Biotech’s brave legal world

Legal issues can create a minefield for biotech companies bringing research to market


The rapid advancement in biotechnology in the past two decades, particularly in animal breeding, has created a minefield of legal issues.

Lengthy battle: ABS Global sexed genetics brand manager Olivier Hiers says bringing its new sexed semen product to market was a long process.

Lengthy battle: ABS Global sexed genetics brand manager Olivier Hiers says bringing its new sexed semen product to market was a long process.

The courtroom has become almost as important as the laboratory for companies developing commercial products from biotechnological advancements.

The battle in the past few years between two companies producing lucrative sexed semen is an example of how legal issues can slow the adoption of science for the market.

ABS Australia launched its new sexed semen product Sexcel at International Dairy Week in January.

The sexed genetics brand manager for the company’s global arm Olivier Hiers said its product launch was delayed for two years by a legal battle with Inguran, trading as Sexing Technology.

ST was the pioneer of commercial sexed semen more than a decade ago.

Its technology uses a machine to apply fluorescent dye to sperm cells; the female X chromosomes contain more DNA so are brighter than the male Y cells.

The dyed cells then flow past a laser beam that detects the amount of fluorescence and applies an electrical charge that deflects the cells into different containers.

The ABS technology also applies fluorescent dye to identify the X and Y cells.

But its premise is based on ‘not touching’ the valuable X cell.

So the technology ‘cuts’ the Y cells, rendering them useless.

The legal battle between the companies was based around two separate actions.

ABS filed an antitrust lawsuit accusing ST of monopolising the market, while ST counter-sued over patent infringements.

After a lengthy trial, a jury last year found ST had “wilfully maintained” a monopoly in the market since 2012, clearing the way for ABS to take its product to market.

But ABS was required to pay upfront patent payments of $US500,000 and $US750,000 and ongoing royalties of $US1.25 and $US0.50/straw to ST.

Mr Hiers said biotechnology companies, such as Genus ABS, needed to equip themselves to understand the legal implications.

Companies needed specialists in IP (intellectual property), so they could identify whether their research and products were worth seeking a patent for or not.

The legal team also needed to advise on contract negotiations.

Sexcel’s launch was also delayed because it had a contract with ST to produce a minimum amount of sexed semen until the end of August 2017.

"You have to equip yourself to know," Mr Hiers said.

The legal battle was the final step in a long process for ABS in developing its technology.

Mr Hiers said a key for research and development was identifying something in the lab that would work on a big scale for commercial application.

ABS’s sexing technology is also different in that the dead Y sperm and other debris remain in the semen straw.

So it needed to present it to the scientific community, specifically the International Committee for Animal Recording, for approval.

"We knew the technology was different, so the first thing we knew could be a challenge was the debris in the straw,” he said.

The product then needed to be tested in the field.

The company put 12,000 units into trials throughout the world across a year.

These were then compared with results from the company’s database for conventional semen and other sexed semen.

Sexcel achieved a 90 per cent relative conception rate compared with conventional semen and a higher rate than other sexed semen.


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