Is a cannabis patent war on the horizon?
Cannabis business clients may soon face new patent-related risks.
It’s not uncommon to have a patent issued on certain fruits, vegetables and other plant varieties. In fact, patents issued within the agribusiness field are commonplace — and for good reason: Once patented, a plant cannot be legally grown without the permission of the patent holder. Recently, the U.S. Patent and Trademark Office has issued a number of patents for specific strains of cannabis, and the trend is quickly picking up speed.
Today, the legal cannabis industry is worth an estimated $11 billion — a figure that could easily double within the next two years. At this rate of growth and with federal legalization becoming increasingly likely, businesses ranging from startups to big corporations are ramping up patent purchasing efforts and claiming ownership of cannabis plant DNA.
Strain protection
According to an investigation conducted by Leafly, the sharks are already circling and filing patent claims, making the threat of a cannabis patent war a very likely scenario. Why? Because biotech startups and Big Ag corporations have taken the unprecedented step of acquiring utility patent protection for the cannabis plant itself, attempting to gain control over access to and use of the various cannabis strains that are covered by its patents. The control over strains will impact all parties involved — from growers to consumers and throughout the supply chain.
The importance of prior art
The cannabis industry is just now emerging from the shadows of a formerly illegal market. As such, there is little to no formal documentation of the progression of cannabis plant strains and cannabis-related innovation, commonly known in the patent world as prior art. Prior art is what patent examiners review during the application process, and it can result in a rejection if the idea an applicant tries to claim has already been publicly known. Simply put, without prior art, patent examiners are left with no choice but to allow the patents to be issued.
Cannabis industry leaders may be able to find documentation of well-known strains by building a bank of prior art related to cannabis plant varieties by way of sources not typically used. This will require great effort and the development of strategic initiatives among like-minded businesses in the industry, all working toward a common goal of combating commercial exploitation of well-known ideas that would allow other players in the industry to acquire patents.
Conclusion
More than ever before, it’s critical to speak with your cannabis business clients about steps they should take now to be better prepared and protected against patent-related issues.
Norman Ives (nives@wwfi.com) is cannabis practice leader and wholesale insurance broker, and Morgan Moore is life science practice leader and wholesale insurance broker at NutraRisk, a division of Worldwide Facilities. As a wholesale insurance broker and program manager, NutraRisk specializes in insurance coverage for the nutraceutical and cannabis industries.
This article first appeared on NutraRisk’s blog and is republished here with consent.
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