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THE USE OF HUMAN BIOLOGICAL MATERIALS IN THE DEVELOPMENT OF BIOMEDICAL PRODUCTS

TUESDAY, OCTOBER 29, 1985

HOUSE OF REPRESENTATIVES,
COMMITTEE ON SCIENCE AND TECHNOLOGY,
SUBCOMMITTEE ON INVESTIGATIONS AND OVERSIGHT,

Washington, DC. The subcommittee met, pursuant to notice, at 9:34 a.m., in room 2318, Rayburn House Office Building, Hon. Harold L. Volkmer (chairman of the subcommittee) presiding.

Mr. VOLKMER. The Subcommittee on Investigations and Oversight of the Science and Technology Committee will come to order.

Today this subcommittee will examine the use of human biological materials for product development in the biomedical industry. For years, researchers have used human biological materials such as blood and bone marrow to develop products useful in fighting disease. However, advances in genetic engineering techniques have caused a surge in research and

development of biomedical products derived from human biological material.

Just last week, the Food and Drug Administration approved the marketing of a human growth hormone developed through genetic engineering. Similar technology was used to produce a human insulin product that has been on the market for some time.

These and other developments hold great promise for fighting the major diseases of our time. These breakthroughs also hold great commercial potential for the biomedical industry and the researchers involved. The number of private companies conducting biomedical research has increased significantly in the past 5 years. More and more, these companies are entering into contractual arrangements with universities to fund the research and development of biomedical products from human biological material.

The universities, in turn, have begun to patent these products in ever-growing numbers and to grant exclusive marketing licenses to their partners in industry.

In preparation for this hearing, the Subcommittee on Investigations and Oversight conducted a survey to determine the extent to which researchers in our medical schools used human biological materials in their research and the degree to which those schools are applying for patents on products derived from human biological material.

The results show a significant and impressive use of human biological materials in research and a substantial increase in recent

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years in patent applications for products derived from human biological materials.

Specifically, in 81 medical schools that responded to our survey, 49 percent of all researchers at those schools are using human biological materials in their research. Over the past 5 years, the schools we surveyed applied for 211 patents on products derived from human biological materials.

These patent applications are significant for several reasons. First, these applications did not come from a few large schools. A full 50 percent of the schools answering the survey have applied for at least one patent in the last 5 years for products derived from human biological materials.

Second, these 211 patent applications represent a full one-fifth of all patent applications filed by the surveyed schools in the past 5 years.

Finally, these 211 patent applications represent a threefold increase over the number of patent applications filed by the same schools from 1974 through 1979 for products derived from human biological materials. The increase in patent applications by medical schools and the accompanying licensing agreements with private industry show the growing importance of university-industry cooperation in the area of human biological materials and the trend toward commercialization of biomedical research.

This morning we will discuss some of the legal, ethical, and economic implications of this trend.

Of course, researchers are central figures in the biomedical industry. Historically, society has relied on researchers to discover new ways to combat disease. The emergence of a highly competitive biotechnology industry has created new incentives for researchers to produce patentable, marketable products. We will examine how university researchers are affected by these diverse expectations and incentives and how they are responding to the novel questions they face.

Most importantly, our hearing today focuses on responsibilities to the patients and research subjects whose biological materials are used for developing biomedical products. The Congress and this subcommittee have been active in the development and enforcement of regulations governing the conduct of researcher treatment on human beings. Today we are faced for the first time with questions concerning whether the patient has a right to consent to and share in the profits from the development of biomedical products from his own biological materials.

We have asked the National Institutes of Health witnesses and the university researchers testifying today to discuss the rights and protections that are afforded patients by the research community.

We have also asked John Moore, a patient whose biological materials gave rise to patented biomedical products, to testify. I am delighted that Mr. Moore is able to be here with us today to share his unique perspective as a patient.

I do want to emphasize, however, that the purpose of this hearing is to examine the generic issues in biomedical research and the use of human biological materials in the development of products. Therefore, I would request all of our witnesses to keep these larger

issues in mind and to avoid commenting on any specific litigation, including Mr. Moore's lawsuit.

We in Congress should do everything possible to speed the progress of medical research, but we must ensure that research is conducted fairly, ethically, and with full regard for the health, dignity, and rights of the human patients and research subjects involved.

Before I conclude, I would like to say that the survey results of the survey that was taken by the subcommittee staff will be on the table to the right, and anyone can have a copy of those if they so desire.

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Mr. VOLKMER. At this time I would recognize the gentleman from California for an opening statement.

Mr. PACKARD. Thank you, Mr. Chairman.

The issues surrounding the development of biomedical products from human biological materials is extremely complex. It involves not only medical questions, but questions of ethics, morality, and legality. I feel this subcommittee should be congratulated for its willingness to tackle such serious, sensitive, and vital issues.

Mr. Chairman, I am concerned that this hearing could become a forum for raising questions and issues which are currently involved in the legal action. One of the witnesses scheduled to appear before us today is involved in such litigation, and I have previously expressed concern that testimony during this hearing might be used to affect the outcome of that litigation.

I was, therefore, very pleased, Mr. Chairman, to have you state in your opening remarks that the purpose of this hearing is to examine the generic issues of biological research and the use of patient materials in the development of products. I commend you for reminding the witnesses that they should avoid commenting on any specific litigation.

I look forward to hearing from today's witnesses and appreciate the opportunity to participate in it, Mr. Chairman. Thank you.

Mr. VOLKMER. I appreciate the comments of the gentleman from California.

Before calling the first panel, I would recognize the gentleman from California for a unanimous-consent request.

Mr. PACKARD. Mr. Chairman, I would ask unanimous consent to permit the media to photograph the actions of today's hearings.

Mr. VOLKMER. Without objection, so ordered.

The first panel concerning itself with the use of human biological materials in the development of biomedical products consists of: Mr. Niels Reimers, director of technology licensing office of Stanford University, Palo Alto, CA; and also Dr. George Rathmann, president and chief executive officer of AMGEN Corp., Thousand Oaks, CA.

I would appreciate if the two gentlemen would take the witness table.

Mr. Reimers, you can begin. Both of your statements will be made a part of the record, and you may either review the statement in full or summarize, however you so desire.

STATEMENT OF NIELS REIMERS, DIRECTOR, TECHNOLOGY LICENSING OFFICE, STANFORD UNIVERSITY, PALO ALTO, CA

Mr. REIMERS. Thank you-I think-for inviting me here today. I submitted a written paper. It first deals with a short history of modern university-industry relationships in the United States, the perception of the role of this partnership in innovation and national competitiveness, the role of Government in enabling this partnership, and examples of linkages between university and industry. I would parenthetically note the most prominent and important linkage is the graduated student.

A later section gives examples of therapies using the biological techniques of recombinant DNA and hybridomas. These examples

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