Europe Country Report

In contrast to U.S. and Australia, there is no “official” government-solicited report on gene patents and related practices. However, two influential papers, which are frequently cited in literature, were published in consideration of these matters.

First, in response to increasing public concerns about the effects of gene patenting, the European Society of Human Genetics (the “ESHG”) researched and published a report on ethical, moral, frequency, and breadth of patent claims over genetic material and associated licensing practices in Europe. This report, titled the Patenting and Licensing in Genetic Testing: Ethical, Legal, and Social Issues (the “ELSI Report”), was published in the European Journal of Human Genetics in 2008 for the purposes of “establish[ing] a dialogue between all stakeholders,” review[ing] the facts and indentify[ing] ways to improve the current patent system applied to the genetic testing field.”

As a follow up to the ELSI Report, the ESHG subsequently published a second report, titled Patenting and Licensing in Genetic Testing: Recommendations of the European Society of Human Genetics (the “RESHG Report”), which provided specific recommendations for the European Patent Office in 2008.

Guide to European Reports

Report Title	Abbreviation	Date of Publication	Subject Matter Covered	External Link to Report
Patenting, Licensing in Genetic Testing: Ethical, Legal, and Social Issues	ELSI Report	2008	Covers the ethical, moral, frequency and breadth of patent claims over genetic material and associated licensing practices in Europe and identifies areas of concern and needs for improvement.	Available Here
Patenting and Licensing in Genetic Testing: Recommendations of the European Society of Human Genetics	RESHG Report	2008	This supplemental report provides specific recommendations to address concern identified in the ELSI Report.	Available Here

Summary of the ELSI Report

Similar to the U.S. SACGHS Report and the Australia’s ALRC Report, the ELSI Report identified a number of concerns related to genetic patents, including patent-holders’ “abusive use of their monopoly position, patent-thickets (ie [sic] overlapping sets of patent rights with different ownership, requiring several licenses), overly broad patent claims; and blocking patents due to defensive [intellectual property rights] policies of the companies.” The ELSI Report similarly identified that these issues may “hinder[] further research and development, increas[e] the costs and/or to preventing access to new diagnostic tools in clinical practice.” The ESLI Report was conducted through a systematic review of current literature and articles on patenting and human genes, as well as through a studies of recent reports produced by international organizations.

Although criteria between individual European countries can vary some, patent-eligible inventions generally require “(i) an invention, (ii) novelty, (iii) inventive step, and (iv) industry applicability.” Similar to the exclusive rights granted in the U.S. and Australia, European patents provide a patent-holder with “an exclusive right to prevent third parties, without the owner’s consent, from the acts of making, using, offering for sale, selling, or importing” a patented invention. The exclusive rights persist over a 20-year term of the patent, with the possibility for a 5-year extension for claims covering pharmaceutical substances.

According to the ELSI Report, European patent claims are either “product claims” or “process claims.” Product claims include a substance or composition (eg [sic] chemical compound or a mixture of compounds) as well as any physical entity (eg [sic] object, article, apparatus, machine, or system of co-operating apparatus) which is produced by a person’s technical skill. Product claims also cover “prospective new uses of the invention, even if not foreseen at the time of patent application.” Process claims are applicable to “all kinds of activities in which the use of some material product for effecting the process is implied; the activity may be exercised upon material products, upon energy, upon other processes (as in control processes) or upon living things.” Like their U.S. and Australian counterparts, European genetic patents can assert rights of DNA sequences themselves, including in ways that might “block all access to the DNA sequences itself.”

The ELSI Report discusses the problems created by royalty stacking, access to knowledge, patent holdouts, and licensing in some detail. The Report draws similar conclusions to the problems identified in the U.S. GPLPPA Report. The following paragraphs discuss some of the highlights of the ELSI Report with respect to these problems.

The ELSI Report described some concerns over the breadth of certain patent claims covering isolated gene molecules:

“Genes have unknown functions, they can produce several proteins; introns can have independent functions, so called junk-DNA can be involved in regulating the genes and how and when genes are expressed. Many functions are still to be found. Therefore, product patents in biotechnology are not generally held fair and justifiably, and very stringent application of the criterion for inventiveness ought to be applied.”

On the basis of this reasoning, the ESHG is concerned that claims to isolated gene molecules potentially privatize unknown uses for a given molecule and its nucleotide variants. The potential here is for a patent holder to obtain rights that are more expansive than the original invention, and in cases where the unknown uses prove to be important to the other diseases or gene functions, that molecule is now subject to private ownership for the patent term.

The ELSI Report also noted that access to information and technology may be hindered by patent rights:

“In the ‘jungle’ of many different patents and patent holders, one practical problem is that the users, and in the case of diagnostics, the clinical laboratories, do not know which licenses, if any, are needed, who the patent holders are, and which methods are covered by a patent, so that they even could pay royalties. In such a situation, further innovation may be hampered. “

These concerns are similar to those addressed by the GPLPPA and ALRC Report. The fact that many patents claiming various rights to methods and isolated molecules in the genome already exist means that prior to conducting research, a researcher must conduct an extensive search of existing patents to stay clear of infringement liability. Moreover, the costs of such a search coupled with the associated costs of negotiating a license and the payment of royalties may be so excessive as to prohibit research.

The ESLI Report also notes that “[l]icensing is not very regulated and practices are not well known, even though few practices known thus far have been harmful.” Despite the lack of known harms, the Report found that “confidentiality requirements” do pose a problem as they can allow “patent holders to manipulate the market and licenses.” Beyond the terms within an agreement, licenses payment fees, including annual fees and royalties, potentially pose a barrier to access and research. The ESLI Report notes that one group suggests that “license agreements should include mechanisms to set a reasonable overall royalty burden for genetic invention products and services, including research tools.” Nevertheless, the Report found problems in licensing costs to be “directly linked to the problem of royalty stacking.”

In response to some of these concerns, the ELSI Report discusses compulsory licensing and patent clearing houses as possible solutions to the problems. The Report found that “compulsory licensing constitutes an important safety valve, but it may not offer a satisfactory solution in case of patent thickets” as the “regulation of compulsory licensing lies to some extent in the hands of national laws and court practice.” A clearing house model would collect all the important patents which would be accessible through the clearing house for a fee. The Report notes that “it is questionable whether it could work in the biotech field, where there are many different players with different business goals.”

On the concept of patent pools, the ELSI Report cites a Swiss study which conducted a survey that found “many biotechnology entities were cautious about collaborating with competitors and therefore reluctant to adopt this approach.” The ELSI Report also noted that patent pools may still require further research because they “might constitute a cartel and have anticompetitive effects.”

Recommendations from the RESHG Report

Following the discussion of potential issues in the ELSI Report, the EHSG published the RESHG Report which provided specific recommendations. The recommendations begin by stating that patents “can be beneficial for society, if they drive innovation and promote progress,” however, “in some instances patents can also be problematic; this is the case in the field of genetics, and particularly in the field of genetic testing.”

The first recommendation by the ESHG is to establish “voluntary reporting system (annually or case by case), whereby geneticists could report on any new and/or old patents or licenses perceived as damaging service to patients.” Additionally, the ESHG recommends participating through interaction and dialogue “between patent owners, service providers, consumers and patients should be established to find a way to preserve the patent system without damages the quality of care.” In terms of more substantive recommendations, the ESHG recommends that the European Patent Office should “become yet more careful in assessing the scope of claims in genetic patents” to avoid overly broad patent claims and “reduce the influx of patent applications” by “narrowing the scope of gene patentability.” These recommendations focus on reducing the problems caused by the lead time for issuing a patent which eventually becomes a blocking patent. In particular, the RESHG Report proposes a prohibition on granting patents “of individual mutations in known disease genes” on the basis of novelty.

For licensing issues, the ESHG strongly notes “that license agreements should not provide the licensor with exclusive control over genetic information” and that “[r]ights holders should license genetic inventions for health applications, including diagnostic testing, on terms and conditions that seek to ensure the widest public access to, and variety of products and services based on inventions.” In particular, the ESHG recommends that “[f]oundational genetic inventions – and methods for diagnosis – should be licensed so as to be broadly accessible, at a fair and reasonable price.” The recommendations also note that further research on alternative licensing methods, such as patent pools and clearing houses, should be studied.

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