How Big Agribusiness Is Heading Off The Threat From Seed Generics — And Failing To Keep The Patent Bargain

from the bad-taste-in-the-mouth dept

Recently we wrote about how pharmaceutical companies use “evergreening” to extend their control over drugs as the patents expire. But this is also an issue for the world of agribusiness: a number of key patents, particularly for traits of genetically-engineered (GE) organisms, will be entering the public domain soon, and leading companies like Bayer, BASF, Dow, DuPont, Monsanto and Syngenta are naturally coming up with their own “evergreening” methods.

A new report from the ETC Group, which describes itself as working “to address the socioeconomic and ecological issues surrounding new technologies that could have an impact on the world’s poorest and most vulnerable people”, offers an interesting view of how the big agribusiness companies are trying to do that (pdf).

Making its position quite clear, ETC calls the approach “philanthrogopoly” — a “charity” cartel that is designed to assuage fears that they represent an anticompetitive oligopoly, while simultaneously ensuring that real control remains with the agribusiness companies even after key patents have expired:

The Gene Giants know their market dominance looks conspicuously like an anticompetitive oligopoly, so they’re launching a series of initiatives — including the false promise of cheap, post-patent GE seeds — to mollify antitrust regulators and soften opposition to transgenics while advancing their collective market control.

Here’s the problem that “philanthrogopoly” claims to address:

The looming crisis, according to the Gene Giants, is that when patents on biotech traits expire, the breeders who want to use these generic traits must have biosafety approval from the government authorities where they plan to export the GE commodity or cultivate the GE seeds. If biosafety authorizations are not kept up-to-date — even for tiny traces of expired traits — entire barges of transgenic beans, containers of biotech cotton or maize risk being rejected in Rotterdam, Dalian, or Yokohama. For US and other farmers who depend on exports of GE commodity crops, the presence of unauthorized generic traits could be devastating, according to industry. For example, one quarter of all US soybeans are exported to China, and 95% of those beans are genetically engineered. An estimated 93% of GE soybeans in the United States contain a Monsanto trait that goes off-patent in 2014.

The complexity, however, is not just the biosafety review process; it’s also the fact that re-registration requires legal access to the proprietary safety testing data initially submitted by one of the Gene Giants to government regulators. (For the Gene Giants, safety data are considered “confidential business information” and a protected trade secret — it’s not something they’re accustomed to sharing, especially with competitors.) Without access to the proprietary information, the cost of bringing generic biotech crops to market would be prohibitive.

So what do the top players here propose in order to address this issue? They have come up with what they call, rather dramatically, “the Accord“, which includes an option for patent holders to continue to oversee biosafety approval for their GE seeds, either alone, or working with other companies. As ETC points out, this is likely to lead to even closer cooperation among the leading agribusiness giants, which already have extensive cross-licensing agreements with each other.

One thing that the Accord will not lead to is a flood of low-cost seeds produced by generics companies, as has already happened in the world of pharma, with huge knock-on benefits for the world’s poor. For that to happen, the key safety testing data held by the agribusiness giants would need to be available. And despite the reasonableness of requiring companies to do that — after all, if they want people to eat their products, they should be prepared to release the scientific evidence it is safe to do so — that’s not likely to happen unless they are forced to by governments.

Another factor making it extremely unlikely that we will see many seed generics is the dense web of patents that now envelope GE varieties, as ETC explains:

In the words of Randy Schlatter, DuPont Pioneer’s senior manager of intellectual property: “What growers may not realize is that even though the trait patent expires, there are a host of other intellectual property patents on those varieties that are just as strong.” In an interview with DTN/Progressive Farmer, Schlatter observed: “If there is a [first generation genetically engineered] soybean in the market today that is truly generic and not protected by a patent of some sort, I’ve not been able to find it.” DuPont Pioneer, the world’s second biggest seed company, has more than 225 patents covering its portfolio of soybean seeds — not just on transgenic traits — but on breeding technologies, germplasm and conventional (“native”) traits. Even if a single transgenic trait goes off patent, the maize or soybean variety that contains the trait is likely the subject of a complex web of intellectual property. The two dozen patents on biotech seed traits that will expire over the next decade are dwarfed by the thousands of existing patents on traits, seeds and varieties

This is similar to some of the approaches to evergreening in the pharma industry — adding extra, patented features to older technologies as the latter enter the public domain. The net result is the same for both drugs and crops: the patent “bargain” with society, that a time-limited, government-backed monopoly is granted in return for allowing anyone to use the invention freely at the end of the patent term, is not being kept fully. Once more, the public is shortchanged.

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Companies: basf, bayer, dow, dupont, monsanto, syngenta

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Comments on “How Big Agribusiness Is Heading Off The Threat From Seed Generics — And Failing To Keep The Patent Bargain”

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38 Comments
Nettie (profile) says:

Re: So they are not keeping up with their end of the bargain?

That’s always my feeling. I think so many discussions of patents (and even more so copyright) always assign too much of a moral component to the rights of the owner, which misses completely the fact that both copyright and patent law are bargains between society and the content or idea producers. They are not about some inalienable right against stealing but about protecting the small producers from having the chance to make money without competition. I think this viewpoint comes from being so stuck on the idea that infringing these laws is the same thing as plagiarizing in an academic context (It’s morally wrong not just rule-breaking). This becomes so limiting once we’re out in the real world where copying can actually be necessary for the health of society (also because copyright and patent law actually prevents a lot more than plagiarism rules in academia does–which allow you to use the work quite easily as long as you cite–but the moral associations still survive)

Aaand that got a little away from the point, which was that if it’s a bargain that moral idea is false–and like a contract if one side reneges the other side is not held by the constraints anymore. So when one of these companies plays these games we should be able to invalidate their patents in some way as a society…and possibly have consequences on their other patents so that there is an actual detriment to them to continue these filthy sort of manipulations

God these situations make me so sick.

That Anonymous Coward (profile) says:

How does any of this benefit the world?

Once upon a time when your patent might expire in your lifetime there was a drive to get the product to market, show it was better/safer/faster, you’d make money and use that to look for the next big thing.

Now the patent lives longer than any fresh faced patent examiner who approves it, the public gets no improved benefit for these monopolies outliving their children, and pays higher prices caused by court cases over a magic gene getting pollinated to another plant. The money pours into the corporations who use a tiny fraction to look for a new way to keep the gene under patent for as long as possible, pay huge bonuses to the people running the corporation, all at the expense of progress moving forward.

Greevar (profile) says:

Re: Re:

Property rights are highly profitable. The more you own, the more you can extort from the market. When you own everything, everyone has to come to you for what they need and then you own the people. Property rights are the source of all monopolies.

We live in a slave society, formed through indirect ownership of the people. People are owned by creating mechanisms that artificially limit access to resources they need to live.

In a world that is benefiting from an unprecedented level of abundance, people are still denied the basics of life simply because they don’t have what the owners demand in exchange for access. For example, we have more than enough food to feed the entire human population. 40% of our food supply gets wasted in the journey from farm to plate because of marketing concerns. They won’t sell food that doesn’t live up to their idea of what the “product” should look like, so they throw it away. Yet people starve because the owners demand tribute in order to prolong their opulent existence.

Anonymous Coward says:

If the seeds are not safe for generic breeders, then they are not safe period. Getting regulations on bio-safety to apply to breeders using GM seeds is a purely a move to extend the monopoly, as the genes will and have escaped into the wild. These regulations can be used to attack breeders and farmers who seeds have been contaminated by the GM crops.

AzureSky (profile) says:

Re: Re: Re:

the thing is, and this is well documented, NONE of monsantos seeds/gmo’s are tested, they are granted “gras” status because, monsanto own the fda.

even with all the stuff thats come out showing that last seasons corn was really bad…nothing as been or will be done, because monsanto has the money so they make the rules.

I say there should be testing thats like getting a drug approved(though thats a joke to, drugs proven safe in the rest of the world are held up till a US drug company puts something out that does the same thing)

we need strict long term testing….if we had that, im sure many things wouldnt be allowed in our food…aspartame…..you know the stuff that can kill rats…and that many americans including my own father are addicted to in the form of diet soda….

welcome to the incorporated states of america, whatever is best for the biggest business, is what society gets.

R.H. (profile) says:

Re: Re:

The way regulations work today, the specific genetic code of that particular harvest must be approved to be allowed to import it into certain countries. Right now the patent owners are handling that for their GM crops and since they don’t allow cross-breeding, it is known that the crops that have their IP in them are compliant. The problem appears when the patents start expiring and suddenly parts of these crops are no longer having their periodic biosafety checks handled by the large corporations and now each exporter needs to deal with the massive bureaucracy that has grown up around the import/export of GM crops.

I accept that GM items, especially items for human consumption, need to be checked for safety but, for the system to be so convoluted that it requires biosafety checks whose costs can’t be borne by anyone without millions of dollars to spend is quite a large problem.

Androgynous Cowherd says:

Patent issues

DuPont Pioneer, the world’s second biggest seed company, has more than 225 patents covering its portfolio of soybean seeds — not just on transgenic traits — but on breeding technologies, germplasm and conventional (“native”) traits.

That last item seems questionable to me. How can a native trait possibly pass the machine-or-transformation test? The others all meet the transformation prong but that last one meets neither.

Furthermore, if, say, a bean was produced 20 years ago, any patent covering it that hadn’t already expired ought to be expiring now. Even if they produced a Bean 2.0 with additional, patented traits whose patents’ expiration clocks started later, Bean 1.0 should go generic around now, and the beans themselves, or the means of recreating them, should still be around in some form. (Patents do still require disclosure of how to perform the patent, right? In this case, how to (re)create Bean 1.0 from wild or common, generic cultivated beans? For that matter, how to (re)introduce a specific patented Bean 1.0 trait, whether into beans or something else?)

Ninja (profile) says:

Re: Patent issues

There is a Brazilian company called Embrapa that used to lead the market of engineered seeds with the added benefit that it would be very easily accessible to smaller producers. It’s pretty much scrapped now and while I can’t provide evidence I suspect that Monsanto, DuPont and the likes are to blame for it (it has happened in other sectors too).

It’s amusing to see how the Workers Party (currently in power at the Federal sphere after they snatched power with ex-president Lula) went from hated with passion by the big industry to madly in love. Workers party my ass.

Anonymous Coward says:

Re: Patent issues

Recreating Bean 1.0 may not be that easy – I’m not sure on that, but I’d suspect that it would probably at the least require re-performing testing (to make certain that the actual product was the intended one), which would likely add significant cost.

As for the beans themselves – it’s actually not implausible that they may NOT exist anymore. If (as I have heard is the case), one of the terms of the contract to get GM seed is to return any seed you gather from the crop (they want you buying new seed next year, instead of saving it from year to year, after all) – or the plants are engineered to be infertile – there may simple not be any seed in the “wild” except for stuff that (unwantedly) escaped.

It’s possible it’s out there / recreatable from the information in the patent – but even if it is, it may not be cheap to obtain.

out_of_the_blue says:

You state the problem at 2nd word: BIG.

Well, well. “BIG” is a pejorative even here at pro-corporate Techdirt!

You should stop at that key word and try to figure out how to reduce the sheer size of corporations, rather than whining over some entirely typical details that are the inevitable result of letting them grow without limit. But so long as you stick to the notion, variously deemed “capitalist” or “libertarian”, that corporations can’t be strictly regulated or held to account beyond small fines now and then, let alone the officers tossed into jail, and that success in life is measured only by the amount of money piled up, then you actually are the problem.

I’ll repeat more specifically that problem is NOT monopoly of patents: that’s just a specific tool that BIG corporations wield much more effectively, not least because takes such a tiny fraction of their income to totally buy politicians.

It’s sheer BIG that’s the problem. Whether Microsoft or Google or Monsanto, the actions of large corporations are inherently always against public interest. — One easy solution is that patent protections should be removed after corporations pass an arbitrary size. — But do we get even hint of a solution from Minion Moody? Nope, just whining.

Breaking up corporations is easy given public sentiment: about a hundred years ago, the problem of industrial trusts first arose, and they were largely broken up. — Not enough, and now the principle has been lost upon those who benefitted from getting corporations under the control of public interest.

I’m probably preaching at ankle-biters here. You’re too steeped in what capitalists have mis-taught you (they sponsor “schools” at Ivy League colleges to promote self-serving myths) to see that corporations are just simply not your benefactors.

Anonymous Coward says:

Re: You state the problem at 2nd word: BIG.

They wouldn’t grow that big but for the monopoly of patents. Therfor if bigness is the problem then monopolies are as well.

Monopolies are the engine of abnormally high profits alllowing such growth. In a free market they have to price competivively spreading the profits around resulting in smaller companies

Anonymous Coward says:

Re: Re: You state the problem at 2nd word: BIG.

It’s kind of tricky. What seems to have happened is that all the big players collude to make a sort of mega-monopoly without being too obvious about it. Except for the fact that they are. What to do? Who knows at this point as government seems to be in on the collusion too.

Suzanne Lainson (profile) says:

Re: Re: Re:2 You state the problem at 2nd word: BIG.

We have a financial system that rewards big and growth. Whether that is achieved through patents or through other means, as long as we hand over financial rewards based on those measures and as long as we allow well-funded companies and individuals to buy politicians, I don’t think the system will change even if patents are eliminated. The companies that have power now will likely strive to create and strengthen a political and economic system that favors them.

If you eliminate patents but keep everything else in place, you may end up with very big companies built to take advantage of no patents. So the power shifts to companies that don’t use patents, but use other forms of law and control to maintain power. I think you need to look at the entire political and economic situation in the world rather than just a small part of it, particularly when eliminating that small part may be done in order to strengthen already big companies.

Financial companies, gun manufacturers, energy companies, chemical companies — these are big industries that don’t depend on patents these days to maintain control, but they do influence laws and regulations or lack of them.

Gwiz (profile) says:

Re: You state the problem at 2nd word: BIG.

I’m probably preaching at ankle-biters here.

Says the person who ankle-bites Mike on every single article.

Now, twice I have asked for clarification on your supposed “common law copyright theory” and you’ve run away twice (and then claimed no one has refuted you on this). Don’t make me go all AJ on you, OK? How about just answering this question, Blue:

https://www.techdirt.com/articles/20130410/07134322658/new-book-history-music-copyright-piracy-shows-how-copyright-tends-to-hold-back-music.shtml#c465

Suzanne Lainson (profile) says:

Re: You state the problem at 2nd word: BIG.

It’s sheer BIG that’s the problem.

I am concerned about this, too. As wealth/power becomes more concentrated, political/economic structures are reinforced to maintain the wealth/power of those who already have it.

One reason I haven’t been won over by libertarians is my fear that the emphasis on property rights will help maintain the power of those who already have property rather than giving access to it to those without it.

Given the way Silicon Valley has embraced the financial system (e.g., IPOs; corporate growth as a way to boost stock prices; an insiders club of VCs) I don’t see many of the entrepreneurs there taking steps to create systems that will begin to dismantle the ways they accumulate wealth. I would feel more impressed with the copyright/patent discussions if the goal was to find ways to eliminate the need/value of big multinationals, including the big tech companies.

Josef Anvil (profile) says:

Is anyone else bother by this????

Ummmm, “key safety data” ??

WTF does that mean? I thought we were talking about plants. Shit that grows and people eat it. I hear farming has been around for years.

So “key safety data” is either:
A) Bullshit made up to keep prices artificially high OR
B) It’s real, and we should all be worried about just how genetically altered the plants are.

Trollificus says:

It’s real, and demonstrates that the product is safe. What they’re saying is that, while THEY have proof the plants are safe, they’re not giving up the data that shows it and therefore, anyone using the (patent-expired) seeds HAS NO SUCH PROOF.

Which is ridiculous. If someone PROVES 1+1=2, I don’t have to RE-prove it if I have a bird in each hand and want to know how many I have in total. Unless I’m in a bush. Then it’s quantum math or something…

Steph Kennedy, IPTT (user link) says:

Yeah you right

“If the seeds are not safe for generic breeders, then they are not safe period.”

LOL, exactly.

What do you expect from a consortium that includes the company who went after that sweet old farmer? Like I said, playuhs gonna play – http://iptrolltracker2.wordpress.com/2013/03/06/play-uhs-gonna-play/. (Yes, that’s a self-serving blog post link, but it’s totally relevant. Promise.)

Just sayin’,

IPTT

Peter (profile) says:

What happened to 'safe history of use'?

Granted, for marketing a new material, companies are required to conduct expensive safety tests, and it is not an unreasonable request them to keep them confidential.

On the other hand, when a product has been on the market for a long time, with all serious issues recorded and investigated by regulators, this typically creates a ‘safe history of use’ that proves a product is safe for the established use. No old or new safety required.

Regarding the evergreening, as said before, bean 1.0 should be free to use, but not new and improved bean 2.0 with new patent protection (and safety tests). Industry is free to claim that bean 2.0 is worth the premium, Consumers and farmers are free to not buy that story and go with off-patent bean 1.0.

Anonymous Coward says:

Re: What happened to 'safe history of use'?

Granted, for marketing a new material, companies are required to conduct expensive safety tests, and it is not an unreasonable request them to keep them confidential.

When the product can affect human health, all test data should be made public, so that other researchers can at least review it. Preferably independent test are carried out to validate the test results.
It is axiomatic in science that results are not valid until the experiments have been repeated by other someone else else to validate the method and result. Independent validation of experimental results is the quality control mechanism of science.

That Anonymous Coward (profile) says:

Is anyone else bother by this????

Because they passed laws to protect this data from the prying eyes of people who can’t be smart enough to understand it.

The parts of Government that are supposed to oversee these things have had their hands tied and powers stripped to protect large corporations from investigations.
How many more stories do we need about a drug finally being recalled because data was withheld about bad side effects?

CPSC has to get the large manufacturers to agree to the wording in a release attempting to remove from market an item that kills. They had no problem taking on buckey ball magnets because well teens and children are at danger… despite warnings on the packages, but a high chair that collapses and kills… we wait months for them to word the release mentioning there might be a fault with the product.

People decry big government getting in the way, but have no problem getting that big government to pass laws to shield and protect those corporations more than citizens.

R.H. (profile) says:

Is anyone else bother by this????

Unfortunately, the answer is likely both. The thing is, it is quite possible that some of the potential modifications could be dangerous so many countries require testing to prove the safety of the modified foods. This testing is expensive so, to protect their profits, the companies that produce GM seeds pay for the tests themselves, protect the output of this testing as trade secrets, and turn over the results to the pertinent government agencies so that farmers that buy their seeds can export at will. The problem here is, number one, the fact that after the patents expire these big companies have no further incentive to keep testing the products covered by expired patents and number two, the fact that these biosafety examinations are required on a recurring basis.

Honestly, I don’t see why the re-authorization is required. If a genomic sequence has been approved then it can’t have changed. If something has changed then doesn’t that mean that the genome of the plant has changed, through either mutation or cross-pollination, and therefore would require a separate authorization anyway?

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