The Regulation of Agricultural Biotechnology in the USA
L.J. Butler
Keywords:  United States of America; Plant breeders' rights; Patent law; Biodiversity; Biosafety/Foodsafety; Policies/Programmes. 
Correct citation: Butler, L.J. (1995), "The Regulation of Agricultural Biotechnology in the USA." Biotechnology and Development Monitor, No. 24, p. 2­6.

Since the elections of 1994 and the resulting change in the balance of power in the US Congress, there have been a number of resolutions to weaken those regulations that are perceived to impinge upon individual property rights and business in general. This deregulatory mood in Congress makes it difficult to predict the direction of future US biotechnology regulation.

Safety regulation, biodiversity conservation and intellectual property protection are three policy fields that have been subject to intensive debate in the USA. In this article, the legal side of these regulatory policies are analyzed in the developments of the last 20 years.

Safety regulations
The fear that the products of biotechnology may cause unforeseen harm to human health, or that genetically modified (micro­)organisms (GMOs) may cause irreparable damage to the environment, has been the major driving force behind the regulatory climate surrounding biotechnology in the USA for the last 20 years. The first notable attempts to address biosafety concerns occurred in 1975 when scientists proposed a set of biosafety guidelines which came to be known as the National Institutes of Health rDNA Advisory Committee (NIH­RAC) guidelines. Over the years, these voluntary guidelines have evolved into a comprehensive set of precautions which are used to guide experimentation of recombinant DNA research in contained laboratories.
While they are not statutory regulations, most people feel that laboratory­contained research of GMOs is pretty much a settled issue as far as human health, human safety and environmental protection are concerned. However, the problems of regulating experiments conducted outside the laboratory are not settled.
A vehement and bitter debate arose in the 1980s about the safety of field experiments involving GMOs. On the one hand there was much concern about the costs attached to the safety measures. On the other hand both the public and the biotechnology industry were dubious of the federal government's ability to ensure human and environmental health and safety. This was due to the apparent contradictions between agencies with oversight responsibility for biotechnology. Thus far, about 1,800 field tests with GMOs have taken place in the USA.

Field research regulation
In 1984, the Domestic Policy Council of the White House introduced the Coordinated Framework for the Regulation of Biotechnology, which was based on the premise that biotechnologically altered organisms do not differ substantially from non­modified organisms. Therefore, the products of biotechnology, and not the process, would be regulated. Additionally, existing laws would be used to regulate biotechnology products. The Coordinated Framework assigns authority for the regulation of biotechnology to three main agencies of the federal government: the United States Department of Agriculture (USDA), the Environmental Protection Agency (EPA), and the Food and Drug Administration (FDA).
To complement the NIH­RAC guidelines mentioned above, the USDA created the Office of Agricultural Biotechnology (OAB) in 1986, and subsequently the Agricultural Biotechnology Research Advisory Committee (ABRAC), involving experts from various backgrounds, including public interest groups, to give advice. These offices created guidelines to ensure the safety in the construction of laboratories and in the production of modified organisms. Additionally, USDA­Cooperative State Research Service created the National Biological Impact Assessment Program (NBIAP) to facilitate the safe field testing of GMOs through an information network of electronic bulletin boards, data bases and knowledge bases, biological monitoring, and biosafety research.
While the regulatory process continues to evolve, the ideological debate over the scope of proposed regulations, with one side pushing for the minimization of regulations and relaxation of rigid controls, and the other side pushing for carefully framed risk­based regulations, continues today. Under existing legislation, the FDA has approved many new products of biotechnology, including the controversial rbST. The USDA and EPA have established procedures for reviewing field tests of modified plants and micro­organisms. In 1993, the Animal and Plant Health Inspection Service (APHIS), an agency of USDA, after substantial experience with field testing transgenic species of six crops, amended its regulations to allow a simple notification procedure for the introduction of certain regulated articles (i.e. genetically­altered organisms that are or may be plant pests, or that may contain a plant pest or part of a plant pest).
In addition, the regulatory amendments provide for a petition process for the determination of non­regulated status. Non­regulated status means that a transgenic crop species may be cultivated, propagated, shipped within the USA and cross­bred with other non­regulated lines without prior approval from APHIS. Non­regulated status, however, relates only to the initial field testing of a transgenic plant and does not excuse compliance with regulations from other administrative agencies.
Despite this and other relaxation of rules, much remains to be resolved. Time and cost requirements to complete clinical and field trials are considered to be a burden by many, especially young firms. The regulation of GMOs under EPA's Toxic Chemical Substances Act (TCSA) and Federal Insecticide, Fungicide and Rodenticide Act (FIFRA) are still open to interpretation and debate. The issue of legal liability for environmental problems caused by the release of GMOs has not yet been resolved. The question of whether biosafety liability for biotechnology research (as opposed to product development), will be provided by regulation or by guidelines is highly uncertain.

In response to a rapidly growing and enthusiastic grassroots movement in the early 1970s, the US Congress enacted landmark legislation for the protection of the environment, which included the Endangered Species Act of 1973. In the ensuing years of the late 1970s and 1980s, Congress moved slowly, but gradually, to enact a number of other pieces of legislation aimed at furthering the goal of conserving biodiversity. However, no federal law specifically mandates the maintenance of biological diversity, either on­site (in situ) or off­site (ex situ).
The most comprehensive national plan for the protection of species diversity and their habitat is the Endangered Species Program authorized under the Endangered Species Act. The thrust of the Program is protection through proper management of a species habitat, which can include federally or privately owned habitats. The Program effectively maintains species already listed and protected under law, but provides little protection for those that are candidates.
The Program has been criticized for the slow pace of candidate review in the listing process, for underfunding and understaffing of the Office of Endangered Species, and its zealous enforcement by federal and state agencies and other pro­environmental conservation organizations. In the last year, a number of organizations advocating for private property rights have lodged objections against the rigid enforcement of the Endangered Species Act when it has prevented owners of land on which the protected habitat is located from doing anything that might disturb the habitat.
These protests, and other complaints about excessive regulation in the USA have prompted some legislators to propose measures that put a freeze on all federal regulations (with a special 2­year hold on the Endangered Species Act), force the federal government to pay regulatory compensation to property owners impacted by environmental laws, and require agencies to publicize rules on cost/benefit analyses prior to bringing court action against the alleged offenders.

Plant breeders' rights
The US Plant Patent Act (PPA) of 1930 provides intellectual property protection for developers of vegetatively propagated plants. The holder of the plant breeder right can exclusively reproduce, sell, and use asexually propagated plants for 17 years. Protection is not provided, however, for plant parts, genes, or traits. In addition, there is no protection against sexual reproduction. Thus, the protection afforded under PPA is relatively narrow, and generally not applicable to protection of germplasm, or products of biotechnology.
The formation of the International Union for the Protection of New Varieties of Plants (UPOV) by several European countries in 1961 prompted US plant breeders to investigate the possibilities of broadening the PPA to cover new sexually reproducing plants that could replicate "true­to­type" but could not be protected under the PPA. In 1970, US Congress passed the Plant Variety Protection Act (PVPA), which extends protection to novel, distinct, uniform and stable varieties of plants that reproduce sexually.
The PVPA is not a patent statute, but it provides a breeder of new plants protection similar to patent protection. Unlike other patent laws administered by the US Patent and Trademark Office (USPTO), the PVPA is governed by the Plant Variety Protection Office which is an agency of the USDA. And, despite the fact that it was patterned after other US patent laws, the PVPA contains several provisions that make it quite different from other US patent laws. For example, registration of varieties under the Act is based on UPOV criteria: (a) novelty (i.e. distinguishable from all existing varieties of the species); (b) uniformity (i.e. does not exhibit significant variation between individuals of the variety); and (c) stability (i.e. reproduces truly between generations).
These three criteria are in contrast to the criteria used by the USPTO of novelty, non­obviousness and utility. In essence, the PVPA places more emphasis on novelty, and excludes the criteria of non­obviousness and utility. This allows a new plant with small morphological differences to qualify for protection, increases the probability of marginal differences in protected varieties, and weakens protection from imitation. In addition, the breeder must submit 2,500 viable seeds at the time of application. These seeds are (permanently) preserved in the National Seed Storage Laboratory, a gene bank at Fort Collins, Colorado, unavailable to the public for bona fide research in developing new varieties.
As with all US patents, enforcement of the PVPA is in principle the sole responsibility of the plant breeder through civil law. Nevertheless, plant breeders are allowed, under the Act, to elect seeds to be sold by variety name only as a class of certified seed. If a breeder makes this choice (at no extra cost), the number of generations of certified seed permitted beyond the breeders' seed must also be specified.
The effects of this allowance are twofold. First, since this clause is under Title V of the Federal Seed Act, PVPA enforcement becomes the responsibility of the state seed inspectors. This enhances the firms' ability to identify and bring action against violators of the Act. Second, the clause assists companies in maintaining quality control and varietal purity by making state seed inspectors responsible for checking the number of generations produced beyond the breeder seed. Surprisingly, only about 40 percent of protected varieties are released under Title V.
More importantly, the original PVPA contained two provisions that compromise its effectiveness as a protection instrument. First, the original PVPA included a clause known as the "farmer exemption", which allowed a farmer not normally engaged in the commercial sale of seed, to sell seed of a protected variety to other farmers. Second, the PVPA allows researchers to use the protected variety to develop new varieties. These new varieties can be sold without infringing the rights of the original plant variety protection certificate holder.

PVPA amendments
The two provisions mentioned above, and other aspects of the original PVPA, were changed substantively in amendments in 1994 which significantly strengthened the PVPA as a protection instrument. These amendments mainly aimed at bringing USA law into conformity with the 1991 UPOV convention. First, the farmer exemption clause was essentially revoked. That is, it is still legal to save seed for use on the farm, but it is no longer legal to sell seed to others for reproductive purposes. Second, the amended PVPA stipulates that infringement provisions apply to essentially derived varieties (EDVs), which substantially limits the research exemption clause of the original PVPA.
The new provisions of the PVPA also provide significantly broader scope of protection for new plant varieties than was previously available. For example, the 1994 amendments extend eligibility of PVP protection to F1 hybrids and to tuber propagated crops (e.g. potatoes) which were excluded from the PPA of 1930 and the PVPA of 1970. In addition, priority for PVP Certificates is now given on a "first­to­file" basis, rather than the original "first­to­develop" basis, which was the original way. The variety name must be unique worldwide, and in general the name must be used when marketing the variety. Under the original PVPA, legal protection lasted for 17 years. In 1980, this was amended to 18 years, and in 1994, the length of protection was extended to 20 years for most crops, and 25 years for trees and vines.

Utility patents
In 1980, the Supreme Court decided in Chakrabarty vs. Diamond that utility patents are available for inventions consisting of living materials. As a result, the Ex Parte Hibberd case of 1985 established the ability of plant breeders to patent their plant materials under Section 101 of the Patent Act. This provided new opportunities and possibilities for plant breeders and seed companies to protect their products. Special phenotypic characteristics, broader phenotypic and genotypic characteristics of plants and plant parts can be patented. More importantly, transgenic plants and other products of biotechnology can be protected by a patent as well.
There are however a number of differences that need to be taken into consideration when applying for a utility patent, as opposed to protection under the PPA or PVPA:

Reaction of industry
The US seed industry has not embraced utility patents to the extent that some people might have expected, given the scope and flexibility of the protection afforded by utility patents. For example, it is generally considered more difficult, and more costly, to take out a utility patent than to get a Plant Variety Protection Certificate (PVPC). Most seed companies use utility patents only when a particular characteristic, or perhaps, a process, needs to be patented. But in general, seed companies seem to be comfortable with the protection available under the PVPA as the number of PVP certificates issued indicates. By January 1st 1995, 3,269 PVPCs had been issued of which 459 have expired. Another 698 are currently pending. In contrast, since 1985, the USPTO has issued just 112 patents for genetically engineered plants.
The availability of utility patents for plants under the Patent Act has definitely broadened the scope and flexibility of protection available to plant breeders. In recent years, the USPTO has issued several broad patents on biotechnology­related products or processes that have created bitter debate and court challenges by companies who stand to lose the rights to use technologies or processes they previously thought they owned. These legal challenges are not, as yet resolved.
A typical scenario is as follows: company A develops a new genetically engineered product and applies for a patent. At a later date, company B discovers and takes out a patent on a process that may include one or more of the techniques used to develop previously discovered products. The owners of the process patent, i.e. company B, may then file suit against company A which had previously used the technique to develop their product, claiming infringement of their broader process patent. Thus, company A which originally developed the genetically engineered product stand to lose the rights to their product, even though they had used the technique prior to the discovery of the broader process.
Another important concern for biotechnology companies is the scope of international protection afforded by US intellectual property rights. Developing countries have little incentive to participate in any of the 'harmonization' treaties that have occurred over the last few decades, mainly because they fear they will be exploited if they grant patent protection to outside inventors.
In addition, many industrialized nations have limited capacity or political will to grant the sort of protection that US companies expect. While the Trade Related Aspects of Intellectual Property Protection (TRIPs) discussions under the recent GATT negotiations have the potential to change this situation, it will probably remain a barrier to international trade in biotechnology­derived products for some time.
L.J. (Bees) Butler

Department of Agricultural Economics, University of California­Davis CA 95616, USA. Phone (+1) 916 7523681; Fax (+1) 916 7525614; E­Mail ljbutler@ucdavis.edu

A more detailed paper on the issues discussed in this article is available from the author.

L.J. Butler and B.W. Marion (1985), The Impacts of Patent Protection on the USA Seed Industry and Public Plant Breeding.

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V.L. Lechtenburg and A.A. Schmid (1991), "Intellectual Property Rights". In: Bill R. Baumgardt and Marshall A. Martin (eds.), Agricultural Biotechnology: Issues and choices. West Lafayette IN, USA: Purdue University Agricultural Experiment Station.

D.R. MacKenzie and Anne K. Vidaver (1991), "USA Biosafety Regulations: Too much or not enough?". In: Bill R. Baumgardt and Marshall A. Martin (eds.), Agricultural Biotechnology: Issues and choices. West Lafayette IN, USA: Purdue University Agricultural Experiment Station.

Office of Technology Assessment (OTA) (1987), Technologies to Maintain Biological Diversity. Washington DC, USA: USA Government Printing Office.

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Contributions to the Biotechnology and Development Monitor are not covered by any copyright. Exerpts may be translated or reproduced without prior permission (with exception of parts reproduced from third sources), with acknowledgement of source.


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