THE FACTS

- Bio-prospecting is the exploration, extraction, and screening of biological diversity and indigenous knowledge for commercially valuable genetic and biochemical resources.

- The first major bilateral contract for bio-prospecting was made in 1991 when Merck & Co announced a 2 year, US $1.135 million deal with INBio of Costa Rica to provide Merck's drug-screening programs with chemical extracts from 10,000 samples of plants, animals, and soils.

- It was estimated in 1994 that the market for natural product research specimens within the pharmaceutical industry was US $30-60 million per annum.

- It is estimated that annual sales from drugs derived from natural sources now exceed US $40 billion.

- Scientists have found that 86% of plants used by Samoan healers display biological activity.

- It is generally acknowledged that about one in 10,000 chemicals derived from mass screening of plants, animals, and microbes results in a profitable drug. A US based drug company which collects plants by talking to indigenous healers and watching them work, claims a success rate of 50%, making collection using indigenous knowledge 5000 times more effective than random collection.

There is a general consensus that the potential for bio-prospecting in New Zealand exists, but are we positioned to capitalise on this potential? Clearly, any systems we have in place will need to fit within current international law. We also require national legislation to reflect our cultural needs and protect our interests in the wider international community.

WHERE DO WE STAND RIGHT NOW ?

New Zealand is a signatory to the Convention on Biological Diversity. Article 3 of the Convention recognises the sovereignty of States over their own genetic resources. Article 8(j) directs States to:

- Respect, preserve, and maintain the knowledge, innovations, and practices of indigenous and local communities in respect to conservation and sustainable use of biological diversity.

- Promote their wider application, with approval and involvement of the holders of such knowledge, innovations and practices and encourage the equitable sharing of benefits arising from the utilisation of such knowledge, innovations, and practices.

According to the New Zealand Institute of Patent Attorneys, implementation of Article 8(j) would require national action in three main areas including:

- Development of standards relating to the availability, scope and use of intellectual property rights for the knowledge, practices, and innovations of indigenous/local communities.

- Promotion of the application of knowledge with involvement and approval of stake holders.

- Equitable sharing of benefits arising.

As a member of the World Trade Organisation ("WTO") New Zealand is required to conform with Trade Related Intellectual Property Rights ("TRIPs") which requires countries to:

- Provide protection for all major types of intellectual property rights (including patent protection for pharmaceutical and agricultural chemical products).

- Provide plant variety protection in some form.

Currently New Zealand has the following legislation that is consistent with TRIPs:

- The Plant Variety Rights Act 1987 which protects plant varieties that are new, distinct, homogeneous, and stable. A plant variety right may be obtained for varieties which are either introduced from abroad, or are of indigenous New Zealand origin. The holder of the plant variety obtains the right to licence others to produce the variety for sale and to sell reproductive material and to sue for any infringement of these rights.

- The Patents Act 1953 will protect "inventions", or a new "method of manufacture", provided they are new, involve an inventive step and are capable of industrial application. Patents will not be granted for pure discoveries, which means that, in general, plants, species and raw extracts cannot be patented.

Under a claim that is currently before the Waitangi Tribunal ("WAI 262 Claim"), the claimants allege:

- The Treaty of Waitangi guarantees Maori absolute authority over indigenous flora and fauna.

- The Treaty therefore vests in iwi "all rights relating to the protection, control, conservation, management, treatment, propagation, sale, dispersal, utilisation, and restrictions upon the use of indigenous flora and fauna and the genetic resources contained therein".

- The Crown has denied Maori proprietary interests in indigenous flora and fauna, in breach of the Treaty, in a number of ways, such as allowing the patenting of inventions and the granting of plant variety rights in relation to indigenous flora.

WHAT DOES THIS ALL MEAN ?

As a member of the WTO, New Zealand is required to follow TRIPs and ensure patents are available for inventions. New Zealand is also required to provide some protection for plant varieties.

Critics argue that TRIPs, with their emphasis on private intellectual property rights, are in direct conflict with the Convention on Biological Diversity which, in general, imposes obligations concerning the conservation of bio-diversity and indigenous life-styles.

There are also obvious discrepancies between TRIPs and the WAI 262 Claim. It is clear that if the claim is successful, the Government may feel compelled to consider changes to our intellectual property system and, more specifically, its application to indigenous knowledge/native flora and fauna.

WHAT ARE THE OPTIONS?

Commentators suggest there are two options. The first is to amend existing intellectual property law to accommodate our international obligations and any policy directives arising from the WAI 262 Claim. The other is to develop a new class of property rights in indigenous intellectual property relating to flora and fauna and a system to protect those rights.

On the face of it, we have plenty of time to debate these options, given the low priority that is given to intellectual property law reform in New Zealand. The issue is how long we can afford to wait!

Important Facts
"With the green revolution and advances in bio-technology there has been a new gold rush fever among pharmaceutical and chemical companies seeking to join the wave of what has become known as "bio-prospecting"
AIPJ February 1998 Vol 9

The active ingredient in Western Australia's smokebush has been patented as the result of its anti-HIV properties. It is predicted that commercialisation of the drug could earn the Western Australian Government $100 million by the year 2002.

"While many Maori in the environmental field have long awaited the outcome of WAI 262, it is difficult to see the tribunal making recommendations within the next two years. Whatever the outcome of the claim, it has already had the positive impact of putting scientific researchers and decision-makers on notice".
Bevan Tipene Matua August 2000


This is a general summary only and should not be taken as a substitute for specific advice.

x-tech group Simpson Grierson
Web site: x-tech group Simpson Grierson

Contacts

Michael Sage, Partner, michael.sage@simpsongrierson .com
Earl Gray, Partner, earl.gray@simpsongrierson.com
Jan Kelly, Partner, jan.kelly@simpsongrierson.com
Anna Jellie, Solicitor, anna.jellie@simpsongrierson.com

July 2001