EXECUTIVE SUMMARY
Chapter 1
The terms of reference for the inquiry directed the Committee
to consider the impacts of gene patents on healthcare, medical research and the
health and wellbeing of Australians. The length of the inquiry was indicative
of the complexity of many of the legal and scientific issues underpinning the
inquiry's terms of reference, and the equally complex way in which these
interact with the development and delivery of healthcare services and the
conduct of medical research in Australia. The Committee regards the subject
matter of the inquiry as being of fundamental importance to the quality and
accessibility of Australia's health system.
Chapter 2
The background to the inquiry, discussed in Chapter 2 of the
report, was concerns arising from the attempts by Genetic Technologies in
2002-03 and 2008 to enforce its patent rights over the BRCA1 and BRCA2 genes in
Australia. Testing for these genes can indicate a predisposition to developing
breast and ovarian cancer. Although Genetic Technologies did not ultimately
enforce its patent rights, had it been successful in doing so it would have
been able to become the sole tester for the BRCA genes in Australia, or to
charge a licence fee to third parties for conducting the test. The potential
for such a critical test to be subject to commercial exploitation on these
terms led to widespread community concern, and resulted in the inquiry into
gene patents being referred to the Committee.
Chapter 3
Chapter 3 of the report discusses the impact of gene patents on
the provision of healthcare, training for medical specialists, medical research
and the health and wellbeing of the Australian people. While the Committee
heard of a number of cases where the provision of healthcare or the conduct of
medical research in Australia has been impeded, the evidence did not show that
gene patents are systematically leading to adverse impacts in these areas. The
Committee's ability to make definitive conclusions in relation to these
arguments was ultimately frustrated by the lack of comprehensive, systematic and
accessible data in relation to gene patents. Accordingly, the Committee has made
recommendations (Recommendations 1 and 2) which seek to improve the quality of
available data and information regarding the impacts and use of patents (and
gene patents in particular) in Australia. These measures would involve the
Australian Health Ministers' Advisory Council (AHMAC) establishing processes
for the economic evaluation of medical genetic testing and other new genetic
medical technologies, and for examination of the financial impact of gene
patents on the delivery of healthcare services in Australia. The Committee has
also called for the establishment of consultative processes as a basis for
establishing a transparency register for patent applications as well as other
measures to track the use of patents dealing with genes and genetic materials.
Given the present uncertainty around the impacts of gene
patents, the Committee intends to maintain a watching brief on this area, and
improved capture of data and information on the impacts of gene patents will be
critical to guide any future deliberations of the Committee. This approach is
also justified by the high level of uncertainty about the impacts of gene
patents on future, as yet unknown, developments in genetic science.
Chapter 4
Chapter 4 of the report discusses the proposal for an express
prohibition on gene patents, and this was the central issue addressed in much
of the evidence submitted to the inquiry. To the extent that this proposal was
supported by claims that gene patents are, or could, adversely impact on
healthcare and medical research, the Committee's ability to make a definitive
conclusion was, as above, significantly frustrated by a lack of relevant data.
Further, the Committee heard conflicting evidence as to whether
a prohibition on the patenting of genes and other biological materials (a)
would be effective and (b) would not lead to unforeseen consequences in other
fields of technology, particularly biotechnology research and development.
The Committee notes also that, in fact, current Australian law
does not allow the patenting of 'a mere discovery' (that is, a product of
nature as opposed to an invention) and, in the Committee's view, there is
substantial doubt that IP Australia's approach to the granting of patents over
genes conforms with the general prohibition in law on the patenting of a
discovery. While the Committee acknowledges IP Australia's defence of the
current approach as being analogous to other classes of patents, such as
chemical products, the Committee strongly rejects the reasoning which says that,
for the purposes of the Patents Act 1990 (the Act), genetic information
that is 'isolated' from its naturally occurring state in the human body may be
classed as an invention, and therefore properly be the subject of a patent
(where the other requirements of patentability are satisfied). The Committee considered
this to be the strongest justification for recommending that the Act be amended
to include an express prohibition. However, a number of considerations
persuaded the Committee that it would not, at this point in time, recommend
that the Act be amended to expressly prohibit the patenting of genes.
First, as noted above, there was a level of the uncertainty
around the potential effectiveness and effect of such a prohibition. With
improved data and information collection on the impacts of gene patents (as the
Committee's first two recommendations seek to achieve), the case for or against
such an express prohibition may be clearer in future.
Second, the Committee noted legal developments, both nationally
and internationally, which are directly relevant to the application of the
invention-discovery distinction to isolated genetic materials. In the USA, a
legal challenge to the validity of the BRCA gene patents has recently been
decided in the US District Court for the Southern District of New York.[1]
This case found that isolated genetic materials are not patentable subject
matter (that is, are not inventions) and, in the event that this decision is
confirmed by a higher court on appeal, this finding will become binding on the
practices of the United States Patent and Trademark Office (USPTO). Further, on
29 October 2010, the US Department of Justice indicated that the US federal
government had altered its policy to reflect the US District Court's finding (although
it was not clear whether the USPTO would implement the revised policy). While
changes to the law in the US will not be directly binding on IP Australia, the
Committee notes evidence that IP Australia considers that a high degree of
conformity between Australia's patent system and jurisdictions such as the US
is desirable. The Committee therefore expects that the Government and IP
Australia will seek to adopt any substantive changes to US patent law and
practice around the granting of patents over isolated genetic materials.
In Australia, a similar challenge to the BRCA gene patents was
commenced in the Federal Court in June 2010. If the court finds that isolated
genetic materials are not patentable subject matter, IP Australia will be
required to adjust its approach to conform to that decision.
The Committee will continue to monitor these important
international and national legal developments, and notes that these cases may bring
greater clarity to the application of the invention-discovery distinction to
isolated genetic materials. As part of its watching brief on this area, the
Committee may wish to revisit this issue if the area remains problematic
following the outcomes of these cases.
Third, the Committee notes that the Australian Council on
Intellectual Property (ACIP) is currently considering reforms to the manner of
manufacture test, and that its recommendations in this area may also clarify
the application of the invention-discovery distinction to isolated genetic
materials. The Committee awaits the publication of ACIP's final report with
interest.
Finally, the Committee notes that the international and
national legal developments described above, as well as the ACIP review of
patentable subject matter, may ultimately be superseded by the introduction of
a private member's Bill, the Patent Amendment (Human Genes and Biological
Materials) Bill 2010 (the Bill), into the federal Parliament. The Bill is
intended to prevent the patenting of human genes and biological materials
existing in nature, and would amend the Act to 'reinforce the distinction
between discovery and invention and...apply that distinction by expressly
excluding from patentability biological materials which are identical or substantially
identical to those existing in nature, however made'.[2]
The Committee believes that the introduction of the Bill to the
Senate will provide a further, and much-needed, opportunity for the arguments
and questions around the impacts and effectiveness of an express prohibition on
gene patents to be considered. The Committee is of the view that a Senate
inquiry into the Bill should be undertaken, with a focus on the specific terms
of the proposed amendments and the implications of their implementation for
human health and other potentially affected fields of innovation. The Committee
notes that its inquiry into gene patents has served a valuable purpose in
bringing the issue of gene patenting to the light of public interest and
attention, and provides a sound basis on which a targeted inquiry into the Bill
can build. Accordingly, Recommendation 3 of the report requests that the Senate
refer the Bill to a relevant Senate Committee for inquiry and report.
Chapter 5
Chapter 5 of the report discusses proposals for measures that
would ameliorate the impacts arising from the granting of gene patents,
including possible amendments to the Act. The Committee agreed on a number of
recommendations that it believes could substantially address concerns about the
impacts of gene patents on healthcare services and medical research, by improving
patent quality and the operation of the patent system more generally. The
recommendations are collectively intended to:
-
increase the threshold requirements of patentability (improve
patent quality);
- reduce the scope of patent claims;
- reinforce mechanisms and policies by which governments can and
should intervene with the rights of patent holders; and
- assist judicial interpretation of the Act and establish an external
accountability and quality control mechanism for the patent system.
The recommendations increasing the threshold requirements for
patentability (Recommendations 6 to 8 and 10) are intended to improve patent
quality. In simple terms, these recommendations seek to ensure that patents
(including patents over genes and genetic materials) are granted only where an
invention is, for example, sufficiently novel, inventive and useful. This will
help to ensure that patents (which effectively grant an inventor a monopoly to
exploit their invention) are not granted where their costs outweigh their
intended economic and social benefits.
Recommendation 9 goes to the criteria for 'full description'
and 'fair basis'. These requirements relate to the way in which a patent
application sets out the scope of the patent claim and provides the information
necessary for the invention to be replicated by others. This recommendation is
intended to ensure that a patentee may not monopolise a greater field than they
have disclosed to the public, and thus to prevent the granting of patents in
relation to overly broad patent claims (including those relating to human
genes).
Recommendations 11 and 12 relate to the development of clear
policies regarding the circumstances in which the Crown use provisions
contained in the Act should be employed by Government; and to clarification of
the operation of the compulsory licence provisions. In making these
recommendations, the Committee observes that successive Australian governments
have failed to properly engage with the Commonwealth's responsibility to ensure
that such measures are contemplated and exercised where this is justified by
relevant social or economic considerations. This failure to engage with and to
oversight the operation of Australia's patent system is exemplified by the
failure of successive governments to respond to the comprehensive review of
gene patents conducted by the Australian Law Reform Commission (ALRC) in 2004.
Noting the imminent completion of the ACIP review of patentable subject matter,
as well as IP Australia's review of Australia's patent system, the Committee
has recommended that the Government provide a response to the final reports of
these reviews by mid-2011 (Recommendation 4). A comprehensive response to
the work of these reviews should form the basis of the Commonwealth's ongoing
engagement with the patent system into the future. To underpin the Committee's
commitment to maintaining a watching brief on the impact of gene patents and
the implementation of suggested reforms to the patent system, the Committee has
also recommended that, following the tabling of the Government's response or at
an appropriate time, the Committee be tasked with inquiring into the extent and
impact of the implementation of any such reforms (Recommendation 5).
Recommendation 13 calls for the Act to be amended to include a
broad research exemption. Such an exemption was widely supported by
stakeholders, and is necessary to ensure certainty for both researchers and
patent holders. The intent behind the Committee's recommendation is that any
such research exemption should be sufficiently generous and broad to ensure
that research, particularly medical research, can proceed without concern that
a patent holder could sue for patent infringement.
Recommendations 14 and 15 call for the inclusion of
anti-avoidance and objects provisions in the Act. These amendments are intended
to assist in judicial interpretation of the Act, and to enable challenges to
patents based on strategic or creative drafting of patent claims.
Finally, Recommendation 16 calls for the establishment of an external
oversight authority in the form of a patent audit committee. The Committee
envisages that this body will be comprised of members with relevant technical,
scientific, economic and other relevant expertise, and be tasked with broadly
assessing the operation and performance of the patent system, particularly in
relation to areas of complex or emerging technology such as gene patents.
Critically, the patent audit committee would act as an independent source of
credible advice to guide and inform the Government's engagement with the patent
system.
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