The NewStandard ceased publishing on April 27, 2007.

Stem Cell Battle Gestates Outside the Beltway

by Michelle Chen

July 24, 2006 – With Capitol Hill awash in controversy over federal funding for stem-cell research, consumer advocates see more-obscure legal hurdles outside the beltway between researchers and pursuit of the new field of medical science.

Two public-interest groups have filed challenges to patents held by a university-based organization that has asserted intellectual property claims over embryonic stem cells. The organizations argue that stem-cell science in the United States is on a collision course with interests seeking to skim money off of investments in public health. They fear that intellectual-property issues could eat into the country’s leading government-sponsored stem-cell project – a $6 billion program in California that is now finalizing its funding plan.

The Wisconsin Alumni Research Foundation (WARF), based at the University of Wisconsin, holds several patents covering human and primate embryonic stem cells. By granting licenses to researchers, the organization can siphon off various fees and royalty charges for the use of laboratory-cultivated stem-cell lines. While WARF has granted free licenses to academic scientists, it has charged companies for the use of stem-cells for research. The patent encompasses not just potential commercialized treatments derived from the cells but also the use of the stem-cell lines for research in general.

Critics say the patents enable WARF, a nonprofit organization with a $1.5 billion endowment, to act as a gatekeeper on stem-cell science, impeding medical advancement by making research prohibitively costly.

Advocates fear that intellectual-property issues could eat into the country’s leading government-sponsored stem-cell project.

The patent challenges were filed by the California-based Foundation for Taxpayer and Consumer Rights (FTCR) and the public-interest law firm Public Patent Foundation.

FTCR’s John Simpson said that while patents are a routine part of the commercialization of treatments, WARF’s control was “too far upstream� in the research process. The scope of WARF’s patent rights, he said, means that researchers may have to obtain costly licenses at the most-basic stages in the development of potential cures. FTCR also speculates that under WARF’s patent controls, even non-profit researchers would need WARF’s approval to develop stem-cell-based cures, and that WARF would also control scientists’ ability to exchange cell lines among themselves to advance research.

“We're most concerned about the impact the patents are having on the free flow of research,� Simpson told The NewStandard. Though therapies using embryonic stem-cells are still in the experimentation phase, many scientists say the cells could potentially lead to treatments for AIDS, spinal injuries, cancer, diabetes and other illnesses.


WARF’s licensing fees for the use of stem cells range from $75,000 to $250,000.  Licensed research institutions must pay royalties, and other costs related to the commercialization of research products. 

According to critics, a set of patents enables a single organization to act as a gatekeeper on stem-cell science, impeding medical advancement by making research prohibitively costly.

WARF has asserted that it has made extensive efforts to promote stem-cell research and to educate the public on the benefits of stem cells, and has allowed over 300 nonprofit institutions to use its discoveries for free. Yet WARF considers California’s fledgling stem-cell initiative, which just last week received an infusion of $150 million, fair game for capitalizing on its intellectual-property rights.

The center of the dispute is the funding structure of California’s stem-cell program, a taxpayer-supported initiative that grew out of a public referendum in 2004 known as Proposition 71. The government agency tasked with doling out the funds, the California Institute for Regenerative Medicine (CIRM), administers a profit-sharing agreement with academic research institutions, which is designed to ensure an economic return on the public’s investment. 

In WARF’s view, that makes the state’s stem-cell sponsorship a “commercial� operation. At a San Francisco stem-cell research conference earlier this year, WARF’s legal counsel, Elizabeth Donley, argued that the funding system entitles WARF to a cut of the state’s revenue from any future treatments that are developed, on par with its terms for commercial drug developers.

Researchers have begun to chafe at WARF’s influence over stem-cell access. Dr. Robert Goldstein, chief scientific officer for the Juvenile Diabetes Research Foundation, testified at a CIRM meeting in March, “The WARF patents have been a major inhibition to productive scientific research that’s potentially available, because it’s had a dampening effect on the dissemination of stem-cell lines.â€�   He also noted that scientists were finding a more fertile ground for funding new projects overseas, where WARF has not managed to impose its patent rights.

Carl Gulbrandsen, managing director of WARF,  called FTCR’s petition “a politically and financially motivated challengeâ€� in a public statement, and said that WARF is gearing up for a legal battle. The US Patent and Trademark Office receives about 450 challenges to patents each year, and about 70 percent of the cases result in some modification of the patent’s terms. Gulbrandsen happens to sit on the US Patent Office’s Public Advisory Committee.

University of Wisconsin researcher James Thomson  secured the patents after successfully isolating human stem cells in 1998. But in a declaration in support of FTCR’s petition, stem-cell biologist Jeanne Loring of California’s Burnham Institute for Medical Research contended that the patent should never have been issued, because Thomson simply rehashed the publicized work of others. Drawing on her observations of the field since the 1980s, Loring argued when Thomson sought the patent, “it was obvious to one of ordinary skill in the art of [embryonic stem] cell derivationâ€� that his work piggybacked on previously discovered methods applied in animal studies. 

Simpson contended that on top of legal objections to WARF’s patents, his group also rejected the entire concept of owning the scientific potential of human cells. “If you… patent the drug, that’s one thing,� he said. “But I don’t think that the fundamental little pieces of human life that are human embryonic stem cells should be patented.�

 

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The NewStandard ceased publishing on April 27, 2007.


This News Report originally appeared in the July 24, 2006 edition of The NewStandard.
Michelle Chen is a staff journalist.

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