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Gone are the days when Filipino scientists and researchers engage only in
research and development (R&D); when they are not conscious of the business
aspects of their projects. With the advent of modern agricultural
biotechnology, where organisms are altered or improved to make them suit the
modern man?s needs, and with the borderless trade, government researchers
and scientists are now becoming conscious of protecting their intellectual
creation so that they and their respective agencies could take full
advantage of their intellectual property (IP) -- especially commercially,
March 2005 by Lyn Resurreccion.

At the same time, they are now also asserting their rights when using
foreign IPs -- also to be able to gain from their market potential.

?We are becoming very conscious [about IP] because we can also register
microorganisms, so that the process of violating them [researchers? IP
rights, or IPRs] could be prevented,? said lawyer Ronilo Beronio, deputy
executive director of the Philippine Rice Research Institute (PhilRice) in
Mu?oz Science City in Nueva Ecija and concurrent head of its Intellectual
Property Management Office (IPMO).

He explained that he is convinced that biotech is almost synonymous with
IPR. ?When you make an invention or a creation, that organism shall become
intellectual property because it becomes intellectual creation. It is almost
a one-to-one correspondence.?

He told Today in an interview that researchers and scientists at PhilRice
are now becoming aware of the measures in applying foreign biotechnology
into the Philippine setting, especially with the prospect of possibly using
it commercially.

?Before you can use a [biotech] technique, you have to seek permission from
the owners, particularly if you would wish to make money out of it or
commercialize it. . . If you want to make money from biotech [products],
their owners will run after you, so you should be conscious about [the
measures needed],? he said.

He said that PhilRice, an agency under the Department of Agriculture, is not
yet encountering problems on the matter because it is still in R&D stage of
some technologies. But this early, the agency is not only becoming conscious
about IPR ?because we don?t want to encounter problems [in the future].? It
is also ?doing something? about it.

?There are many instances in the world, when scientists do something, but in
the end they could not commercialize their products because they did not
take care of the IP issues beforehand.?


Negotiations


The liberalization of trade with the advent of GATT-WTO with its Trade
Related Intellectual Property Rights, or TRIPS, has altered international
trade and IP landscape.

?Ang target lang nila noon IPs on computer software, movies and the like.
Then came agricultural biotech, which is becoming pervasive,? Beronio said.

He cited the case of Vitamin A Rice, which is being tested in PhilRice. The
agency was not yet conscious of IP implications when it first signed the
testing agreement. Realizing this, PhilRice is renegotiating the license
with the consortium, led by Europe-based agribusiness company Syngenta, that
owns the biotechnology.

The problem? The agreement had ?no clear provision? that would allow
PhilRice to commercialize. ?There was a very limited authority to
commercialize? the genetically modified crop, also popularly known as Golden
Rice. Under the original agreement, Syngenta allows an individual farmer or
seed grower to commercialize the Vitamin A Rice seeds up to $10,000 (or
approximately P550,000) as the company?s so-called humanitarian target.

Beronio gave a hypothetical situation: If PhilRice will organize 100 seed
growers to produce seeds, which production may exceed $10,000, will the
agency be exempted from paying royalty?

This prompted PhilRice to renegotiate to insert a provision that will allow
it to commercialize, or what is known in the IP lingo as ?option to license
agreement.?

?If the Vitamin A Rice becomes a hit and becomes very critical to our food
and nutrition, we don?t want to be placed in a situation, when that?s the
only time we deal with it, which is already too late because the owners may
also be conscious about the commercial prospects of the product. So, this
early, we should both take the risk of [the test?s] failure, as well as
success,? Beronio said.

He noted, however, that Syngenta has earlier said that it has ?no commercial
interest? for the crop in the country.

He said that the result of the renegotiation on the license agreement on
Vitamin A Rice will be concluded soon.

Similarly, in the recent plan to adopt Bt cotton in the Philippines, Beronio
said his office has helped in injecting the provision on the option for
commercialization in the licensing agreement with the Chinese owners of the
genetically modified organism.

?Whatever happens [to the adoption of the transgenic crop in the country]
you know what you will do. Kung mag-fail, sorry; kung mag-succeed alam mo na
at ng Chinese ang relationship ninyo.?

IPR is not very complicated, he said. ?Isang phrase lang ?yon sa contract
tapos na ang usapan.?

He also cited important Philippine products, whose IPs were not pursued,
leaving the country failing to profit from them financially, or even losing
the right to a product.

One is the virgin coconut oil, which, he said, is ?exploding in the market,
and nobody seems to be controlling it.?

Another is the nata de coco, once a very popular traditional Filipino
delicacy. Thailand is benefiting from it and is reaping a windfall by
exporting the product to Japan because the Philippines did not protect its
technology.

He stressed that the IP owners ?appreciate? it when the licensees insist on
their rights ?because that would also prevent problems and embarrassments
for them in the future. . . These countries will respect you if you
negotiate with them. You should assert [your rights].?

Beronio warned that the Philippines will be left behind in biotechnology if
it will not be serious in its IPRs. ?In many biotechnology ventures, we were
already left behind.?

Citing cotton, he said the Philippine cotton is just as big as golf balls,
while the Bt cotton of China is as big as the baseball.

There is also an even more advanced development in IP -- the Canadian
Supreme Court?s recent decision on plant biotech, which says that the right
of the person who inserted the gene to the plant extends to the new plant
itself.

?There is no dividing line now between the patent and the plant protection.
Dahil may na-introduce na siya [researcher] sa plant, kahit iba ang
mag-breed [sa plant] sa kanya [researcher] ?na yun [right to the plant],?
Beronio said.Training

To be able to develop the skills and capabilities among DA researchers and
scientists on IP matters, the IPMO is providing them training. PhilRice is
the only R&D institution in the DA that has an IP policy in place.

?I tell the [nonlegal] staff, ?I?m making patent lawyers out of you,??
Beronio said in jest.

Actually, Beronio has been training his IPMO staff in filling up patent
registration forms, training them in licensing agreements and in assisting
the scientists in filing up the forms and entering into licensing
agreements.

?We need this kind of [human capability] investment. If you let law firms
handle your [patent] registrations, they will bill you by the minute.? He
clarified that if members of the staff are well trained on IP concerns,
lawyers are needed only when there are legal contests.

The P1.2-million project, funded by DA?s Biotech Program and PhilRice, will
have five batches of training this year.

It includes lectures and exercises on the fundamentals of IP, patent
searching drafting of claims, IP valuation, and IP commercialization and
technology transfer.

Fundamentals of IP: It involves orientation on the definition, history,
existing national and international IP laws and regulations, basic
information on patents, utility models, copyright, plant variety protection,
layout designs, geographical indications, and term of protection.

Patent searching: A technique in IP audit, patent search could be easily
made through the Internet. Through the technique, Beronio said, a researcher
can access 80 percent of the inventions worldwide through the Internet by
using codes. From this the researcher could check if the concept he wants to
develop is already available abroad. If it does, he should turn to new ideas
for research, or just modify the foreign research for Philippine setting.

?If we are able to institutionalize patent search [among researchers] we can
save our meager funds in the government because researchers won?t do a
research all over again. They can concentrate on breakthrough or
cutting-edge researches,? Beronio said.

Drafting of claims: The training on the drafting of claims, he said, is also
very critical. He said there is a peculiar language used, which only patent
lawyers know, in filing patent claims, in reacting against another patent
and in arguing for one?s claims.

Training participants will be taught on the process in drafting claims and
the specification for patent applications on engineering and biotechnology.
Real life experiences will be shared to them and they will be given
practical exercises.

IP valuation: Through IP valuation, its owner can decide on the most
effective way in which it may be used, protected, insured, sold, leveraged
or exchanged in the market. The training will focus on reviewing situations
why IP valuation is necessary, the different methods of valuing IP and the
uses and limitations of each.

IP commercialization and technology transfer: The training proposal said
that one of the main advantages of clear IPRs is that it facilitates
technology transfer through licensing, strategic alliances and other types
of contractual arrangements. It added that it is important for research
institutions to have an effective knowledge on IP commercialization and
technology transfer so that ?it can fully reap the benefits of its IP.?

The training will include handling technology-transfer agreements, such as
licensing, material-transfer, confidential-disclosure and other related
agreements. IPRs made Beronio said that the less than one-year-old IPMO has
registered seven patents and has paid the Filipino researchers royalties for
their inventions, mostly machinery.

The royalty arrangement is 60-40 in favor of the scientist, if the invention
was an initiative of the scientist, even if the facilities and funds used
were that of PhilRice, and 40-60 in favor of PhilRice, if it was the agency?
s initiative.

Among those up for patent registration is the PhilRice and University of the
Philippines Diliman project on canned rice with adobo or menudo. An
exclusive licensing agreement was already entered into with a private
company to market the product.

PhilRice is also negotiating for an agreement on the use of a transgenic
bacterial leaf blight-resistant rice owned by the University of California
and for another gene against tungro with Danforth Laboratory in the US.


Raging debate


A raging debate is ongoing which could revolutionize the IP landscape in the
country. The issue: whether IPs made by Philippine government institutions
and scientists using public funds and facilities should be protected and be
made available for licensing agreements for commercialization, or whether
these should be given free to farmers or consumers because they are publicly
generated anyway.

Obviously, the science community is in favor of the former.

Beronio asked, ?How will you encourage innovation and invention in the
public sector? You should provide some incentives. You cannot provide
incentives without commercialization because how will you generate
royalties??

He explained that commercialization does not simply mean giving the
technology to the farmers for free, and letting them decide whether to adopt
it or not.

?When I talk about commercialization, I mean licensing agreements; [giving]
exclusivity to commercial companies, who will have a certain degree of
monopoly. No businessman in his right mind will buy a technology from the
government if he knows that he has many competitors.?

A patent is protected for 20 years, which gives the businessman a limited
monopoly with his exclusive licensing agreement. While the businessman is
ensured of making money, the patent owner collects royalties from him.

?Where will you get royalties? [The government] cannot appropriate it. We
only get it from commercialization. But if we won?t allow such arrangement,
paano kikita ang researcher? Kasi [it is for] public good [and should be
given for free]? This is the reason why the government is not earning.?

To stress his point, Beronio explained that the US has been profiting from
this system since the 1980s through the Bayh-Dole Act. The law allows
universities and public institutions to commercialize their IPs, even if
they were generated from federal grants. It even allows the inventors to
spin-off in private business, making the scientists earn, if not become
rich, from their intellectual creation.

?Ang nangyari na-revolutionize ang landscape sa universities [in the US],
na-encourage ang mga scientists, na-unleash ang kanilang creativity,? he
said, citing that Columbia University in the US has been earning a whopping
$1 billion a year from the drugs its scientists help develop.

He added that if the publicly owned IPs are bid out, their owners will be
free from perceived corruption and conflict of interest issue when they help
businessmen trade their product.

Beronio suggested that one way to cut the budget deficit in the Philippines
is by allowing government research agencies and universities earn and let
their income revolve within the institution. Actually, the funds generated
by almost all government research agencies or educational institutions from
royalties or sales go to the National Treasury and not for the use of the
agencies and their scientists and researchers.Fortunately, PhilRice is
allowed to revolve the fund it gets from sales and royalties.

Another scientist told Today that many government researchers and scientists
have left their public posts for greener pastures in private research
agencies or go abroad, owing to lack of incentive from the government.

On the argument on government researchers? IP are for public good and
therefore should be given free to the consumers, Beronio said that the
science community is not only dealing with public good now. ?Public good has
international dimensions. Vitamin A Rice is 50 percent public good and
50-percent international good. So that definition of public good is getting
blurred now. It is no longer fully public. There is private component in
it.?

He said they are conscious that IP protection should not hinder the
promotion of the technology.

He explained: ?The focus of protection is to prevent misappropriation by
others. Protection simply gives us confidence that we are really the owners.
That we shall be able to selectively engage the market, hindi lang free for
all. When people think about public good, I think they generally mean free.
Kahit ang magsasaka ayaw na ng libre. Kung ako ang magsasaka bibilhin ko,
bibigyan ko kayo ng royalty, basta maganda ang quality ng product mo.?

He said the DA and Department of Science and Technology are into a one-year
study on the available legal and institutional frameworks on the issue in
the country.

He said the matter should have a definite legal ground. ?We are in a
tightrope. We are doing a balancing act. Anybody can challenge it. So I say,
?Go ahead challenge it [in court], so that the Supreme Court can resolve the
issue.?? Or a law might be needed to settle its legality.

He said that while the issue has become very controversial, it also
?generates a lot of rights and protection for the farmers. Because this time
we are selling a product and we are liable under the Consumer Act for any
failure on our part. So [the farmers can say], ?While you [IP owner] are
protected, I?m also protected because now I can sue you for selling me a bad
product.?

[www.abs-cbnnews.com]

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