European Court of Justice Prohibits Patenting of Embryonic Stem Cells

The European Court of Justice (ECJ) issued its opinion in an appeal from a German court decision regarding the patentability of embryonic stem cells (ESC). Originally, Greenpeace challenged the grant of a German patent on a method for deriving neuronal progenitor cells from ESC, and achieved a favorable ruling from the Federal Patent Court of Germany. That court then referred the overarching policy question on the granting of such patents to the European Court of Justice in view of the Directive 98/44/EC of the European Parliament (the legal protection of biotechnological inventions). This EU-wide directive sets out the standards for patentable subject matter. First, the directive establishes the concept of public morality as a touchstone for patenting decisions (the U.S. lacks any such standard). Article 6.1 of the Directive notes that “Inventions shall be considered unpatentable where their commercial exploitation would be contrary to ordre public or morality” while Article 6.2 prohibits the “uses of human embryos for industrial or commercial purposes.” The court’s summary states that “the use of human embryos for purposes of scientific research which is the subject-matter of a patent application cannot be distinguished from industrial and commercial use and, thus, avoid exclusion from patentability.” This decision firmly halts most patenting efforts in the EU on ESC technologies. Contrast this outcome with the ban on federal funding of ESC research instituted in 2001 by the Bush administration. That was not a patenting decision, but it had great effect on reducing incentives and opportunities for U.S. stem cell research. That ban has since been lifted (see here). While patenting opportunities are limited in the EU, U.S. patenting remains available, and one of the consequences of the ECJ decision will be to offer the possibility of evaluating the costs and benefits (incentives, or lack of) for two sharply contrasting IP environments for ESC research.