RiceTec: Profiting from Derived Knowledge

Aug 25th 2001, C.P. Chandrasekhar

The decision of the United States Patents and Trademarks Office (USPTO) to grant biotech firm RiceTec a patent that accepts five claims relating to three ‘novel rice lines' has once more triggered a controversy in the country. Parliament witnessed a heated debate in which the opposition accused the government of having through its negligence created a situation where India's exports of basmati rice traditionally grown in India and Pakistan would be adversely affected. The government, needless to say, refuted the allegations, and declared the development a victory on a number of grounds. First, the decision of the USPTO was arrived at in response to India's request to re-examine 3 of the originally accepted 20 claims made by RiceTec. Second, the number of claims upheld by the USPTO amounts to just five. And third, these claims are seen as relevant not to "basmati rice and lines" as originally defined, but to "novel rice lines" BAS867, RT1117 and RT1121, which are seen as varieties that deliver grains "similar to or superior to good quality basmati rice". What is of interest is that even "expert" NGO opinion and the media are clearly divided on the dilatory question as to whether India has won or lost the legal battle.
 
The debate now centres on whether the specific form in which RiceTec has been given a patent on rice lines is in keeping with patenting "norms" and whether India's interests as an exporter of basmati right have been affected adversely. The larger issue of whether "rice lines" deriving from varieties traditionally developed by cultivators located in specific geographical areas should be patentable at all is being ignored.
 
The defence for any patent rests on the need to provide intellectual property rights to developers of new technologies, who have undertaken risky investments to achieve their goal and in the process provided society with new or better products or processes. Further, such technologies are seen as providing substantial ‘external' benefits to society, far more than captured by prices or by the private benefit accruing to the innovator in terms of profit. Unless such investments are protected and profits on investment assured, it is argued, technological change would be much slower or absent, implying considerable social loss.
 
Even this argument is fraught with problems. It is by no means clear why investments in agriculture by the government and the private sector, which are also quite risky and which also provide society substantial ‘external benefits', should be subjected to the "winds of international competition" through liberalisation, even while investments in innovation are protected.
 
Moreover, in the case of plant varieties derived from traditionally developed ones, the net accretion in terms of new knowledge is limited relative to the existing varieties. But since the traditional varieties developed over time as a result of cultivator practices have substantial common property characteristics, they are not patentable by any single agent. On the other hand "commercial plant breeders" like RiceTec who build on traditional knowledge, without having to pay for it, and manage to "differentiate" their product to render it "novel" enough to be considered for a patent, obtain the protection unavailable to the source product.

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