Abstract

The imperative to produce protein-containing nutritional foods and animal fodder to ensure food security in a sustainable manner is driving innovation, and investment in R&D. In the box of tools that companies can use to enable a return on their investment, are intellectual property rights (IPRs), including patents, trade marks, plant breeders' rights, copyright and know-how/trade secrets. These tools allow companies to control exploitation of the fruits of its research and achieve appropriate levels of profitability, and inhibit unfair competition, for instance direct copying of business models, use of inventions, appropriation of branding, etc. Patents are an excellent basis for open innovation, as the invention is published as part of the process. The patent rights provide a framework for collaboration agreements with co-developers and future manufacturers. Published patent specifications can provide an indication of the research and development landscape and the plans of individual companies.

There is a multifold challenge facing food producers. The global population is expected to reach 9 billion by 2050. Food production must increase to satisfy the consequent demand. Meanwhile resources, e.g. water, phosphorus, are becoming scarcer, climate change is impacting yields, and developments must mitigate climate change, paying attention to creation of greenhouse gases, and avoiding problems of land conversion. The growing problem of antibiotic-resistant pathogens is impacting animal husbandry and hygiene. These challenges are recognised at the country level, and solutions must be global in reach. For instance, one of the Horizon 2020 work programmes is devoted to food security, sustainable agriculture and forestry, marine and inland water research and the bioeconomy, and there are EU partnerships with Africa and China.

At a micro rather than macro level, there is local tightening of regulations on food ingredients, functional foods, chemical residues, pathogen contamination, and pesticide usage. Additionally, there is a heightened recognition of the importance of health and well-being and the need to minimise waste at all stages of the supply chain. All these factors indicate that innovation is necessary in the food and drink field. Financial capital investment can be protected using the tools of intellectual property, to enable a return to be generated, which can be reinvested in R&D. Which of the various IPR tools is suited is very much dependent on the business plan of the participants in any development.

Registered rights including patents and trade marks, by their nature are published and readily searchable. The classification of technical information available in patent specifications is highly evolved, so that very powerful searches can be undertaken. Limiting searches by subject-matter, and combining terms with data concerning inventorship and ownership can reveal interesting clues as to specific company investment and commercial plans that may otherwise not be publicised. Global or local trends can be analysed.

One particular area of development is alternative protein sources. Searching for published patent specifications that fall within the category of protein compositions for foodstuffs reveals some interesting statistics. From a patent search carried out for patent families published within the period of 2004-2014, it was deduced that more than 50% of these patent families related to recovery of protein from three sources:

  • Milk & whey
  • Soy
  • Rice

The remaining patent families related to a huge diversity in the sources. A few examples are plants such as: mung bean, sweet potatoes, discarded tobacco leaves, peanut protein powder, sesame protein, sunflower seed, pea protein, bean starch production wastewater, peach kernel, sweet almond protein, hemp, kaniwa (a S. American plant), Lotus seed, ginko and avocado, microorganisms such as algae fluorescence protein, waste mushroom leftovers, marine/aquatic sources such as fish waste, scallop shells, krill, shrimp heads and shells, anchovy, squid, crustacean exoskeletons, snail and jellyfish, insects (see below for some examples), as well as unusual animals, reptiles and birds such as eggshell membrane, donkey bone, giant salamander and chicken feet.

It can be noted that many sources are likely side-streams/by-products of existing processes, and this will be no doubt be an area that will provide opportunities in the future.

Most of the publications identified in the above search that relate to the less traditional sources derive from Asia, it being notable that Chinese inventions feature highly. An analysis of all the data concerning insect sources revealed that over 90% of these originate from Chinese sources. Insect sources included: fly maggots, cockroaches, locusts, grasshoppers, flies, butterflies and moths, beetles, cicada, silkworm pupa and bee larvae. It is possible that the main products covered in these cases are destined as animal fodder, rather than human food. Nevertheless, it may not have escaped readers' attention that consuming insect-based foodstuffs has been high on the broadcast media's priority list in recent months, not only for celebrities in Australian jungles, and it may well be that farming of insects proves to be an efficient and sustainable industry. We Westerners may overcome the yuck factor and accept insect-based protein-rich foods in the not-too-distant future.

Significant investment in patent translation tools now allows published patent documents to be read in English for patents published by most of the main patent offices, thus, Russian, Chinese, Japanese and Korean. This enables those with a curious mind to research food production, especially production of protein for food, from sources that have not been conventional in the West up to now. Patent specifications are required to enable a reader, with the level of common general knowledge in the relevant technical field, to put the claimed invention into effect. Once the term of the patent has expired, or lapsed, the user of the information need not license in the right, nor compensate the proprietor.

The food and drink industry has historically utilised trade mark protection and know-how more widely than patents. Patents had been viewed as inappropriate, as expensive and too slow to justify in the field where product life is short and innovation more aesthetic than technical. However, it can be seen that some stakeholders are using the patent system extensively, perhaps to support collaborative business models, reflecting more cross-border trade, and to support funding needs or other corporate transactions. Certainly the global players are using the patent system to maintain value and as a tool to compete.

We conducted a case study on the patent portfolio of the Quorn business at the time of the acquisition in 2015. The business was established in the mid-1960s when there was already concern about protein security with increasing world population. A collaboration between ICI and RHM, with IP developed also by Du Pont, led to identification of a species of fungi that could utilise waste from RHM's flour production. The fermentation and mycocelium production was optimised and MAFF granted a licence to sell the product as a foodstuff in 1984. The JV, known as Marlow Foods (MF), became wholly owned by ICI in 1990, then, when the biological products divisions were spun out, Zeneca, latterly AstraZeneca. MF was Private Equity (PE) owned for a couple of years in the mid-2000's before being acquired by Premier Foods in 2005. PF had to rationalise its brands in 2011 and sold the business to another PE. In 2015 the PE exited, selling to Monde Nissin of the Philippines for £550M in 2015.

Identifying the patent rights owned by the various players through the life of the business required a multi-faceted approach. There were several parties contributing technology, and the early patent rights were mostly published in the name of the original corporate owner. These were found by searching (full text and titles) for the species of fungus, then checking for similar subject-matter in the same corporate names and/or with common inventorship. As the commercial transactions took place, existing patent and trade mark rights were usually assigned, and this allowed related names to be identified in the patent databases. These could then be checked again.

The publications show the history of the R&D that went into building the business through its various phases. Although the early patents had of course expired by the time of the 2015 transaction, there was a significant portfolio of patents on innovations made in the AZ era. These no doubt supported the company assets at the first period it was owned by a PE. In addition many of those patent rights were still in force at the time of the 2015 transaction, and were acknowledged by the company to be important rights during the most recent transaction. There was little patent filing in the PF period, but the trade mark rights were consolidated during this period. The business also relies on considerable know-how in the processing and recipes such that they are confident that the business is relatively safe from competitive new entrants. The IPR portfolio including patents, trade marks and confidential information/know-how is a barrier that should keep the company's ability to keep a niche part of the market clear of significant competition, to support profitability and justify the price paid by the new owners.

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