Posts in Guest Contributors

Although complementary, patents and data exclusivity protection incentivize innovation in different ways and serve distinct purposes. Patents provide protection for innovations that meet the standards of patentability and are novel, nonobvious, and useful. In the context of biopharmaceuticals, patents protect both breakthrough discoveries as well as incremental improvements. Due to the length of the drug-development and patent-approval processes, effective patent terms rarely correspond to FDA approval. Accordingly, in some cases innovative therapies may experience patent expiry shortly after making it to market. In contrast, data exclusivity protects the tremendous investments of time, talent, and financial resources required to establish a new therapy as safe and effective. This is accomplished by requiring competing firms seeking regulatory approval of the same or a similar product to independently generate the comprehensive preclinical and clinical trial data rather than rely on or use the innovator’s data to establish safety and efficacy of their competing product.

EDITORIAL NOTE: This article is a continuation of Alice, the Illusory Death of Software Patents. We can return to the beginning of the analysis and revisit preemption. As stated, the Court sees § 101 as protecting the big ideas that are fundamental to commerce, science, and technology, patents that would preempt and “block” innovation. The Court realizes that every patent…

With apologies to the great humorist, the report of the death of software patents is an exaggeration. The Court set forth a two-step test grounded in Bilski v. Kappos and Mayo v. Prometheus. While the Court may not have defined a clear boundary for so called “abstract ideas” specifically, it did squarely place this case within the “outer shell” of the law set forth in Bilski and Mayo. In doing so it articulated an approach that focuses not on finding the boundary line, but rather on the core properties of an ineligible patent claim.

Attention has recently turned to patent assertion entities that are suing vast numbers of customers using patented technologies in their everyday businesses. But, end users were also principal players in some of the main recent patent before the Supreme Court. In Bowman v. Monsanto, Monsanto sued farmers for re-using its patented self-replicating seeds. In Association for Molecular Pathology v. Myriad Genetics, patients and physicians sued to invalidate breast cancer gene patents. And, patients and drug stores repeatedly challenge pay-for-delay agreements between patentees and competitors, claiming they undermine patients’ interests in access to generic drugs. Finally, end users are likely to become even more prevalent in patent litigation, as the 3D printer becomes more popular, making it more likely that an individual or a small business will make an infringing item that will expose them to patent liability.

The value of such innovation is best measured through the improved health outcomes for patients. In this context, a few examples from the developing world are even more illustrative. Given that those who most vehemently oppose protection for incremental innovations frequently cite the need for treatments for neglected diseases and maladies of the developing world, it is important to note that many of the treatments that do exist for the world’s most vulnerable populations are themselves incremental innovations. Numerous incremental innovations have resulted in improvements that have specific application to neglected diseases and the maladies of the developing world.

Recently I visited a Congressional office with a friend who led technology transfer at a public institution located in a mid-level city not normally associated with innovation. By skillfully using the authorities of Bayh-Dole and the patent system combined with good business judgment the program was very successful in start up formation and licensing, making it a driver of the regional economy. The Congressional staff were effusive in their praise of the results, which are well known in the state, vowing to do everything they could to support continued success. However, just before the meeting my friend confided that their new leadership made it clear that they did not consider technology transfer a profession requiring special skills and experience. The staff that labored so long and hard building the program got the hint and was leaving. Luckily their achievement is recognized by other institutions that are happy to snap them up. Unfortunately, the economy of the area they left behind will pay a high price for this boneheaded mistake.

Essentially, innovation patents are 8 year short form patents available in Australia as an alternative, or in parallel with standard, or utility, patents. An innovation patent can be filed on an obvious invention, is hard to invalidate and, when filed as a divisional from a standard patent application, can be infringed from a date before the standard patent application was published.

In a decision barely reaching 11 pages, a unanimous Supreme Court in Limelight Networks, Inc. v. Akamai Technologies reversed and remanded the Federal Circuit’s per curiam majority ruling in Akamai Technologies and McKesson Technologies. That the Supreme Court overturned the Federal Circuit’s per curiam majority ruling is not a surprise. But what is truly shocking are the factually inaccurate statements, as well as the problematical reasoning that appears in Justice Alito’s opinion for this unanimous Supreme Court. With all due respect, Alito’s opinion is an abysmal ”comedy of errors.”

Canada is not the first country that comes to mind as a threat to U.S. trade. After all, Canada is our largest goods trading partner, with $632 billion in total goods traded bilaterally during 2013. . . Over the last decade U.S. pharmaceutical companies have faced trade challenges in the form of a narrow interpretation of patent eligibility in Canada. Canada’s patent utility provisions are a serious threat to U.S. innovative industries, and therefore are legitimately being raised in NAFTA’s dispute settlement system.

What brought these painful memories back was reading a story titled Russian scientists and businessmen discussed the global role of universities and technology issues. I was casually skimming through it and stumbled on this: “If universities wouldn’t take part in the generation of main priorities of the government development it’s complicate process of scientific research and training of highly skilled specialists. It’s necessary to predict situation at least on decades.” After reading it again, it was apparent this was a comically bad translation.

The past decade has seen tremendous growth in design patent filings, increasing from 582,000 in 2004 to over 1,217,000 in 2012 worldwide. In 2012, the 17% growth over the prior year in applications was the highest one year growth seen since reporting started in 2004… President Obama signed the Patent Law Treaties Implementation Act of 2012 into law in December of 2012. With the inclusion of the United States in the Hague system, it can be expected that international filings using the Hague system will continue on an upward trend. Gregoire Bisson, Director of the Hague Registry, was recently quoted stating that the Hague System will grow massively, as South Korea is scheduled to join in July, and “Japan, China, the 10 Asean countries and Russia could join in 2015.”

Written by David J. Kappos, former Director of the USPTO: “The language of the Myriad decision did not on its face mandate drastic, innovation-dampening action. The Supreme Court chose to narrowly decide the Myriad case, stating that a DNA segment merely “found” from nature without further human innovative intervention is not patentable subject matter… Indeed, the stakes are high – the decision and the USPTO’s interpretation may impact a number of industries that depend on patent protection to provide products, goods and services to the market and jobs to Americans, not to mention the future of life-saving medical discoveries. Of the over 300 drugs on the World Health Organization’s Essential Medicines List, fewer than a dozen were brought to market without having received patent protection. From the ibuprofen ubiquitous in the world’s medicine cabinets to breakthrough treatments for epidemics like the HIV-inhibitor AZT, the patent system has long played a pivotal role in global health.”

There are those who argue against the patentability of software as a whole – never mind finding a test as to what software (or computer-implemented) claims should be patentable. We disagree. Why? Well, the notion that software should not be patentable necessarily indicates that the software industry itself is not capable of innovation worthy of patent protection! Yet, in a country where patent rights are guaranteed by the Constitution, should not all fields of innovation be treated equally under the law? Should we not avoid becoming a country where one field of endeavor (e.g., pharmaceuticals or electronics) is deemed more “patent worthy” than other fields (i.e., computer science and information technology)!? To answer these questions in the negative seems silly to us.

Written by Don Dunner: ”Fifty-four years ago, a lawyer in the prime of his career was appointed by President Eisenhower to serve as a judge on the Court of Customs and Patent Appeals (CCPA). Within weeks if not days of that appointment, then Chief Judge of the CCPA, Noble Johnson, chose as his sixth and last law clerk a second year law student. Giles Sutherland Rich was the new judge; I was the new law clerk. Little did I realize at the time that the new judge on the block was about to embark on a judicial odyssey that would extend just short of the 21st century and that would propel him into the rarified atmosphere occupied only by true giants of the profession.”

Trials were held in 128 patent cases in 2013, including 52 bench trials and 63 jury trials. Thirteen cases involved both bench and jury trials. Over half of all trials were held in the District of Delaware (25), the Eastern District of Texas (25) or the Southern District of New York (17). Cases went to trial fastest in the Eastern District of Pennsylvania; its 255-day median time to trial was approximately 12 times faster than the 2,423 days it took a case to get to trial in the Western District of New York, the slowest district.