Expiring patents could create opportunity, trade challenges

Generic seed International regulatory approvals must be maintained on off-patent traits produced via biotechnology

A farmer and former chemical company executive doesn’t expect western Canadian farmers to benefit as patents gradually expire on biotech seeds.

“A generic industry is possible in the seed industry … but it’s not going to be easy, in my opinion,” said Maurice Delage, the former president of Aventis Crop Sciences in North America who now oversees farming operations on 22,000 acres near Indian Head, Sask.

In the 1990s, farmers began to benefit from a generic crop protection industry that materialized as patents expired on products such as glyphosate, which increased competition in the sector and reduced producers’ expenses.

Delage doesn’t expect the same thing to happen as patents expire on the first crop traits produced by biotechnology.

“There’s a general belief in the farm community and by farmers in general that as patents expire … they’re going to see a similar spinoff that happened in the crop production industry,” said Delage. “I think that this is a bit of a misstatement.”

The issues of farm-saved seed, plant breeding and exporting in a “post-patent” environment were raised at the Agricultural Biotechnology International Conference in Saskatoon last week.

The issue is on the minds of industry officials because the patent on Monsanto’s Roundup Ready 1 soybeans will soon expire in the United States.

Other intellectual property rights complicate matters, but the move potentially allows for farmers in that country to save seed and for other companies to use the technology.

Monsanto has been selling its Roundup Ready 2 technology for several years.

“The Roundup Ready 1 patent expired almost four years ago in Canada. Nobody has picked it up,” said Delage.

He said the future is particularly clear cut for canola.

“Nothing is going to change in canola in North America because the market is dominated by hybrids.”

A generic seed industry is more likely in an open-pollinated crop such as soybeans, he added.

There’s less incentive to save seed in a hybrid crop such as canola because it loses vigour in later generations. Other hurdles include the high cost of bringing seed to market and maintaining multiple regulatory clearances.

As well, crop protection products made in one market can be effective in another, while seeds need to be responsive to localized agronomic and disease issues.

“I don’t see the generic patent situation at all the same as the generic crop protection business, where a patent is expiring on a herbicide or insecticide or fungicide and somebody came in as a generic producer and dropped the price by 30 percent and the industry had to compete with the generic price,” he said.

“I don’t see that happening, certainly not in the short term, in the case of plant biotechnology. There’s just too much value built into the seed in many other things around plant breeders’ rights and inbred lines and other traits and stacking of traits.”

Few seeds carry just one trait. Other quality or performance traits, such as herbicide and disease tolerance and seed treatments, can protect the seed from being reproduced.

“Most (biotechnology) events today are in germplasm that cannot be worked with,” said Tom Carrato, a U.S. agricultural biotechnology consultant.

Carrato said the issues of post-patent biotechnology could hurt farmers more than it helps.

Regulatory approvals for genetically modified seeds must be maintained in countries where they are planted and imported, he added. Export markets could be at risk if old, off-patent technology makes its way into the supply.

The threat brings to mind the European Union, which shut its doors to Canadian-grown flaxseed when GM Triffid made its way into exports in 2009. Last week, officials called for stewardship on the part of farmers and seed companies.

“That’s the worry, that somebody chooses to go outside of the system and try to create some havoc,” said Delage. “It’s an area where we have to, as farmers, be really concerned how the international access to these markets is maintained because that’s the basis of our business.”

In the case of Roundup Ready 1, Monsanto says it will maintain approvals through 2021.

Under a private-sector agreement in the U.S., participating organizations will notify the industry of expiring patents three years in advance. The U.S. Ag Accord, a legally binding contract, has 10 signees, including BASF Plant Science, Bayer Crop-Science, Dow AgroSciences, Dupont Pioneer and Monsanto.

“Even though we have patent expiration looming, we do not expect there to be many products coming off patent before 2021,” said Matthew O’Mara of the Biotechnology Industry Organization.

With herbicide resistant weeds an increasing concern, another issue is farmers’ need for multiple modes of action.

“We really need to be considering from a stewardship standpoint how much sense it makes to create a generic market for an (biotechnology) event that’s been in the market for 20 years as a single event because of the potential to create resistance,” said Carrato.

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