Species Patent on Transgenic Soybeans Granted to Transnational Chemical Giant W.R. Grace

The Implications of a Species Patent; Indian Government Revokes Agracetus Species Patent on Cotton

ISSUE: On March 2, 1994 Agracetus, Inc. (a subsidiary of W.R. Grace & Co.) received a European Patent on all transgenic soybean varieties. The company has a similar patent pending in the USA. In addition, Agracetus has a world patent (WIPO) pending for genetic transformation of rice.

IMPACT: Sweeping patent claims on all transgenic soybeans, a previous patent on all transgenic cotton, and a portfolio of patents pending on other major crops--(rice, groundnuts, maize and more) give W.R. Grace legal monopolies and exclusive control over any genetically engineered variety of soybeans and cotton for the life of the patent. A major chemical corporation is thus positioned to control the direction of future biotechnology research on two of the world's major food and industrial crops. These shocking examples of species-wide" patent claims confirm that the intellectual property system as applied to biotechnology products and processes is out of control, posing a serious threat to global food security and the well-being of small farmers.

REACTION: Even biotechnology industry insiders are stunned by W.R. Grace's sweeping patent claims on major agricultural species. RAFI is challenging the soybean patent and hopes to develop a coalition of non-governmental, governmental, industry and scientific organizations who will press for a broad societal review of the patenting of life.

FINANCIAL STAKES: In the 1992/93 crop year, soybeans were grown on 57 million hectares worldwide, with production totaling 116.43 million metric tonnes. The estimated value of the 1992/93 soybean crop was approximately (US) $27 billion worldwide.(1) In 1992//93 the US accounted for 51% of worldwide soybean production. The farm value of the US crop was $11.8 billion in 1992.(2) Other major soybean producers/exporters include Brazil, Argentina, Paraguay and China.

THE SOYBEAN "SPECIES" PATENT

On March 2nd, 1994, the European Patent Office granted a patent (Publication number 0 301 749 B1) on genetically-transformed soybeans to Agracetus, a wholly-owned subsidiary of W.R. Grace -- a major transnational chemical company headquartered in Boca Raton, Florida, USA. The sweeping patent claim extends to all forms of genetically-transformed soybeans, regardless of the technique employed or the germplasm involved.(3) The approved patent amounts to a "species" monopoly on all genetic engineering of soybeans within the European community for the next 17 years. The patent is also pending in the United States.(4) It is likely, though not confirmed, that Agracetus has applied for patents on transgenic soybeans in other major soybean producing nations.(5) The US, Brazil, Argentina and China account for 88% of global soybean production.(6)

Broad patent claims over transgenic crops are clearly a strategic marketing tool for W.R. Grace. Agracetus Chairman, Dr. Robert Walton, explains: "We must consider how we get paid for value-added on a non-hybrid crop. That's why we must protect our investments." Walton adds: "Grace recognizes the value of establishing patents. Our charge is to develop patentable processes or products. We strive for that rather than for short-term profits."(7)

The Cotton "Species" Patent

The soybean "species" patent follows on the heels of an October, 1992 patent on all forms of transgenic cotton granted by the U.S. Patent and Trademark Office to Agracetus, W.R. Grace's subsidiary. The earlier cotton claim unleashed a storm of controversy within the biotech industry, and led the Indian government to revoke the patent in February.8 India is the world's third largest cotton producing nation. Much of the debate was sparked by RAFI's particle acceleration method for genetic transformation of major food and industrial crops, W.R. Grace has managed to convince US and European patent examiners that the use of any other genetic transformation technique used on any other germplasm of the same species would amount to a violation of Grace's patent rights on cotton and soybeans. Depending on the licensing and royalty fees involved (not yet disclosed) these patents could effectively put transgenic research on cotton and soybeans out-of-reach for many companies and public researchers who are outside of the big league players. With a broad portfolio of patents still pending, W.R. Grace's monopoly control over transgenic crops could extend to other critical food crops such as rice, maize and beans within the next year.

Livestock Engineering Technologies

In addition to its holdings in human health, specialty chemicals and plant biotechnology, W.R. Grace also owns American Breeders Service, a cattle genetics business located in DeForest, Wisconsin. American Breeders Service now controls all of the rights to cattle-cloning technology developed by Granada Biosciences, a biotech enterprise that dropped out of the business in 1992. One patented process makes it at least theoretically possible to extract a 32-cell embryo from a prize dairy cow and use it to produce 32 identical calves via less valuable surrogate mothers. So far, however, only five or six cells successfully develop into new calves. Horse breeders are now paying as much as $3,500 for embryo transfers.(17)

Agracetus has applied for a world patent on the use of its gene gun to genetically transform somatic animal cells.(18) Depending on the company's claims, and the interpretation of the patent examiner(s) involved, this patent could prove to be extremely broad in covering genetic transformation of mammalian species.

W.R. Grace Under Fire

RAFI will file formal opposition to the W.R. Grace/Agracetus patent claim on transgenic soybeans. Under Article 99(1) of the European Patent Convention notice of opposition may be filed for up to nine months after the patent is granted. For further information about joining this effort, please contact RAFI at the address given below.

RAFI is also in the process of contacting numerous organizations, including farmers' organizations, sustainable agriculture NGOs, the UN Food and Agriculture Organization, the Consultative Group on International Agricultural Research, concerned private companies, and national governments to discuss the formation of coordinated opposition to the various "species" patents and to propose that an international conference be held on the implications of patenting life forms.

Corporate Profile

In 1992, W.R. Grace ranked 237 in Fortune Magazine's ranking of "The World's Largest Industrial Corporations," with annual sales of (US) $6,329.6 million. The company has 44,000 employees worldwide.

A Partial Listing of W.R.Grace's Portfolio of Agricultural Patent Claims Granted and Pending

Agracetus Patents in the United States

4531324 Plant tissue culture device

4533636 Medium for plant protoplast culture

4556643 Assay method and probe for polynucleotide sequences

4654465 Genic male-sterile maize

4727219 Genic male-sterile maize using a linked marker gene

4875921 Bacterial agricultural inoculants

5004863 Genetic engineering of cotton plants and lines

5015580 Particle-mediated transformation of soybean plants and lines

5120657 Apparatus for genetic transformation

5149655 Apparatus for genetic transformation

5159135 Genetic engineering of cotton plants and lines

5177308 Insecticidal toxins in plants

5260191 Method for diagnosing tumors

Agracetus World Patents Pending

WO 9215675 Particle Mediated Transformation Of Cotton

WO 9220809 Method Of Creating A Transformed Rice Plant

WO 9308270 Particle-Mediated Trans. Of Mammalian Unattached Cells

WO 9308292 Particle-Mediated Transformation Of Animal Somatic Cells

WO 9317706 Genetic Vaccine For Immunodeficiency Viruses

W.R. Grace Mammalian Patents Granted in USA.

4929706 Cell growth enhancers and/or antibody production stimulators

5155038 Use of thrombospondin to promote wound healing

5232848 Basal nutrient medium for cell culture

 

(1) Soybean area, production and price based on data from U.S. Department of Agriculture, Foreign Agriculture Service and Economic Research Service. RAFI used average US price of (US) $213 per metric tonne (oilseed prices) to calculate value of US soybean crop 1992/93, and Rotterdam price of $246 dollars per metric tonne to calculate value of the remainder of world crop for 92/93.

(2) Information provided by Mark Ash, USDA, ERS, Commodity Economics Division.

(3) Claim # 17 on European Patent 0301 749B1, states: "A soybean seed which will yield upon cultivation a soybean plant comprising in its genome a foreign gene effective to cause the expression of a foreign gene product in the cells of the soybean plant."

(4) Under US patent law, patent applications are not disclosed until granted. However, the European patent discloses that a US patent has been filed.

(5) On October 27, 1992 Agracetus received US Patent No. 5,159,135 on all transgenic cotton. It filed similar patent applications in India, Brazil, Europe and China. For further background, see RAFI CommuniquÈ, "Control of Cotton," July-August, 1993.

(6) Source: Soybeans: World Supply and Distribution, USDA, FAS, for 1992/93, March, 1994.

(7) Grooms, Lynne W., "Agracetus Builds Position," Seed World, December, 1991, p. 19 and 21.

(8See RAFI Press Release, March 17, 1994 and Kanth, Ravi D., "Govt. to Revoke Seed Patent of US Firm," Business Standard, Calcutta, 18 February 1994.

(9) Grooms, Lynne W., "Agracetus Builds Position," Seed World, December, 1991, p. 20.

(10) Christou, Paul, Tameria L. Ford and Matt Kofron, "The development of a Variety-Independent Gene-Transfer Method for Rice, Trends in Biotechnology, July, 1992 (Vol. 10).

(11) Personal communication with Dr. Geoffrey Hawtin, 29 March 1994.

(12) Applied Genetic News, "Agracetus Expands ACCELL Gene Delivery Success," August, 1992 (Vol. 12).

(13) Biotech Reporter, "Agracetus Offers Transgenic Services on All Corn Varieties," February, 1993, p. 3.

(14) Genetic Technology News, "Agracetus Genetically Engineers Commercial Corn Varieties," June, 1992.

(15) Grace and Du Pont Cross-License Genetic Engineering Technologies," Industrial Bioprocessing, May, 1992, Vol. 14, No. 5.

(16) Bioscan, Vol. 7, No. 5, February, 1994, p. 391.

(17) Nash, J. Madeline, "They clone cattle, don't they?" Time, November 8, 1993, p. 68.

(18) European Biotechnology Newsletter, 6 August 1993, p. 6.

 

COMMUNIQUE UPDATE

Indian Government Revokes Agracetus "Species" Patent on Cotton: In February, 1994, the Indian government rescinded Agracetus's controversial patent on transgenic cotton (genetically engineered cotton). According to the Business Standard of Calcutta, the Indian Government, under clause 66 of the Indian Patent Act, 1970, decided to summarily revoke the patent, "because of its far-reaching implications for India's cotton economy." The action was taken last month, and was reported in the Business Standard on 18 February.

After China and the US, India is the world's third largest cotton producing nation. At least 190 million people in the developing world derive all or part of their cash income from cotton growing and handling. An additional 60 million people depend upon cotton processing.

Agracetus's controversial patent was the subject of RAFI's July-August, 1993 CommuniquÈ. That publication is credited with alerting the Indian government to the negative implications of the first-ever "species patent."

In a press release issued by RAFI on March 17, RAFI's Director of Research Hope Shand stated, "Government policy makers should take a cue from the Indian Government--this issue demands broad societal review of intellectual property laws affecting biological products and processes." The implications for farmers and consumers in developing nations are particularly severe in light of the recently concluded GATT trade agreement, which imposes tremendous pressures on developing nations to adopt stronger intellectual property laws. It remains to be seen whether or not the Indian government will remain firm in its action in light of the GATT agreement, which comes into force later this year.

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