[NYT] AUG 17, 2001 Patent Laws May Determine Shape of Stem Cell Research By SHERYL GAY STOLBERG WASHINGTON, Aug. 16 - As they carry out President Bush's plan for government financing of embryonic stem cell studies, federal health officials confront a daunting challenge: United States patent 6,200,806, a claim to the human embryonic stem cell. The patent, held by a foundation at the University of Wisconsin, is apparently the only one of its kind in the world, leaving the university in such a powerful position that next week the health officials will begin negotiations in hopes of reaching an agreement to allow federally financed scientists broad access to the cells. The patent, which covers both the method of isolating the cells and the cells themselves, gives the Wisconsin foundation control over who may work in the United States with stem cells, and for what purpose. In turn, the foundation has granted important rights to a biotechnology company, the Geron Corporation of Menlo Park, Calif., giving that company considerable say over who ultimately profits from stem cell therapies. This complex tangle of intellectual-property rights and contracts is now a pressing concern at the National Institutes of Health, the agency charged with putting President Bush's plan into effect. Next week, representatives from the foundation, the Wisconsin Alumni Research Foundation, or WARF, are to meet with officials at the institutes to take the first steps toward negotiating access to stem cells. "I don't want people to see us as an 800-pound gorilla," Carl Gulbrandsen, the foundation's managing director, said. "We will work very hard with the government to make sure that there is access to this technology and that our patents are not an impediment to researchers." But many scientists fear that the foundation's restrictions might hinder research on cells that hold promise for treating and curing some of mankind's most devastating diseases. And though legal experts say it could be challenged in court, the Wisconsin patent could help push stem cell science overseas. Mr. Bush said that 60 lines, or self- sustaining colonies, of stem cells exist in laboratories around the world, and said that under his program, government scientists would be free to work with any of them. But the government does not have control over whether those cell lines get to researchers, according to Mr. Gulbrandsen, federal health officials and patent law experts. If the cell lines match the description in the broadly worded Wisconsin patent, these experts say, their owners must obtain approval from the foundation before distributing them. That has scientists worried. "The whole point of this, surely, is to get good cells into the hands of researchers," said Dr. Ron D. McKay, who has conducted promising research on mouse embryonic stem cells at the National Institutes of Health and is eager to work with the human cells. "I think that it is unclear, in practice, how easy it will be to get these cells." As far as experts know, the United States is the only nation to have issued a patent on human embryonic stem cells. The patent is valid only in this country; the foundation has also applied for patents in Europe. And at least two foreign biotechnology companies say their cell lines may fall outside Wisconsin's claim and have applied for patents of their own in the United States and elsewhere. A patent gives its owner the right to exclude other people from making, using, selling or importing their invention. So "researchers in other countries have a double advantage," said Rebecca S. Eisenberg, an expert in biotechnology and patent law at the University of Michigan. Other nations, notably Britain, have fewer restrictions on studies of human embryos. And scientists in other countries may still derive stem cell lines without fear of patent infringement. President Bush's decision may have strengthened the hands of the Wisconsin group and Geron. By refusing to allow taxpayer money to finance creation of new cell lines in this country, Mr. Bush reduced the chances that scientists would derive and patent cells that might challenge Wisconsin's dominance in the field. "What constrains the monopoly power of a patent holder is the prospect of new technology being developed that will make it unnecessary to deal with them," Ms. Eisenberg said. "The president's decision limits that threat." Embryonic stem cells, extracted from human embryos when they are still tiny enough to fit on the tip of a sewing needle, are regarded by scientists as the foundation of a new era of regenerative medicine, one in which doctors might be able to use the cells to create replacement tissue grown to order. Theoretically, the cells can be coaxed in the laboratory to grow into any cell or tissue - insulin-producing cells to use against diabetes, for example, or nerve cells that might treat Parkinson's disease. Studies of embryonic stem cells in mice have been conducted for two decades, but in 1998, Dr. James A. Thomson, a developmental biologist at the University of Wisconsin, shook up the stem cell world by reporting that he had isolated human embryonic stem cells. As is customary at his university, Dr. Thomson assigned the patent for his discovery to the research foundation, which had already obtained a patent on the primate embryonic stem cell, after Dr. Thomson derived those cells from rhesus monkeys. In theory, because humans are primates, the patent covered human cells as well. But the foundation applied for a second patent to make its claim on human cells explicit. The patent was issued on March 13. Shortly after Dr. Thomson's discovery, the foundation began negotiating with Geron, which has contributed roughly $1 million to Dr. Thomson's research and wanted to commercialize it. "They wanted all rights," Mr. Gulbrandsen recalled. "We felt it was too much to expect a small company to develop this technology fully, and giving them all rights would not be fair to them or the public." Ultimately, the foundation granted Geron exclusive rights to develop stem cells into six cell types that are of great medical importance: liver, muscle, nerve, pancreas, blood and bone. Ms. Eisenberg and other patent law experts said that those rights, coupled with the Wisconsin patent, might mean that anyone seeking to develop commercial applications of stem cells in these six areas must negotiate with Geron first. The relationship between the foundation and Geron, however, has become contentious. On Monday, the foundation sued the company to block Geron's efforts to extend its commercial rights to another 12 derivative cell types. Geron has not commented on the suit, other than to say it is prepared to meet with foundation officials to resolve it. Last week, Geron's chief executive, Thomas Okarma, said he was eager to begin collaborating with government-financed researchers. Dr. Okarma said that academic scientists would be free to convert stem cells into derivative cells of the types its agreement with the foundation covers. "We would only prevent them from trying to commercialize them," he added. So far, Dr. Thomson has developed five stem cell lines, and the foundation has set up a nonprofit subsidiary, the WiCell Research Institute, to distribute them. The cells are given to academic researchers under a "materials transfer agreement"; scientists must pay WiCell $5,000 and agree to certain restrictions. The agreements give the foundation - and, by extension, Geron - control over the derivative cells. One prominent stem cell scientist, Dr. Douglas Melton of Harvard University, said he would not agree to such terms. "Those conditions would mean that I am the ideal employee of Geron," he said. "They don't pay my salary, they don't pay my benefits, but anything I discover they own." Now the health institutes will negotiate their own materials transfer agreement with Wisconsin.. This agreement would cover only those scientists who actually work at the institutes. Once negotiated, though, the agreement's terms will become public, and universities may demand the same terms for their researchers. "Our role, albeit limited, is very important," said Maria Freire, who directs the institutes' office that handles such agreements. "We would like to be able to craft an agreement that allows our scientists to use the WiCell cells and other cells without being in violation of the patent. We think that can be done." Meanwhile, companies in other countries are concerned that, if they distribute their stem cells in the United States, the foundation might charge them with patent infringement. Legal experts suggest that the Wisconsin patent is one reason researchers have said little about many of the 60 stem cell lines that President Bush said exist around the world; the owners of those cell lines are probably afraid to come forward. Those who have come forward say they have developed stem cell lines that avoid the patent. Alan Robins, chief scientific officer of Bresagen, in Adelaide, Australia, said his company had derived four stem cell lines at a slightly later stage in the embryo's development than Dr. Thomson's cells. They are different enough, Dr. Robins contended, for his company to win a separate patent. Another company, ES Cell International in Singapore, said it had six stem cell lines in its possession. Robert J. Klupacs, the company's chief executive, said it was evaluating its lines "to see if they fall within the Wisconsin claim." He added: "I'd like to think that sanity will prevail and this will work out in the best interest of all stakeholders. But I imagine it will take some time to work through."
