The possibility is causing widespread alarm because the company, Agracetus Inc, has gained an unprecedentedly broad patent and could corner most of the multi-billion dollar cotton market if its research is successful.
Agracetus' patent opens the way for other biotechnology companies to 'own' living plants and, potentially, dominate the markets for major staple food crops such as wheat and sorghum.
Everyone who uses genetically engineered cotton plants will have to pay Agracetus a fee. Jerry Quinsenberry, director of the US Department of Agriculture's cotton systems research laboratory in Lubbock, Texas, said: 'We will be spending tax payers' money to do Agracetus' research for them,' he said. 'My hope is that this doesn't happen to all crops. It's happened to cotton and not a lot has been done about it. What about wheat, potatoes or sorghum?'
The issue raises new doubts about whether patenting products and processes involving genetic engineering is appropriate. Last year, the European Patent Office (EPO) was criticised for granting Harvard University a patent on the 'Oncomouse' - a laboratory animal genetically engineered to die of cancer.
The decision provoked a pan-European protest that patenting the animal was contrary to 'morality and public order' and so in breach of the European Patent Convention. Last year, the EPO called an unofficial halt on all plant and animal patents to allow debate of the ethical issues involved. The US patent office seems to be more willing to grant patents on plants and animals than its European counterpart, demanding only some form of human intervention as innovation enough.
The universities of Michigan and Toronto, where the human gene responsible for cystic fibrosis was first discovered, have patented the gene - even though about one in 20 of the population carry the gene in every cell of their body. NHS regional genetics services have already had demands for royalties from the patent-holders. Payment was refused, because the patent is not yet valid in the UK.
Agracetus claims it now owns the rights to any genetically engineered cotton. 'This is the first reported case where one patent covers all transgenic plants of one crop,' the company said when it obtained the US patent.
The company said this was unique in plant biotechnology because of its unusual breadth - covering 'all genetically engineered cotton products'. Agracetus can effectively dictate who does what transgenic research on the plant, and charge them a licensing fee.
The patent is making rival biotechnology companies and cotton research groups nervous, as they wake up to its full implications. These are only now emerging, although the patent was granted this time last year.
Agracetus eventually wants to engineer stronger, longer, finer, warmer and wrinkle-free cotton fibres. Its rivals have other goals including built-in pest resistance through plants that produce their own toxins.
Cotton researchers fear the Agracetus patent puts their projects in jeopardy. University groups funded from the public purse will have to pay licence fees to Agracetus, which could make the work too costly to continue.
Dr Quinsenberry said: 'We weren't terribly aware of the patent. With any crop you always hope that all the tools necessary to manipulate a crop are available to anybody . . . the innovation comes in using those tools. It's very seldom that you get the tools themselves patented.' Agracetus has applied for a similar patent in three of the world's top six cotton producing countries - China, India and Brazil, as well as in Europe.
If it is granted in these countries the biggest losers could be farmers, who traditionally save seed from crops for the following year. They will have to pay Agracetus if they want to use seed from any 'transgenic' cotton. The leading players in cotton engineering are known to have signed licensing deals with Agracetus, but are reluctant to discuss the terms.
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