although a few consultations questioned whether Biotechnology Australia possesses adequate capacity and resources to implement education and training programs, this proposal was generally supported.
22.38 DITR, which is one of five member departments of Biotechnology Australia, strongly agreed with the proposal. DITR indicated that Biotechnology Australia is engaged in programs to increase awareness of intellectual property management on an on-going basis: ‘The government fully recognises that the more effective commercialisation of IP is vital for the growth of a dynamic biotechnology industry in Australia’.
22.39 DITR observed that there were already some projects directed to improving industry awareness of intellectual property management and commercialisation, including the Biotechnology IP Manual and IP Australia’s IP Toolbox. Further, DITR commented that the Australian Government is also addressing other factors that affect the commercialisation of biotechnology in Australia; in particular, the difficulties biotechnology companies face in attracting venture capital funds.
22.40 The results of the Nicol–Nielsen Study, and submissions to the ALRC’s Inquiry, suggest that restrictive licensing of gene patents is not currently pervasive in the Australian biotechnology industry. Further, as outlined in other chapters of this Report, no significant adverse impact on genetic research, commercialisation, or the healthcare system has been demonstrated at this stage. In light of this, the ALRC is not inclined to make recommendations aimed specifically at regulating gene patent licensing practices, or prohibiting certain types of licensing arrangements.
22.41 However, there is evidence to suggest that some participants in the Australian biotechnology sector find the negotiation of patent licences to be problematic. These difficulties stem from a variety of causes, including lack of commercial experience in licensing patents, the unequal bargaining power of the parties, and inadequate resources to commit to extended licence negotiations. In addition, the increasing complexity of the Australian patent landscape may make it difficult to identify relevant patents and negotiate licences.
22.42 An effective way to address these matters is to assist Australian entities in developing commercial skills and negotiation skills by enhancing education programs about the licensing of inventions involving genetic materials and technologies. Biotechnology Australia, in conjunction with its member departments, would be an appropriate body to coordinate the development of such programs, in collaboration with state and territory governments, peak national bodies with an interest in the licensing and commercialisation of intellectual property—such as AusBiotech, AIC, LES and KCA—and other relevant stakeholders.
22.43 Education programs about patent licensing would expand upon projects already undertaken by Biotechnology Australia and federal, state and territory departments to assist Australian entities in commercialising the results of biotechnology research. Education programs for research organisations and biotechnology companies would also complement initiatives recommended in Chapters 17 and 18 to assist research organisations and biotechnology companies in commercialising inventions involving genetic materials and technologies (see Recommendations 17–1 and 18–1).
22.44 The proposed education programs should address issues such as: structuring deals aimed at the licensing of inventions involving genetic materials and technologies; alternative mechanisms by which rights to a patent may be obtained by a third party (such as a patent assignment) and when these mechanisms might be preferable to licensing patent rights; common terms in gene patent licences; typical licensing practices; and negotiation strategies for gene patent holders and licensees of gene patent rights. The programs should also address other issues relevant to the licensing and enforcement of patent rights, including patent litigation insurance.
Recommendation 22–1 Biotechnology Australia, in conjunction with its member departments, should develop and implement programs to assist research organisations and biotechnology companies in licensing and commercialising inventions involving genetic materials and technologies. The programs should be developed in collaboration with state and territory governments, peak national bodies with an interest in licensing and commercialisation of intellectual property, and other relevant stakeholders. (See also Recommendations 17–1 and 18–1.)
 See also Australian Law Reform Commission, Gene Patenting and Human Health, DP 68 (2004), Ch 11.
 Biotechnology Australia and Commonwealth Biotechnology Ministerial Council, Australian Biotechnology: A National Strategy (2000), 7, 18–19.
 Biotechnology Australia, Biotechnology Intellectual Property Manual (2001); Department of Foreign Affairs and Trade and AusAID, Intellectual Property and Biotechnology: A Training Handbook (2001).
 Biotechnology Australia, Biotechnology Intellectual Property Manual (2001).
 Ibid, Ch 8.
 For example, Unisearch, Consultation, Sydney, 15 March 2004; National Health and Medical Research Council, Consultation, Canberra, 26 March 2004. The Department of Industry, Tourism and Resources reported that the Biotechnology IP Manual has been downloaded more than 20,000 times from the Biotechnology Australia website: Department of Industry Tourism and Resources, Submission P97, 19 April 2004.
 Department of Foreign Affairs and Trade and AusAID, Intellectual Property and Biotechnology: A Training Handbook (2001).
 The DFAT IP Handbook indicates that it is intended for use as a resource in connection with a training course, either in a group or on an individual basis: Ibid, vii.
 Ibid, Module 9.
 Department of Industry Tourism and Resources, Submission P97, 19 April 2004.
 See Ch 17 for a discussion of support programs directed toward technology transfer from publicly funded research organisations.
 AusBiotech Ltd, What is AusBiotech?, <www.ausbiotech.org/whataus.php> at 16 June 2004; AusBiotech Ltd, AusBiotech’s Corporate Members, <www.ausbiotech.org> at 21 January 2004.
 AusBiotech Ltd, Membership Benefits, <www.ausbiotech.org> at 21 January 2004.
 See, eg, AusBiotech Ltd, ‘Policy Insight’ (2004) 14 Australasian Biotechnology 24 for an outline of AusBiotech’s involvement in policy initiatives from December 2003 to January 2004.
 Australian Institute for Commercialisation Ltd, About the AIC, <www.ausicom.com> at 16 June 2004. AIC was established by a Queensland government initiative, but also receives a small amount of funding from the Australian Government and other state and territory governments.
 Australian Institute for Commercialisation Ltd, AIC Know-How, <www.ausicom.com/01_about/aic_ know-how.htm> at 16 June 2004.
 Licensing Executives Society Australia and New Zealand, LES ANZ Inc, <www.lesanz.org.au> at 16 June 2004. LES International comprises 28 separate country or regional societies, including LES Australia and New Zealand Inc.
 Licensing Executives Society Australia and New Zealand, LES Objectives, <www.lesanz.org.au> at 16 June 2004.
 Knowledge Commercialisation Australasia, Home Page, <www.kca.asn.au> at 16 June 2004.
 Australian Law Reform Commission, Gene Patenting and Human Health, DP 68 (2004), Proposal 23–1.
 Unisearch, Consultation, Sydney, 15 March 2004; National Health and Medical Research Council, Consultation, Canberra, 26 March 2004. See also Ch 18.
 Walter and Eliza Hall Institute of Medical Research, Submission P71, 13 April 2004; South Australian Department of Human Services, Submission P74, 15 April 2004; Australian Centre for Intellectual Property in Agriculture, Submission P81, 16 April 2004; Royal College of Pathologists of Australasia, Submission P82, 16 April 2004; Cancer Council Victoria, Submission P101, 20 April 2004; Queensland Government, Submission P103, 22 April 2004; Centre for Law and Genetics, Submission P104, 22 April 2004; National Health and Medical Research Council, Submission P107, 19 April 2004; Walter and Eliza Hall Institute of Medical Research, Consultation, Melbourne, 1 April 2004.
 Department of Industry Tourism and Resources, Submission P97, 19 April 2004. The other four government departments are: the Department of Agriculture, Fisheries and Forestry; the Department of Environment and Heritage; the Department of Health and Ageing; and the Department of Science Education and Training.
IP Toolbox is a multimedia package that provides information for businesses on the protection and commercialisation of intellectual property: IP Australia, About IP Toolbox, <www.ipaustralia.gov.au/ toolbox/about.shtml> at 22 June 2004.
 Department of Industry Tourism and Resources, Submission P97, 19 April 2004.
 Other difficulties faced by Australian research organisations and biotechnology companies in patenting and commercialising research results are considered in Ch 11, 17 and 18.
 Patent litigation insurance is discussed in Ch 9.