LICENSING EXECUTIVES SOCIETY

Britain and Ireland

NEWS EXCHANGE
Issue 72: April - May 2000

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ORPHAN MEDICINAL PRODUCTS REGULATION

Richard Binns - Partner, Simmons & Simmons - Member of LES Healthcare Committee

On 15 December 1999, the European Parliament accepted the common position of the Council on the proposal for a regulation to encourage the research, development and marketing of medicines to treat rare diseases. This regulation, which was proposed by the Commission in July 1998, will be known as the Orphan Medicinal Products Regulation (EC) No. 141/2000 and will be brought into effect some time in spring 2000.

Some diseases occur so infrequently that the cost of developing and bringing to the market medicinal products to diagnose, treat or prevent them would not be recovered by the expected sales of the product. The pharmaceutical industry is therefore understandably unwilling to spend time and money developing potentially life-saving medical products under normal market conditions. These diseases or conditions are known as "orphan".

The Commission recognised this lacuna in the treatment of patients and has, through the Regulation, sought to provide sufficient incentives for the pharmaceutical companies to develop orphan medicinal products. Whilst this is a welcome and even admirable idea, it is certainly not a novel one. The United States had provided incentives for the development of orphan medicinal products since 1983 and Japan since 1993. Experience in these two countries has shown that the most influential factor for the pharmaceutical industry when deciding whether to develop medicinal products was the potential period of market exclusivity in which they may recoup their expenditure. The current data protection provisions contained in Directive 65/65 do not provide adequate protection in this respect, hence the need for new protection provisions. The Regulation adopts this "carrot" of market exclusivity as well as offering a number of other incentives to potential product developers.

Identifying "orphan" medical conditions Article 3 of the Regulation defines orphan medicinal products as those for which it can be established that:

  • They are intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition affecting not more than five in ten thousand persons in the Community; OR
  • They are intended for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition in the Community and that, without incentives, they are unlikely to generate sufficient return to justify the necessary investment.

If a medicinal product is to be deemed orphan, there must be no satisfactory alternative at the time of the application.

Committee for Orphan Medicinal Products, composed of experts appointed by Member States and representatives of patient's associations, is to be set up under the Regulation to consider applications for designation as orphan medicinal products and to develop policy in this area.

Development incentives

The requirements for marketing authorisations from the European Agency for the Evaluation of Medicinal Products for orphan medicinal products can be relaxed, including the waiving of registration fees.

Additionally, developers of orphan medicinal products are entitled to a period of marketing exclusivity. For a period of ten years after granting marketing authorisation, the Community and individual Member States shall not accept any other applications or grant another marketing authorisation for the same therapeutic indication in respect of a similar medicinal product. The main exception for this rule is where the second medicinal product is clinically superior to the original or is needed to satisfy demand.

This ten year period may be reduced to six years if, at the end of the fifth year, it can be shown that the product has fallen outside the criteria for orphan products as laid down in Article 3 (supra). This exception to the ten year period is designed to catch those products for which financial success has rendered their market exclusivity unnecessary and inappropriate.

There also exists the possibility of financial aid: whilst it does not lay down any concrete aid packages, the Regulation states that small and medium-sized undertakings carrying out research into orphan medicinal products shall be eligible for aid to assist them in their research.

The Regulation should be welcomed by industry and may be seen as a boon for those involved in licensing new technologies. The Regulation should prompt more research and enable smaller biotech companies to develop novel medicinal products, in more comfortable financial and market conditions.

The Regulation is due to be brought into effect by an implementing regulation, a draft of which is currently being circulated. The implementing regulation contains definitions of "similar medicinal product" and "clinical superiority" and lays out the application procedure for receiving designation as an orphan medicinal product. The implementing regulation also allows an already authorised medicinal product to receive designation and provides for more than one sponsor to receive designation for the same medicinal product.

The implementing regulation is due to be brought into effect in early March - a target which sources believe is still on track.


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President's Diary
Good support for LES events!

February proved to be a good month for LES Britain and Ireland!

In Glasgow, some fifty members enjoyed the 'Alternative to the Burns' Night Supper'. The next day, around seventy members attended our morning meeting on Recent Developments in UK and European Competition Law, organised by EC/Laws Chairman, Nigel Jones, which was followed by an attendance of one hundred at our Annual Lunch at the Café Royal. Our speaker, Joanna Reesby gave us a fascinating insight into the commercial exploitation of the Intellectual Property of Hasbro, world leader in children's and family leisure time and entertainment products. Notwithstanding her years in private practice, Joanna's undoubted commercial acumen shone through and she emphasised the need for licensing deals to have benefits for both licensor and licensee, if success was to be achieved in the market place. At the lunch we made presentations to Michael Burnside and Jeremy Brown, in recognition of their service to the Society over many years, and Michael Connor, a Past President of the Society, delivered the eulogies on behalf of Council.

On February 18th Janet and I enjoyed the generous hospitality of our Irish colleagues at the Conrad Hilton in Dublin, when some thirty-five LES members and partners met for the Annual Dinner of our Irish section of the Society. Our thanks to Mary Swords and Yvonne McKeown, and colleagues, for their welcome and most enjoyable company. Following the Dinner, and escaping the company of the many, kilted brethren, who had joined us in Dublin for the Rugby International, Janet and I took the opportunity to travel down to Wexford. Unlike the Scots, we were not disappointed!

Now, in addition to our continuing programme of evening meetings in London and the regions, our attention turns to the LES International Conference in May, 'A World of Innovation' organised by our LES Benelux colleagues in the dynamic city of Amsterdam. Good support from LES Britain and Ireland is assured and this event presents us with a great opportunity to encourage our European members to join us at our own Annual Conference in Harrogate in July, when we shall be debating the Value of Licensing in the New Millennium. Harrogate, an established International Conference Centre, is within easy reach of everywhere!

See you there on July 6th and 7th!


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Views Exchange


Kim Archer's article in the last edition of News Exchange clearly struck a chord with others trying to find their way around Intellectual Property issues in the NHS:

Dear Sir

Commercial Sponsorship in the NHS

I agree fully with everything that Kim Archer said in the February/March edition of News Exchange. I have already written to congratulate her and to suggest that the key points be writ large, framed and hung in a prominent place over the desk of every NHS consultant!

If anything, Kim has understated the case. We at MMI have been working with teaching hospitals since the formation of the company in 1988, and for some time with NHS Trusts. Our senior staff are all taken from the pharmaceutical industry, so in this role we are "poachers turned gamekeepers". With very few exceptions, our experience has been that the whole area of commercially sponsored research, be it "work for hire" in the form of clinical trials or specialised laboratory services, or funded speculative research, can best be described as anarchy. Individual consultants frequently make arrangements directly with a sponsoring company, without reference to a central authority and without consideration of either the legal position or of the true cost of doing the work. The question of, for example, VAT, if considered at all, is usually dismissed with the thought "We're registered as a charity, so VAT doesn't apply to us". Wrong! It can be a nasty surprise to find out the hard way just how far-reaching the powers of the VAT man are. It can also come as a shock to find that signature of an agreement without the authority to do so may invalidate insurance cover, leaving the investigator personally liable.

Where, as is often the case, a consultant has joint tenure, holding an academic and a NHS post, the situation can be even more complex, with the academic "partner", expecting (and in many instances entitled to) a share of the benefits. Ideally there should be an amicable, formal agreement between the institutions, setting out how costs and benefits are to be shared. Sadly, this sort of arrangement is rare. In the worst case that we have encountered, (it would be invidious to name names) the academic partner asserted that it had full rights of ownership to all IP, even when the consultant's salary was fully recharged to the Trust, and the work used Trust facilities.

The effective costing and negotiation of collaborative agreements with industry should form part of a wider responsibility for technology transfer. This is not an activity that should be treated as an add-on to someone's "proper" job. It requires an experienced dedicated business manager with professional skills that are rarely found in the NHS or academia, a point made by John Baker(1) and emphasised by Tony Bates(2) . Both of these authors suggest that in many cases it is more appropriate to seek expertise from an external specialist organisation, rather than to try to establish an in-house business development function. To be fair, business skills are also frequently lacking in the commercial partner - especially when a CRA has the task of negotiating a clinical trial contract, which has been poorly adapted from a generic document.

The pharmaceutical industry readily acknowledges that each day's delay in bringing a major new drug to the market costs hundreds of thousands of dollars in lost sales. The emphasis is on good quality data, generated by a recognised expert and delivered on time. Provided that charges can be shown to be reasonable, the cost of doing the work is seldom an issue. There is no reason why the NHS should not benefit from its enormous wealth of expertise in all areas of human health, and access, which is unsurpassed, to patients in all disease groups.

The Government is rightly keen that the nation's knowledge base should be utilised for the benefit of all, and in a way that creates both jobs and prosperity. A robust, "win-win" deal can be efficiently achieved only by negotiation between professionals.

A J Christmas
DIRECTOR OF LICENSING

Medical Marketing International Group plc
Tony.Christmas@mmigroup.co.uk

(1) H M Treasury: Creating Knowledge, Creating Wealth. The Baker Report, August 1999. (http://www.hm-treasury.gov.uk/docs/1999/baker.html).
(2) Tony Bates, NHS Intellectual Property Advisor: Management of Intellectual Property in the NHS. Presentation to LES, London, 13th January 2000.

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Focus on LES Scotland Branch

Introducing Caroline Sincock, Monica Flynn and Cathy Rooney.

Dr Caroline Sincock was originally a biological scientist and is now a qualified UK patent agent and intellectual property (IP) specialist with commercialisation and product development expertise gained from both the public and private sectors. She has recently joined Targeting Technology Ltd in Glasgow, as an innovation advisor, where she will help develop product and IP exploitation strategies for clients from all sectors. Her experience is wide ranging, with experience of technology transfer, networking and negotiation.

She has been actively involved with LES (Scottish Branch) since the late 1980's, taking over as Secretary in the mid-1990's, working alongside Chair Fiona Nicolson in making the Scottish Branch one of the most active and best attended local branches of the LES UK & Ireland.

Caroline has assumed Chair of Scotland Region from January 2000. The new Millennium looks in good hands with her team of Monica Flynn, of Scottish Agricultural College Edinburgh, as Secretary, Cathy Rooney, of Scottish National Blood Transfusion Service as mailing list coordinator and, of course Fiona Nicolson as advisor.

Dr Cathy Rooney has a research background in Pharmacology. She joined the Scottish National Blood Transfusion Service in 1988 to manage Regulatory Affairs. In 1995 she moved to SNBTS Business Development where she is responsible for the protection, management and best use of SNBTS Intellectual Property of all types.

Cathy's primary remit includes licensing, technology transfer, research and development collaborations in addition to: patent and trademark applications in fields as diverse as cell therapy, transfusion Transmitted infection, immunohaematology, biotechnology manufacturing methods, therapeutics, diagnostics and information technology.

However, as an organisation like SNBTS is particularly knowledge-rich in terms of the wider elements of "Intellectual Capital" her activities are now increasingly addressing the codification and best use of Organisational and Human Knowledge.

Cathy has been a member of LES for 5 years and is delighted to have the opportunity to be an active committee member of this dynamic professional society.

Monica Flynn Monica is Research Commercialisation Manager at the Scottish Agricultural College in Edinburgh and takes over from Caroline as Secretary of the Scottish Branch. Monica's first degree is in Microbiology and she gained experience both in university and local authority settings. She then did a post-graduate degree in marketing followed by five years in sales and marketing throughout Scotland and the North of England. Monica then transferred to the NHS, handling IP and commercialisation before moving back to the tertiary education sector. Her experience in negotiations, technology transfer, licensing and new business start-ups and spin-out companies is in great demand in her current role. She has been heavily involved with LES (Scottish Branch) since the early 1990's and assumed the position of Secretary of the Scottish Branch in January 2000. Monica hopes to continue the highly effective work of her predecessors and is delighted to be able to give something back to a Society that has given her so much, both in terms of expert advice , knowledge and friendship.

More than 40 people attended each of the Scottish Branch meetings last year. To build on this success and to be sure to attract even more, the Scottish Branch has devised an exciting programme for the new Millennium.

The theme chosen was foretelling the technology and laws of the 21st Century. The branch expanded their database, introducing the LES to new contacts, and welcomed friends, colleagues and even family members to meetings.

This goes some way towards explaining the great turnout on 9th February (50 people) for The Burns' Supper - with a difference. Why was it different? Well, not only was it not on Burns' Night but they also had a lady addressing the haggis!

The haggis was piped-in, in traditional fashion, before the actress, dressed as Burns' close family relative, Betty Davidson, from the 18th Century, did the honours, ably assisted by the audience who toasted it with a wee dram. The whisky was a kind gesture by the restaurant Axiom, to accompany the three-course dinner.

The dinner itself was punctuated by Betty Davidson telling ghost stories of Alloway Kirkyard; through Betty, these tales later inspired Burns to write his own tale of Tam O'Shanter and his tail-less mare Meg.

Burns, in fact, grew up listening to stories of witches and warlocks, pixies and brownies at Betty's knee. Betty was "remarkable for her ignorance, credulity and superstition" and Burns later said that her stories "cultivated the latent seeds of poesy" in him. Maybe the branch was stretching it a bit - but this was said to be an early transfer of know-how from Betty to Robert Burns! And thus relevant to the LES!

However the success of the night was largely attributable to excellent after-dinner prognosticators, forecasting "The Technology of the Future" - Paul Anderson, Director and instigator of The Digital Design Studio (DDA), Glasgow School of Art and Gordon Keir from the Scottish Executive, who kindly stepped in at the very last moment (i.e. an hour before dinner) as the expected speaker was taken ill.

Paul described the significant technological advances being made by the DDA, working with Ford and other major players in designing the "design tools" of the future as well as the products made with these tools. He introduced "replacement reality" - more "real" than virtual - and its use in the development of the future generations of Ford cars, reducing development time from over 5 years to less than 2½!


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Focus on LES Ireland

Gordon hypothesised on design and technology restrictions of the future, suggesting, for example, that minerals and other "hard" materials would be available from, perhaps, outer space and the limiting factor might well be water - at least in some places.

All told, a full and thoroughly entertaining, memorable night in Glasgow, during which special thanks were given to the outgoing Chair, Fiona Nicolson, for her sterling efforts on behalf of the branch - during her period of office the average attendance has more than doubled. Fiona is however still actively involved as part of the new committee, chaired by Caroline Sincock of Targeting Technology Ltd, with Monica Flynn of the Scottish Agricultural College as Secretary and Cathy Rooney of the Scottish National Blood Transfusion Service bearing the rigours of the mailshots.

As you can tell from the back page, other meetings of the Scottish Branch will concentrate on the more predictable. Or do they? Licensing and genetically modified organisms, and the (soon to be introduced) UK Utility Model as a route for software protection, um… well, maybe not!

Report by Mary Swords,

Chair of LES Ireland
The activities of the Irish Section of LES have been characterised this year by the active participation of LES members at LES UK and International meetings. Yvonne McNamara, a solicitor with McCann Fitzgerald, specialising in intellectual property law, and a member of the LES Laws Committee presented an informative paper on the Irish perspective on Irish and European competition law at the LES half-day meeting held on February 10th, 2000 at the Café Royal in London under the title "Recent Developments in U.K. and European Competition Law".

Yvonne's presentation was very informative, as Ireland has had the benefit of specific Competition Legislation since 1991, which established the Competition Authority. The Irish legal experience was of interest to UK LES members because of recent legal developments there.

Also present at the Seminar and Annual Lunch were Mary Swords, Yvonne McKeown, a patent agent with MacLachlan & Donaldson, and Dr. Philip Graham, a sectoral officer at Queen's University, Belfast.

The Annual Dinner took place at the Conrad International Hotel on 18th February, 2000. The pre-dinner drinks reception was kindly sponsored by Conrad International, and there followed a very relaxed and enjoyable Annual Dinner attended by Trevor Hunter, President, LES Britain and Ireland and his wife, Janet, as guests of honour. Trevor gave a light-hearted account of previous visits to Ireland, and Irish Section Committee were delighted to entertain Trevor and Janet to some famous Irish hospitality.

The next LES Irish Section event is an evening Seminar to be held on Tuesday, 11th April, 2000 at the Conrad International Hotel. Professor Robert Clarke of UCD is to speak on the topic "Recent Developments in Character Merchandising".

This evening meeting is free of charge to all LES members, and will commence with light refreshments, in the hotel's Liffey room, at 6pm followed by Professor Clarke's talk at 6.30pm (sharp). The meeting will end at approximately 8.00pm.

The meeting should be of interest to LES members and those working in marketing and advertising fields. Members and guests are welcome, and should confirm attendance by fax or by e-mail to Mary Swords prior to the event.

Mary's contact details are:
fax: (353 1) 618 0731
email: mswords@arthurcox.ie

A number of Irish LES members will travel to Amsterdam for the European conference in May followed by a visit to Harrogate for the LES Annual Conference in July.


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A lively and interesting meeting of LES, Britain and Ireland, was held on Thursday 10 February 2000 at the Café Royal in London to discuss recent developments in UK and European Competition Law. It was extremely well-attended, with over 70 registrants.
The meeting was chaired by Nigel Jones, Chairman of the EC/Laws Committee and the speakers were Michael Burnside, Sue Singleton and Yvonne McNamara, all active members of that committee.

Recent Developments in UK and European Competition Law

Nigel Jones opened the meeting by explaining the role of the Committee in educating LES members on legal developments which are likely to affect their licensing activities, and lobbying the UK Government and the European Commission on proposed new legislation. He went on to set the scene for the morning's discussions, explaining the aim of legislators to make the law easier for businesses to understand and comply with - and encouraging the audience to judge for themselves whether that aim had been achieved!

Michael Burnside, former Chairman of the Committee, then explained the background to European Commission's approach to licensing agreements. Michael outlined the effect of Article 81 (formerly Article 85) of the Treaty of Rome and referred to the numerous block exemptions which had been introduced by the European Commission, exempting certain categories of agreements from the notification requirements.

Michael suggested that selling over the Internet defies the categories of "active" and "passive" sales identified in many of the block exemptions - an issue which will clearly be the subject of considerable debate as e-commerce continues to develop.

Susan Singleton then considered the provisions of the European Commission's recent Vertical Restraints block exemption (no. 2790/1999) which comes into force on 1 June 2000. This new exemption replaces the block exemptions on franchising, exclusive distribution and exclusive purchasing.

Susan queried how many of those at the meeting considered, when drafting a licence agreement, whether the agreement was "horizontal" or "vertical". The resounding silence illustrated that, in practice, these distinctions are seldom appropriate to licensing arrangements.

The Vertical Restraints exemption applies to agreements for the supply and purchase of goods and services between two companies operating at a different levels of the production or distribution chain. The exemption will not be available to agreements between companies with a large market share (over 30%) - though problems will clearly be encountered in determining what the relevant market is and the size of a particular company's share.

Susan also explained that any agreements covered by the existing Technology Transfer or Research and Development exemptions will be excluded from the Vertical Restraints exemption.

The Commission has issued 224 paragraphs of draft Guidelines to accompany the Vertical Restraints exemption. Although voluminous and of uncertain legal effect, these Guidelines are helpful in explaining the intention of the Commission and include specific references to intellectual property and software, together with detailed provisions on franchise agreements.

After coffee, the Office of Fair Trading's video was shown to general enjoyment. The video "reports on" a fictitious OFT investigation, from the initial report of suspicious pricing, investigations of dubious "golf lessons", through a typical "dawn raid" to the imposition of heavy penalties.

The video emphasised that, even if organisations had infringed competition law, a co-operative approach to OFT investigators would be likely to reduce penalties. (The video is available free of charge from the Office of Fair Trading.)

Susan Singleton then took the floor again to outline the main provisions of the UK Competition Act 1998, which comes into force on 1 March 2000. The Act replaces the Restrictive Trade Practices Act 1976 and introduces new Chapter I and Chapter II prohibitions mirroring Articles 81 and 82 (formerly 85 and 86) of the Treaty of Rome. Susan mentioned the "de minimis" levels under which an agreement of minor importance would be unlikely to infringe the Chapter I prohibition and emphasised that the OFT wishes to discourage applications for individual exemptions. Infringing restrictions will be void although the remainder of an agreement will normally survive (highlighting the importance of severance clauses). In the context of the Chapter II prohibition, the OFT has indicated that a company with more than 40% of market share is likely to be dominant.

The OFT has issued a number of Guidelines on aspects of the Act, including two useful Guidelines in relation to Market Definition (OFT 403) and Assessment of Market Power (OFT 415). The Intellectual Property Rights Guidelines (OFT 418) are unlikely to be issued until after the Act comes into force in March.
A draft Guideline on Vertical Agreements and Restraints (OFT 419), issued on 26 January 2000, proposes the introduction of an exclusion order similar to the EC Vertical Restraints block exemption.

Yvonne McNamara concluded the formal presentations with an enlightening explanation of the way in which technology transfer agreements are treated under Irish competition law, demonstrating that in many ways, Ireland is way ahead of the rest of Europe. Ireland brought its law into line with the Treaty of Rome as early as 1991, when its Competition Act was amended to closely track Articles 85 and 86. Recently, the Competition Authority was given the power to instigate investigations itself, rather than being dependent upon government ministers. However, because of the strict division between executive and judicial functions in Ireland, only the Courts can impose fines or custodial sentences.

The Irish Competition Authority has issue "category exemptions" for certain areas and issued its own, slightly different, exemption for vertical agreements.

Yvonne felt that the Competition Authority tended not to interfere with agreements concerning intellectual property, recognising the unique position of intellectual property owners.

Michael Burnside then briefly referred to the welcome repeal of Sections 44 and 45 of the Patents Act contained in the 1998 Competition Act (although this provision has not yet been brought into force).

In the general question and answer session, which ended the morning, many difficult issues were raised, notably concerning the treatment of R&D agreements.

Nigel Jones explained that a draft of a new Horizontal Agreements block exemption had just been circulated, and that this contained numerous provisions relating to this type of agreement. It was clear from the level of interest among the audience that the EC/Laws Committee needs to study the new draft carefully and do its utmost to ensure that the new exemption is clear on the treatment of such agreements. A topic, no doubt, for another LES meeting in the not too distant future.

Report by Nigel Jones
Chairman LES EC/Laws Committee

(With thanks to the speakers for their valuable contributions, and toClare Goodman of Bristows and Kerry Watson of Linklaters for their help in preparing this report).


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Cloning around at the EPO?

The European Patent Office was forced to admit recently that a patent on cloning technology that could be used for human genetic manipulation had been granted "by mistake"!

The controversial patent (European Patent No 695351), which was granted to Edinburgh University last December, discloses a method of isolating and genetically modifying animal stem cells. These relatively immature cells have the capacity for self-renewal and can develop into mature cell types with diverse specialised functions - embryonic stem cells are effectively the "parent" cells for all tissues in an animal's body. Changes made to the genetic instructions within embryonic stem cells can profoundly influence the subsequent development of the animal.

It was revealed - apparently following research by the environmental group Greenpeace - that Edinburgh University patent reads: "In the context of this invention, the term "animal cell" is intended to embrace all animal cells, especially of mammalian species, including human cells."" However, processes for human cloning, or for making genetic changes in humans that can be passed on from one generation to the next, cannot be patented under European Law. The EPO was therefore left to acknowledge its mistake, and released a statement to the press expressing its "regrets" over the incident.

In fact, the patent is expected to be amended following the nine-month opposition period - Greenpeace has already filed an objection and, via its website, is urging individuals to file further objections to the EPO.

Dr Michael Douglas
Wilson, Gunn M'Caw


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Cranfield Drafting Course overflows again - and new courses are announced…

An update on the popular courses run at Cranfield by Richard Reeves:

The December/January issue of Les Nouvelles carried a report that the LES-sponsored course on Drafting License Agreements held at Cranfield in November had been oversubscribed, and that an extra run had been scheduled for February. We can now report that the February course was over subscribed as well. The next run will not be until 15 November 2000, but bookings can be made now by downloading a leaflet from the Cranfield website (www.cranfield.ac.uk/sme/rdman/courses/schedule/).

We can bring you news of two new courses. LES member Ludi Lochner and Cranfield are planning a Technology Licensing Masterclass on November 16, the day after the Drafting Course. The Masterclass will have parallel sessions to deal with the special issues of licensing in software, biotech, chemicals, etc. This is very much at the planning stage, and if you would like to offer a session, why not email Richard Reeves on rdman@cranfield.ac.uk?

The other new course is for members working in companies. Managing Intellectual Property in Companies on 7-8 June addresses the issues of how to manage the corporate IP asset. Details are on the website, and also circulated with this issue of News Exchange.

Pharmaceutical Industry Sailing Regatta PharmaVentures is hosting the first, annual sailing regatta for the pharmaceutical industry and its support businesses. It is the opportunity for large and small companies to come and sail in a fair and competitive manner.The event this year is from 26th to 28th May 2000 at Port Solent Marina, Portsmouth.

For further details on these events, contact: zoe.atkinson@pharmaventures.com or call +44 1865 784177


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IP for dot.coms

Internet companies or dot.com companies as they are otherwise known, have been much in the news of late. Any company launched, (floated seems somewhat inadequate here) onto the stock market with a capitalisation of almost £1billion such as lastminute.com after only a few years of existence is bound to create a certain amount of interest in most of us, but perhaps more so in those of us who are concerned with intellectual property and its value. These companies tend to have few, tangible assets. Their value lies mainly in intangible assets including intellectual property assets, and concern has been expressed as to how those assets might be protected given the high capital value apparently being placed on them. Brands have been considered particularly important. The term brand is often used in an all embracing sense to include not only the specific trademarks the company uses, whether registered or unregistered, but also the way the company is marketed in general, for example through the way in which the company web site is constructed and presented to the customer. A memorable domain name, which is often the company's main trade mark is considered to be very important and its protection equally so. Despite its tender years lastminute.com is thought to have one of the best known domain names. But as the management of Marks & Spencer and Levi Strauss will confirm brands must be constantly nurtured and the quality and design of the goods and services sold under them maintained and improved if the value of the brand is not to decline.

What of other forms of protection. Little has been said of patent protection, but that may be about to change. Amazon.com Inc recently secured the grant of US Patent No. 6029141 directed to an Internet-based customer referral system. The referral system enables individuals and other business entities to market products sold from a merchants web site in return for a commission. Automated registration software runs on the merchants web site allowing entities to register as associates. An associate, once registered, sets up a web site to distribute hypertextual catalogue documents including marketing information about selected products of the merchant. The catalogue document includes, for each such product, a hypertext referral link allowing a customer to link to the merchant web site to purchase the related product. On selection of a link the customer computer transmits a unique ID of the selected product and the associate enabling the merchant to identify both the product and the associate. Should the customer buy the product from the merchant, the commission is the automatically credited to the associate's account.

The claims of the patent which define the scope of protection the patent affords can be divided into two groups, a first group directed to a method of selling or similar and a second group directed to a computer implementation system. In the U.K. at least attempts to protect a method of selling may be seen as attempts to protect a method of doing business and therefore excluded from protection under Section 1 (2)(c) of the U.K. Patents Act 1977. As has been happened in similar cases in other fields in the past, however, securing appropriate protection may depend upon the way in which the claims are drafted. For example, in Merrill Lynch's application, which concerned a data processing system for making a trading market in securities, the application was first refused but then subsequently allowed following amendment of the claims.

Comparisons have been made between Internet companies and the South Sea Bubble Company in which the late great Sir Isaac Newton is said to have both made and lost considerable sums of money, which shows that even brilliant mathematicians sometimes make mistakes. Will it all end in tears? If Internet companies fail or are unable to protect their intangible assets, that possibility seems more rather than less likely.

Bill Downey, Wilson Gunn M'Caw, Manchester


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Michael Croft reports on the West Midland Groups last meeting

Brother Cadfael- the Merchandising of a Medieval Monk

The West Midlands Group heard a fascinating talk at their meeting on 14 March by Arthur Fielder of Beringar Limited, a company which he founded to exploit the exclusive merchandising rights arising from the "Brother Cadfael" books of Ellis Peters. Before her death in 1995 Ellis Peters wrote 20 books recounting the amateur detective adventures of "Brother Cadfael", who was the herbalist at Shrewsbury Abbey. Although he was a fictional character, the stories were set against actual events of the 12th Century. The books were very popular and have been sold all around the world.

Mr Fielder described how he acquired the merchandising rights and how his initial involvement in organising tours in "Brother Cadfael" country around Shrewsbury developed into a worldwide merchandising business. He emphasised the importance of consistently producing high quality merchandise that is always relevant to the character and the stories.

After an abortive agreement with a film company a television series was made which has been shown all over the world. As a result the demand for "Brother Cadfael" merchandise has grown and Japan and America have become the largest markets.

Mr Fielder said that as the business had developed he had realised how valuable it had been to have proper agreements drawn up not only at the beginning but also as new projects emerged. Legal costs may have been high but it was well worth it. Also, he said that trade mark registration had been essential. A highly distinctive logo had been created which has been applied to all merchandise and to the books themselves. This coupled with registration of the logo has helped to maintain exclusivity.


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LES International experience the magic of Vienna

This year's Expanded Executive Committee meeting was held in Vienna January 22-23 under the chairmanship of Heinz Goddar, President of LES International for 1999/2000.

The purpose of the annual January planning meeting is to bring together leaders of the international committees to discuss their future plans. Heinz had also invited the Presidents of the national societies to the Vienna meeting. Eight presidents accepted the invitation and participated in the meeting.

As was expected, Vienna provided a fairy-tale landscape covered in snow, with further snowfalls during our stay. It was cold and we needed lots of layers of clothing to keep warm.

Most committees were represented and gave details of their forthcoming activities. It was generally stressed that committee work should be done throughout the year, preferably by email and not just during the Delegates meetings.

The professional, industrial sectors and international liaison committees, all commented that they were planning to conduct workshops at the forthcoming international conferences, this year's being held in Amsterdam in May and Cape Town in 2001.

Highlights from the Operational committees included a report from the Legal committee regarding the incorporation of LESI in the State of Delaware. The Membership committee reported on the continued request from national societies for information on speakers and licensing courses and how best to present this.

Mr Kahler, President of LES Austria made the local arrangements, which were perfect. Vienna is, of course, known for its multitude of balls, mostly held during January, one of the more famous being the Philamoniker Ball. Herr Kahler had obtained several tickets for interested participants - so a group of about 20 couples from LES was able to attend. What a night, Viennese high society enjoying themselves! The ball was held in the Musikverein with formal presentations and dancing taking place in the concert hall and drinks and food being served in the surrounding little bars and restaurants on all floors.

Dress code: tails for the men and long evening dress for the ladies. The ball opened with a formal dance by Viennese debutantes and their partners and followed by other presentations. The dance floor was then opened to participants. What a scramble, everyone wanting to take part in the first waltz with the floor turning into a sea of tails and dresses! A wonderful evening - and good start to the LESI planning meeting - it was a hard act to follow!

Report by Renate Siebrasse, Chairman - LESI Management and Internal Publications Committee


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LES Britain & Ireland Annual Conference & AGM


The Majestic Hotel, Harrogate
"The Value of Licensing in the New Millennium" 6-7 July 2000

"If I have seen further, it is by standing on the shoulders of giants" - Sir Isaac Newton, 5 February 1676

In the heady atmosphere of soaring stock market prices for fledging e-commerce companies, and a resurgence of investment in the biotecs, the theme of this year's Annual conference in Harrogate will be to explore the Value of Licensing in the New Millennium.

In his key-not speech at the LES USA & Canada meeting in Miami in October 1998, Judge Randal Radar expounded that the licensing function makes the whole system of Technology Transfer work and brings about the advancement of technology for the benefit of all - world-wide.

Sir Isaac Newton (1642-1727), with only the Statute of Monopolies of 1624, which had little practical effect for many years, to protect his work, was, at the age of 34, prepared to admit that his profound achievements had been built on the work of his predecessors. What better advocacy could one have for our present system of patent Protection and Technology Transfer by Licensing?

What is the value of licensing to our private inventors, our universities, and to industry? How do we go about protecting and maximising this value in e-commerce, the biotecs, big-pharma and the traditional heavy industry of yesteryear?

Speakers from all these important sectors will address us on these issues in plenary sessions and interactive workshops.

We are delighted that Walter Willigan, Director of Licensing for the European Intellectual Asset Management Practice of PricewaterhouseCoopers has agreed to give the keynote speech at the conference. His career at PricewaterhouseCoopers and previously at IBM, in assisting clients in managing and exploiting their intellectual property assets (including the development of patent licensing strategies and leveraging technology assets in support of joint venture activity) has provided him with a wealth of experience.

Prior to the conference, LES Britain and Ireland will conduct a survey of patent and Licensing managers from industry and the universities to ascertain their views, and these will be discussed and analysed by a panel of experts at our conference.

Accompanying persons will also be well occupied. Over a period of three days visits will be organised to Harewood House, Betty's world-famous tearooms, Brontë Country and the home of James Herriot in Thirsk. For those able to spend an extra day in the beautiful Yorkshire countryside the Education Committee will be organising the "Traditional Saturday Ramble", ending with a pub lunch at Ripley Castle.

The Majestic Hotel is an impressive 19th century hotel in the centre of Harrogate, a town renowned for the rejuvenating quality of its spa waters. Set in 12 acres of landscaped gardens, the hotel retains its imposing Victorian architecture with gleaming chandeliers, lavishly furnished rooms complete with marble columns generating an air of quiet refinement associated with a bygone age.

The Majestic Hotel was a popular choice for Victorian society to relax after a hard day's bathing! Today it has its own modern Leisure Club!

Harrogate is famous for its splendid gardens, tree-lined avenues and Victorian architecture: The Pump Rooms were built in 1841-42 to house a sulphur well, which is believed to be the strongest in the world. The strong smelling water was drunk from the early seventeenth century for medical reasons and was a great favourite with the Victorians and Edwardians as part of their daily routine while visiting the town. The Royal Baths, opened in July 1897, provided the most advanced centre for hydrotherapy known at the time. The centre still offers Turkish Baths, Sauna and Massage along with various beauty treatments.

Contact: Renate Siebrasse
Fax: 0171 629 9705, email: siebrasse@medtap.co.uk


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New Members

  • Miss Laura Bence, GOULDENS;
  • Mr Kevin Byrne, Solicitor, BIRD & BIRD;
  • Mr Aarti Chapman, ISIS INNOVATION;
  • MrGeoffrey Chisholm, NORTEL NETWORKS:
  • Mr Mark Earnshaw, Patent Agent, MURGITROYD & CO;
  • Dr Glynn Edwards, Manager-Biotechnology, SHELL;
  • Mr Craig Elford, Commercial Director, PHARMAGENTIX LTD;
  • Dr Mark Haxell, Licensing Coordinator, PFIZER;
  • Mr Takao Honda, Manager of Licensing (London), TANABE SEIYAKU Co Ltd;
  • Mr Peter Horsfall, Solicitor, PHILIP CONN & Co;
  • Mr Jason Irvine-Geddis, Legal Counsel, PACEMICRO TECHNOLOGY PLC;
  • Mrs Dominique Kleyn, New Ventures Manager, IMPERIAL COLLEGE COMPANY MARKER LIMITED;
  • Mr Colin Macleod, Partner, DALLAS McMILLAN;
  • Dr Keith Mayes, Senior Manager, VODAFONE Ltd;
  • Mr Brian McCaul, Head of Research & Support, SHEFFIELD HALLAM UNIVERSITY;
  • Dr Wendy Nicholson, Business Development Executive, THE UNIVERSITY OF EDINBURGH;
  • Mr Michael O'Shea, Director of Product Development, BORREGAARD SYNTHESIS;
  • Dr Manjit Rahelu, Licensing Liaison Manager, PFIZER;
  • Mr Martin Sandford, Director of Operations, BTG INTERNATIONAL Ltd;
  • Mr Mark Shipley, Solicitor, WACKS CALLER; Mr Daniel Smerald, Director, ATLANTIC OPTICAL;
  • Mr Paul Strover, Chartered Insurer, Chairman, STROVERS (PLEA) LTD;
  • Mrs Jackie Wilbraham, External Research Liaison, ASTRAZENECA;
  • Mr G L Willis, SIMON CARVES LIMITED; Miss Pamela Withers, Partner, MARKS & CLERK;

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Editor: The Kudos Partnership Ltd,
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email:s.ireland@kudos-uk.com


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