Varying the Course in Patenting Genetic Material: A Counter-Proposal to Richard Epstein's Steady Course

Abstract:     
In Steady the Course: Property Rights in Genetic Material, Richard Epstein rejects the notion that patent law should recognize new defenses to infringement of patented inventions in the biotechnology field, claiming that an all-or-nothing approach to patent rights represents the best course of action. This paper examines Epstein's argument, including four core assumptions that underlie it regarding the nature of the patentee, the patent, the licensing relationship, and the goals of patent law. The paper argues that science-intensive fields, such as biotechnology, present a new challenge to patent law because they give rise to patentable technologies that are also core building blocks to future scientific advances. Patents on fundamental principles are unlike patents on products because they sometimes cannot be invented around. As a result, the "steady course" (by which Epstein apparently means current law) gives patentees unprecedented control over innovation markets. To avoid the potential drag on progress that this control entails, it is necessary to enact new measures to safeguard the scientific commons.

The paper ends with a proposal for one such safeguard. It suggests that a non-commercial research organization, university, or an employee of such an institution should be immune from liability for patent infringement if 1) the patented material the researcher needs are not marketed on reasonable terms; 2) the researcher agrees to publish the results of the work; and 3) the researcher agrees to refrain from patenting the fruits of the resulting work. A registry would be maintained (presumably in the patent office) in which qualified researchers would file waivers agreeing to these terms. Buyouts would be permitted.

Such an approach would avoid the need to characterize the invention or the manner in which it was used. Because exclusive rights are not denied even when they protect inventions of research significance, patents would continue to be available to serve as signals, as facilitators of technology transfer, and as vehicles for appropriating end-use (as well as commercial research-use) value. As important, the proposal eliminates all need to price the usage made of the patented invention. Indeed, the proposal recognizes that an important difference between commercial and nonprofit institutions is that the latter do not have the same resources to pay, or patents to cross-license defensively. The waiver element has interesting effects of its own. Most prominently, it serves to enrich the public domain because all resulting work is published and not patented. In the university setting, it may also soften the effect of the Bayh Dole Act, which is often incorrectly treated as requiring (rather than permitting) the recipients of federal funds to patent their inventions. In a sense, the effect of the waiver is to partially monetize and internalize the public benefit of allowing work to fall into the public domain. Providing basic researchers with an incentive to forego patenting may also help restore the Mertonian ethos that once dominated basic scientific work.

Number of Pages in PDF File: 12

Keywords: intellectual property, patent, research exemption, experimental use, biotechnology

JEL Classification: K4, L0, O0, O34

working papers series