You Get What You Pay For

Be careful about provoking scientists.  They can be persistent.

The issue I’m writing about today was first raised a quarter century ago when Henry Herman (“Heinz”) Barschall published two papers in Physics Today about the cost of academic journals.  He performed analyses of various physics journals at the time, based on some widely used metrics that attempt to quantify the “value” of a journal in terms of its reach and citation frequency.  His analyses showed that according to his criteria, physics journals published by the American Institute of Physics (“AIP”) and by the American Physical Society (“APS”), two not-for-profit academic societies devoted to physics in the United States, were more cost effective than other journals, particularly journals produced by commercial publishers.  Copies of his articles can be found here and here.

His articles prompted a series of litigations in the United States and Europe alleging that they amounted to little more than unfair advertising to promote the academic-society journals that Barschall was associated with.  At the time, he was an editor of Physical Review C, a publication of the APS, and the magazine Physics Today where he published his findings was a publication of the AIP.  (In the interest of disclosure, I was also previously an editor of an APS publication and also recently published a paper in Physics Today.  I have also published papers in commercial journals.)  The academic societies ultimately prevailed in the litigations.  This was relatively easily accomplished in the United States because of the strong First Amendment protection afforded to publication of truthful information, but was also accomplished in Europe after addressing the stronger laws that exist there to prevent comparisons of inequivalent products in advertising.  A summary of information related to the litigations, including trial transcripts and judicial opinions can be found here.

The economics of academic-journal publication are unique, and various journals have at times experimented with different models in order to address the issues that are particular to the publication of academic journals.  They have as their primary function to disseminate research results and to do so with a measure of reliability that is obtained by their use of anonymous peer review.  Despite their importance in generating a research record and in providing information of use to policymakers and others, such journals tend to have a small number of subscribers but relatively large production costs.  Consider, for instance, that Physical Review B, the journal I used to work for and one of the journals that Barschall identified as most cost-effective, currently charges $10,430 / year for an online-only subscription to the largest research institutions, and charges more if print versions are desired.

While commercial journals have generally relied upon subscription fees to pay their costs, academic-society journals have been more likely to keep subscription fees lower by imposing “page charges” that require the authors to pay a portion of the publication costs from their research budgets.  The potential impact on their research budgets has sometimes affected researcher decisions about where to submit their papers.  More recent variations on economic models distinguish among subscribers, charging the highest subscription rates to large institutions where many researchers will benefit from the subscription, and charging lower subscription rates to small institutions and to individuals.  All of these economic models have needed to compete more recently with the growing practice of posting research papers in central online archives, without fee to either researcher or reader.  The reason that traditional journals still exist despite the presence of these online archives is that they provide an imprimatur of quality derived from their use of formalized peer-review considerations that are still relied on by funding bodies and other government agencies.

As reported this weekend in The Economist, Cambridge University mathematician Timothy Gowers wrote a blog post last month that outlined his reasons for boycotting research journals published by the commercial publisher Elsevier.  A copy of his post can be read here.  The post has prompted more than 2700 researchers to sign an online pledge to boycott Elsevier journals by refusing to submit their work to them for consideration, by refusing to referee for them, and by refusing to act as editors for them.  My objective is not to express an opinion whether such a boycott is wise or unwise.  The fact is that journals compete for material to publish and for subscriptions.  While they accordingly attempt to promote distinctions that make them more valuable than other journals, they are also affected by the way their markets respond to those distinctions.

What is instead most interesting to me in considering the legal aspects of this loose boycott is the extent to which it is driven by a general support among commercial publishers for the Research Works Act, a bill that was introduced in the U.S. Congress in December and that would limit “open access” to papers developed from federally funded research.  The Act is similar to acts that have been proposed in 2008 and 2009.  Specifically, it would prevent federal agencies from depositing papers into a publicly accessible online database if they have received “any value-added contribution, including peer review or editing” from a private publisher, even if the research was funded by the public.

The logic against the Act is compelling:  why should the public have to pay twice, once to fund the research itself and again to be able to read the results of the research it paid for?  But this logic is very similar to the arguments raised decades ago against the Bayh-Dole Act, which allowed for patent rights to be vested in researchers who developed inventions with public funds.  The Bayh-Dole Act also requires the public to pay twice, once to fund the research itself and again in the form of higher prices for products that are covered by patents.  Yet by all objective measures, the Bayh-Dole Act has been a resounding success, leading to the commercialization of technology in a far more aggressive way than had been the case when the public was protected from such double payments — and this commercialization has been of enormous social benefit to the public.

The Bayh-Dole Act has been successful because it provides an incentive for the commercialization of inventions that was simply not there before.  This experience should not be too quickly dismissed.  In the abstract, the Research Works Act is probably a good idea because it provides an incentive for publishers to provide quality-control mechanisms in the form of peer review that allows papers to be distinguished from the mass of material now published on the Internet without quality control.  This is worth paying for.  But the Act also has to be considered not in the abstract, but instead in the context of what not-for-profit academic societies are already doing in providing that quality control.

The ultimate question really is:  Are commercial publishers providing a service that needs to be protected so vitally that it makes sense to subject the public to double payment?  The history of the Bayh-Dole Act proves that the intuitive answer of “no” is not necessarily the right one.  But what the commercial publishers still need to prove in convincing the scientific community that the answer is “yes” is, in some respects, no different than the issue Heinz Barschall raised 25 years ago.

JuriSnippet: Recent Developments in US Patent Law

The magazine Physics Today published my article on the impact of the new US patent laws on scientists.  It can be found here, and the magazine has made it available free.

Gene Patents

Not a day goes by that breast cancer does not figure in the news, at least at some level.  There are reports of new treatment options, reports of high-profile women who have been diagnosed, reports of improvements in early detection, and many other stories of how it affects our lives.  With approximately 12% of women likely to develop an invasive form of the disease sometime during their lives, there are few among us who are not impacted by it.

In 1994 and 1995, the BRCA1 and BRCA2 genes were isolated (the name of the genes is derived from “BReast CAncer”), representing one of the most significant advances in understanding the disease.  Women who carry mutations of these genes have an 82% risk of developing breast cancer and a 54% risk of developing ovarian cancer by age 80.

This ability to test for mutations has radically altered the lives of many women.  Before isolation of the genes, women who had a family history of breast cancer lived much of their lives under the assumption that it was merely a matter of time before they developed it also, and often feared that their daughters would one day endure the same heartbreak they had seen in their mothers.  Genetic tests for mutations now offer many greater options for women.  Those who test negative for the mutations are provided with reassurance not only that they are not at increased risk for breast cancer but that their children are also not carriers.  Those who test positive have a more realistic assessment of their actual risk and can avail themselves of options that range from increased monitoring to prophylactic mastectomy.

While no one disagrees that the ability to test for the genes is a positive development for women, many people object — strongly object — to the fact that there is a government-enforced monopoly on the right to administer such tests that was granted to the company Myriad Genetics.  Information about the test, called BRACAnalysis® is available at the web site here.  The cost of the test is somewhere around $400 for a single-mutation analysis (useful if the woman has a known family history involving a specific mutation) and somewhere greater than $3000 for a full-sequence analysis of both BRCA genes.  There is no question that these costs are elevated from where they would be in a competitive market because of the monopoly held by Myriad Genetics; if other companies were permitted to offer similar tests using the technology, competition mechanisms would drive costs lower.

The monopoly held by Myriad Genetics is, of course, a consequence of the patent laws.  Myriad Genetics owns a number of patents directed to isolated forms of the genes themselves and to methods for analyzing a patient’s BRCA sequence.  The patents grant them the right to prevent others from performing the BRCA tests, and they actively make use of that right.  Earlier this week, an appeal was filed with the U.S. Supreme Court challenging the validity of Myriad Genetics’ patents.  At the heart of the issue is the fundamental question:  should companies be allowed to patent genes?

Many believe that corporate profits in an area such as this are unseemly, and it is impossible not to have at least some sympathy with their point of view.  Currently, access to an important genetic test is denied to those women who do not have either the independent financial means or health insurance to pay for it.  A broad public policy that allows gene patents will inevitably result in other genetic tests having similar financial barriers.  Further, it has always been the case that laws of nature and physical phenomena cannot be patented.  Those opposed to gene patents essentially argue that human genes should not be patented because they are created by nature, not by men.

These are important and valid points that need to be considered by the Supreme Court if it chooses to accept the case.  But they fail to tell the whole story and are misleading when presented without a fuller context.

When the Myriad Genetics case was litigated in the original court, the argument that genes were products of nature prevailed, resulting in a ruling that the patents were invalid.  But this was overturned by the appellate court, which noted an important distinction between genes as they occur in the human body and genes that have been isolated:  “BRCA1 and BRCA2 in their isolated state are not the same molecules as DNA as it exists in the body; human intervention in cleaving or synthesizing a portion of a native chromosomal DNA imparts on that isolated DNA a distinctive chemical identity from that possessed by native DNA.”  A full copy of the appellate decision can be read here.  It is that distinction between genes as they occur in the human body  (only as a component of very long strings of chemically linked nucleotides) and genes after they have been isolated (where they consist of only about 0.1% of the nucleotides of the original DNA molecule) that is at the heart of why gene patents are currently valid.

Beyond this technical reason, though, it is worth recognizing the policy issues that argue in favor of allowing gene patents.  Foremost is the fact that the patent monopoly is temporary — the earliest of the Myriad Genetics patents on this technology will expire in about three years, after which the ability of competitors to provide similar services will progressively open up and drive down costs.  In evaluating the prudence of allowing gene patents, it is a mistake to look only at the circumstances during the period when the patents are enforceable — everyone agrees that monopolies have negative consequences on trade, but it is the price we temporarily agree to pay in order to have the technology commercialized in the first place.

Medical scientists also know that BRCA1 and BRCA2 are only a small piece of the puzzle that defines the genetics of breast cancer.  There are many other discoveries yet to be made, and the cost of the research to make those discoveries is large.  The possibility of obtaining a patent that allows a profit to be realized is a major incentive that promotes private investment in the research.

Consider the following choice.  Is it worse to endure a temporary period of time in which our access to technology is limited, leaving the right to profit from it exclusively with those who developed it?  Or is it worse to endure not having the technology at all?  The answer really is no different for genetics than it is for other technologies.

A Thing of Immortal Make

Today, the President signed the America Invents Act, bringing about the most significant changes to U.S. patent law in more than half a century.  While most commentary centers around the shift by the U.S. to join the rest of the world’s “first to file” system — in which priority for a patent goes to the one who wins the race to the Patent Office instead of the one able to prove he invented something first — I want to focus on a more obscure provision of the Act.

Bear with me while I begin with Greek mythology.  Homer described the Chimera in the Iliad:  “a thing of immortal make, not human, lion-fronted and snake behind, a goat in the middle, and snorting out the breath of the terrible flame of bright fire.”  A monstrous creature, the sight of which foretold any variety of natural disasters, the Chimera was ultimately defeated by Bellerophon, who shot her from the winged horse Pegasus.

One of the achievements of modern biological research has been the ability to create fusions of different organisms by combining embryos from different species — “interspecies chimeras.”  The cells intermix and the organism continues to include cells from different species as it grows.  One of the more famous interspecies chimeras is the “geep,” an organism created in 1984 by scientists who fused a sheep embryo with a goat embryo, and which successfully grew to adulthood.  By any measure, the geep is a peculiar-looking creature, with portions of its skin covered in hair (that grew from the goat embryo) and portions covered in wool (that grew from the sheep embryo).  Ever since their creation, many have debated whether their legitimate scientific value outweighs the very common initial reaction that they are too bizarrely unnatural.

The World's First Geep

Shortly after the cloning of Dolly the sheep in 1997, when public attention was focused on the ability of biologists to circumvent natural processes in the creation of lifeforms, Stuart Newman, a professor at New York Medical College in Valhalla, New York, submitted a patent application for a human-nonhuman chimera.  A copy of the application can be found here and makes for interesting reading (perhaps unusually so for a patent application).  Dr. Newman has always been clear on his motivations for filing such a patent application, asserting that he never had any intention of producing humanzees, bahumans, or any other type of human-nonhuman chimera.  Rather, he was concerned by the legal environment in which the Supreme Court appeared to be giving real effect to the desire expressed by Congress in 1952 that a patent be available for the invention of “anything under the sun that is made by man.”  Indeed, I commented several months ago here that roughly 12% of each of our bodies is estimated to be subject to some form of patent coveage.

Dr. Newman’s motivations in wishing to provoke a thorough consideration of the merits of allowing patents on scientifically engineered metahumans are best expressed with his own words:

As a scientist who came of age in the 1960s, I had witnessed the damage that could be wrought by using the products of research and technology without appropriate constraints.  The list is long….  My objective in filing the application was to help alert a wider public to what was coming down the road in terms of human applications of developmental biology.  In a society with democratic values it should be inarguable that those who pay for scientific research and will eventually experience its effects should be informed of what is in store while there is still a chance to discuss its objectives and influence its course.  As a researcher myself, moreover, I was not oblivious to the possibility of a backlash against my field if it was seen to have violated the social trust.

Dr. Newman’s expectations about the line of biological development in this area were correct.  In 2003, the first human-nonhuman chimera was created by Chinese scientists, in that instance between humans and rabbits (embryos were allowed to develop only for several days before being destroyed).  This has been followed by creations of chimeric human-sheep, human-pig, human-mouse, and other human-nonhuman embryos.

Dr. Newman’s patent application was never granted.  Indeed, it precipitated the very debate he hoped it would.  In April, 1998, Commissioner of Patents Bruce Lehman took the highly unusual (and perhaps legitimately criticized) step of announcing to the public that the application would never be allowed, disdaining it as an attempt to patent “half-human monsters.”  That has been the effective policy of the Patent Office ever since, which has asserted that “[i]f the broadest reasonable interpretation of the claimed invention as a whole encompasses a human being, then a rejection … must be made.”  Indeed, since 2004, this policy has received a measured support from Congress, which has passed the so-called Weldon Amendment every year as a rider to the Commerce, Justice, and Science Appropriations bills:  “None of the funds appropriated or otherwise made available under this Act may be used to issue patents on claims directed to or encompassing a human organism.”

But the Weldon Amendment has been limited to the channeling of federal research funds.  Today, with enactment of the America Invents Act, the U.S. government has gone farther by declaring that “[n]otwithstanding any other provision of law, no patent may issue on a claim directed to or encompassing a human organism.”  It is worth noting that this is generally consistent with the approach taken by other countries, and that this provision of the Act removes not only human-nonhuman chimeras from being patentable, but also affects other areas of research involving human embryos and fetuses.  While the Act does not make it unlawful for researchers to investigate human-nonhuman chimeras, the result remains important since it removes one of the primary legal mechanisms that would make such research profitable.

The last time Congress overhauled the patent system in 1952, it proudly and poetically declared its intention to allow patents on “anything under the sun that is made by man.”  Today, it limits that a little, but in a way that few find objectionable.

Not Contented With Things as They Are

Among lawyers, patent attorneys tend to be among the more reserved.  We mostly spend our days quietly crafting language to describe and protect inventions, and pride ourselves on the use of subtlety.  Sometimes our area of the law is described as “arcane.” But every now and then, our lives are thrown into turmoil by an invention of such importance that men will  lie, swindle, and bribe to get credit for it, not only for the immediate financial gain but also so that history will forever remember them as having invented something that changed the world. 

Alexander Graham Bell

Surely one of the most intriguing such stories involves three men:  Elisha Gray, Zenas Fisk Wilbur, and Alexander Graham Bell.  Schoolchildren still learn the story of how Bell, whose mother and wife were both deaf, was diligently experimenting with hearing and speech, leading him to develop sound devices and eventually the telephone.  They are reminded of Bell’s first words over the device to his assistant, “Mr. Watson.  Come here.  I want to see you.”  Perhaps they are even told the quaint story of how Bell himself viewed the telephone as an intrusion on his real interests and refused to have one in his study.   

But the drama surrounding Bell’s credit for having invented the telephone is far more interesting, at least among those who are attracted to scandal and intrigue. 

Bell’s patent application for the telephone was filed on Valentine’s Day, 1876, the very day that Elisha Gray filed his own claim with the Patent Office.  The Examiner to consider the application was Zenas Fisk Wilbur, known to be an alcoholic, and there are enough irregularities surrounding the application that people to this day wonder whether Bell (or his attorneys) conspired with Zenas Wilbur to defraud Elisha Gray from his rightful claim.   

There is Claim 4 of Bell’s patent, which can be found here.  One of the more important claims in the patent, it recites a feature that was not shown in any of the drawings Bell included with his application, but it is present in the drawings Elisha Gray filed that day.  More damning, the feature is described in seven mysterious sentences that were written into the margin of the application.  Allegations were made that Zenas Wilbur had shown Gray’s document to Bell’s attorneys and allowed them to make the insertions, ultimately resulting in Bell being awarded the patent.  It would be ten years later that Zenas Wilbur swore in an affidavit to the Congressional Telephone Investigation Committee that he had, in fact, been handed a $100 bill by Bell himself when Bell visited the Patent Office and Wilbur improperly showed him Gray’s material. 

To this day, no one is certain whether Wilbur was actually bribed.  In his affidavit, he recants statements made in earlier affidavits, claiming to have been “afflicted with and suffering from alcoholism” and that with his “faculties … not in their normal condition [he] was, in fact, duped.”  Nonetheless, the U.S. Supreme Court, even after Wilbur’s confession that he received a bribe, found in The Telephone Cases that Bell’s patent was valid and that he was the inventor of the telephone.  A copy of The Telephone Cases can be found here.  (It is worth noting the 2008 book by Seth Shulman entitled The Telephone Gambit.  Shulman reviewed Bell’s notebooks, which can be found here, and identified what he believes to be a “smoking gun” — a drawing in Bell’s notes that essentially duplicates a drawing from Gray’s confidential patent submission).   

Elisha Gray

People sometimes point to Bell and Gray, and argue about which of them actually filed first with the Patent Office.  They certainly filed on the same day, but there is some question which of them was actually first.  It is an interesting academic question, but is, in the end, largely irrelevant in deciding who deserved the patent.  At the time, and to this day, the United States uses a “first to invent” system rather than the “first to file” system used elsewhere in the world.  Under the U.S. system, a race to the Patent Office is less important than the timing of actual invention.  The U.S. is the last country in the world to use this system, with Canada and the Philippines having adopted “first to file” systems in 1989 and 1998.  The “first to invent” system can be more complex, entertaining the difficult role of deciding when someone “invented” something rather than relying on the simple and clear determination of who filed first with the Patent Office.  But at the same time, the “first to invent” system gives greater recourse to individual inventors and small startup companies who may have lacked the resources and machinery to file patent applications as quickly as larger corporations. All that may be about to change.  

 This week, Representative Lamar Smith, chairman of the House Judiciary Committee, unveiled the House version of the America Invents Act, a copy of which can be found here.  It includes significant changes in the U.S.’s patent laws, adopting many of the same principles found in a similar bill approved by the Senate on March 8, 2011.  The Senate version of the bill passed with a vote of 95–5, and the President has indicated his intention to sign such a bill if presented to him.   

The Act would alter U.S. Patent Law in a number of ways.  It expands the ways in which third parties can challenge patents within the Patent Office instead of resorting to courts.  It alters the importance of the U.S.’s unique requirement that inventors disclose the “best mode” for practicing their inventions.  It gives the Patent Office increased authority over the way it charges fees.  And in addition to a variety of other changes, it perhaps most importantly would convert the U.S. patent system into a “first to file” system.  It seems inevitable that these changes will occur, and with the House now poised to act, it will probably happen relatively soon.  The U.S. has long toyed with the idea of changing to a “first to file” system so that its patent laws are more harmonious with those of other countries.  There remain some issues to work through:  there are the specific details to be reconciled between the House and Senate versions, and there is the lingering question of whether a “first to file” system is Constitutional in the United States; some scholars insist that only a “first to invent” system is consistent with the language of the Patent Clause.   

When the U.S. does make the switch, patent attorneys will still be practicing in an arcane area of the law.  But it will be with the heat of the metaphorical race against our colleagues to the door of the Patent Office hot on our heels.