Transitioning Transgenic Seed from Patent to Generic: Supplementing Contractual Solutions with Governmental Action

Abstract

Almost all food products in the United States rely on transgenic crops, which have been protected by patent since their introduction in 1996. However, the final patents for the first of those crops, the Roundup Ready Soybean, expire in 2014. That event could open markets to generic transgenic seeds, which would lower food prices and potentially lead to improved seed stock. However, the generic seeds cannot be grown in the US or sold in most countries unless regulatory clearances are maintained, which require access to data only available to the patent-holder. In the fall of 2012, agricultural industry organizations attempted to resolve this problem with a contractual solution. This paper argues that the contractual solution fails to address critical regulatory, antitrust, and patent law problems that stymie the emergence of a competitive market in transgenic seed and that supplemental government action is necessary to fully address the needs of the marketplace. After introducing the transgenic seed market, the paper describes the current patenting regime. The paper describes the regulation of generic transgenic seeds, explaining where data from the innovator company is necessary and identifying places of regulatory uncertainty. The paper then outlines the contractual solution and explains why that solution excludes traditional seed variety developers. The paper describes consolidation and antitrust issues in the transgenic seed market and explains why the contractual solution will maintain this consolidation. Finally, the paper proposes three novel regulatory reforms that Congress should pass to resolve the most pressing barriers to a competitive generic seed market.