- Ah, welcome I'm Ann Hassett.
I'm the executive director
of the Engelberg center
and I'm really thrilled
to be able to bring you
this program tonight.
Because, it's something I've
really wanted to understand
and fortunately I found
four super smart people,
who understand so many aspects of it,
that I'm gonna let them
do most of the talking.
But what I do wanna just start out with
are some of the things
that I think are so
interesting about this.
Like many different levels
of this phenomenon of CRISPR.
30 years ago, some Japanese scientist
were looking at E. Coli
and they saw some very
interesting repeats.
Which someone at radio lab
came up with a really good
musical way to display,
to kind of communicate,
and I'm not gonna try to repeat it
because I'm not musically talented.
But what they saw this,
sequence of repeats
and they thought, gee that's
unusual you don't usually get
repeats preserved like that in E. Coli.
So a lot of time goes on and the step,
that was the beginning of
what ended up being identified
as CRISPR which,
and Jake will correct me
if I've got this wrong,
is a sort of acronym
for clustered regular
interspaced palindromic repeats.
And that's basically what
those scientist had discovered
but they didn't yet know
what the value of them was,
and there's a very very long
story to get from there to here
and I'm gonna leave a lot of that to Jake.
But, I think what's really interesting
is what we're facing today
is kind of a revolution
in what is available
for us to do with gene editing techniques.
And I think you'll hear some of the,
from the participants in the program,
some of the things that can be done
in the course of addressing the issues
that we really wanna focus on tonight.
And I just wanna kind
of go over those briefly
before we let each of the
panelist start doing the talking.
I think that one of the big
issues that we have to consider
with a technology like
CRISPR is this question of.
What does it mean for
downstream innovation
and commercialization of gene editing?
And there are a lot of difficult issues
to consider about that.
I think the key issue that
we have to consider is
what are the models that are
being used for licensing,
and are there any special responsibilities
for licensing when the
results of the research
are really from government
funded efforts at universities,
and that's exactly the situation here.
And then I think we also have to consider,
not just what's happening.
Which is a story in itself.
But what really is the
way that we ought to be
trying to license these
sorts of technologies.
What's the social significance for us
of the effect on innovation.
So that's the headline of what
I think the panelist will cover.
I'm gonna give them each two
minutes to introduce themselves
and give kind of a main point
and then we're gonna go
through the technology first
and then the subsequent licensing topics.
So Jake why don't we start with you.
- Sure, so my name is Jake Sherkow.
I'm an associate professor
at the Innovation Center
for Law and Technology
at New York Law School.
Yeah. (laughs)
- Okay, you don't have to
use all your two minutes
you can save it for later that's fine.
- Sure I reserve it for rebuttal after.
- For rebuttal yeah. (laughs)
We have the yellow
lights here so you'll be,
it's like being in a oral argument.
And,
Bruce.
- I'm Bruce Wexler I'm a
partner at Paul Hastings,
chair of the life sciences
industry practice group
and an adjunct professor at NYU.
- Lisa.
- Hi, I'm Lisa Wallet.
I'm a professor at Stanford Law School
and I'll mostly be talking
about some of the policy
implications here.
A lot of my research is
focused on University patenting
and in particularly, University patenting
under the Bayh-Dole Act
for a federally funded research like this.
- And Abraham.
- Hi, I'm Abraham Goldfinger.
I had the Industrial
Liaison Office here at NYU,
which is the office responsible
for commercializing NYU technology.
So we've been very active
in starting up new companies
around technologies having
started more than 100,
and have seen many of our
products come to market
to help benefit patients.
So you know I'm very grateful
to Ann for setting up
this very interesting discussion.
You know cause we'd like to,
our goal is to bring products
to market to help the public.
But it's good to be thoughtful
about what we're doing
and is it, what's the best way to do that.
So looking forwards to a
very interesting discussion.
- So, I was looking into
kind of how many patents
there were that cover CRISPR
and just in the United States
I think that the US patent office has 50.
It has already issued 50
patents covering CRISPR
and there's a few
applications that are pending.
One of them we'll hear about later on.
And out of those 50 it's interesting that
probably 13 of them are
from the Broad Institute,
MIT kind of group of institutions.
Another 10 are Harvard itself.
Then there's three from Dupont
and then a few other
companies that each have one,
and then Caribou,
which is a company you're
gonna hear about later,
has one and has some pending applications.
So what kind of brought
us to this event today
is that about a month ago the
US patent office, the PTAB,
the Patent Trial and Appeals Board,
issued a decision in an
old-fashion interference
the kind that we may not see many of.
Because there were patents from CAL,
University of California Berkeley,
that were filed and then other
patents that had applications
that had been filed by.
I'm gonna call the Broad Group
just to note all that
of those relationships.
And they were all in
the first to invent era
and so old-fashion interference
had to be decided between them.
And that's really the
decision that came down
about a month ago,
and it's gotten lots of attention,
it's raised a lot of interesting questions
and that is where we're
gonna try to focus tonight.
So I'd first like to start with Jake,
who is amazing as a lawyer,
because not only does he get the law
but he also gets the science.
So he's going to talk to
us about the technology
to the extend we can
within the time we have
and also about the litigation.
- Sure, thank you very much Anna
and thank you very much for having me
this is a wonderful program.
I hope you are all as
excited about this as I am
although I suppose that that will be hard.
So let's talk about
exactly what CRISPR is.
Since the molecular structure
of DNA was discovered now
roughly 64 years ago.
It's been the holy grail
of molecular biologist
to be able to edit this
DNA in living cells,
to be able to edit the genome.
This wasn't even dreamed
of as a possibility
until the advent of
recombinant DNA technologies
in the 1980s.
And we didn't really develop
techniques for gene editing
until the 1990s and the early 2000s.
These older methods you need to understand
were costly, they were
difficult and they were clumsy.
In very broad stokes,
for those of you with a
computer science background,
they were not programmable, right.
In order to edit any
particular gene of the genome
one needed to create an
entirely different enzyme
to do so.
This is like building a new
computer for every line of code
that you needed to write.
It is other words impractical.
In 2012 we have a major breakthrough.
We have Jennifer Doudna of
University of California,
here on the right, receiving
her 2013 breakthrough prize,
and to her left Emmanuelle Charpentier,
who was then at Umea University in Sweden,
she is now at the Max Planck Institute.
They discovered a way to modify
a naturally occurring bacterial
immune system called CRISPR
in order to flexibly edit
the genome of living cells.
I wanna be clear
and this something than
Anne mentioned earlier.
They were not the first to discover
the naturally occurring system.
That honor belongs to,
depending upon how one takes
a view of scientistic history,
a string of researchers from Japan, France
and importantly Lithuania.
But Doudna and Charpentier,
they were the first to be
able to engineer the system
in a programmable way.
What do I mean by engineering the system
in a programmable way?
Well, this is CRISPR-cas9,
the system that we're talking
about in it's most basic form.
It uses a single enzyme,
cas9, that is the blue blob
you see at the top there.
Which is derived from
particular species of bacteria
known as streptococcus pyogenes.
It also needs a short piece of RNA,
this is the purple DNA-like
looking thing here,
although to be clear it
is RNA it is not DNA.
That is referred to as a guide RNA.
In natural systems the guide
RNA comes in two pieces.
The CRISPR RNA, the one that looks like
it is matching,
the matching genomic
sequence component over there
and something called the
trans-activating CRISPR RNA.
Which is essentially that loop up top
that you see there right.
These two pieces are required to form
the CRISPR-cas9 complex that you see here.
Doudna and Charpentier's
major advance was discovering
a couple of things actually.
The first was that these two
pieces that were otherwise
separate in bacterial cells,
could be combined into a single-guide RNA,
that is the purple molecule
you see right there.
This is known as SG-RNA
or the single guide RNA.
They also discovered that
to get this system to work
you needed what's called a
protospacer adjacent motif,
that is the yellow DNA bit
that you see over there
at the side.
And this essentially allows
the CRISPR cas9 system
to cleave DNA at both
sides, not just on one side,
but to make a clear
double-stranded break here.
By making a clear double-stranded break
you have thus enabled yourself to be able
to edit the genome essentially
however you see fit.
The other reason why this
technology is so powerful
is unlike previous systems
which needed to create
essentially a new cas9
for every different gene
you wanted to edit.
We could use a single
enzyme and simply create
a new piece of guide RNA
depending upon the gene
that we wanted to change.
These guide RNAs are relatively
short and you can literally
go home and do this if you
would like, order them online.
They are cheap,
they are something like
$7 a base pair right.
At the same time, right,
this is a bacterial system,
CRISPR-cas9 is a bacterial system right,
and it was unclear at the
time whether it was gonna work
in the cells of higher
orgasms or eukaryotic cells.
There's some concerns about this right.
Eukaryotic cells, the
cells of higher orgasms,
they have a nucleus, DNA is
packed into chromatin modules,
like proteins that DNA
wraps itself around.
And the fact is that the
cells of higher organisms
don't naturally produce cas9.
In January 2013, Feng Zhang,
a researcher from the Broad institute,
blows this wide open by demonstrating that
it is possible in living
cells to be able to edit
the genome using CRISPR-cas9.
Not only that but you
can do this in the cells
of higher orgasms if you
find a way to produce
the cas9 enzyme,
and maybe most interestingly
you could do this
for multiple genes at once.
In other words if you
wanted to edit 50 genes
at the same time, you could
do it at the same time.
You didn't need to do it
in 50 separate reactions.
If you guys are interested
in some of the mythology
behind the invention here,
the mythology works like this.
Feng Zhang is at a conference in Florida,
he hears about Jennifer
Doudna and Charpentier's work
and he immediately
retreats to his hotel room
or he reads every paper that
he could find on CRISPR,
and then leaves the
conference early and goes back
and creates the system
that he created in his lab
at the Broad Institute.
I have no idea whether
this is true or not,
this is the apocrypha
that we are dealing with
when it comes to CRISPR invention.
But this is it, this is
still a major advance.
This is a way to
precisely edit, in a cheap
and easy fashion,
the genome of cells and higher
organisms virtually at will.
Our ability to what we
can do with CRISPR-cas9
as an engineer-able system
is essentially limited
by our own imagination.
Needless to say everyone's
imagination immediately
has fixed on designer children,
right designer babies.
This is the thing that
CRISPR scare mongers
like to talk about.
I think that for a variety of concerns
I'm happy to talk this in a Q&A.
This is wildly overblown.
But kind of more on the table
for discussion right now
is using the CRISPR system to
edit to the genome of pests.
For example, by inserting something called
a gene drive CRISPR system
in aedes aegypti mosquito
in order to eradicate it entirely right.
Or for that matter rather
than eliminating an animal
bringing an animal that
no longer exists back.
To resurrect species that
have longed been extinct.
George Church, a researcher
at Harvard has proposed
using CRISPR to do just this.
Editing the genome of an
Asian elephant to bring back
the Woolly mammoth.
Why I wouldn't call these application
of CRISPR science fiction,
at this point they are somewhere
between fact and fiction
and yet something much more superlative
than alternative facts.
The real value of CRISPR-case9
is just how flexible
the system is for a
variety of different types
of genetic modification.
Here's a great review of those from Shue
in this 2014 cell paper.
"We can use the system
to turn genes on or off
"that already exists in a genome.
"We can screen for the
function of different genes
"on genome-wide basis.
"We can show us when and
how much certain genes
"are being processed by a
particular cell or a cell type.
"We can control wide variety
of cellular interactions
"in an almost infinite
variety of conditions.
"The power of CRISPR-case9
isn't just that it edits.
"It is also that it can be
used to create, to power,
"to report and to analyze
the content of the genome.
This power was recognized by
both Doudna and Charpentier
as well as Feng Zhang,
and suffice it to say both
sides filed patent applications
covering engineered forms
of this CRISPR-case9 system.
Doudna and Charpentier's
application was not specific
to any cell or cell system
and just literally was
silent with respect to that.
Although they hypothesized
that the system could be used
in the cells of higher organisms.
Zhang's application however was specific
to eukaryote system,
and gave great details
about how to implement
that system in eukaryote.
This, long back story that
I won't get into right now,
triggered an interference
at the patent office.
Which is a trial, for
those of you unfamiliar
with interference practice
to assess among other things
or among multiple inventors,
who invented a particular
technology first.
I will describe the timeline
of this interference
in a moment.
But if you wanted to distill
the thousands of pages
of interference material
down to a single question
this is it.
Who was the first to invent
a single-guide RNA mediated
CRISPR-cas9 gene editing system
in a eukaryotic cell?
For those of you that have a
procedural bent, like myself,
here is the timeline right.
May 2012, Doudna files her
first provisional application,
she publishes her critical
paper in science in August.
December 2012, Zhang files
his provisional application
for eukaryotic applications.
He publishes his seminal
science paper in March.
Because Zhang had the ability
to fast track his application
for those patent
practitioners in the room,
using a procedure known as
a petition to make special.
His patent was issued first
even though it was filed second.
So Zhang's first complete
patent gets issued
in April of 2014.
At this point University of
California Berkeley realizes
that they may be loosing the horse race
and so thy petitioned the PTO
to declare this interference.
This petition gets filed April 13th 2015.
I still remember where I
was when this got filed.
January 11th 2016, the patent
office formally declares
the interference and we had
interlocutory oral arguments,
in December sixth 2016 of this year.
Last word about this phrase
interlocutory oral arguments.
Generally speaking
interferences are broken down
into two phases.
The first phase is something
called an interlocutory phase.
This is where the patent
trial and appeal board,
a panel of three judges who are experts
both on molecular biology and patent law,
decide all of the issues
that are related other than
who was there first.
They decided what was invented,
what type of technology,
what precisely was claimed,
does it meet certain
requirements so on and so forth.
We call these the non-priority motions.
Both sides get to petition
for which non-priority motions
that they wanna file.
In doing so we need to
first assess exactly what
the technology is that's in
dispute between the two parties.
In other words how do compare
essentially two documents
or for that matter in this case.
How do we compare 14 different
documents at the same time?
And to do so the patent
trial and appeal board
writes essentially a
fictional patent claim
that is suppose to cover
all the technology at issue.
I am not mercifully going to
go through what the count,
this is what this fictional claim is here.
I simply want to point out
three important elements.
The first element is that
the interference centerd
on applications in a eukaryotic cell.
They also centered on applications dealing
with this DNA targeting RNA.
That's the single-guide RNA
that I mentioned earlier.
And lastly that they are
specific to one particular enzyme
to use this technology, cas9 right.
Here are the patent
applications and the patents
that were originally subject
as part of the interference.
You have Jennifer Doudna
and Emmanuelle Charpentier's
patent application that had
yet to be granted or issued
down at the very bottom.
By the time the interference
gets declared Zhang
already has 13 issued
patents, he actually had 14.
All right one was
originally put in as part
of the interference
and then removed later.
Here are the motions,
the non-clarity motions
that each side petitioned to file
during the interference proceeding.
I'm not gonna go through the
meat of each one of these,
although to the extent that
you're a gluttons for punishment
I'm really happy to do that.
I wanna focus on just one
here, these are the ones
that got granted.
The one here that Broad file
called the no interference in fact.
This was essentially Broad
arguing that Zhang's invention
was an appreciable advance over Doudna's,
irrespective of what Doudna's
invention actually was.
Irrespective of how Doudna's invention
ends up being claimed.
Zhang did something different,
therefore Zhang is
entitled to his own patents
and there should not be an interference.
There is, "No interference in fact."
That argument won the day on
February 15th of this year.
So for those of us suffering
from a Valentine's day hangover
we had this to look forward to.
Broad said that they had,
the patent trial and
appeal board panel claimed
that Broad has persuaded them,
that the parties claimed
patten-ably distinct subject matter
and for that reason the
parties' claims do not interfere
and the interference was terminated.
What is the meat of this decision?
Why did the PTAB decide
that what Zhang invented
was an appreciable advance over Doudna's?
Well here's a couple of reason why.
Reason number one for trial,
attorneys in the audience.
Because of statements
that Doudna herself made
when being interviewed
about her technology.
She said for example, that they
did not know whether or not
the system was gonna
work in eukaryotic cells.
That she herself had many frustrations
getting it to actually work
and that anyone who will
be able to get it work,
would be making, "A profound discovery."
If you are a trial lawyer
and this is your clients own statements,
I hope you are sitting down.
Right.
There's a number of other reason as well,
reasons that have to deal
with the molecular biology
between eukaryotic system
and prokaryotic systems.
Some of these I went over earlier right.
Things having to do
with protein folding cellular
compartmentalization.
Those kind of chromatin module issue
which some scientist laugh at.
And so anyway all of these
ended up the PTAB concluding
that the Broad statements,
do not demonstrate that Doudna
had a reasonable expectation of success
in getting her system to
work in eukaryotic cells.
Because she did not have a
reasonable expectation of success
to getting the system to
work in eukaryotic cells,
Zhang actually doing it was an advance
such that Zhang was
entitled to his patents.
So very briefly I just wanna
talk for two minutes about,
what happens now, where
do we go from here.
What happens after there's no interference
and fact is declared?
Well essentially
the University of
California has two options.
First option, it can
appeal the no interference
and fact decision to
the US Court of Appeals
for the Federal Circuit.
And I think as a strategic
move this is probably
a good idea.
This is the only avenue for
them to still have a chance
to declare complete victory.
But with that being said I
think the chances of complete
victory at the Federal Circuit are low.
The absolutely excellent attorneys
are at the Patent Docs Blog,
you guys should all read it.
Talked about why this is
so and that is because,
decision regarding reasonably
expectations of success,
those are factual decisions,
and by being factual
decisions they're entitled
to deference on appeal.
This is not just a case where
it's a little bit of fact
that the PTAB is hanging it's hat on.
The PTABs decision on February
15th was a 51-page monster.
That's a monster as far
as the PTAB is concerned.
It was 51-page decision that
went through a lot of facts
as to why It believed that
there was not a reasonably
expectation of success
to get the system to work
in the cells of higher organisms.
So to the extent that University
of California Berkeley
loses at US Court of Appeals
for the Federal Circuit.
It can go back to the patent trial.
It can back to
the United States Patent
and Trademark Office,
where it could try to get broader claims
covering of the technology.
It could try to convince
the patent examiner
that it's entitled to what
are called genus claims.
It's entitled to claims
that are independent
of particular cell system.
But, I think for all the reasons
that the patent office stated.
Even if they are successful in
getting these claims issued,
in a litigation posture they're
gonna be incredibly weak.
Why are they gonna be weak
in a litigation posture?
Because the first piece of
evidence a challenger is going
to offer, to demonstrate that
the patents are not valid,
with respect to eukaryotic cells
is the PTABs own decision
that came out February 15th.
It would not be that
difficult to convince,
or at least I personally.
I know we have some difference
of option on this panel.
I don't think it would that
difficult to convince a jury
that this is something where
three of the best experts
in patent law in molecular biology
have decided that what
Zhang did was different
and Doudna did not sufficiently disclose
what she claims she had invented.
So in that case if this is what happens.
If University of California Berkeley
ends up getting their Broad patents,
and that they are later
invalidated in trial,
their invention goes up in smoke.
This is anyways, that's the graphic there.
This uncertainty is gonna
complicate the licensing
arrangement that currently
these surrogate companies have.
That Doudna's company has
and Zhang's company Editas has here.
The licensing regime is
very very complicated.
I will leave a discussion about this later
to my other panelist.
I simply wanted to show you
the slide just to show you
that a lot of companies have
already invested a lot money
in this space,
and not having a clear
answer as to who owns
the foundational patents
in this technology
is really kind of hampering
other entrants in this field
and is causing some inefficiency.
Right, that's it thank you very much.
- Thank you Jake.
So I'm gonna alter slightly
what I told the panelist I was gonna do.
I'm gonna give Lisa and
Abraham the short comment time
and then Bruce I think you
have more that you wanna say,
so we'll let you follow.
Lisa do you have any comments
on Jake's presentation?
- It was awesome.
(panelist laughs)
Yeah I mean I think.
I'm slightly more optimistic
than Jake about the ability
of Berkeley to get Broad
genus claims granted
and have them upheld in litigation,
and I think I agree
with his overall assessment of the merits.
But, It might seem odd that
Berkeley could get broad claims
genus claims that would
include use in eukaryotic cells
and that the Broad claim
would still be granted
and not obvious in light of that.
But they're really
different legal questions
and that kind of situation
happens in patent law
all the time.
Where you have an initial genus claim
and then some has species
claim that is not obvious
in light of that and so.
The question on whether
Berkeley's claim would be valid
it's primarily a 112 disclosure question.
You'd need the disclosure
in the Berkeley patent
to enable people who
are skilled in the art
to make the full scope of the invention
at the time of filing
and to show possession of that invention.
And there's been a number
of cases in biotech
where courts have invalidated,
kind of broad claims
under these 112 concerns.
Though, primarily in
cases where the claim is
really more functional language,
I mean not at official
means post function claims.
But functional in a way that
I don't think it could be CRISPR claims.
So, I think that it is possible
that we could end up here
with a situation where
in order to use CRISPR
in eukaryotic cells you
need to have a license
from both Berkeley towards genus patent
and that Broad species patent.
- Abraham did you want any comments about
any of the points that Jake made?
- Just again that was an
excellent presentation
and I'm not nearly as
familiar with the details of
what went on the patent
inference as they are.
But just to echo what was just said.
Sometimes you might get a very broad claim
or you also might get
specific technique claims.
That the technique that
would be applied broadly,
would also be applied with eukaryote.
So without claiming it so very broadly,
you're claiming techniques and
if the techniques are useful
when you apply it to
eukaryotes that it's potential
that they would get claims
that a company would wanna
use as they develop products.
- So Jake I'm gonna let Bruce talk
and then you'll get a moment,
two minutes to respond if you want to.
So Bruce I know that you
have a lot of thoughts
about the litigation
and the meaning of it.
So why don't you let us know.
- Yeah, first of all everything,
I mean it was an excellent presentation.
I don't actually have anything
specific that I disagree with
in the presentation.
What I did was I looked more
at the patent office's decision
and the thinking about future litigation.
How things will play out and some really
sort of observations I made looking at it
from the outside.
Not having been involved in
that particular interference
or nothing I'm saying is sort
of confidential to any party.
As a global point I think
that the interference decided
that the the UC genus that
was patent-ably distinct from
the Broad species.
So we have a species that is non-obvious
over a prior genus
that's the upshot of it.
The outcome of that you split off
into two separate groups of patents.
And so I think what that did ultimately
was just to generate more
uncertainty, than anything else.
It was interesting to me that
Broad was authorized to file
a written description motion.
Where they could have
attacked whether or not
there was adequate
support for the UC claims,
but the board point out at page eight
that they chose not to.
So then the question is why,
you know why not go down that path?
And there's a couple of things
that are potentially embedded within that.
One is, if they had attacked
the written description support
of the UC claims
in a situation where they're
not functional claims per say,
but they're just very broad claims.
Then you wonder whether that
record itself might cause harm
to the scope of the Broad claims,
except they were trying
to go broadly as well.
So there could be some
risk intention there
in keeping like a date on the most.
Also, you know, did they
think it would be weaker
to raise the unpredictability
of the CRISPR
in the eukaryote?
Was it weaker to raise
that in a 112 attack
on the UC patent,
than to focus on the
non-obviousness of the species
over the genus?
Now remember in this interference context,
the focus was on the
claim of the UC patent,
versus the Broad patent.
Not the disclosure per
say of the UC patent
and at pages 46 to 48 of the opinion,
the board, the PTAB,
discounts a slew of references
that UC was relying upon
and trying to asset obviousness.
On the ground and in the context
of an interference and fact
they're just not relevant.
So that leaves uncertainty
there for us to really the
question of obviousness
of the Broad patents,
if the full scope of the
prior arc would be considered.
Now, I'm not gonna offer any view on that.
I'm just suggesting that
the interference decision
by the PTAB doesn't really
fully answer that question.
Of course it doesn't
answer the 112 questions
and then there was no
exploration of priority,
so you don't know about that.
There was this initial
collaborative spirit
that seemed to exists on the CRISPR
that then split off as
people started to fight.
Which raises the potential
for inventorship fights
that none of this addresses.
And then on appeal,
reasonable expectations success is in fact
a factual issue that
is difficult to appeal.
But what's very interesting
about this appeal
is that reasonable expectations success
will be isolated in the
obviousness of this inquiry.
And it's very unusual I
think to see an appeal
where the entire obviousness question
lasers in so much on reasonable
expectation and success.
Because the board found that
prior basically, prior claim,
that they were suggesting the
use of CRISPR in eukaryote.
The board found that
there was a motivation
to start using it in eukaryotes,
that people were working on it.
They were talking about it.
And the board really was
persuaded by these statements
that said, that you know, I
don't know if it's gonna work
and that was very compelling.
But the question is if you go on appeal
to the Federal Circuit,
and let's say you find
a judge in particular,
who is looking at it more from say a KSR
more flexible approach to obviousness.
Is this case an opportunity
for the Federal Circuit
to pull back on the strictures
of reasonable expectation and success?
If that were to happen that would
be very dangerous precedent
for patentees potentially.
So there could be very broad ramifications
of this kind of appeal.
Just quickly, some observations
about the litigation itself.
UC used two experts
doctors Ryder and Carroll,
the board said they were
substantially identical.
So you wonder why were there two experts
saying the same thing.
Maybe the theory was two
experts are better than one.
But Dr. Carroll has published
some very bad statements,
and his statements that
they cited were about
how unpredictable the field
was they were contemporaneous,
and Broad did a very good job
of making the entire litigation
premise on Dr. Carroll.
They mounted a massive
attack on Dr. Carroll,
it was the theme and it
was very effective because
it showed that, in terms
of credibility, what UC,
and again this my impression
reading these materials.
I found the UC briefs a
little sort of formalistic
they took a very patent
approach where they said,
at page so and so, line so and so,
there's this argument
the response is that.
Whereas the Broad briefs
really told a story
of difficulty of moving to eukaryote
and how difficult it was.
And how the UC folks
we're just kinda saying
that you could do it,
but there was really no
real clear evidence showing
how you could move from one to the other.
There was a comment that,
UC said that Broad you know
heard about what the UC people were doing
and then got the idea
and they attacked the
credibility of that by pointing
to emails and information thar
predated what they had cited
to show that Broad was doing
it's own work independently.
Again, another hit on the credibility
of the arguments UC.
So that then leads to the
question so what happens next.
So this decision basically
just separated off the too patents.
So if there's litigation
all these two issues are on the table.
And if there's litigation,
for example you know
I can think of reading this decision.
I already can think of ways
I might litigate this case differently.
It's a lesson, its a
learning lesson for something
in the future,
and yes you can show
the decision to a jury
or If it's admissible if you get it in.
But the point is if
there was a wold in which
there's a different body of prior,
there's different experts,
there's a different explanation,
that answers all the questions
the board wanted to hear.
What's the outcome?
And I don't, I can't tell you right now.
So when I look at this I
see a lot of uncertainty.
I see pathways for
litigation in the future.
But it definitely is very
interesting that at this point
they said the species is
non-obvious over the genus and
that's about the best I think
we can take away from that.
- So Bruce I have a question.
In view of your sense that
there's a way you would have
litigated the case differently,
is any of that something
that you would affect
how you think UC should proceed on appeal?
- Perhaps.
But you know, since the
appeal hasn't happened
I guess I'll just sort
of not talk about that.
- Okay.
- No you know I think
in general, in general.
I think if the approach
at the Federal Circuit
was similar to the approach at the board.
Where it was very sort
of at page seven line six
it is argued that and there's the argument
and then it says the response is that,
and it's sort of organized that way.
I would think that the
Federal Circuit wants to see
something more compelling than that,
rather than a compartmentalized
set of arguments.
And Broad did just that,
I mean they had a story of this work.
And I think it was a
pretty stark contrast,
I don't know if you agree.
When you read the two sets of briefs.
- Yeah, definitely and so
there is a burning debate
among litigators at the PTAB right now,
essentially since inter par-tes review
became a substantial
part of law firm practice
back in 2012, 2013 as to
whether you as a client
are better off hiring a
litigator to litigate your case
in front of the PTAB.
Or whether or not you are
better off hiring a kind of
died in wool patent practitioner to do so.
And these differences were
on parade in the CRISPR
interference case here.
Broad on the one hand,
their main attorney Steven
Trybus at Jenner Block
who is a litigator all right.
You know Federal Courts
around the country.
University of California's
attorney Todd Walters
Buchanan, Ingersoll, who's
PTO reg number is like five.
Right by the way.
I'm thrilled that I got
any laughs all right.
(panelist laughs)
Yeah and so I couldn't agree with you more
this showed in a nutshell
kind of what this difference
in this area of practice is.
I was at the oral arguments
on December sixth.
I sat in a room with
you know I don't know,
48 of my closest friends or how ever many
the fire marshal would let in.
And while I think it is true
that University of
California's briefs very much,
like you said were very compartmentalized
and just very overly
formalistic as one would expect
from a died in the wool
patent practitioner,
who's practicing before the PTAB.
I have to confess I was really impressed
with Todd Walters'
presentation at the PTO.
I thought that in the oral
argument her presented
an amazingly compelling
story for you know,
here's what Doudna did,
here's when she did it,
here's exactly how long it
took to get to where she was.
You know yes she had
these statements but then
you have to understand
she was being interviewed
by 10,000 media for an entire year
and you know fine she
made that statement once.
What about the 9,999
other times where she said
we're gonna do it now right.
And frankly If I were a PTAB judge
I'd probably would have sided
with University of California then.
But it was interesting
of the three PTAB judges
at the time,
at least two of them had had
former litigation experience.
This would be judge Shaffer
who was sitting on the left
and judge Debra Cats
who was the lead judge
for that particular panel
who was sitting on the right.
And I think as litigators
you can't shake the habit
when a deponent makes a statement
against party admission,
statement against party interest.
And you can't shake that habit of thinking
that that's not conclusive,
and I've got a feeling that
that's what ended up happening.
- And I would say the one thing that
I didn't see a lot of detail,
was the idea that to go from what UC did
to get the eukaryote.
There was no really heavy discussion of
what actually was done to make it work
and why that sort of flowed
from a set of information
that existed before.
It just wasn't discussed that
much one way or the other.
When she left the
statements very powerful.
- What's interesting is
that it didn't come out
in the no interference and fact opinion.
But it was mentioned during the course
of the oral arguments right.
So essentially you know,
if you wanna think of this
in like basic patent law terms.
We have a claim, a claim
has elements, what elements
did Zhang add right.
Well essentially Zhang added two elements.
The first element was called
a code on optimization technique.
There's ways of getting
certain genes to be transcribed
in cells of higher organisms
in a superior fashion
relative to their bacterial cases right.
So that got discussed a little bit.
And there was also the
importance of being able to
insert in the guide-RNA,
the kind of purple piece
of RNA that I showed previously right.
What's called the nuclear
localization signal
to make sure that that got to the nucleus,
where with respect to the genome
that's where all the action's happening.
But, and this is where I thought
Todd Walters' presentation
was so fascinating.
There were five other labs doing
the same thing at the same time,
Zhang just got there first.
So to the extent there
was five other people
doing the same thing at the same time
that leaves you to believe
that adding those elements
was in fact obvious right.
- But then--
- We can go on about the decision.
Let's save the rest of this
which is very interesting
for Q&A or for the cocktail hour.
So Abraham did you wanna make any comments
on any of this or you know?
- No again I think it's
all been well laid out.
I guess in addition to this just in terms
of licensing landscape where
we've been talking the US patents
I guess they're also European patents
and the rest of the world
and that will all play out
in different ways perhaps.
So, just that that all needs to be taken
into account as well.
- Yeah and there's opposition
proceedings in Europe
right now to Doudna patent,
issued patent right.
But anyway yeah.
- Listen did you wanna add any comment.
- Just one very quick
thing anyone's thinking
about possible futures
here, one possibility
that we haven't talked
about is that Berkeley could
get it's Broad genus claim allowed,
and then it might not get
challenged in litigation
if Berkeley decides to
take the strategy of
licensing it at a low enough
cost that it's not worth
anyone's time to challenge
it in litigation.
I've heard from a number of people
that they think this is what happened
with Stanford's famous Cohen Boyer patents
on recombinant DNA, which
I'll be talking about
a little more later.
There have been validity
challenges against them
but no one had an incentive
to bring those validity challenges
because they were being
licensed so cheaply.
- Okay, I wanna get to
the licensing issues now.
But Jake could you just like
give us like two minutes
on your chart to help
the audience appreciate
the difference between.
Well how the licensing rights
are kind of basically sorted out here.
- Sure.
So first thing's first, I cannot
take credit for this chart.
This chart is the work of Jorge Contreras
who's my co-author in article
that we just published in science.
As he explained to me
PowerPoint is his muse
and here you guys go.
All right, so when we're looking
at the CRISPR patent landscape,
we could think of it in two areas right.
The first are licenses
that are originating
from the Broad Institute and
it's related institutions.
Those are these top licenses up here
and then we have licenses
that are originating from
University of California
and interrelated institution
down, oh the clicker's
gone, down there right.
You may see that Emmanuelle
Charpentier seems to be
standing alone right there.
This is because at the
time of the invention,
Emmanuelle Charpentier,
when she was at Umea University in Sweden.
Sweden does not have a
Bayh-Dole equivalent.
So Emmanuelle Charpentier
got title to her interest
in the patents.
There's another researcher,
Martin Karlinsky,
who's name I'm almost
certainly mispronouncing,
who was at University of Vienna.
Austria does have a Bayh-Dole equivalent,
so University of Vienna
is the title holder
to his particular interests in any event.
So one of the ways that
these license structures
are set up is through what
we term surrogate licensers.
Essentially these companies
that take an exclusive license
off of the hands of these universities
and are then tasked with the
burden of shopping them around
to other commercial developers.
That's essentially what we see here.
Editas, which is Broad's
exclusive surrogate licensee
for human therapeutics
you see them at the top.
They are definitely the
large player in the field.
They are certainly the
large player in the field
today after the no interference
of fact decision came out.
And then we have Caribou
Biosciences and Intellia Genomics
and CRISPR Therapeutics down there.
Which are the surrogate licensees
to the University of California side.
There's a number of different
companies that are working
with them, but those companies,
just make sure this is still true today,
still true today.
Those companies are not as far along
as some of the companies
that obtaining their license
from Editas now so.
- So Jake is Sharp MPA,
granting exclusive rights
in the same patent as Berkeley.
- Yeah, so those exclusive licenses derive
from the same patent application,
the 13842859 patent application.
- So they don't have a
joint agreement to cooperate
rather they each do it themselves?
- Since December of this year,
since December 24th of this year,
they now have a joint
agreement to cooperate.
There is an entire Cloak and Dagger story
regarding Emmanuelle Charpentier believing
that Jennifer Doudna's
attorneys were not looking out
for her best interests with
rest to licensing the patents
that's why CRISPR
therapeutics was started.
Which I won't get to and
I could save for the Q&A
as you guys could call
it, literally talk about
this stuff forever and
will stop right there.
- Thank you Jake, so I
wanna turn to Lisa now.
Lisa how did we get here,
two major university groups
duking it out you know, dark
stories in the background
about the money they can earn
from the results of research
that was funded by the government.
So explain it.
- I think this is a kind
of great time to reflect on
why are universities
allowed to patent things
that are funded by public money
and then this stems largely
Bayh-Dole act which.
How many people here have
heard of the Bayh-Dole act?
Most of you great.
So as you probably know it
made uniform rules so that
most federally funded
technologies, universities
can patent and exclusively license them.
And for those kinds of
technologies the normal story
for why we have patents in general,
reason we allow private
companies to have patents
is that they provide
an additional incentive
to come up with these
inventions in the first place.
So we think people will
create more inventions
if they have the incentive
of the patent right.
That story is less compelling
when we're talking about
something at a university
that's being largely financed
by public dollars.
Because university professors
they have the grants
to do the research, they
lots of incentives to,
probably there's gonna be
a Nobel prize from this.
And so many of these things
they would have the invention
even if the researcher
wasn't going to get the patent right.
So the most compelling
justification that's been
offered for why we allow
universities to patent things
is called commercialization in theory.
The idea that, it's not
that the exclusive right is
necessary to get the
invention in the first place.
It's that if there's an
an exclusive right on it,
not one's going to then
commercialize that invention.
So that kind of story makes a lot of sense
if you're talking about
a typical pharmaceutical.
No drug company is going to
invest in clinical trials
for a new drug if they don't have
sufficient exclusivity in it.
And so even though we might
have gotten the patent
on the initial molecule
that seems promising for curing cancer.
Even if we didn't have the patent,
having the patent is useful
for them getting someone
to bring that cancer drug to market
so that patients can actually use it.
In other cases where there's
some technologies where
many people are interested in using them,
even if they don't have exclusive rights
and including all the cases
here where this is being
licensed non-exclusively.
In those cases it doesn't
really make any sense
to say that exclusivity is
necessary for commercialization,
because it clearly isn't.
People are licensing it non-exclusively
and commercializing it
because it is useful
because it's a good idea.
And so that commercialization
story then doesn't make sense
the initial like having
the patent incentive
to come up with the invention
doesn't make as much sense.
It might be useful to have
these patents as a way of
generating revenue for the university
and overall tech transfer
does generate more licensing income
than all of the cost of it.
But most tech transfer offices
are not big money makers
for the university.
In fact most of them at least
as of most recent date I saw
were not even operating in the black.
So it's not a very efficient
revenue transfer
mechanism to universities.
So if you're thinking about this from
a public welfare perspective
and then the many inventions
where universities
are using them, are licensing
them without exclusive rights,
whether it's lots of people
clam pouring to use them
because it's useful.
I think it's harder to explain
why we want these patents.
I had mention earlier
the Cohen Boyer patents.
These are patents that
Stanford had on earlier
recombinant DNA technology.
Stanford widely,
non-exclusively licensed them,
brought in a significant
amount of revenue for Stanford
and the foundation of biotech industry.
But I think it's hard to say
that we would not have had
the biotech industry if we
didn't have those patents.
And this recombinant DNA
technology is not that people
wanted to use them because
they had the patents,
no one had exclusivity, they're
not exclusively licensed.
And so to that extent
it's basically a small tax
on the early biotech industry,
that anyone who wants to
use them has to pay some
fee to Stanford for the right to use them.
And so it's worth thinking about that
in the CRISPR context now
and to what extent are
some of these technologies
like traditional pharmaceuticals.
Where it's really important
that somebody have exclusivity
or else nobody is going to use it.
To what extent is it to say,
really important platform
technology that everyone
is going to want to use
because it's been a biotech breakthrough.
And to the extent we're
in the former category
where it's things that
we need some exclusivity
in order to get it commercialized.
It's not a binary question of
how much exclusivity you need.
There's the full scope of
the patent rights you can get
but it could be that a company
would be willing to pursue
a particular commercial
application for less than
than the full patent term.
Or for less than such
a broad exclusive right
and so some of the areas on Jake's graph
here are for exclusive rights for use
in all human therapeutics.
And it could be that
those companies would,
if they simply had exclusive rights,
for the particular applications
that they have in mind then
that they would be happy
to take that license
and develop that.
And that from a public welfare
perspective it would be
preferable to then not have
them also have control over
any other therapeutic
application that someone else
wants to develop.
Which could then lead to
them not wanting to have
a competing therapeutic
application with the particular one
that they are developing.
So I think I will pause there
and let the fellow
panelist respond and then
can talk more abut some of
these policy implications.
- Abraham we'll start with you
on comments on Lisa's statement.
- We'll I guess I'll talk
about it in a bit more
when I talk.
But I guess I would just
say you know the mission of
the university is to
bring products to market,
to translate technology into products
that will actually benefit people.
So that is the goal of what we try to do
and we do think thoughtfully about it.
I guess I would question
the phase that's been used
a couple of times of surrogate licensees.
Implying that really all
the startup company is
is a surrogate that just takes things
and moves it forward
being our sales person.
Whereas in reality a
lot of startup companies
add tremendous value there.
Because they're startups
they can be recipients of
venture capital and investment.
That these technologies are not what,
you know after the fact it's easy to say,
this could have been easily
exploited by many people
without much effort.
But there is tremendous effort.
There were many gene therapy
companies in the 80s and 90s
that generated just as
much excitement then
as CRISPR is generating now
that ultimately didn't succeed
that there were more technical
hurdles than were thought.
So again it's easy to look at it and say,
you know that these are just
essentially sales surrogates.
But, what I would say is
that they, in many cases,
are needed to generate the investment
in the overall technology
which advances it.
Which then makes it more
applicable for the many other
sub-licensees to take it forward.
- Bruce did you have any
comments that you wanted to make?
- No.
- Okay Jake.
- Yeah so I mean.
I guess just to kind of both
to what was Lisa was saying
and then also to what you
were saying Abraham too so.
With respect to how I agree
with Lisa that surrogates
can be pernicious right.
I wanna give you one
concrete example here right.
Right here, Editas is Broad
Institutes what we call
or what Jorge Contreras and
I call a surrogate licensee.
If you're a small biotech
company and you wanna get
a license to use CRISPR-cas9
for the purposes of
developing human therapy.
The first stop on that
trail that you need to go to
is not to the good people
at the Broad Institute,
it's the good people at Editas.
It's really only if there's
a dust-up between you
and the people at Editas
does it makes sense to get Broad involved.
And to be clear, the Broad
has been intelligent enough
to carve out provisions of
it's own license agreement
with Editas that in some
extreme circumstances
will allow the Broad to step in
and essentially to remove
back that tiny aspect
of exclusive surrogacy that Editas has.
But still, it is one thing
if you are a small biotech company
and the license that you are asking for
is from a research institution.
Which probably does not have
it's own plans to develop
a commercial clinical trial.
But it's another thing if the
person that you need to ask,
mother may I, to be able to
do this research is a rival,
and it's certainly the case
if it's a similar technology
to something that you're
planning on doing.
So let's take a look at Juno,
this license here between Editas and Juno.
The chart doesn't
necessarily show this well,
this is actually a cross-license right.
So Juno has a patent estate covering
a method of gene editing
in a particular cell type
called Chimeric Antigen T-cells.
It's actually a way of modifying T-cells
that doesn't have chimeric antigens.
What we call CAR-T technology right.
So it's essentially this
combination of using CRISPR
for CAR-T technology.
It is a way to use CRISPR
in a particular type of cell
within the human body
for editing any gene.
That is the license that
Editas has with Juno right now.
Needless to say Juno does not,
and I couldn't imagine it even
capable of having the ability
to run clinical trials
for all 20,000 plus genes
in the humans genome or
every disease indication
that is listed out there.
So even if Juno is successful,
we still have some lock up in
the market for someone else
who wants to maybe try to be able
to use this technology,
CAR-T CRISPR technology
for an indication that
Juno wasn't pursuing
at this moment.
That if the Broad were
in charge of this, Broad
would you know be able
to give away or sell
an even narrower version
of it's exclusive license
that is currently tied up between
Juno and Editas right now.
So on one hand yes, they're
not pure marketing agents
of the university because
they do themselves have value
they do do real things.
But at the same time they are
in some ways acting as rivals
to some of the small
biotech companies out there
and so that I think poses some problems.
This is especially true from Juno,
because Juno's a pilot studies
for CAR-T CRISPR technology
have failed due to some,
an absolutely freak
neurotoxicity issue that no
one could have predicted.
So much so that Juno has now abandoned
using it's CAR-T technology at all.
Which means that essentially
you have this humongous patent estate
that's locked up behind exclusive gates,
that even if you think you can
get around the neurotoxicity issue
you still need to beg them for a license.
So there's that particular issue.
And then yeah so I mean I think you know,
I guess I'm not, even
though I just wrote this,
maybe I'm not wedded
to the terminology of
them being surrogates.
But there is some sense,
there's some sense in the literature
both from Editas and Caribou
and from the research
institutions themselves
that in fact these
companies aren't surrogates.
These companies are doing
what we are doing but you know
with like commercial plus,
public interest plus.
So to the extent that
they're not really surrogates
and maybe they're not
and maybe my characterization is wrong.
It would be nice If that
was reflected from the
actual research institutions themselves.
- So Lisa I have a
question for you which is.
If CRISPR truly is a platform
and I think that's what
has been explained today.
Then why should it be
treated any differently from
the Cohen and Boyer patents?
Which were exactly a platform
that people could use
in many many different ways.
Why does one company have to tie up
all the human therapeutics?
I mean I understand why you're doing this.
The question is from the
perspective of someone
who thinks about what the law should be.
What are the criteria that
we aught to be looking at?
- I think it's probably
useful to tease apart
two different policy issues here
and if we focus just on the
Broad Institutes licenses
as Jake as illustrated them here.
We've mostly been talking
about the Editas human
therapeutic exclusive license
and I think the policy questions there are
is that exclusive license
broader than it needs to be
from a public welfare perspective.
And by broader, patents create
costs and that weight loss
and so to the extent you
don't need that exclusivity
to get these different
therapeutic applications commercialized
then we don't wanna be granting
than exclusive license.
There's a different question
which I think is more analogous
to the Cohen Boyer situation
of all of the other kinds
of applications like the black lines here
are non-exclusive licenses and there's
whole bunch of different companies there.
So for all of those,
exclusivity is clearly
not necessary to them to
get it commercialized.
So I'm curious Jake and Abraham.
What do you think is
the best justification
for having the patents there,
having that as license,
rather than simply letting anyone
use in those areas for free?
- Is it me?
- Either or anyone who has an opinion.
- Okay, well obviously
you get the patent first,
you know and then it could be
applied to in different ways
and then I think the Broad was very,
you know thought it out well
in terms of making it broadly applicable
through non-exclusive licensing,
so that's it's not inhibiting it.
In terms of whether that
serves a purpose or not,
obviously the Broad will
plow whatever they get back
into further research so.
I would say it's not inhibiting it.
Whether it's promoting it
the way an exclusive license
does in the case of therapeutics,
it's not clear if there's
as great a benefit as with
some of the exclusive licenses
that lead to products.
But I don't think you know to
the extent you call it a tax,
I don't think, you know it
will be as I said plowed back
into further research
and generally if they do it
wisely and not egregiously
it won't inhibit further development.
- I mean it does inhibit
it to some, like it.
I mean you said you don't
wanna call it tax but
to the extent it's charging
some fee for people--
- No I said it could be considered
even if it was considered a tax.
- And so taxes under kind
of general economic theory
they're gonna decrease use to some degree
and it might not decrease all these,
but the low value users
who, and on the margins
it's gonna decrease use of
the technology to some extent.
- I have a question maybe
because I've had situations where
you know this idea of public
good and the universities
doing all the right things.
I mean I've had situations where a client,
not related to this, has
nothing to do with this.
But a client gets a
communication from a surrogate
about something and it is very aggressive
and as far as I can tell
there's almost no discernible
public policy involved,
it's all about the money.
And so I just wonder you know,
If you create this Editas
and you say go make money.
Is it the case that for example
maybe Stanford or NYU or.
It's just different philosophies
by different universities about money.
- I think that's definitely true
and there are some awesome anecdotes
about just that that I won't
regale everyone with right now.
But yes I think that's absolutely true.
- So Abraham I wanna bring you
in here because now I think.
So there's some practical constraints
that you can talk about
from the perspective
of the university licensing
office in terms of,
you believe you should be
serving the public good
you wanna be serving the public good.
But there are examples
where it doesn't always work out that way.
Tell us something from your perspective.
How can it happen that
there are restraints
even when people have the best intentions?
- So I would say by in large
most universities and NYU,
for which I could speak specifically.
You know our goal is the public good
and so for example we
had a number of patents
on a malaria vaccine
that we made available
in a royalty-free cross license.
Where we got nothing out of it
and that's the first
malaria vaccine that's been
successfully tested in people.
So that's something where
there was a way to make it
available to help people
and we didn't look for anything for it.
But then there are other cases
where there are major commercial potential
and you need to incentivize
companies to invest
as was mentioned.
And also as you look at
but, in terms of some of
the practical consideration.
So there are a number of
different constituents here
so one of them our various,
the Federal Government
and state governments.
Which wanna promote economic development.
So that was the primary
reason for the Bayh-Dole Act
in the first place.
When the US was under a lot
of competition in the 80s
and it was felt we were falling behind.
And so economic development,
generally we're suppose
to show a preference for small business.
Entrepreneurship is definitely
viewed as a good thing.
Then one our other constituents
would be the faculty
that invent the technology.
So one they have financial
interests that they'll benefit
when revenues are generated.
But apart from that they
wanna see their technology
broaden to widespread use.
And again entrepreneurship
is something that's viewed
as good in it's own
sense that we're creating
industry that, in the case of Stanford
to all of Silicon Valley.
In the case of MIT the
whole initially route 128
and electronics and then
the whole biotech industry
that most local governments
would like to see
a startup ecosystem develop,
in which many startup
companies are created
and they feed on each other and it leads
to economic development and excitement.
Which our faculty share
in that excitement.
So those are all goals you
know in addition to the goal
of bringing products to
market to help people.
So I would just say that's
something in it's own right
that we're looking to do.
But I would say it has not
impeded the actually development
of products to help people.
Again, where things can be broadly,
non-exclusively licensed
as in this case MIT
of Broad did that.
And where there are potential
therapeutics to be developed
there might need to be exclusive licenses.
But you just have to
think thoughtfully about
how you structure them.
- I just wanna check, Jake
maybe correct me I'm wrong
but my understanding is
that Broad did non-exclusive
licenses for research tools,
for basic research but not
for the human therapeutics
where the money is. Is that correct?
- Yes.
So Broad is engaged in a
policy of essentially free use
for academic research,
it does this for a non-profit
outfit called Addgene.
Which is think one of the
most innovative companies,
being a non-profit company
that has been created.
That essentially serves as a DNA,
what we call plasmid repository
for researchers out there.
It's just a fascinating organization
that essentially relies
on the contributions
of other scientist in
order to be able to run.
It's fascinating.
For research tools it also
offers non-exclusive licenses
for agricultural purposes.
It only offers non-exclusive licenses.
It has a license with Monsanto
that's non-exclusive for example.
And it is only for human
therapeutics that it engages
in it's exclusive incense
practice and it manages that
through Editas it's surrogate.
There are no surrogates for
these other non-exclusive license areas.
It manages it's IP itself.
- Just a minute, so Abraham I
wanted to ask you a question
which is, there's been
a lot of conversation
about the use of surrogates companies.
Is that something that is
kind of necessary these days.
Because the work of licensing
of big technology like this
is larger than what
a University Office of
Industrial Liaison can handle,
or there something else at play?
Is it that there's, is it
as what's suggested earlier
that it's the view on the dollar sign?
- Right, I would say that on
the licensing aspect of it
probably it might be done more efficiently
with the additional resources that
a startup company would bring
to make the licensing of it
more efficient and quicker.
But again I would come back
to, a lot these technologies
while they might seem very
exciting and like they can't miss
that there is still work to be done,
actual research in the labs,
and companies like Editas
raising capital to further
develop it and make it work.
Again there have been other
technologies that seemed
just as exciting as this years ago,
but they didn't succeed and
you know a certain thing
that it will succeed here
as exciting as it is.
And so these companies serve
the function of further developing it
and through all the various relationships
they have as it's each of
their exclusive licensees
as they work with them,
it all goes to benefit
the core technology.
They might learn something
from Juno, they might learn
something from another company
they exclusively incense
in another field.
So having a company that's
focused on the practical aspects
of making this an FDA approvable product.
There's a value there
that goes beyond just being a surrogate.
- And in your experience have
you found it from time to time
the interest of the scientist
who are the inventors
in working with the further
development of the invention
into a product,
is greater when it's
happening through a company
as opposed to just directly
through the university licensing office?
- Yeah it adds a level of
excitement to it and it also.
Whereas within the
university there are charged
with educating their graduated students.
I mean it's a teaching mission.
Whereas at the company
they could be focused
on just getting things done
in a as timely a way as possible.
You know doing more of
the practical brunt work
that might not be suitable for
a graduate student's education.
You know they could be
focused on making products
and translating it into
something with practical benefit.
- I wanna give each of
the panelists a minute
to give any sum up points if they want to
and if they don't that's fine.
We'll go to questions from the audience.
I'll just note, we're being
recorded today because
there are a lot of
people who couldn't come
and want to be able to watch.
And that means if you ask
a question you have to
either go to or let somebody
give you the microphone,
there's one on either side of the room.
So don't just ask the
question from you chair.
So we'll start. Jake
you wanna add anything?
- Yeah you know look I
think this is one of.
I mean needless to say I think this is
one of the most interesting
areas both of patent flaw
and of science and also
for those of you interested
in he kind of licensing systems
surrounding intellectual property.
And that, you know, without
expanding this too much
to get derailed I would say
that there are some advantages
that in an ideal world
and lord only knows it's
not the world we live in these days.
But in an ideal world that
a private licensing scheme
that is administered by
research institutions
could be the best, the
optimal way of ushering
some of these technologies for it.
I don't necessarily think that
that's happening here right.
But I do think that again
ideally it is possible
so that's it.
- [Ann] Okay, we'll go down the line.
Abraham any last thought?
- Yeah just again that these
are all very good points
that have been raised
and universities do need
to constantly soul search and
make sure that we actually
are achieving our mission.
You know structuring various
clauses into agreements
where we do grant
exclusivity to make sure that
the companies will make it as
broadly available as possible
again to serve the serve the public good.
- Yeah, again I go back I think right now
in terms of sort of business out there.
There's just a lot of
uncertainty generated
by this decision.
I think there's conflicts questions
of who take licenses from.
I think this chart for example
I think is very helpful.
(audience laughs)
I think a lot people are
gonna like this chart.
So I think you know there
was a lot of lack of clarity
out there about who's been giving licenses
and who you should go to and talk to
and things like this are helpful I think.
There's a ton of open
questions on the patent side
and I'm sure a lot of people
out there are thinking
about all these things
and there's gonna be a
lot of thing to watch.
So it's gonna be an area
that's gonna keep people
busy for a while I think.
- Yeah I'll just say I think
it's worth for scholars
and the public to be paying attention to
how universities are
licensing these things
and whether it's actually
being done in the public good.
To Bruce's question earlier,
there was nothing that
requires universities
to act in the public
but in some universities
have been asserting
their patent portfolios
in ways that have pretty
clearly seem to not be
very aggressive ways.
It's hard to tell any compelling
social welfare story from.
As more universities, if
more universities do that,
I think there might be
more public opposition
to the way, to university
patenting more broadly
and so that's it important that scholars
work with with universities
to help think about the
ways that they can do that.
And to just add one wrinkle
we haven't talked about here.
I think the role of credit
in all of this is important.
These researchers who are
angling to be the ones who get
the Nobel prize,
and for the university
tech transfer officers.
Most tech transfer officers I've talked to
do view their role as
bringing technologies
to the public.
But it's very important for
them to be able to point to
like here is a patent and
a license that I helped
to make that got it to the public.
And it's harder to explain
the commercialization story
if you don't have a concrete
license to point to,
even though there may
be some case where the
best way to get it to
the public is actually
not to have a patent at all.
So thinking about ways
to help give credit
for technology transfer
that happens outside the
patent license structure
might be one way align
what universities are doing
with the public interest even more.
- Thank you for that.
Are there any questions from?
Okay, we'll start with Ron
and then you'll be next.
- [Man] Could you give us
some kind of thumbnail sketch
of the economics of these
levels of licensing.
So that what kind of money
is Caribou and Editas
getting from where?
How much of a percentage ultimately would
the licensing universities
get if Monsanto invents
a billion dollar product.
That they're gonna be able
to own their own patent
on whatever improvements they make
on the technology they've received,
or would be co-ownership and?
And I know that it probably varies a lot
but if you could give us
some kind thumbnail idea
of what the economics are
at these various stages?
- Yeah sure thing.
So first thing's first right.
We've collected all of these licenses
or at least information
about these licenses
and we've put them on a data
repository at Dataverse.
Which is Harvard's data repository site.
I think if you search
CRISPR licenses there
or my last name,
that's surely be the
first thing that comes up.
It varies by the particular
license that each company
is taking here.
And It also varies by
the particular indication
that they wanna license for.
So if we're gonna think about this
in terms of a joint-payment of both,
excuse me,
of both whatever the
upfront license fee is
as well as milestones on the back end.
Bears, where Bear?
There we go right.
Bears' license from your
estrogenomics down here
has been pegged at around $440 million,
right that is an incredible fee.
That's essentially going
through phase three
and then after that there usually is
a single digit royalty
percentage on net sales.
Most other licenses these days fall within
the $90 million to $250 million range.
Again, if you're gonna
take the upfront fee
as well as kind of milestone payments,
not including net sales.
Those are between $90
million and $250 million.
Just on Monday for example,
Editas signed a license
with Allergan to make a treatment.
I think it was for wet
macular degeneration,
I actually don't know if
they specified wet or dry.
But it's for wet macular
degeneration CRISPR product.
That license was for $90 million.
So somewhere between 90
million and $250 million.
By coincidence or by design
when the patent interference
decision came out in February 15th.
The stock prices of the
publicly traded surrogates
which are Editas, CRISPR
and Intellia down here.
Editas for example rose
by about $300 million
and CRISPR TX and Intellia
dropped temporarily
by about $200 million,
although they have since gained ground.
So between the fact that these
are what the licenses go for
and this is how the market is reacting.
Somewhere in the again,
around 90 million to $250 million range,
gives you a good idea about
what it costs to buy
CRISPR license upfront
for a particular indication
across multiple genes.
90 million to 250 million.
Sorry?
- [Woman] Hi, I just
find this so fascinating
and I have an MBA I was
equity research analyst.
I've been following these stocks
and I also have an MSW as a social worker.
I teach here at the
social work school at NYU.
So as an investor this chart excites me,
as a social worker it scares me.
Because one of the things
that I see is this overweight
of all of these corporate interests.
That when you think about
the users and the creators
of the technology,
and this challenge of
public good public welfare,
and then you think about
the business interests
that are aligning.
What do you see in terms
of trends of alliances
when it comes to lobbying
around the ethics of this?
Because at some point this is going to
start going down that line.
And then my other question is,
do you think, I'm not a lawyer
that's the one thing I'm not.
As I read and saw the sort of trajectory
of the patent board and
their process of deciding.
Do you think that this
punt or this sort of middle
of the road that creates
a lot of uncertainty
is going to impact ethics conversations;
because there has been no
sort of definitive you know
decisions on this type of technology
and who really owns it?
So may that's for a much
broader conversation
but you know if you had
any thoughts on that.
- [Ann] We wanted to put the
ethics admissions in here
and we realized it would
be another two hours.
- [Woman] So just maybe again,
my concern or my thinking
is when you look at CRISPR
and what they did to get
an alliance with a lot of
the overseas technologies and
sort of protect themselves
with forthcoming technologies.
Do you see this potential
aligning of corporate interests
when it comes to lobbying
and sort of protecting
you know the hundred of millions
of dollars you're spending
for these licenses?
- Real quick on the ethics part.
I don't think that, I don't
see the patent decision itself
as directly impacting ethics
discussions in general.
The patent issues are the patent issues
and then ethics flows.
The fact that two different
groups now have exclusive rights
I suppose could affect the dialogue
on the breath of all the
different people involved.
That really goes to the first question
which I'll defer.
- I mean I can say broadly
on some of the political economy issues
that as in many situations there's
the public interest doesn't
have a lobbying group
to the extent that universities having
a fairly effective
lobbying and patent issues
and corporations obviously.
There are, built into the Bayh-Dole Act,
there are various mechanisms,
safeguards for the public.
Ensures things that agencies
could do that they have
in general not exercised.
For example this ability
to have march in rights
to in some cases where the
university isn't licensing
in a way to get it to the public
to grant additional licenses
that they've never exercised.
And I think it's largely a
political economy story there
that it's hard to make
that case for the public.
