The commercialization of agricultural innovations is driven by IP laws, with patents playing a central role in advancing agrifood technology. Cathy Li discusses the challenges of balancing biodiversity, food security and patent filings as farmers and seed companies face legal and commercial pressure. 

In the gentle embrace of a late summer breeze, cucumber vines stretch along trellises, their leaves dappled with sunlight. The journey of a cucumber starts from the moment its seed touches the soil and continues to bustling markets among crates filled with vibrant greens. Here, a selection of different cucumber varieties awaits, from crisp pickling types to sweet slicing cucumbers, each offering a unique taste of agricultural diversity.  

Industrial agriculture has eroded much of the planet’s crop diversity over the last century, leading to a looming crisis of resilience. Farmers face regulations and legal concerns, while advocates for biodiversity often rely on the very patents and legal protections that may have contributed to this erosion. 

Ironically, those who seek to protect seed diversity often find themselves caught in a legal maze. To finance their work, many turn to intellectual property laws – the same mechanisms that both protect and limit genetic variety in our food system. 

“It already is a cucumber, and it’s a cucumber that somebody else developed, and they’re saying you can’t use it to make a cucumber,” reflected Edmund Frost, farm manager of Twin Oaks Community Seed Farm in Louisa, Virginia, highlighting current legal constraints in an interview with Organic Seed Alliance.  

Frost has long battled downy mildew, a destructive pathogen that severely impacts broad-leaved crops, particularly cucurbits, leading to significant annual crop losses. Frost has struggled with this issue and sought resistant varieties through breeding trials. In 2013, he started working with resistant cucurbit varieties, including one from Cornell University (PI197088), to combat downy mildew. 

However, in 2017, Seminis Seeds was granted a patent for cucumbers resistant to downy mildew using PI197088, which Frost had also been trialling. He criticized the patent as an overreach, arguing that it unfairly restricted the use of a pre-existing cucumber variety. Frost ultimately discontinued using PI197088 due to its susceptibility to bacterial wilt but continues to develop resistant cucurbit varieties. 

Battle for biodiversity 

Climate change, no longer a distant threat, is wreaking havoc on the predictable rhythms of seasons, soil and water that large-scale monocultures depend on. Yet beneath the surface, a quiet revolution is taking root. Independent seed companies, breeders and farmers are striving to reclaim our crops’ lost biodiversity by cultivating resilient varieties that can withstand an uncertain future. Additionally, urbanization is reducing natural resources and agricultural land, further impacting crop yields and livestock production. 

The world population is projected to reach 9 billion by 2050, according to the Food and Agriculture Organization of the United Nations (FAO). FAO also found that in 2021, 11.7 percent of the global population experienced severe food insecurity. Shrinking arable land and loss of crops due to pest attacks lead to wastage, posing a critical challenge to ensuring food and nutritional security.  

“As environmental factors such as climate conditions and crop pests change more rapidly, a breeding or agrochemical technology based on current environment conditions may quickly lose its application value and competitiveness in new environments,” said Tina Tai, co-head of patents at King & Wood Mallesons in Beijing. 

“Aside from validating sustainable innovations, patents can provide a commercial advantage over competitors by establishing a proprietary leadership position in the agricultural market and forcing them to spend money to design around or license the technology. Patents can also generate financial rewards through royalty-bearing licences and create valuable trading assets to help assure freedom-to-operate through cross-licences,” said Peter A. Jackman, a director at Sterne Kessler’s biotechnology and chemical practice group in Washington. 

Meanwhile, the agrochemical industry is also poised for transformation. As patents on key active ingredients expire between 2023 and 2028, according to S&P Global, the rise of generic pesticides offers a lifeline to farmers in developing countries, even as it raises new questions about innovation, competition and sustainability in global agriculture. 

Off-patented active ingredients open gates to pesticides 

The expiration of patents on 19 active ingredients will open the floodgates for generic agrochemicals, offering an opportunity for pesticide manufacturers in developing countries. This influx of generics promises cost-effective solutions for farmers but also presents its own set of challenges – particularly in a world where intellectual property laws and innovation intertwine like the roots of the very crops they govern. 

“For example, the biotech sector has exploded over the last 20 to 30 years, with agrochemical companies developing patentable genetic and epigenetic tools that increase pest resistance, disease resistance, growth rate and drought tolerance,” said John T.M. DiMaio, senior associate at Hodgson Russ in Buffalo, New York. The agrochemical industry is keenly focused on the commercial prospects of generic agrochemicals, especially in regions where high costs have been a barrier for farmers.  

According to an article published by global agriculture news website AgroPages, contributing author Pradip Dave, president of the Pesticides Manufacturers & Formulators Association of India and chair of agrochemical manufacturer Aimco Pesticides in Mumbai, generic pesticide manufacturers now account for about 30 percent of the global pesticide market. This is expected to grow as the number of off-patent molecules increases, and the pace of innovation in new active ingredients slows. In developing countries, where affordable agrochemicals are critical for food security, the availability of generics can be a game changer. 

The affordability factor plays a crucial role in enhancing productivity and sustainability, especially for smaller-scale farmers. For many, the availability of generics could mark the difference between profitability and financial hardship. 

Investing in agrochemicals is a major expense for farmers, with the largest expected increase in production expense in 2022 being fertilizer, significantly impacting their crop production costs. This investment varies based on the type of chemicals, application scale and geographical location. While farmers often experience immediate benefits such as higher yields and reduced crop losses, long-term financial sustainability is jeopardized by challenges like pest and weed resistance. This resistance may need the use of larger doses or newer, more expensive chemicals.  

Off-patent agrochemicals are significantly cheaper than their patented counterparts, increasing their availability in the market. Smallholder farmers, who often struggle with limited resources, benefit greatly from these lower costs and increased availability; it also enables farmers to adopt better pest and disease management practices. By protecting crops from pests and diseases, agrochemicals play a pivotal role in ensuring food security. This is particularly crucial in regions where food scarcity is a pressing issue, and the loss of a single harvest directly affects the local population.  

Post-expired patents increase market competition as more companies can produce similar products, leading to lower prices and more choices for consumers. This heightened competition forces companies to innovate and improve their offerings to maintain market share, creating a dynamic and competitive market environment. 

How does patent protect innovation of the farm? 

Patents play a critical role in fostering innovation, especially in agriculture. They provide the incentive companies need to invest in research and development, driving advancements essential for sustainability. This is particularly clear in the rise of biostimulants, biologicals and precision agriculture technologies – many of which are protected by patents – showing how intellectual property protection directly supports the development of sustainable agricultural practices. 

“Patents incentivize companies to continue to invest heavily in research and development,” said DiMaio. “As a result, we’ve seen tremendous growth in areas that directly impact sustainability.” 

Agrochemicals typically fall under the category of utility patents, and these patents generally expire 20 years after the filing dates of the relevant same or related patents, but some protection may remain in force. 

In recent years, intellectual property offices have recognized that agrochemical active ingredient inventions cannot be exploited commercially until regulatory approval has been obtained and that this can be a lengthy process. This regulatory delay underscores the importance of patents in providing a window of exclusivity for innovators.  

“Patents provide a vital incentive as they block competitors from using the innovator’s claimed technology without having to endure the costly resources of development. For small agrochemical businesses or startups, the entire company’s value may depend on the strength of its patents since without significant patent protection; larger companies can simply copy the products of a smaller competitor without recourse,” explained Jackman.  

However, patents will eventually expire. Once a company’s patent on an agrochemical expires, competitors can begin producing similar products using the same formulas or ingredients. To stay ahead, companies often develop new formulations, enhanced versions or added components. While these may not offer the same broad protection as the original patent, they can still prevent competitors from accessing the most effective version of the product.  

“Competitors will be limited to using older recipes that may not have all the same benefits as the new recipe,” said Nathaniel W. Lucek, a partner at Hodgson Russ in Buffalo who leads the firm’s IP&T practice. This means that even as patents on active ingredients expire, competitors entering the market may still face legal obstacles related to these auxiliary patents.  

It is also a common misconception that a patent provides the owner with the affirmative right to practice the claimed invention. Patents are exclusionary rights. “The patent owner can only exclude third parties from making, using, selling or importing the invention,” said Jackman. 

“So agrochemical companies need to be keenly aware of third-party patents and invest in strategies for having freedom-to-operate, such as design-around and invalidity strategies for non-expired patents. There are certain patent office invalidity challenges, such as European Patent Office (EPO) oppositions and U.S. Patent and Trademark Office (USPTO) post-grant reviews, which must be filed within nine months from grant. Therefore, agrochemical companies need to constantly monitor for competitor patents and patent publications or risk missing key challenge windows,” explained Jackman.  

Additionally, original patent holders often safeguard their innovations not only through patents but also by relying on trade secrets. Unlike patents, which require public disclosure of the invention, trade secrets allow companies to keep their innovations confidential, safeguarding the algorithms powering precision farming to the genetic makeup of bioengineered crops. This poses a challenge for generic producers, as they must replicate the quality and effectiveness of the original product without access to proprietary information not disclosed in the patent. Without these key details, generic manufacturers are forced to undertake costly and time-intensive research and development efforts to match the original agrochemical’s performance, which can significantly delay their market entry. 

Special forms of intellectual property have been developed to extend the protection of a patented active ingredient after the expiry of the patent. “Most notably, member states of the EU offer supplementary protection certificates (SPCs), which extend the patent term for European patents directed to medicinal and plant protection products which have been the subject of pre-marketing regulatory approval. SPCs can extend the patent term by up to five years,” said DiMaio.However, the U.S. does not offer patent term extensions for agrochemicals, but there are frameworks available in other countries for patent term extensions for agrochemicals. 

Despite these mechanisms, the agrochemical industry still faces some challenges that go beyond patent protection. “In fact, the main challenges they face lie more in the uncertainty of the legal and policy environment, the challenges of technological innovation, market competition pressures and limitations on funding and resources,” said Tai. She added that changes in laws and policies can affect how seed companies and breeders operate, particularly in areas like intellectual property rights and biodiversity regulations. To succeed, independent seed companies and breeders must navigate this uncertainty while also promoting biodiversity and innovating to stay competitive in the market. 

Data harvesting 

In the sun-drenched fields of modern agriculture, drones, sensors and satellites monitor the way crops grow. Precision agriculture tools gather a treasure of data and paint a detailed picture of crop health, soil conditions and weather patterns.  

The rise of AI in agriculture, encompassing precision farming, predictive models, farm management platforms and AI-powered drones, is revolutionizing the industry. These advanced tools are designed to boost productivity and sustainability, providing farmers with unprecedented insights into their operations. However, as these technologies collect vast amounts of data, concerns are growing about the ambiguity of agreements and legal frameworks surrounding data collection, processing and sharing. This uncertainty can lead to significant challenges in data privacy practices.

“When we look at worldwide patent filing trends in the agrochemical sector, we see that companies file patent applications in developed countries with favourable agricultural patent laws and reliable enforcement mechanisms, with China, Europe and the U.S. dominating the market. In contrast, developing countries with less favourable laws or enforcement mechanisms tend to be an afterthought in companies’ IP strategies. For example, India and Brazil both have major agricultural economies, yet see far fewer patent filings. In fact, India has historically held agricultural methods to be ineligible for patent protection. There tends to be a greater generic presence in developing countries,” said DiMaio. 

“There is currently no clear intellectual property protection method specifically for data collection, and it is generally scattered among civil privacy rights, trade secrets and other rights,” said Yongwen Wang, a partner at Johnson IP in Shenzhen. He explained that from his understanding, for data collection to be protected independently, legal relationships, scope, enforcement and damages involved should be decided.  

Lucek further explained that agriculture companies in the precision agriculture space typically require, at a minimum, a licence to the farmer’s data output to improve their platforms, with many of the larger agriculture companies claiming full ownership of all such data outputs. 

“Reasonable restrictions on usage scenarios should be considered. The special nature of the agricultural field lies in its involvement and significant public interest such as livelihood and ecology. Therefore, in the process of promoting data analysis and AI-assisted agricultural decision-making, the public attributes of this field and its acceptable risk limits should be fully considered,” said Tai.  

As the collection and use of agricultural data become increasingly integral to modern farming practices, the legal frameworks surrounding data compensation also gain importance. One such framework is the the United States’ Federal Insecticide, Fungicide and Rodenticide Act, which provides exclusive use protection for data generated during the development of new pesticides. This exclusivity is crucial for encouraging innovation and investment in new pesticide development. 

“Exclusive use protection offers tremendous value to chemical innovators by disallowing use of data on a new pesticide for 10 years – a lawful monopoly to help innovators recoup their investment,” said Lynn Bergeson, managing partner at Bergeson & Campbell in Washington.  

However, the process of negotiating data compensation can be complex and expensive. “For follow-ons, data owners often seek to attach premiums of one sort or another to drive up the cost of the reliance. Disproving these premiums is time-consuming and expensive. For data owners, aligning expectations with the follow-on can be frustrating given their very different perspectives. Slow-walking the negotiation is a popular tactic to delay payment, but also invites data comp arbitrations, which are costly to initiate, staff and define. In short, it takes money to make it in the data comp realm,” added Bergeson.  

Adding to the complexity, issues related to software and AI usage are becoming prevalent. “Patent offices around the world also are struggling with issues around software and AI protection, such as how to protect proprietary innovations related to AI. We expect more guidance from patent offices as AI becomes even more common,” said Lucek.