Serious Deficiencies of Directive 98/44/EC

 

Directive 98/44/EC of the European Parliament and of the Council of 6 July 1998 on the legal protection of biotechnological inventions, Official Journal L 213 , 30/07/1998

Working paper/Greenpeace Germany / May 2000

 

Introduction

The recent incidents with the European Patent Office – the patent on human embryos The European Patent EP 695 351 granted in 1999 comprises the extraction of cells out of human embryos, the genetic manipulation of these cells, and the cultivation of genetically modified embryos from these cells, and the patent on plant varieties. The patent EP 546 090, of the company Monsanto, granted in 1996, comprises genetically modified plant varieties, the agricultural cultivation of the varieties, and corresponding seeds. In April 2000, an objection against the patent was rejected by the European Patent Office – as well as the public discussion about the patentability of human genes show that there is an urgent need at this time for an unambiguous legislation which reliably defines the limits of patentability as to the living world. There must be sufficient regulations, especially concerning ethical issues and the distinction between patentable technical achievements on the one hand and discoveries and biological processes on the other.

The Directive "Legal Protection of Biotechnological Inventions" by the European Union (98/44/EC) does not contribute anything to clarify these issues, on the contrary it even creates additional gray areas and uncertainties, therefore being totally unsuitable for solving the present issues.

For that reason, Greenpeace demands that the Directive must not pass into national law. The governments of the Member States should not hesitate to bring charges before the European Court of Justice in this connection. Such a step would be the right signal as to the necessary revision of this Directive.

The Directive has decisive deficiencies:

  1. The regulations as to the ethical limits of patentability are insufficient.
  2. A realization of the Directive would lead to a serious discrepancy between the respective degrees of invention and the resulting patent claims.
  3. The Directive offends against wordings and aims of various international treaties and acts.
  4. In addition to that, because of inconsistent regulations, it does not provide the necessary legal security and is therefore inconsistent with the general principles of EU law.

The most serious defect of this Directive, which cannot be corrected in case of realization, is the lack of a limit of patent rights as to the living world. With this Directive, patent claims on plants and animals, on parts of the human body and on the genomes of all living beings are, in principle, authorized. This cannot be brought into line with the fundamental principles of modern patent law, which allows for patents only for technological inventions. At the same time, the Directive implies a serious violation of essential ethical values. The Member States of the European Union should for that reason suspend the realization of the Directive and require the European Commission to revise it.

The following report explains in detail some of the most important deficiencies of the Directive.

 

1. Gaps of regulation regarding the field of ethics

The Directive recognizes the necessity that in the area of genetic engineering and biotechnology special regulations are necessary regarding the field of ethics. Concrete examples are listed which are described as not being exhaustive (Recital 38, Article 6)

Recital 38:

Whereas the operative part of this Directive should also include an illustrative list of inventions excluded from patentability so as to provide national courts and patent offices with a general guide to interpreting the reference to ordre public and morality; whereas this list obviously cannot presume to be exhaustive; whereas processes, the use of which offend against human dignity, such as processes to produce chimeras from germ cells or totipotent cells of humans and animals, are obviously also excluded from patentability;

Article 6:

  1. Inventions shall be considered unpatentable where their commercial exploitation would be contrary to ordre public or morality; however, exploitation shall not be deemed to be so contrary merely because it is prohibited by law or regulation.
  2. On the basis of paragraph 1, the following, in particular, shall be considered unpatentable:
    1. processes for cloning human beings;
    2. processes for modifying the germ line genetic identity of human beings;
    3. uses of human embryos for industrial or commercial purposes;
    4. processes for modifying the genetic identity of animals which are likely to cause them suffering without any substantial medical benefit to man or animal, and also animals resulting from such processes.

These regulations, which according to the wording of Recital 38 can be amended during realization, are insufficient for the following reasons:

A reference that the national Courts of Justice could in isolated cases revoke patents out of ethical reasons without the necessity of considering every conceivable case in the wording of the law, is insufficient. At least as regards fundamental issues, the Patent Offices and the Courts of Justice must be provided with a clear and sufficient basis for decision-making, particularly because in patent law, exceptions from patentability are narrowly interpreted so that by inversing the argument one could derive that everything which is not definitely prohibited is to be allowed.

 

2. Lack of a limit for the scope of patents

Concerning delimitation, there are no sufficient and extremely contradictory regulations See the grounds for the charge by the Netherlands against this Directive, brought before the European Court of Justice in 1998.

as to the prohibition of the patentability of plant and animal varieties Article 4

  1. The following shall not be patentable:
    1. plant and animal varieties;
    2. essentially biological processes for the production of plants or animals.
  2. Inventions which concern plants or animals shall be patentable if the technical feasibility of the invention is not confined to a particular plant or animal variety.
  3. Paragraph 1(b) shall be without prejudice to the patentability of inventions which concern a microbiological or other technical process or a product obtained by means of such a process.

as well as of the patentability of genes Article 5

  1. The human body, at the various stages of its formation and development, and the simple discovery of one of its elements, including the sequence or partial sequence of a gene, cannot constitute patentable inventions.
  2. An element isolated from the human body or otherwise produced by means of a technical process, including the sequence or partial sequence of a gene, may constitute a patentable invention, even if the structure of that element is identical to that of a natural element.
  3. The industrial application of a sequence or a partial sequence of a gene must be disclosed in the patent application.

For that reason, the realization of the Directive would lead to a serious discrepancy between the respective technical achievements and the derived patent privileges. In view of the fundamental function of patent law, which is to guarantee a just balance between the interests of the inventor and those of society, this is a fundamental deficiency of this Directive.

The problem of the scope of patent right is obvious especially in the following areas:

  1. The technical achievement must be distinguished from the following process of biological reproduction and further growing. If the scope is not explicitly laid down, the patent right may, starting from patents on certain processes or gene constructs, be extended to all succeeding levels of reproduction. The prohibition of the patentability of plant and animal varieties can thus easily be avoided. Concerning the delimitation between technological inventions and succeeding biological processes which are unpatentable there is a pioneering decision (T356/93) by the European Patent Office which, however, has been partially reversed by a judgement of the Enlarged Board of Appeal (G1/98).

  2. The Directive was passed although fundamental problems had already been seen earlier. A statement by the German Government from 1993 "Record" from the German Ministry of Justice from May 1993, p. 7-9 runs:

    "However, there still exist objections against the fact that, according to Article 53b EAP, the authorized protection of the (technical) process to grow a new plant variety shall be extended with its effects on all succeeding generations of the plants produced by that process. As a result, the reproduction material of the variety would be protected by patent. This does not seem to be justified. Therefore, as regards the objects to be protected, there is a need for a reasonable delimitation between the protection by patent and the protection of varieties on the basis of Article 53b of the European Agreement on Patents. It is a different question if, concerning certain plant materials, the effects of several patent rights (patents and protection of varieties) could overlap. This may be the case if a patent on plant material is granted and the patentee or a third party cultivates a variety. One must start from the principle that each inventor is entitled to make a claim for the protection of the achievement (invention or cultivation) he contributed and that the effects of a granted patent right depend on the regulations that apply to this patent right. However, this conclusion cannot be the end of the matter, particularly since it is the professed aim of the Directive to provide clear legal principles in the field of the legal protection of biotechnological inventions. For that reason, regulations must be found which adequately take into account the legitimate interests of patentees, cultivators, farmers and consumers. ... It must be tried therefore, by way of an appropriate rearrangement or adaptation of the exhaustion regulation, to confront the danger that in their effects on the farmers, patent right and protection of varieties overlap unintentionally."

    The German Government agreed to this Directive in the EU Council of Ministers against its better judgment. A serious error which must not be repeated once again this time.

  3. Contrary to American patent law, the European Patent Directive makes the granting of a patent depend not only on its isolation but on indications about its function and its usefulness. The European Patent Office is already now working according to the same principle. However, patents of the last years prove that the imprecise wording of patent law is made use of to grant far-reaching patent rights on the basis of speculative functional descriptions and hypothetical applications.

The practice of granting patents does not only lead to an extreme imbalance between the degree of an invention and the patent right but also to unjustified basis patents blocking research and development. In practice, differences to US American patent law are thus marginal.

In Europe as well as in the US, patents on genes accordingly comprise all kinds of functions, even those which at the time of the patent application are still unknown. In order to cover up the fact that those who apply are as a rule primarily interested in the monopoly on the genetic information, and in order to formally fulfil the stipulations of patent law, patents are often wrapped with obviously feigned inventions: Possible applications of the isolated genes are derived from well-known basic medical principles or from general biological correlations.

If the scope of patents is not explicitly laid down, patents on single genes have an enormous scope. These patents comprise among others:

The present problems can be proved concretely by way of examples of patents, which according to the wording of the Directive would probably be granted completely. As far as the following patents have already been granted, they are especially suitable as model for the possible interpretation of the regulations: Over the years, the European Patent Office has actively influenced the rearrangement of the Directive. Since 1985, employees of the Office have been going to Brussels repeatedly in order to advise the Commission regarding the conception of the Directive, and has – illegally. As to dubiousness of this decision see the Greenpeace documentation "Gene, Monopole, Life Industry", www.Greenpeace.de – already integrated the wording of the Directive into the European Agreement on Patents.

Some examples for problematic patents:

  1. Plant varieties
  2. Example 1 (granted):

    The Patent EP 546 090 of the company Monsanto comprises genetically modified plants which have been made resistant to the company's herbicide Roundup-Ready (Glyphosat). The following varieties are listed: "maize, wheat, rice, soybean, cotton, sugar beet, rape-seed, canola, flax, sunflower, potato, tobacco, tomato, lucerne, poplar, pine, apple, and grape".

    Although the patentee explicitly confirmed in a public hearing before the Opposition Division of the European Patent Office that the patent comprises plant varieties. Public hearing on April 11, 2000, objections against the patent were overruled. Among other things, the text of this Directive was referred to. The German Farmers' Organization also protested against the granting of this patent. Press release by the DBV, Deutscher Bauernverband, from 13.4.2000

    Example 2 (applied for):

    The patent 925366 is about plants, seeds and food (oil and flour) with an increased quantity of vitamin A. The following are claimed: cruciferous plants (such as rape, for example), cotton, soy, thistles, coconut, palms, wheat, barley, rice, maize, oats, amaranth, pumpkin, sesame, poppy, grapes, mung beans, peanuts, peas, beans, radish, alfalfa, cocoa, coffee, walnut trees.

    Problems here result from delimitation concerning the prohibition of patentability of plant varieties as well from the use of products which are extremely far from the technical process: Products coming from the harvest process are even claimed here Similar far-reaching patents on "anti squash tomatoes" have already been granted in Europe to the companies Calgene and Zeneca. The protection by patent may thus, because of the lack of an explicit exhaustion regulation, be extended to all levels of the net product.

  3. Human genes
  4. Example 3 (granted in the US, applied for in Europe):

    Situations that may result from the patent on genes have been indicated already in 1997 in the SCIENCE magazine, titled "HIV Experts vs. Sequencers in Patent Race". The article describes the discovery of the CCR5 receptor, which caused a sensation among scientific experts since it has an important function regarding the intrusion of the AIDS virus into the cell. Many scientists already had worked on the CCR5 receptor and possible therapeutic approaches when they had to realize that Human Genom Sciences had in 1995 submitted a patent application on the corresponding gene sequence (WO96/39437). Although the patent specification does not even mention a relation to HIV infection, Human Genom Sciences demands patent rights on this gene also in the field of AIDS research. Jorge Goldstein, lawyer of the company, explains: "Whoever is first to patent a DNA sequence – for any use – can lock up subsequent uses." (SCIENCE, Vol 275, 28.2.1997 S. 1263)

    This principle would, in case of a word-for-word realization of the Directive, be introduced in Europe as well, although the wording of Article 6 seemingly stipulates the contrary.

    Example 4 (applied for):

    The US company Myriad has submitted a whole range of patents on the so-called breast cancer gene 1 (BRCA1), which is held responsible for a hereditary form of breast cancer.

    The patents have been submitted also in Europe. The application EP 705902 is a typical example of these submissions. This patent comprises among other things:

    The concrete technical achievement indicated here is a diagnostic process. All kinds of possible applications of the gene sequence are claimed, e. g. drugs and therapies the development of which, however, cannot be traced either in the patent or in reality.

    Example 5 (granted):

    On 28.7.99, a European patent was granted on the gene of the Hippel-Lindau disease (EP 698093). This hereditary disease can cause a serious cancer for the persons affected, which can among other parts affect brain, eyes, and kidneys. At present the disease is incurable.

    The basis for the patent is the discovery of the gene section causing this disease. In order to find this gene, indications by doctors from the US, Europe, and Canada were made use of. Some of the patients had a medical examination at the National Institute of Health (the highest health authorities in the US). The NIH is patentee at the same time.

    The patent claim extends to the gene sequence discovered and isolated from samples from the patients. From this, the patentee derives further claims, such as diagnostic and therapeutic processes as well as the production of drugs, although the patent does not specify any achievement as regards the development of therapies or drugs.

  1. The Directive is inconsistent with, among other things, the wording or the aims of several treaties and acts. See also: "European Directive 98/44 violates eight international instruments", Oxfam Solidarity, Rue du Conseil 39, Brussels
  2. Several examples:

    The Bioethical Convention by the Council of Europe Convention for the Protection of Human Rights and Dignity of the Human Being with Regard to the Application of Biology and Medicine, from April 4, 1997 stipulates in Article 21: "The human being and its parts shall not, as such, give rise to financial gain."

    The human body and parts of the human body must not be used to the end of making financial profits."

    The Convention on Biological Diversity Convention on Biological Diversity, CBD, passed in Rio, June 1992 requires a balanced and a fair sharing out of the benefits resulting from the use of the genetic resources. A patent, however, grants the patentee an exclusive monopoly for its use.

    The European Patent Convention excludes in Art. 53b the patentability of plant and animal varieties. These patents would now be legalized through the backdoor.

    The Recommendation 1425 by the Council of Europe Resolution by the Parliamentary Assembly from September 23rd, 1999 stipulates: "... that neither plant, animal nor human derived genes, cells tissues or organs can be considered as inventions nor be subject to monopolies granted by patents."

    Moreover, the German Government determined already in 1993 "Record", German Ministry of Justice, Bonn, Germany, May 1993, Department, III B4. p 8/9. That The objections made by farmers stipulated in Articles 10 and 11 violate the Community Patent Law of the EU: "Such a stipulation must be refused as this would entail a reduction of the patentees' rights which would be inadequate and, in addition, would not be in conformity with the system. Besides, a privilege for farmers in patent law would violate the stipulations of the Agreement on Community Patent Law from December 21st, 1989 (BGBl 1991 II p.1361), by which Germany is committed to international law." According to this, the regulation is founded on such a dubious basis that it could possibly be successfully appealed against so that as a consequence the objections made by farmers would have to be deleted in the national acts.

  3. The Directive violates general principles of law.

Creation of legal security

The Directive, which defines subjective rights and duties, should be turned into compelling domestic regulations, which satisfy the requirement "of clarity and certainty" ECJ, Rs. C-365/93, Commission/Greece, 1995, I-499, Rn. 35. In 1998, the Netherlands and the Italian government took legal action before the European Court of Justice. According to their view, the regulations of this Directive are contradictory in a way that they cannot pass into national law.

If EU Directives use open or imprecise legal terms, i.e. legal terms which need to be interpreted, they may be put in concrete terms by national law. The Member States of the European Union now face this situation regarding the Directive 98/44/EG, as it makes use of several terms that need to be interpreted and put in concrete terms, e.g.

Efforts to put expressions in concrete terms which have possibly failed have no disadvantageous consequences for the Member States, because in such a case there is no sufficiently qualified violation of Common Law and consequently no entitlement for compensation cf. ECJ, verb. Rs. C-283/94, C-291/94 and C-292/94, Denkavit, 1996, I-5085, Rn. 50 ff.

In addition, there is a large scale of assessment if the Directive itself concedes a corresponding scope to the Member States to put the stipulations of the Directive in concrete terms. Such a situation could e. g. apply, according to Recital (34), to the terms "invention" and "discovery" used in the Directive 98/44/EG, and, according to Recital (39), to the terms "ordre public" and "morality".

Closing gaps of regulation in the Directive is in principle left to the legislator of Common Law or to the jurisdiction of the ECJ. Nonetheless, the national legislator could be granted supplementary regulations as regards the realization of the Directive, provided that the system basically envisaged by the Directive, i.e. the regulation concept, is not interfered with. In practice though, the national scope is small. A national effort to close assumed gaps in the regulation concept of a Directive will probably not, however, entail any claims for compensation.

The regulations of a Directive can thus, as regards their passing into national law, be amended with supplementary regulations. Such measures, which go beyond a mere putting in concrete terms of imprecise expressions, may be considered necessary by the national legislator, because he considers the regulation concept of the Directive to be incomplete or because he is of the opinion that the protection standard defined by the Directive (e. g. concerning health or environmental issues) does not go far enough.

Concerning the Directive 98/44/EG for example, supplementary regulations about the limits of patents could be added so that the protection by patent is not extended too far. An exhaustion regulation could be justified by the fact that it is a general issue being valid for all patents. Recital (7) of the Directive clarifies that the national patent law "continues to be the principal basis for the legal protection of biotechnological inventions". From this it follows that the general national patent law in principle continues to be decisive for biotechnological inventions as well.

  1. The need for national regulations

According to the view of Greenpeace, this Directive could in fact be supplemented as regards the passing into national law in order to solve several of the indicated problems. However, an altogether satisfactory solution cannot be achieved on the basis of the text of the Directive. For that reason, Greenpeace refuses that this Directive pass into national law. Nonetheless, several possible supplements shall be indicated below. They cannot replace the necessary revision of the Directive, but would, in case of its realization, provide the necessary concrete terms so as to reduce possible harms until the revision process will be initiated.

The following possibilities arise to supplement the Directive:

Introduction of exhaustion regulations: The exhaustion regulation serves as a means to regulate the purpose of protection in a way that it cannot entail any unbearable irritation of circulation: "For that reason, a protected object which has been legally put into circulation must be allowed to be used without there being the necessity of a special permission by the patentee for every single use. If, e.g., the patentee puts a patented machine into circulation, he has the possibility to receive a remuneration from the purchaser as a compensation for its technical usability. Patent law has then fulfilled its purpose, further authorizations as regards this machine will have to be considered exhausted. From then on, the machine must be allowed to be offered for sale, to be resold, or to be utilized." Hubmann, H; Götting, H.P. "Gewerblicher Rechtsschutz", 6th edition, Munich 1998, Verlag Beck.

The European Agreement on Patents and the WTO Treaty on the Right of Intellectual Properties (TRIPs) concerning the commercial aspects abstain from the regulation of the exhaustion issue. The TRIPs Agreement gives the Member States the possibility to pass specific regulations

Art. 6

"In the scope of this agreement, it must not be used, for the purpose of settling a dispute, to deal with the question of the exhaustion of rights on intellectual property."

In view of the dubiousness of the legal regulations in Art. 10 and 11 (privileges for farmers) and of the special case of autoreproductive biological material, there should be more precise regulations concerning the first putting into circulation and the extension of the protection so as to prevent especially patents on seeds, plant varieties and animal varieties and to effectively define the delimitation between technical achievements and succeeding biological processes.

The protection by patent could thus be limited to the cases where a first putting into circulation of the product coming from a process protected by patent can be assumed. Then again, all further putting into circulation in the form of seeds, harvest, products from the harvest should be excluded from the protection by patent.

Regulation of the scope of protection by patents:

In the field of the patentability of plants and animals, the view of the Board of Appeal of the European Patent Office, as stipulated in T1054Published in the gazette of the European Patent Office, 05.12.98, p. 552, is relevant here: "On the other hand, it could be considered that Article 4.2 of the directive is satisfied by permitting process claims. The technical teaching of an invention concerning plants or animals that is not confined to a particular plant or animal variety, could logically be considered to lie in a generally applicable process. The direct and indirect results of this process would still have protection under Articles 8 to 11 of the directive, ..."

The patents on genes could be restricted to certain applications. In order to prevent that genes are patented irrespective of functions or technical applications that are still unknown, the scope of the patents would have to depend on the indication of concrete technical solutions. As according to the wording of the Directive the actual degree of the invention for the patentability of a gene does not result from its analysis (its chemical structure) but from its concrete commercial usability, it follows that the protection by patent also must be limited to the respective indicated concrete technical application

This also takes into account the interests of human geneticists, doctors and patients, who have on several occasions explicitly objected against the patentability of human genes. The British parent organization of the self-help groups of patients, the Genetic Interest Group (GIG), presented a statement already at the time of the discussion of the Directive, which runs: "GIG believes that if a patent is granted on a product or therapy or pharmaceutical product which incorporates, or relies upon knowledge of, a gene sequence the patent protection should not cover the sequence itself. A different product or therapy incorporating or using knowledge of the same gene sequence should be covered by an entirely separate patent and there should be no derivative patenting." (Letter to European Parliament, on November 19, 1997).

Limitation of the effects of patents

At present it is up to the national authorities within the European economic area to pass regulations concerning the effects of patents. In the German Patent Act, this applies to � 9, 10, and 11. Here it could be stipulated that the effects of patents do not extend to certain areas.

In the field of the patentability of plants and animals, it could be stipulated that the effects of the patents do not extend to the agreed agricultural cultivations. The agricultural cultivation, the imitation of seeds, the use of plant varieties and the utilization of the harvest could be explicitly indicated here.

In the field of the patentability of genes, it could be stipulated that the effects of the patents do not extend to new applications which are not indicated in the patent specification. Furthermore it should be stipulated that the effects of the patents do not extend to the use of genes in therapeutic or diagnostic processes with the human body in order to prevent that the use of therapeutic or diagnostic processes with the human body and the animal body (Art. 52,4, EAP and Recital 35 of the directive), where genes protected by patent are used, become dependent on patentees. In 1997, the Senate Committee of the German Research Group (DFG) once again made clear in a statement concerning patentability that the freedom of choice of the doctors as to therapeutic and diagnostic processes must not be infringed. "The exclusion of processes is ethically justified. It shall prevent that doctors and vets are hindered in their profession because of patents. These ethical limits shall continue to be given full account in patent law." (Senatskommission der Deutschen Forschungsgemeinschaft (DFG), "Genforschung- Therapie, Technik, Patentierung", VCH Verlag, 1997, p. 28).