At universities across
the country, breeders are working to develop new varieties that not
only improve a grower’s productivity but also help ensure the
continuation of the breeding program.
These programs are sponsored through university funding as well as
by some commodity groups. But what happens when the variety performs
well and is sold to an outside company?
When a variety license at Michigan State University (MSU) is up for
sale, the university issues a request for proposals, and companies
submit competitive bids for the license of the product. The company
whose bid is accepted is either granted exclusive or non-exclusive
rights as granted in the contract.
“We try to strike a balance between a number of factors: the
local economic development from the money that will flow to the university
in the licenses as well as to the inventors themselves,” said
Loraine Hudson, director of MSU’s office of intellectual property.
“We try to strike a balance to make sure we come to a result
that will balance out all these factors.”
Hudson said that all of the license agreements at MSU require an up
front payment and a running royalty as part of a minimum royalty per
year.
Ron Voss, Extension vegetable specialist at the University of California,
does potato variety development. Voss said that the process for the
sale of licenses developed at he University of California involves
three phases.
“First is a statement of release and naming by the university,
a general release to the public,” Voss said. “Second,
we apply for pant variety protection, which is part of the patent
law that applies to potatoes. Potatoes are subject to plant variety
protection, but not a patent. The third is the development of a license
agreement between the university and the companies in which the university
is entering into agreement with.”
The variety research program at the University of California has received
funding from different commodity groups. In fact, Voss said that the
California Potato Research Advisory Board (CPRAB) has funded “a
great deal” of his research that has lead to the release of
new varieties.
However, there are no direct benefits from the sales of those licenses
for the CPRAB.
“The university has a uniform royalty policy in which royalties
that come into the university are divided in several ways,”
Voss said. “There’s a certain percentage that goes to
the university president’s office, a percentage that goes to
the breeder. And a certain percentage goes to the campus and a certain
percentage of that comes back to my department for continued research
in the area of potato variety development.
“Indirectly then, the groups benefits because the money comes
back into the research program. There have been several conversations
with the board. I think I can say that the potato board, and I understand
it, all of these boards have expressed concern that more of the money
is not coming back directly to the program or the board.”
Ken Melban, manager of the CPRAB, said that some of the research that
has been done and the licenses resulting from that have been a mess
as far as his organization is concerned.
“We had two varieties, that had basically been partially developed
through funding from the California Board, and were basically let
go by the university system – so they let them die,” Melban
said. “They were basically raised from the dead by two private
companies and continued to be worked on, and those companies sought
to get exclusive licenses to those plants. And our board was not happy
about it because our funding went to these, and we could not reap
the benefits.”
Voss and Melban did say that the University of California does not
typically grant exclusive licenses, but the uniqueness of this situation
merited such.
“This is something that has been coming up more and more with
California commodity groups funding research them (university research
programs) and the universities are releasing the varieties. The groups
are asking ‘what is our stake?’ The university said ‘the
amount of funding you invested is, compared to ours, mill.’
Growers are saying that this has been funded by our money, but it
is falling on deaf ears.”
The situation at the University of Idaho is similar, but not exactly
the same. Steve Love, University of Idaho Extension, said that if
a commodity commission pays for research, he doesn’t consider
it appropriate for the university to corner the benefits. However,
funding for variety research does not only come from the one source.
“The waters then get a little muddy,” Love said. “There
is some aspect of that funding that comes directly from commodity
groups, but there is no one single source for funding for breeding
programs. We do apply for plant variety protection certificates, and
in some cases accept royalties. Right now in the vegetable world,
the only place we’re doing that is with potatoes.”
The University of Idaho is partnered with the U.S. Department of Agriculture’s
breeding program as well as two other state research programs.
“Our purpose is to serve our industry, and the commodity commissions
are a representative example of that industry,” Love said. “When
we make variety releases, we try to put them in the hands of the growers
so that it brings them benefits so they are satisfied that the investment
they made is coming back to them. We just haven’t completely
finished making all of the arrangements to operate the way we want
to – it’s a very complex situation.”
Love said their goal is to make a model for varietal releases that
echoes that at Colorado State University. There, the university protects
the varieties but licenses them to a group of see growers within the
state who markets the varieties.
“We wan to create a situation where seed growers can benefit
not only from growing improved varieties but from actually growing
and marketing the varieties that we serve as a university,”
Love said. “We’re hoping it will bring them some benefit.
If it doesn’t, we may get out of plant variety protection because
all that does is create work for work’s sake.
“One thing we have going for us in Idaho is that our university
is still very closely tied to grassroots agriculture.”
At each of the universities, the realm of intellectual property rights
is still a fairly new one that will continue to develop in the coming
months and years.
“This is something that’s still evolving,” Melban
said. “There are no definite answers on this. It is on a case-by-case
basis.”
