Ongoing Enzyme Patent Dispute May Have Ramifications For Academic Researchers

AT ISSUE: Promega Corp.'s sale of Taq polymerase for PCR has riled Hoffmann-La Roche. It's David vs. Goliath in a battle of biblical proportions over the patents for a crucial enzyme in molecular biology. The Goliath in this case is the century-old health-care giant Hoffmann-La Roche Ltd. The Basel, Switzerland-based company employs 50,500 people and had 1995 sales of 14.7 billion Swiss francs ($11.8 billion). David is the Promega Corp. of Madison, Wis., a biological reagent company with 420 employees and 1995 sales of about $60 million. At stake is not only the validity of a lucrative patent, but also the question of whether academic scientists must worry about whether someone might own patent rights to enzymes or processes they wish to use in their research. Patent experts interpret recent court decisions as being broadly favorable to Promega, but the case is far from settled. Caught in the middle are 40 United States universities and government laboratories and 200 individual scientists who have been named as infringers of Roche's patents. Hoffmann-La Roche Inc., Roche's main U.S. subsidiary that is based in Somerville, N.J., started the fight by suing Promega, accusing the company of violating its patents in the sale of Taq polymerase, the critical enzyme in the polymerase chain reaction (PCR) process (H. Ahern, The Scientist, June 26, 1995, page 16; May 27, 1996, page 17). PCR allows molecular biologists to take a tiny amount of DNA and reproduce thousands of identical copies of it. But Promega loaded its sling with a countersuit, charging that one of Roche's critical Taq patents is invalid and may in fact have been obtained fraudulently. This epic legal battle is taking place before Judge Vaughn R. Walker in U.S. District Court in San Francisco. QUESTION OF INTENT: Patent attorney Reid Adler explains a key issue. "Certainly the case raises the question of where the line is drawn between noninfringing academic use of a patented discovery, and infringing commercial use of the same discovery," notes Reid G. Adler, a patent attorney and partner in the Washington, D.C., law firm Morrison and Foerster. Adler's firm is not allied with either side in this dispute. The dispute began in 1992, when Roche accused Promega of breach of contract and violating some of its PCR patents. Roche acquired the PCR business of the now-defunct Cetus Corp. in 1991. Among its acquisitions were Cetus's existing contracts and its patents for the process of PCR and for two forms of Taq polymerase: the native form and a recombinant form. The native enzyme is purified from the thermophilic bacterium Thermus aquaticus. Promega had previously negotiated a contract with Cetus to sell native Taq polymerase as a generic enzyme. "We saw clearly that Promega, who had a license from Cetus to sell Taq polymerase for uses other than PCR, was in fact violating that license and selling it to researchers specifically for PCR," explains Thomas J. White, vice president of R&D for Roche Molecular Systems Inc., an Alameda, Calif.-based Hoffmann-La Roche subsidiary. "Roche offered to Promega a license, like they've offered a license to a dozen other research reagent companies, to sell Taq polymerase . . . for research in PCR. Promega declined to take that license, and chose to distort the issue by saying that Roche was preventing basic research and was going after basic scientists. This is flatly untrue." PROMEGA POLICY: Promega executive Randall Dimond says a new royalty structure would mean higher prices. Randall L. Dimond, vice president and chief technical officer of Promega, has a different view of the dispute's origin: "It appears to us that when Roche looked at the licenses, they decided they were unhappy with the terms that Cetus had entered into, and they really wanted to change the relationship with buyers of Taq polymerase and, in the process, substantially increase the royalties that were being paid back to them. . . . We felt that the new royalty structure would cause us to have to raise the price of the Taq polymerase to the point where it would make it infeasible to use for many of our customers." According to Dimond, the company charges customers about 28 cents per unit, depending on the quantity purchased, and sells $4 million worth of the enzyme annually. "So we elected to continue to operate under the terms of the original license." Promega has continued to sell Taq polymerase throughout the dispute. Promega responded to Roche's suit with a two-pronged attack on the patent for native Taq polymerase. In the "invalidity" flank, Promega argued that the patent should never have been issued because Cetus's patent claims were insufficiently novel. The company claims that "prior art" existed in the form of two published papers (A. Chien et al., Journal of Bacteriology, 127:1550-7, 1976; A.S. Kaledin et al., Biokhimiya, 45:644-51, 1980 [English translation published in Biochemistry, 45:494-501, 1980]). In the "inequitable conduct" flank, Promega argued that Cetus obtained the patent fraudulently, by knowingly making a series of misstatements and omissions that affected the Patent and Trademark Office's decision. While both sides are concentrating on Promega's challenges to the validity of the Taq polymerase patent, the original breach-of-contract and patent infringement lawsuit is on hold. This may be good-if frustrating-news to the institutions and individual researchers whom Roche named in May 1995 as infringers of its PCR process patents. 'OUTRAGEOUS': Stanford Nobelist Arthur Kornberg decries the case's "unfairness." One supporter of Promega's prior art position is Nobel laureate Arthur Kornberg, a professor (emeritus) of biochemistry at Stanford University Medical Center who was a pioneer in DNA polymerase research. "It was clear to me that Taq polymerase had been described many years earlier," he says. "The unfairness of taking a material that was discovered and developed with public funds and was in the public domain and described in the literature, and then claiming to produce some new wrinkle and then patenting that and making it unavailable to the very people who discovered it in the first place-I think that's outrageous. . . . Now they claim that they have a different enzyme, but on many, many counts it's obviously the same enzyme." "We would challenge Dr. Kornberg to produce any evidence that a full-length Taq DNA polymerase was useful before it was made available by Cetus's researchers," replies Roche's White. "In our view, at best what had been isolated was an impure preparation of a degraded form of the Taq polymerase, and that is [a form] with a smaller molecular weight." Much of this argument hinges on the definition of the word "purified," and that was one of the subjects of a March 13 hearing before Judge Walker. Roche argued that the word should mean that Taq polymerase would be the major protein component of the composition and would be substantially free of contaminating nucleases, while Promega argued that the native Taq patent listed no particular degree of purity and that the removal of any amount of contamination should be regarded as purification. In an August 9 decision, Judge Walker adopted Promega's definition. "What the judge ruled is that the simple word 'purified'-as used in general, in biochemistry, and in that claim-does not denote any particular degree of purity, just that it had been purified more than in the natural state," explains Dimond. "And that means that the argument that Roche has been raising, that the patent should be valid because their enzyme was of a higher degree of purity than the prior art, will no longer be an issue when we get to trial." A PLACE FOR PATENTS: Cornell researcher Francis Barany contends that "sometimes Goliath is right." "That's really odd," comments Francis Barany, a professor of microbiology and structural biology at the Cornell University Medical College in New York City. "When I think of 'purified,' I think that you run the thing on an SDS gel and you see a whopping band," indicating high concentrations of a single molecule. In a hearing on September 13, Roche petitioned the court to permit it to appeal the Walker decision on the definition of "purified." Walker has not yet ruled on this request. While Promega has achieved at least a temporary victory in the invalidity part of the case, the section of Judge Walker's August 9 decision related to inequitable conduct was only partially favorable to Promega. Reid Adler explains that for a patent to be unenforceable because of misconduct, "the challenger to the patent has to show at a clear and convincing level that material information was withheld or material misrepresentations were made and that the applicant for the patent intended to deceive the examiner. "What the judge has said so far," continues Adler, "is that some of the incorrect statements made to the examiner were material, and some of the material withheld from the examiner is material, but the judge says there is not enough information for him to decide at the moment, based on the record, whether or not there was an intent to deceive the examiner by withholding and misstating." If there was no intent to deceive, explains Adler, the patent cannot be invalidated on that ground, even if Cetus's misstatements were the result of gross negligence. Depending on how the case develops, a trial may soon be scheduled on the question of Cetus's intent to deceive. One of the 200 researchers named by Roche as infringers of its Taq patents is R. Max Wynn, an assistant professor of internal medicine at the University of Texas Southwestern Medical Center in Dallas. He learned that he was on the list only after a colleague told him that she had seen his name on Promega's Web site, which contains extensive information on the Taq polymerase case. "I was just annoyed, mostly," Wynn says, recalling his first reaction. He and three colleagues earned a place on the list by publishing a paper in the Journal of Biological Chemistry on the cloning, expression, and assembly of a bovine enzyme in E. coli (J.R. Davie et al., 267[23]:16601-6, 1992). "We just happened to be honest, perhaps too honest. In one of our papers we mentioned no less than about 10 times that we had used the polymerase from Promega." ON THE INTERNET Information on the Taq patent case and the companies involved in the dispute can be found at the following World Wide Web addresses: Promega Corp http://www.promega.com Hoffmann-LaRoche Ltd. http://www.roche.com Although Roche has repeatedly denied in media statements that it intends to sue any of the individuals or institutions named as infringers, Wynn maintains that he has received no official notification of that. "No one from Hoffmann-La Roche has ever contacted me or sent me any information," he contends. Nevertheless, Wynn is conciliatory: "We are more sensitive to this issue, and we certainly don't want to cause problems. And if it's a matter of just making a citation to the fact that Hoffmann-La Roche developed this process-as long as that's okay, that's fine with us. We don't feel bad about acknowledging the fact that they have proprietary rights to the material or to the process." Some observers of the case are concerned that future use of patented technology in academic research will be affected by Roche's infringement case. "As a taxpayer who supports academic research, I would like to think that academic scientists would not have to fear infringement lawsuits of this kind," comments Adler. "Historically, industry has been extremely reluctant to sue academic scientists for infringement. I don't think that attitude on the part of industry is likely to change. Academic research is generally not a commercial threat to a company's market activities. . . . Also, the academic community tends to discover other uses for patented products or processes, which expand in some regards the market for a patented product." Others disagree that patents obstruct scientific progress. Barany (who emphasizes that he has received research support from Roche) maintains that "there's a reason to have the patent law, and that reason is to foster further research and development. And when a patent inhibits that, then there is reason to be concerned. However, it is my understanding that the Taq polymerase patents in no way inhibit research, that Taq polymerase and PCR are available not only from Hoffmann-La Roche but from a number of companies that have taken out licenses. So I don't see a case that science is being held back." Referring to Promega's ongoing battle with health-care powerhouse Roche, Barany says, "I think that Americans have classically always rooted for the underdog." But that sentiment may be unwarranted in this patent battle, he notes. "Sometimes Goliath is right." No matter who is right, this case may drag on for years, failing an out-of-court settlement. At the September 13 hearing, Promega's lawyers submitted a motion for summary judgment, maintaining that the judge's decision on the definition of "purified" should by itself be enough to invalidate the patent. Oral arguments on that motion are scheduled for November 15. But this involves only one part of this complex litigation, and factoring in appeals, Adler doubts that a final resolution is any closer than two years away. Robert Finn, a freelance science writer based in Long Beach, Calif., is online at finn@nasw.org.

Ongoing Enzyme Patent Dispute May Have Ramifications For Academic Researchers

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