January 01, 2015

Marine Genetic Resources: The Clash Between Patent Law and Marine Law

Erica Wales

Marine genetic resources (MGRs) found within areas beyond national jurisdiction (ABNJ) are an issue at the core of international debate. ABNJ cover 64 percent of the surface of the ocean and include both the water column (high seas) and the seabed (the Area). These areas are unique in that no single state regulates all activities. Rather, regulation occurs via a patchwork of regulatory authorities and regional agreements. Because of this patchwork of regulation, gaps in regulation and conservation can occur. One of these gaps is MGRs. Except for resources of the Area, regulated by the International Seabed Authority (ISA) (and defined by the United Nations Convention on the Law of the Sea (UNCLOS) Article 133.a as “all solid, liquid, or gaseous mineral resources found in situ in the Area at or beneath the seabed”), resources not found within national jurisdiction are open for exploitation by those with the technical and financial capacity to do so. Although MGRs are not formally defined in UNCLOS or any other conventions or agreements, the 1992 Convention on Biological Diversity (CBD) does define “genetic resources” and “genetic material.” Using those definitions, for the purposes of this article I define “marine genetic resource” to mean any material of plant, animal, microbial, or other origin found within the marine environment and containing functional units of heredity with actual or potential value.

Genetic resources are seen as having the potential to revolutionize the medical, pharmaceutical, and chemical industries as well as generate significant profit. Because of the profit potential, these resources have become the subjects of patents putting patent law at odds with marine law, mainly UNCLOS. Patents convey the right to exclude, resulting in de facto ownership, which presents a problem when it comes to MGRs in at least three ways. First, UNCLOS does not allow for marine scientific research to become a basis for ownership of the marine environment. Second, patent laws allow for certain information, including location, to remain undisclosed, which presents a problem for conservation of the marine environment and resources. Third, there are concerns over biopiracy, or inadequate compensation for use of an MGR. Because of the complex issues surrounding MGRs in ABNJ, as well as the growing momentum toward conservation and sustainable use of resources, the international community has recognized the need to resolve these concerns. This paper will explore what MGRs are and what they are used for, how patent law and marine law clash, possible options for management, and the current status of international negotiations on regulation of MGRs.

What Are MGRs?

MGRs can be found in both the water column and the seabed; however, the main focus of research on MGRs has been on sessile (attached to a substrate) invertebrates. Researchers target deep-sea species in particular because of their unique ability to deal with temperature extremes, pressure, different chemical conditions, and lack of sunlight (Fernando de la Calle, Marine Genetic Resources. A Source of New Drugs—The Experience of the Biotechnology Sector, Int’l J. Marine & Coastal L. (2009) at 217–218.). A wide range of marine organisms is targeted for research on marine genetics, including tunicates, nudibranchs, sponges, bryozoans, algae, and fungi, as well as bacteria and viruses (David Leary et al., Marine Genetic Resources: A Review of Scientific and Commercial Interest, Marine Pol’y 33 (2009) at 184–185).

Compounds derived from MGRs have been found to treat epilepsy, cardiovascular diseases, and psychiatric disorders. They have also been found to have anti-cancer and anti-viral properties, anti-inflammatory action, anti-HIV activity, and may help fight malaria. Id. at 186. The use of MGRs began in the 1950s with the isolation of spongouridine and spongothymidine, compounds from a Caribbean sponge shown to have anti-cancer and anti-tumor properties. Id. at 185. Cone snail venom, such as the conotoxin from which the drug Prialt is derived, has been shown to be useful as an anesthetic. Ibid.

While marine invertebrates have the highest potential for use as marketed drugs due to their high rate of bio-activity, squalamine from dogfish sharks has also been shown to suppress tumors. Id. at 186. Even proteins from cold water fish have been studied and used for their anti-freeze properties. Id. at 187.

MGRs hold vast potential, not only potential for the creation of new medicines, pharmaceuticals, chemical compounds, and cosmetics, but also a vast potential for profit. (Leary et al. supra at 192) estimated the value of MGRs to the pharmaceutical industry was $634 billion in 2006, a minimum of $50 billion a year for enzymes, and one billion a year for the DNA extraction market. This potential value has led to patenting of these resources.

As of 2011, thirty-one countries held patents related to marine genes; however, ten states held 90 percent of those patents, with just three of those states (USA, Germany, and Japan) holding 70 percent of the patents (Sophie Arnaud-Haond et al., Marine Biodiversity and Gene Patents, Science 331 (2011) at 1521). The countries that hold the patents are generally developed countries with substantial technical and financial resources. The lack of developing countries holding patents on MGRs has led to questions of equity when it comes to MGRs found in ABNJ.

Marine Law Versus Patent Law

The Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) is a World Trade Organization treaty that provides basic standards and principles for intellectual property rights protection in order to promote protections and reduce barriers to trade. TRIPS lays the foundation for what can and cannot be patented, leaving implementation to member states to the agreement. Patenting is a domestic process, meaning member states can provide more extensive protections as long as the basic provisions are followed. Article 27 of TRIPS provides that “patents shall be available for inventions . . . [which] are new, involve an inventive step, and are capable of industrial application.” There are exceptions to what can be patented, including inventions that may be contrary to life or health for humans, animals, and plants.

Additionally, member states have some discretion when it comes to authorizing patenting of plants and animals: “plants and animals other than micro-organisms, and essentially biological process for the production of plants or animals other than non-biological and microbial processes” may also be excluded from patentability (TRIPS Article 27.3b). In other words, microorganisms are patentable. Patent holders are granted the exclusive rights to use a product or process of their own invention (TRIPS Article 28.1.a,b), which results in patents being available for material isolated from a microorganism and any new organisms created from the isolated material. TRIPS also governs what information can remain undisclosed. For example, information that “has commercial value because it is secret” is allowed to remain undisclosed (TRIPS Article 39.2.b).

Patents on MGRs clash with marine law in several ways. First, patents grant ownership to the patent holder by means of exclusion; the patent holder has control over the resource. On the other hand, if the utilization of MGRs is considered marine scientific research, UNCLOS provides that marine scientific research “shall not constitute the legal basis for any claim to any part of the marine environment or its resources” (UNCLOS Article 241). If MGRs are considered resources of the Area, UNCLOS does not allow a state or person to claim rights (UNCLOS Article 137).

Intellectual Property Law Conflicts with UNCLOS

Second, patent law allows for the resource collection location to be undisclosed (TRIPS Article 39.2b). This may give rise to a conflict with UNCLOS (UNCLOS Article 192), which obligates states to “protect and preserve the marine environment.” Impacts to the environment may be minimal at the early stages of collection of a species of interest; however, repeated collection may lead to cumulative impacts, especially for rare or fragile species and habitats. Vierros, Environmental aspects of marine genetic resourcesIntersessional Workshop on the Conservation and Sustainable use of Marine Biodiversity Beyond Areas of National Jurisdiction, 2013.

Conservation and preservation of resources in accordance with UNCLOS is difficult to do when you do not know where the resources to be preserved are located. In addition, UNCLOS specifies that states must “make available by publication and dissemination . . . knowledge resulting from marine scientific research” (UNCLOS Article 244.1) and states are to “actively promote the flow of scientific data and information and the transfer or technology resulting from marine scientific research, especially to developing States” (UNCLOS Article 244.2). This flow of data and research is often impeded by the nature of secrecy surrounding patents and nondisclosure of information.

Finally, biopiracy has become a concern. When marine scientific research is conducted in an area of national jurisdiction of one state by persons of another state, a bilateral or multilateral agreement can be negotiated between the coastal state and the researching state in which favorable conditions for the research are created and conditions on the research are imposed. UNCLOS Article 243. The CBD (nearly universal except for the United States) requires parties to share benefits arising from a genetic resource (CBD Article 15), however, the CBD applies only to national jurisdiction when it comes to components of biological diversity. In ABNJ, only processes and activities fall under CBD jurisdiction, meaning no framework for sharing of benefits exists. Since ABNJ are remote and access requires significant technical, scientific, and financial capacity, lesser developed states are often not able to access the resources found within ABNJ and are left out of sharing in the benefits. Additionally, because patent law allows for the resource location to be undisclosed, it is difficult to tell where some MGRs originate. Some MGR species are widespread and a patent on such a species, initially found in ABNJ, could leave a state being denied the right to develop resources within its own sovereign territory.

ABNJ are in theory open to any state; however, in reality it is often only developed states that have resources to explore these areas and develop MGRs. Equity issues arise if exclusive rights are given for resources in these areas when not all states have the same ability to explore these areas and utilize the resources found within them. On the one hand, developing states often lack the capacity to access MGRs, which puts them at a disadvantage. On the other hand, the ability to patent a discovery spurs research and drives innovation. Finding a way to allow for research, discovery, and property rights while simultaneously allowing for benefit sharing and conservation is key to the regulation of MGRs.

Options for Regulation

There are generally two philosophies behind the status of MGRs under UNCLOS, the “freedom of the high seas” philosophy or the “common heritage of mankind” philosophy. Under the “freedom of the high seas” regime, UNCLOS grants states the freedom of navigation, overflight, laying cables and pipelines, constructing artificial islands and installations, fishing, and scientific research. UNCLOS Article 87. Going further, UNCLOS also specifically grants states the right to conduct marine scientific research in both the Area and in the water column beyond national jurisdictions. UNCLOS Articles 256 and 257. Because MGRs are not specified as a resource of the Area, as defined above, some states contend that research on MGRs is “marine scientific research” and, therefore, governed under the freedom of the high seas regime.

The other philosophy, the idea of “common heritage of mankind,” stems from Ambassador (Malta) Arvid Pardo’s 1967 call for a regime to be set up to regulate the seabed and the resources of ABNJ. Worried that the deep seabed beyond national jurisdictions would become “progressively and competitively appropriated, exploited and used for military purposes by those who possess the required technology,” Ambassador Pardo proposed that the “seabed and ocean floor are a common heritage of mankind and should be exploited for peaceful purposes and for the exclusive benefit of mankind as a whole.” Speech given to the United Nations General Assembly 22nd Session, 1967. Even though research on MGRs began in the 1950s, the extent of MGRs to be found within ABNJ was unknown at the time of the drafting of UNCLOS, and the technology to exploit those resources was not as developed as it is today. Even so, because the general idea behind the common heritage of mankind philosophy is the peaceful exploitation of resources found in areas in which no state has jurisdiction for the benefit of all mankind, some states feel this is the appropriate regulatory regime for MGRs as well as mineral resources. Differing opinions are found in whether or not the ISA, which regulates the seabed and ocean floor, has the mandate and expertise to regulate MGRs, and whether the governance regime, which allocates greater voting rights to some states than others (e.g., those that had previously attempted to mine minerals in the deep seabed and states that mine poly-metallic manganese nodules within those areas of national jurisdiction), is fair in the context of MGRs.

There are several options for the regulation of MGRs in ABNJ. First, the exploitation of MGRs could be considered a high seas freedom that falls under the provisions of marine scientific research, essentially retaining the status quo. This option would cover MGRs in both the seabed/subsoil and the water column; it could be beneficial to avoid a split regulatory regime. However, the issue of benefit-sharing and communicating research plans and results would still need to be worked out and provisions for the transfer of marine technology strengthened and implemented. There is the possibility that the research community can aid in benefit-sharing, for example, in creation of MGR-specific databases for data exchange, and conservation if no legally binding agreements are negotiated. However, states have called for more binding measures related to capacity building and transfer of marine technology, citing the lack of implementation of current regulations as evidence for the need for clearer regulations and stronger enforcement.

Alternatively, expansion of the ISA mandate to include MGRs would put MGRs under the “common heritage of mankind” regime and would likely foster benefit-sharing, both monetary and nonmonetary, and promote conservation. There are, however, concerns with this expansion. The ISA was established for exploiting mineral resources in the seabed beyond national jurisdiction, not for exploitation of genetic resources; so there is some concern that the ISA may lack the scientific and technical expertise required to include MGRs within its structure. Expanding the ISA mandate may require a new arm or division of the ISA, which would also require added financial support. Additionally, the ISA’s jurisdiction is only for the seabed and subsoil, not for activities in the water column. While most research on MGRs is currently conducted on sessile MGRs, expanding the mandate of the ISA to include all MGRs may split the regulatory regime between ISA regulation of seabed MGRs and freedom of the high seas for water column MGRs, further complicating the situation.

Third, negotiating a new implementing agreement under UNCLOS could resolve the manner in which MGRs are regulated. This new agreement could create a whole new institution aimed at conservation and sustainable use of resources in ABNJ, including MGRs. In the same way the ISA regulates seabed minerals, a new institution could be set up to regulate MGRs. However, a new institution would require an investment by the international community. Another possibility in lieu of a new institution is a clearinghouse mechanism with a benefit-sharing fund. Article 250 of UNCLOS requires marine scientific research projects to be communicated through official channels. A new implementing agreement could have a centralized method in which this communication can be made known to the international community, which would be useful for conservation purposes. This mechanism could also facilitate the sharing of research results and the dissemination of data. Additionally, a benefit-sharing fund could aid in conservation of habitats and species as well as build the capacity for developing states to engage in research in ABNJ.

Bioprospecting is the term used to describe the process of research and development of MGRs. The question is, when does bioprospecting begin? Many times a public or academic research institution will extract a sample and research it and then another institution, for example, a pharmaceutical company, will develop the sample for a commercial purpose. Leary et al. (supra at 184) uses the term “bioprospecting” to mean the entire process of research and development, including sampling through to commercialization. Others (Salvatore Arico & Charlotte Salpin, Bioprospecting of Genetic Resources of the Deep Seabed: Scientific, Legal and Policy Aspects, UNU-IAS Report (2005) at 15) are unsure where the line between marine scientific research for the purposes of scientific discovery and advancing the knowledge of the ocean ends and bioprospecting for a commercial purpose begins. Drawing a distinction between the two processes may have significance when it comes to regulation of these resources.

Differentiation between marine scientific research and bioprospecting may also aid in management. Because the development of commercial products requires a significant investment, finding a way to stimulate innovative research while simultaneously sharing benefits is necessary. This could mean the developing entity gains exclusive right to the benefits for a specified time period and shares a percentage after that time. Alternatively, a percentage of profits could be shared after a certain dollar amount gained in revenues or profits. A system designed to spur research and development first and share benefits only after the product is successful and not too early in the development phase, where many commercial products fail, is needed and obtainable with political will.

BBNJ Working Group

States, seeing linkages between ocean resources and issues such as poverty eradication, food security, health, and climate change, have increasingly called for protection of the marine environment as well as the conservation and sustainable use of marine resources. While the CBD is primarily aimed at protection of biodiversity in national jurisdictions, a call for more enumerated protection of ABNJ biological diversity has been heard by the international community. Established in 2004, the UN Ad Hoc Open-ended Informal Working Group to study issues relating to the conservation and sustainable use of marine biological diversity beyond areas of national jurisdiction (BBNJ Working Group) is tasked with examining the existing legal framework of ABNJ and identifying potential gaps. Part of the Working Group’s mission is to decide whether or not a new implementing agreement under UNCLOS should be negotiated to resolve these gaps. MGRs are one part of the discussions of the Working Group.

During these meetings, states have discussed their positions on how to manage MGRs in ABNJ. Because UNCLOS is the “constitution for the oceans,” virtually all states are in agreement that UNCLOS must be the framework for any regulation of MGRs. As discussed above, some of the debate has been centered on what the theory or philosophy behind MGRs is, “common heritage of mankind and a resource of the Area” or a “freedom of the high seas.” Jamaica has been a longtime advocate of using the expertise of the ISA and the legal regime that governs seabed resources for the regulation of MGRs. In contrast, the United States sees MGRs as a right governed by the high seas regime and is concerned about losing incentives for research and development under a benefit-sharing regime. At the June 2014 meeting, several states, including Iceland, New Zealand, China, and Australia, as well as the European Union, voiced their desire for a pragmatic approach to the management of MGRs. Iceland noted that instead of forcing an outcome on what the legal regime for MGRs is, focusing on the benefit-sharing aspects and a pragmatic approach is the way forward in finding a way to manage these valuable resources.

Marine genetic resources hold the potential to revolutionize many fields and states have recognized this value as well as the monetary value from their use and commercialization. Technology in the field of MGRs is rapidly advancing, making sequencing and utilization of MGRs easier than ever before. However, this rapid advance in technology and use of these resources have led to conservation and benefit-sharing concerns and put patent law at odds with marine law. States are divided on what an MGR is, both in definition and philosophy, and how to regulate these resources accordingly.

Conclusion

Regulation of MGRs must provide for marine scientific research for academic and scientific purposes, while allowing the possibility for commercialization. At the same time, any benefits derived from the commercialization of an MGR found within ABNJ must be equitably shared through either monetary or nonmonetary benefit-sharing mechanisms.

Erica Wales

Ms. Wales is a graduate student in the School of Marine Science and Policy at the University of Delaware.