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Intellectual Property Rights

:
Problems and Solutions
Anatole F. Krattiger
Adjunct Professor, Cornell University
Research Professor, Biodesign Institute & Sandra Day O’Connor College of Law at ASU
International Consultant (bioDevelopments LLC)
Transgenic plants for food security in the context of development
 Pontifical Academy of Sciences, Vatican, Rome
15-19 May 2009

intercontinental Consultants

(c) 2009. Anatole Krattiger.

These slides may be used freely for any educational and non-profit uses,
provided the source is properly acknowledged.
For any commercial uses, please contact:
Anatole F Krattiger
Cornell University
Biodesign Institute & Sandra Day O’Connor College of Law at ASU
bioDevelopments LLC (International Consultant)
PO Box 26
Interlaken NY 14847, USA
Phone 
+1-607-532 4413
Fax  +1-212-504 8287
Skype  
Anatole35
anatole@bioDevelopments.com or afk3@cornell.edu

Main take-home message

Authoritative and ethical stewardship of
intellectual property is at the core of
partnerships and will become increasingly
important in the management of the
“knowledge commons”.
Institutions working for the “public good”
operate at the nexus of public and private
and should take IP management more
seriously as a critical component in any
strategy aimed at directing innovation to the
poor.

1.

What is IP?

2.

What are they key problems with IP?

3.

Solutions are “beyond” IP:
Principles of innovation management

4.

Golden Rice case study

5.

Conclusions: Managing the “Knowledge Commons”

Intellectual property

A legal concept: Copyright, trademarks and geographic
indications, patents, trade secrets, plant variety
protection

A social construct that defines “intangible” borders (as
opposed to tangible, real property borders)

A business asset that can be valued and traded

An instrument to achieve humanitarian objectives

A policy tool to foster investments in innovation

(US$, millions, 2000 equivalent)

Yield index of major crops
(1930 = 1.0)

Source: Agricultural Statistics, 
NASS, USDA, various years.

Private sector investments
into corn breeding (excl. biotech

Source: Pioneer Hi-bred 
International. Pers. Comm.

Effects of the introduction of PVP

But…
To benefit from stronger plant variety protection:
1. Vibrant public sector breeding
2. Farmer choice (competition & antitrust)
3. Healthy farm economies

Plato (400BC)

Virtue … unity … community … abolish the private.
The Republic

Plato (400BC)

Aristotle (350BC)

Virtue … unity … community … 
abolish the private.

Wrong objective and
impracticable:
The roots of evil are in men’s
(sic) inherent wickedness.
Aristotle, Politics

The Tragedy of the Commons
Even supposing that it were best for the community to have 
the greatest degree of unity, this unity is by no means proved 
to follow from the fact 'of all men saying "mine" and "not mine" 
at the same instant of time,' which, according to Socrates, is 
the sign of perfect unity in a state. . . That which is common
to the greatest number has the least care bestowed upon
it. Every one thinks chiefly of his own, hardly at all of the
common interest. . . Everybody is more inclined to neglect
the duty which he expects another to fulfill. . .
Aristotle, Politics, II

Tragicomedy?
Compare:
• Tragedy of the Commons
• Tragedy of the Anticommons
M Heller & R Eisenberg, 1998

The Gridlock Economy
Heller, 2006

“Communal” resource management
(land, fisheries, airwaves, etc)

The Contribution of the Romans
The Romans
embedded
property
rights (dominium)
into elaborate
laws.

The Middle-Ages
Self-denial…
Property is the
source of evil,
capable of
corrupting the
soul and leading
to sin.

Ciborium of S. Giorgio in Velabro, Italy,
with frescoes of Cevallini.

St. Augustine of Hippo (400 AD)
A property-less society can
only exist in Paradise.
It requires perfection to
succeed.

Monarch of Medieval Europe Issues First
Monopoly

The Venetian Republic grants monopoly in 1443 to conveyor
belt inventor (Inventor Bylaws, 1474).
The British Crown follows in 1623 (Statue of Monopolies).

The first US Patent: 1790
Right enshrined
in US Constitution:
… promote progress of
science and useful arts
… exclusive right for
a limited time

Industrialization and the 19th Century

Those who wanted to acquire industries were leading the
debate to create the Paris Convention in 1883:
…for the protection of industrial property… and the 
repression of unfair competition…

Many unresolved issues
Eg. Interface of “western” system with other cultures

Principles Themes of Property Discussions
    

     

Balance between

Politics

Stability

Freedom, social
unrest

Ethics

Fruits of one’s
own labor

No equal
opportunity

Economics

Efficiency

Wasteful
competition,
gridlock

Psychology

Self-esteem

Greed

Take-home lessons #1
 IP is a compromise, an imperfect solution. In absence of

alternative, the best we have.
 Search for balance has accompanied societies for

millennia.
 IPRs are instruments of public policy to confer

economic privileges on individuals or institutions
for the purposes of contributing to the greater
public good. The privilege is a means to an end,
not an end in itself.
 The devil is in the details on how this balance is struck

1.

What is IP?

2.

What are they key problems with IP?

3.

Solutions are “beyond” IP:
Principles of innovation management

4.

Golden Rice case study

5.

Conclusions: Managing the “Knowledge Commons”

Key problems of IP to achieve food security
Industry:
– Incentives are not always at the right place
(the “wisdom” of the “herd”)
– Broadly accepted codes of ethics lacking in regard
to IP management
– Insufficient experience in managing technologies for
dual purposes (economic and humanitarian)
– Liability law (tie-in of IP with product liability), due to
“expression” of IP in material property

Key problems of IP to achieve food security
Industry
Donor organizations:
– Slow in funding IP capacity building in the public
sector
– Late in requiring sound IP management plans
(eg. Bill & Melinda Gate Foundation’s “Global Access
Strategy”)

Key problems of IP to achieve food security
Industry
Donor organizations
Governments:
– Slow in adapting to changing circumstances and
new technologies
– Unresponsive to public sector needs
– Weak in enforcing anti-trust regulations
(competition, collusion, etc)

Key problems of IP to achieve food security
Industry
Donor Organizations
Governments
Public sector:
– Mistrust vis-à-vis private sector
– Though of IP to be the sole purview of the private sector
for too long
– Slow in uptake of IP management policies and practices
– Misunderstanding of public good and private good

A public good is…

1. Non-rivalry in consumption
(a good whose use by one person does not compete with or rival its use by
another person)

AND
2. Non-excludable
(no person can exclude other persons from its use)

Take-home lessons #2
 Public and private goods meet every day at the

intersection of IP.
 Private is not the opposite of public.
 A public good is never (or rarely) free.

1.

What is IP?

2.

What are they key problems with IP?

3.

Solutions are “beyond” IP:
Principles of innovation management

4.

Golden Rice case study

5.

Conclusions: Managing the “Knowledge Commons”

Innovation is…
 Doing something that creates (more) value.

6 components of innovation management
Research,
Sci & Tech

Regulations

IP

Manufacture

Domestic
Market

Export
Market

Research

Development

Commercialization

Source: Mahoney 2004

Important roles by public and private sectors
Research,
Sci & Tech

Regulations

IP

Manufacture

Domestic
Market

Export
Market

Research

Development

Commercialization

Role of Public

Role of Private

The innovation management framework:

Interconnected (progress in one requires progress in
others)

Implemented through networks

Dynamically linked (absence of one cannot be
compensated by emphasis on another one)

Global Access Strategy or Innovation Management is all
about STEWARDSHIP.

“PDPs” in health were set-up for this purpose.

What are Product-Development Partnerships?

Using private sector approaches and resources to
tackle R&D challenges

Target one or more neglected disease
Focus on products suited for use in developing countries
Take candidates through to the commercialization
value chain
Primarily pursuing public health objectives
Employ multi-candidate/portfolio management approaches:




– Business Plan, Scientific Blueprint, Pharmaco-Economic Analysis, 

Rigorous “Go—No-Go” Milestones.

Global Access Strategy
eg. A live recombinant attenuated Salmonella antipneumococcal vaccine for newborns

“… an innovation management plan to achieve a
Krattiger, 2005
beneficial public health outcome.”

Development Overview

First 4 year of the anti-pneumococcal vaccine
2006

2007

2008

2009

2010

First Generation RAStyV Engineering & Characterization

GNG

First Generation RAStyV Evaluated in Human

S. typhimurium & other Salmonella vectors
Engineering & Characterization
Discovery & Characterization of
new S. pneumoniae Ags
Seroepidemiology Study
Reagents Generation

Plasmids Construction &
Characterization
New Vaccine Candidates
Engineered and Characterized

Second Generation RASV Evaluated in Human

GNG

Principal outcomes
Broad
Developing and delivering an anti-pneumococcal
vaccine for newborns, particularly for developing
countries

Specific
 Availability of specific vaccines
 A platform for other vaccines
 Ensure Access: affordability
acceptability
adoption

Principal components of ASU’s GAS
1. Science and research
2. Regulatory aspects
3. IP management
4. Production/Manufacture
5. Meeting national needs
6. Trade/export markets

3. IP management
Key drivers
 Ensure necessary incentives are available for
product development, clinical trials, manufacture
and distribution/marketing
 Make scientific and technological advances
available as widely as possible
 Use IP as a tool to facilitate global access and
widespread adoption

Principal Tools
• Project-related IP policy
• In-licensing strategy to obtain FTO
• Patenting strategy
• Licensing strategy
• Confidentiality and protection of regulatory data, if
helpful
• Branding strategy (trademarking)
• Laboratory notebook and invention disclosure policy
• Patent enforcement and infringement policy
• Law, jurisdiction, dispute resolution, indemnification,
liability, insurance.
• Etc.

Major issues to be resolved (triggered by milestones)
• What background IP is available and necessary
• Willingness to pay: developed country and higher
middle income countries
• Manufacturing capabilities in developed an
developing countries
• Financing of production capabilities
• FTO strategy
• Source of value

Some elements for negotiation/incorporation into
licenses with public sector goals
Rights to Practice

IP rights included
Field
Territory

Duration
Degree of exclusivity

Commercial Data

Product/Material
Production

SOPs

Future Improvements

From Licensor
From Licensee

From other Licensees
Rights to Payment(s)
for

Right to Sublicense

Conditions for
Split of fees

Improvements
Grant backs

Patent Expenses

Maintenance Costs
Foreign filings

Prosecution Costs
Defense of Patents

General Indemnity

Product Liability

Ownership Issues

Quality Control

Testing
Laboratory Services

Trademark Policing

Regulatory Approval

Pre-Clinical
Clinical I-IV

Data
Dossiers

Infringement Issues

Studies and opinions
Freedom to Practice

Suits (against infringers, 
by third parties)

FTO strategies
 Legal/IP Management Strategies
1. License in
2. Cross-license
3. Oppose third party patents
4. Seek nonassertion covenant
5. Seek compulsory license

Krattiger 2007.

FAKE… itz the new REAL!

Source: http://go.to/funpic

FTO strategies
 Legal/IP Management Strategies
1. License in
2. Cross-license
3. Oppose third party patents
4. Seek nonassertion covenant
5. Seek compulsory license
 R&D Strategies
6. Modify product
7. Invent around

Krattiger 2007.

Source: lachschon.de

FTO strategies
 Legal/IP Management Strategies
1. License in
2. Cross-license
3. Oppose third party patents
4. Seek nonassertion covenant
5. Seek compulsory license
 R&D Strategies
6. Modify product
7. Invent around
 Business Strategies
8. Wait and see
9. Abandon project
10. Merge and/or acquire

Krattiger 2007.

© Jim Lavrakas, 2000.

FTO strategies
 In Practice:

A combination of several options implemented
concurrently

Marketing and branding
• Conduct of large scale vaccine-introduction trials
• Consensus on the need for the vaccine
• Recommended use practices
• Assurance of adequate and competitive supply
• Creation and sustenance of funding mechanisms to
procure the vaccine
• Effective communications with health professionals,
scientists, and the public about prevention and
control
• Establishment of advocacy groups

Take-home lessons #3
 The 6 principal factors of innovation are interconnected.
 Innovative organizations build and maintain networks

that allow them to address each of the factor.
 Innovative organizations are largely characterized by the

number of “connections”
 Cross-sector (public/private) cooperation is essential.

1.

What is IP?

2.

What are they key problems with IP?

3.

Solutions are “beyond” IP:
Principles of innovation management

4.

Golden Rice case study

5.

Conclusions:

The IP situation with golden rice

~70 patents and patent applications might be applicable
to golden rice when all patents issued in or applied for
in all countries were considered.

A dozen material transfer agreements were also
identified, 1 of which needed a license.

The published analysis, and legal opinion, concluded
that, in practice, only a few patents were applicable in
developing countries.
Kryder et al., 2000

Resolving the IP constraints with golden rice
1. Assembly of IP and tangible property rights:
- within a few months, in licensing, for humanitarian use,
led by Zeneca (Adrian Dubock), of key IP components
(Bayer AG, Monsanto, Novartis AG, Orynova BV, Zeneca Mogen BV, others)

2. Out-licensing, by Syngenta, via the inventors, the
bundled IP to public sector institutions in developing
countries:
- Bangladesh India, Indonesia, Philippines, Vietnam and
many more
- Policy support from Syngenta’s chairman, Heinz Imhof
Krattiger & Potrykus, 2007

Principal terms of the humanitarian license






For use by resource-poor farmers
(< US$10,000/year from farming)
Use of public varieties
No technology fee
Farmers are allowed to reuse harvested seeds
No release in countries lacking biosafety regulations
Export to licensees for research and use is permitted
Improvements:
– Humanitarian use allowed (Syngenta already licensed many 

improvements)
– Commercial rights to improvements are granted back to 
Syngenta

Take-home lessons #4
 A case study on how public & private sector innovations

can be put to work to help the poor with focused public
sector IP management.
 The preliminary FTO “analysis” of golden rice served as

a wake-up call for the public sector, and donors.
 Other constraints are much more critical (eg. biosafety)

but failure to address IP would make IP critical.

1.

What is IP?

2.

What are they key problems with IP?

3.

Solutions are “beyond” IP:
Principles of innovation management

4.

Golden Rice case study

5.

Conclusions: Managing the “Knowledge Commons”

www.ipHandbook.org

Broad conclusions
1. Move away from IP management.
Place emphasis on knowledge management.

2. Government policy everywhere should be focused on
maximizing the public good which should include
appropriate private incentives.

3. Public sector institutions should explicitly manage IP
with the dual goals of creating economic value and
achieving humanitarian goals.

Specific conclusions for food security
1. IP management is an effective, and essential tool, in
achieving humanitarian objectives.
Proven approaches include:
– donations
– different types of product-development partnerships
– creative licensing practices through
various forms of market segmentation
 All require IP management!

2. Insufficient attention has been paid by the public sector
to managing IP.
This lack of focused attention must be corrected.
Public sector must appreciate how it can use its own IP
—and leverage that of others—to help meet its social
mission.

3. PVP and plant genetic resources:
The trend of restricting germplasm flow is one of the
most important threats of future progress in plant
breeding.
The open exchange of plant genetic resources for
breeding purposes, particularly by the public sector,
must be maintained/improved.

4. “Downstream” responsibilities require larger networks.
Collaboration with the private sector, both upstream
and downstream, should often be build much earlier in
the innovation continuum.
Authoritative IP management is an important prerequisite for this.
Donors have an important role to play in applying
pressure on leveraging an innovation network of
outsiders.

5. “Knowledge management”
The need for models in creatively managing the
“knowledge commons”.

How can we leverage a growing network?

Anatole F Krattiger
Cornell University
Biodesign Institute & Sandra Day O’Connor College of Law at ASU
bioDevelopments LLC (International Consultant)
PO Box 26
Interlaken NY 14847, USA
Phone 
+1-607-532 4413
Fax  +1-212-504 8287
Skype  
Anatole35
anatole@bioDevelopments.com or afk3@cornell.edu