Patenting Life Forms: Issues Surrounding the Plant Variety Protection Act

INTRODUCTION ket structure can be maintained concurrent with a patent system. The first is public perception. This paper examines the issues surrounding The patent is not viewed as government regulathe patenting of life forms, specifically the social tion with a purpose, but as a fundamental part of and private costs and benefits of the Plant Varithe institution of private property; not as the creety Protection Act (PVPA) (Plant Variety Protecation of a statutory monopoly, but as protection tion Act, 1970). The PVPA is a current issue, against theft. The second reason lies in the ecoencompassing all the elements of the economic, nomic justification for government intervention: social, and moral controversy aroused by the whenever the private marginal value product is broader issue of patenting life forms generally. less than the social marginal value product of an The subsequent sections of the paper outline activity, and the private marginal cost exceeds the specific issues surrounding the PVPA, disthe social marginal cost, it behooves the governcuss the issue of plant patenting, present the arment to direct resources toward that activity, guments favoring and opposing plant patenting, since societal welfare can be improved. and, finally, present an analysis of the major isThe competitive market thus tolerates govsues of the PVPA. ernment intervention when an activity is characA patent, simply stated, is the awarding of exterized by the described marginal benefit-cost reclusive ownership of a new invention, enabling lationship. More to the point, the government the developer to obtain whatever rewards that intervention encourages such activities. Patent might accrue from the invention. A governprotection, then, is a means to achieve this ment-granted patent confers certain rights and end-by temporarily raising the private marginal privileges on its owner and is considered private value product to induce the private sector to unproperty. Patents are thus a means of providing dertake the desired activity. The PVPA serves to incentive to engage in creative activity, illustrate the costs and benefits of government Patent protection and a competitive market intervention in the form of patent protection. structure have coexisted as basic tenets of sociThe PVPA (P.L. 91-577) was enacted into law ety in the United States for nearly 200 years. Yet, on December 24, 1970. Its enactment was motithe inherent characteristics of patent protection vated by a desire to increase the return on private seem in conflict with conditions necessary for the research investment through enabling patents to efficient functioning of a competitive market be obtained for sexually reproduced plant varistructure. Patents may be barriers to market eneties.I Amendments to the original act were protry. The number of buyers and sellers may be posed in 1979 to extend the life of the patents and determined by the patent holder through licensto broaden the list of plants eligible for patenting. ing or contractual arrangements. Patents may When the amendments, bills H.R. 999 and S. 23, impede the flow of information and the mobility were first considered by the House and Senate of factors of production. By definition, the invenAgriculture Committees, the opposition became tion is distinct and unique; this implies the abso intense that the hearings were postponed sence of existing comparable products, eroding ("Opposition to Seed Law Mounts," 1979). It the assumption of homogenous goods. Further, was nearly one year later, June 4, 1980, before the patent holder has been granted exclusive the House Agriculture Committee passed the power to negotiate contractual arrangements reamendments in a roll call vote of 35 to 2. The garding the use of the product, thus enabling an amendments were passed by the Congress in Deinfluence over price. cember, 1980, before the 96th Congress adThere are two reasons why a competitive marjourned.