8.10 The capacity of IP Australia to examine gene patent applications efficiently and effectively depends, in part, on the financial and human resources available to the organisation.
Funding for IP Australia
8.11 IP Australia operates on a full cost-recovery basis and funds its activities from revenue raised through charges for its intellectual property services. Unlike some other government agencies, therefore, IP Australia is not dependent on appropriations from Parliament to carry out its normal activities. For the fiscal year ending 30 June 2003, IP Australia’s annual revenue from its ordinary activities amounted to approximately $85.5 million. Of that amount, $50.6 million represented amounts collected in patent fees.
Australian patent examiners
8.12 IP Australia currently has up to 200 people involved in the process of examination—as patent examiners, senior examiners or supervising examiners. This is a relatively small number compared with the USPTO, which has approximately 3,500 examiners. As Figure 8–1 indicates, the number of patent examiners employed by IP Australia increased between 1999–2000 and 2001–02, after a period of significant decline, but the number has stabilised in the last two years. Figure 8–1 also shows that, following a steady increase in the number of patents examined annually per examiner in the 1990s, that number has declined in recent years. The total number of patent applications filed each year with IP Australia has risen most years since 1990–91. If this trend continues, the number of applications that Australian patent examiners will have to assess each year will also continue to increase, unless there is a corresponding increase in the number of examiners.
8.13 In addition to the examination of patent applications addressed in Figure 8–1, Australian patent examiners conduct prior art searches relating to applications filed under the Patent Cooperation Treaty (PCT) and on behalf of overseas patent offices. These are discussed further below.
Figure 8–1 Patent examiners and their workload
Sources: IP Australia, Industrial Property Statistics, Table 2, various years; Department of Industry Tourism and Resources, Annual Report, various years.
Submissions and consultations
8.14 While the Inquiry received some general comments on the need to ensure that IP Australia has sufficient resources, only two organisations specifically addressed the issue of funding. The Australian Centre for Intellectual Property in Agriculture (ACIPA) was critical of the current funding arrangements for IP Australia, which are based on a cost-recovery model. ACIPA considered that IP Australia should receive independent public funding, rather than being reliant upon application and maintenance fees to fund its activities. In its view, the fact that IP Australia’s funding (like that of the USPTO) is dependent upon patent fees may lead it to adopt a more service-oriented approach to the patent application process, and may provide incentives to IP Australia to issue patents in order to maintain funding levels.
8.15 The Centre for Law and Genetics suggested that increases in the funding available to IP Australia would allow more examiners to be employed and the development of further training opportunities for examiners. The Centre submitted that increases in IP Australia’s revenue might be achieved by increasing the maintenance fees for patents in the later years of a patent term.
8.16 Concerns were also expressed about whether IP Australia has access to a sufficient number of experienced examiners to assess applications for gene patents in an adequate and timely manner. For example, the Walter and Eliza Hall Institute of Medical Research suggested that ‘the rapidly increasing volume of gene patents raises questions of access to sufficiently experienced examiners’.
8.17 GlaxoSmithKline and ACIPA supported additional examiners being made available to IP Australia in all areas of technology. However, GlaxoSmithKline also suggested that ‘the efficiency and quality of examination by IP Australia has noticeably improved’ since the employment of significant numbers of new examiners in recent years. GlaxoSmithKline contrasted current practices of IP Australia with the general decrease in the number of Australian patent examiners in the late 1990s which, combined with an increase in patent filing activity, was said to have adversely affected the timeliness and quality of examinations.
8.18 The ALRC acknowledges the concerns expressed in submissions and consultations about the number of Australian patent examiners and the resources available to IP Australia. The services provided by IP Australia, like any other government body, could no doubt be improved with additional funding. However, no evidence was presented to the Inquiry demonstrating that lack of funding is currently hampering IP Australia’s examination of gene patent applications, or applications claiming any other type of technology. On the contrary, some submissions suggested that there have been significant improvements in IP Australia’s examination practices in recent years. Furthermore, concerns about Australian patent examiners did not focus on the number of patent examiners per se but on the experience of examiners. This issue is addressed below.
 Department of Industry Tourism and Resources, Annual Report (2003). See also Ch 5.
 The balance of IP Australia’s annual revenue from its ordinary activities includes trademark and design fees, revenue gained from sale of assets, and accrued interest: Ibid.
 IP Australia, Submission P56, 4 November 2003.
 IP Australia, Industrial Property Statistics, Tables 1 and 2, various years.
 However, the rate of increase in annual filings appears to have stabilised more recently. Similar trends are evident in Europe and the United States: European Patent Office, Annual Report (2003), 2; United States Patent and Trademark Office, Performance and Accountability Report for Fiscal Year 2003 (2003), Pt 6.4.2.
Patent Cooperation Treaty,  ATS 6, (entered into force on 24 January 1978).
 The number of patents examined is based on data for the ‘first reports issued’ on patent applications filed with IP Australia. The number of patent examiners does not include supervising and senior examiners because they do not generally have responsibility for examining applications in the first instance.
 Cancer Council Australia, Submission P25, 30 September 2003; Cancer Council South Australia, Submission P41, 9 October 2003; Cancer Council Tasmania, Submission P40, 29 September 2003; National Health and Medical Research Council, Consultation, Canberra, 24 September 2003.
 Australian Centre for Intellectual Property in Agriculture, Submission P81, 16 April 2004; Australian Centre for Intellectual Property in Agriculture, Submission P12, 29 September 2003.
 Centre for Law and Genetics, Submission P104, 22 April 2004.
 Ch 5 discusses patent maintenance fees.
 Walter and Eliza Hall Institute of Medical Research, Submission P39, 17 October 2003. See also Australian Centre for Intellectual Property in Agriculture, Submission P12, 29 September 2003; UniQuest, Consultation, Brisbane, 3 October 2003.
 GlaxoSmithKline, Submission P33, 10 October 2003; Australian Centre for Intellectual Property in Agriculture, Submission P12, 29 September 2003; Australian Centre for Intellectual Property in Agriculture, Submission P81, 16 April 2004.
 GlaxoSmithKline, Submission P33, 10 October 2003. See also BresaGen Limited, Consultation, Adelaide, 15 September 2003.