A Conversation with Andrei Iancu on the Role of Innovation and the USPTO in Combating COVID-19

Andrei Iancu speaking at the IPO Educational Foundation Awards Dinner in December 2019

I recently had the opportunity to conduct an interview with Andrei Iancu, Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office, via WebEx. The focus of our conversation was the COVID-19 pandemic: USPTO efforts to work with stakeholders, the role of intellectual property in finding cures and treatments, and general thoughts relating to what the Office is observing. Our conversation also veered into Bayh-Dole and the the letter just sent by three-dozen state Attorneys General asking the federal government to use march-in rights against Remdesivir.

According to Director Iancu, trademark filings have exhibited a so-called V-shape recovery, where the front edge of the “V” represents a precipitous decline caused by some event (in this case the COVID-19 pandemic) and the trailing edge of the “V” represents a rapid bounce back to normalcy.

Trust in Trademarks

Patent applications are a lagging indicator of economic activity because of the inevitable innovation lag that occurs from the time the research is done and conception is made to when an invention is realized and a patent application is filed. Trademark applications, however, are more closely correlated with current economic activity, explained Iancu.

“Trademark filings are correlated with the general state of the economy, as measured by the growth of the Gross Domestic Product (GDP), and venture capital investment” Iancu explained. “Interestingly, Trademark activities tend to follow the S&P 500 index.”

That being the case, it is heartening to learn that the USPTO is seeing an increase in trademark activity, which traditionally quickly translates into economic activity, since trademark rights in the United States are use-based (i.e., they must be used in interstate commerce in order to establish rights). To obtain a trademark in the United States you must show that the mark is being used presently or that you have a bona fide intent to use it.

Relief for Small Inventors 

In other good news, the Office has attempted to provide some relief to primarily independent inventors and small businesses, although it is applicable to anyone who has filed a provisional patent application. On June 11, the USPTO announced that they would allow applicants to file a nonprovisional patent application claiming the benefit of a provisional application for up to an additional two-months, without payment of a petition fee, if there were delays due to COVID-19. This is significant, but a bit byzantine. Applicants have only 12 months from the time they file a provisional patent application within which to file a non-provisional patent application claiming priority to the provisional. However, the Patent Law Treaties Implementation Act of 2012

(PLTIA) allowed for an additional two months in the case where there was an unintentional delay. Because of the flexibility given agencies under the CARES Act, the USPTO decided they could extend that additional two months for free due to COVID-19. So, if the 12-month period ended between March 27, 2020 and July 30, 2020, the two-month additional period to file is available.

There are a couple of things to note about this additional two-month period for filing a nonprovisional application, which many individuals, small businesses and start-ups have asked me about, and which I discussed with Director Iancu. First, according to Director Iancu the Office is assessing whether to extend this further, and if they decide to do so, another announcement will soon be made. Second, there is likely a limit to what the Office will be able to do because the 12-month period to file a nonprovisional patent application claiming benefit from a provisional is statutory. Therefore, while the Office is working to do what they can (per Director Iancu), inventors should speak with a patent practitioner or call the USPTO directly if they are contemplating going beyond 12 months from a provisional filing before they file a nonprovisional patent application.

Prioritizing Life-Saving Patents

In still other positive news, the USPTO announced on May 18, 2020, that the Office would allow for the free prioritization of COVID-19 related patent applications where one or more patent claims to a product or process that require approval by the Food & Drug Administration (so no software, for example). The program was authorized for up to 500 applications, and is working as designed, Iancu explained.

To date, nearly 25% of that original tranche of fast-tracked applications have been approved. Indeed, as of the time of my interview with Director Iancu, there had been 240 requests for COVID-19 prioritized examination, with 123 applications being granted prioritization and 31 applications being refused prioritization for failure to meet the requirements of the program for one reason or another. Another 86 applications are still pending decision in the Office of Petitions.

“Keep in mind that it is only for small and micro entities; we did not make this program available for large entities who can better afford the prioritized examination fee,” Iancu said. “We want to focus resources on small and micro entities, and individual inventors, to help them out as much as possible to bring their inventions to market.”

What is lurking in those patent applications? Are there great cures, treatments, vaccines that can turn the tide? While Director Iancu is in as good a position to comment on that as anyone, including the surprisingly and instantly famous Dr. Anthony Fauci, patent applications must be maintained in secrecy until they are published. That is the law, and I wasn’t going to ask that question despite it being the question that all Americans, and really all citizens of the world, really want to know. Nevertheless, I tried to phrase the question in a way that Director Iancu could comment, if he wanted to comment:

“So, Dr. Fauci opines all the time, and you are the one with your finger on the pulse of innovation and with access to all the patent files. Are you optimistic? Dr. Fauci seems to make a lot of predictions—would you care to make a prediction?”

After giving me the famous Yogi Berra quip about predictions being difficult to make, especially about the future, Director Iancu demurred and didn’t want to make any predictions. He did, however, talk about the importance of intellectual property in the fight for the vaccines, cures and treatments the nation and world so desperately want and need.

“The American innovation system is working, and is working in overdrive, to solve this pandemic,” Iancu told me. “Intellectual property is proving to be critical as we are working to create tests, treatments and cures for this virus. And the fact is we wouldn’t be able to do what we are doing without the IP behind it to date.”

To put an exclamation point on his message, Iancu finished his thought: “All of what is being accomplished today is the result of years of innovation; it is important not to lose track of that.”

A Measured Approach to Marching In

Indeed, it is important that we not lose sight of the fact that the innovations that are allowing multiple companies to race to a vaccine in unprecedent time frames are because of the vast amounts of research and development that have taken place in the years leading up to this COVID-19 pandemic. Intellectual property is the engine behind innovation, and without intellectual property there could be no justification to prospectively spend the many trillions of dollars on healthcare related R&D that has been collectively spent leading up to this pandemic.

And yet, a bipartisan group of three-dozen or so State Attorneys General are now imploring the federal government to exercise march-in rights relative to Remdesivir. Save for a moment that march-in rights do not apply to Remdesivir, something the State AGs overlooked. The attempt to strip IP rights using march-in rights is roughly equivalent to exercising power under eminent domain and strikes me as foolish.

“Bayh-Dole has been a very important piece of legislation that has opened the door for amazing research and lab-to-market activity over the last few decades,” Iancu told me after I concluded my rant on the then recently sent letter by State AGs. “Before we talk about taking drastic measures to use march-in rights, we really have to be careful that there is actual evidence that such measures are appropriate and need to be taken. At a minimum, there needs to be evidence such as that the invention is not being commercialized.  As far as I know there is no such evidence, and indeed the evidence is currently to the contrary. IP facilitates innovation and enables access to technologies. So, we have to be very careful before we disrupt decades old, or centuries old norms.”