Elvina Chow

On February 10, 2013, Nature Medicine published an article, which discloses that the partially disabled cowpox virus, known as JX-594, has been shown to combat cancer. Scientists have manipulated the vaccinia virus by removing the self-replicating gene and inserting another gene that helps recruit immune cells to cancerous tumors, thereby creating the engineered virus JX-594.

In a randomized dose-finding clinical trial of oncolytic immunotherapeutic vaccinia JX-594, scientists were able to prolong the lives of 30 terminally-ill liver cancer patients. Each patient was given either three large doses or three small doses of JX-594 into their liver tumors over the span of a month. Approximately, sixteen patients received the large doses while 13 patients received the small doses. Researchers found that those receiving the large doses possessed an average of median survival of 14.1 months compared to the 6.7 months exhibited by patients receiving the small doses. At least four patients survivied for more than two years and those survivors included two patients whose tumors did not respond to medication.

As such, there is discussion regarding the use of JX-594 as a tool for combating chemotherapy and other drug-resistant cancerous tumors, as it works by recruiting immune cells to attack cancerous tumors. Currently, the National Institute of Health (NIH) has granted Jennerex Biotherapeutics an exclusive license for the development of oncolytic viral cancer therapies. The license grants exclusive rights to Jennerex Biotherapeutics to manufacture these viruses for the treatment of human cancers. It essentially encompasses the modified engineered viruses and the methods and techniques that allow the practical use of these viruses for cancer treatment.

As per 35 U.S.C. 209(a), a federal agency, such as the NIH, may grant an exclusive or partially exclusive license on a federally owned invention only if granting the license is a reasonable and necessary incentive to: (A) call forth the investment capital and expenditures needed to bring the invention to practical application; or (B), otherwise promote the invention’s utilization by the public.

The Association of Molecular Pathology (AMP) has in certain cases opposed such exclusive grants. In 2011, the AMP opposed the NIH’s proposal to exclusively license cancer-related proteonomics to a private entity. AMP’s rationale was that no one company should be given this amount of breadth as the license allows the private company to monopolize medical information. Granting an exclusive license means that the private company controls the costs of developing cancer-related proteonomics, while decreasing patient access to diagnostic tests and discourage innovation in this area. It would stifle medical research regarding cancer-related proteonomics.

According to the AMP newsletter, “such a license must serve the best interests of the public; must be a “reasonable and necessary” incentive for the attraction of investments required to bring the invention to practical application; and must not lessen competition.” Additionally, “practical application of the invention must be unlikely under a nonexclusive license, and the scope of exclusivity cannot be broader than is necessary to bring the invention to practical application.”

What exactly then is the public’s interest? Several licensing agreements have overcome this hurdle by agreeing to pledge royalties to federal and state governments and/or to certain charities. Additionally, an exclusive license may be in the public’s interest given that enabling one unified group to oversee the production of a vaccination will promote standardized quality control. In this regard, exclusive licensing of a vaccination is a reasonable and necessary incentive to attract investments of risk capital. These concerns need to be weighed against whether an exclusive license by any entity, whether a federal agency or a private company, is the best way to achieve this objective.

Elvina Chow is an LLM candidate at Stanford Law School and a student fellow at the Center for Law and the Biosciences.