Patent Docs

News from Abroad: Progress for Single European Patent and Litigation System

Unitary European Patent

The European Union (EU) Parliament is close to approving new regulations for a single patent covering 25 states of the EU.  Under these regulations, patents granted by the European Patent Office can cover, and be enforceable in, 25 countries of the EU as a single entity.  The patentee will be able to choose if the granted patent becomes individual patents in one or more of those 25 countries, or the unitary patent covering all 25.  There will be no requirement for the patentee to translate the patent.

Italy and Spain have each launched legal challenges, at the Court of Justice of the European Union (CJEU), against these proposals.  However, although these challenges will slow progress, political pressure means that the unitary European patent will become a reality in the near future.

The EU has set a target date of 1 January 2014 for the unitary patent system to come into force.

Pan-European patent litigation system

Currently, European patents are a bundle of national patents, enforced nationally.  For some time the goal of the EU has been central enforcement of European patent rights.  The EU has agreed that the unitary European patent will come into force alongside a system of central enforcement of patent rights in Europe.

The European Commission is putting in place a court, the EU Unified Patent Court (UPC), which will have exclusive jurisdiction over enforcement of both the proposed unitary European patents and national patents granted by the EPO.  The proposed court will be set up by agreement between the 25 member states.

The UPC will initially have three centres:  Paris, London and Munich.  London will have jurisdiction over litigation of patents relating to chemistry and the life sciences, including pharmaceuticals, biotechnology and medical devices, Munich will have jurisdiction over litigation of patents relating to mechanical engineering and Paris will take the remaining technologies.  There will be an Appeal Court in Luxembourg.

The London cluster is a significant boost for the UK, and UK litigants will have easy access to Paris which is only a short train ride away.  Forresters has a strong presence in the other two key locations, with offices in both London and Munich.

The EU has yet to decide the exact relationship between the courts.  This will become clearer as the courts are set up.

The proposed structure would provide a new system of patent litigation in the EU by 1 April 2014.

We will keep you updated on the progress of both proposals.

This article was reprinted with permission from Forresters life sciences newsletter.

USPTO and EPO Announce Launch of Cooperative Patent Classification System

By Donald Zuhn --

Last month, the U.S. Patent and Trademark Office and European Patent Office announced the publication of an advanced version of the Cooperative Patent Classification (CPC) scheme and some final CPC definitions ahead of the CPC's official launch on January 1, 2013.  The CPC is a detailed classification system that includes approximately 250,000 classification symbols based on the International Patent Classification (IPC), which is administered by the World Intellectual Property Organization (WIPO).  The new classification system, which incorporates the best classification practices of both the U.S. and European systems, will enable efficient prior art searches to be conducted and is also expected to enhance efficiency by supporting work-sharing initiatives designed to reduce unnecessary work duplication.  The joint effort to develop a joint patent classification system was first announced in October 2010 (see "USPTO and EPO to Develop Joint Patent Classification System").

The two offices noted that the CPC launch package includes the complete CPC scheme, 59 of the 625 final CPC definitions, and a CPC-to-IPC concordance.  CPC definitions will be available for every CPC subclass and contain a description of the technical subject matter covered in the subclass.  The CPC website can be found here.

EPO President Benoît Battistelli discussed the CPC launch on his blog at the EPO website.  Patent Docs readers may recall that USPTO Director David Kappos posted a list of twelve reasons why the USPTO is moving to the CPC on his blog earlier this year.

For additional information regarding the launch, please see:

• USPTO press release, September 28, 2012
• EPO press release, October 1, 2012

For additional information regarding this topic, please see:

• "USPTO Takes Next Step Towards Cooperative Patent Classification System," June 25, 2012
• "USPTO and EPO Launch Patent Classification Website," October 26, 2011
• "USPTO and EPO Agree to Principles of Joint Patent Classification System," February 14, 2011
• "USPTO and EPO to Develop Joint Patent Classification System," October 25, 2010

News from Abroad: EPO Codifies CJEU's Decision on Human Embryonic Stem Cells

On 8 October 2011, the Court of Justice of the European Union's (CJEU) handed down a landmark judgment on the correct interpretation of Article 6(2)(c) of the Biotechnology Directive (98/44/EC) relating to the patentability of human embryonic stem cells.

The Court of Justice's judgment

The decision excludes an invention from patentability where the technical teaching which is the subject-matter of the patent application requires the prior destruction of human embryos or their use as base material, whatever the stage at which that takes place and even if the description of the technical teaching claimed does not refer to the use of human embryos.

The EPO's position

Until recently, there has been a degree of uncertainty surrounding the EPO's stance on the CJEU's judgment, and whether the Office will align their practices by shifting to the more restrictive interpretation of the human embryonic stem cell exclusion.  A review of the EPO's recently-revised Guidelines for Examination appears to have settled the debate.  The Guidelines advise that:

A claim directed to a product, which at the filing date of the application could be exclusively obtained by a method which necessarily involved the destruction of human embryos from which the said product is derived is excluded from patentability under Rule 28(c), even if said method is not part of the claim.  The point in time at which such destruction takes place is irrelevant.

The UK IPO's position

Perhaps less surprising is the reaction of the UK IPO, which, in recognizing that it is bound by the guidance provided by the CJEU, has recently issued a Practice Note for inventions involving human embryonic stem cells.  The relevant passage of the Note advises that:

[T]he Office practice will now recognise that where the implementation of an invention requires the use of cells that originate from a process which requires the destruction of a human embryo, the invention is not patentable according to paragraph 3(d) of Schedule A2 [corresponding to Article 6(2)(c) of the Directive].  For example, where the implementation of the invention requires the use of a human embryonic stem cell line the establishment of which originally required the destruction of a human embryo, the invention is not patentable.

The future

The recent guidance provided by both the EPO and the UK IPO does little more than paraphrase the Decision of the CJEU.  It is therefore hoped that the situation for biotech innovators operating in this area will become clearer as individual cases are deliberated by the EPO's Boards of Appeal and National Courts.

This report comes from European Patent Attorneys at WP Thompson & Co., 55 Drury Lane, London UK.  Further details and commentary can be obtained from Gill Smaggasgale, a partner at the firm.

News from Abroad: Australia Reforms Its Patents Act 1990

By Craig Humphris & David McCarthy --

Australia is attempting to raise its patentability threshold and specification requirements.  Significant amendments have been made to Australia's patent laws through enactment of the Intellectual Property Laws Amendment (Raising the Bar) Act 2012.  Most provisions will take effect from 15 April 2013.

The Raising the Bar Act, which was enacted on 15 April 2012, seeks to raise the quality of granted patents to a level that is more consistent with the standards set with Australia's major trading partners, including the U.S., Japan, and Europe.  Prior to this Act, concerns were expressed in the 2008 review of the national innovation system (entitled 'Venturous Australia') and the Government's response to this review (Powering Ideas: the innovation agenda for the 21st century, 12 May 2009), that the thresholds set for the grant of a patent in Australia are too low, patents are granted for inventions that are not sufficiently inventive, and that the details of inventions are not sufficiently disclosed to the public.

The Raising the Bar Act intends to raise the requirements for patentability and the requirements for patent specifications for all applications filed after 15 April 2013, and for patent applications filed prior to that date for which an examination request has not been filed prior to 15 April 2013.

A number of actions are available to patent applicants to ensure that the current and perhaps more lenient patentability and specification requirements apply to their applications and future patent grants.

• File patent applications, including national phase applications, and request examination before 15 April 2013.

• If a PCT application has not been filed, consider filing a Convention application in Australia and request examination before 15 April 2013.

• Instead of filing a provisional application to obtain a priority date, file a complete application and request examination before 15 April 2013.

• Add all new subject matter to description/examples before 15 April 2013.

• File divisional applications and a request for examination before 15 April 2013.

• File divisional applications from opposed applications before 15 April 2013.

• If desired, convert pending applications to a divisional application before 15 April 2013

Future granted patents will still be litigated under the current patentability and specification requirements if the application was filed and had examination requested before 15 April 2013.

FURTHER INFORMATION

The key amendments made by the Raising the Bar Act are as follows:

Schedule 1 – Raising the quality of granted patents

Inventive Step

Currently, only common general knowledge from Australia is taken into account in determining what is common general knowledge for the purposes of assessing inventive step.  Under the Raising the Bar Act, common general knowledge from overseas (that is, without a territorial limitation) can also be taken into account and this will permit the use of foreign experts who have given evidence in overseas proceedings.

Previously, only information 'ascertained, understood and regarded as relevant' was considered in a review of prior art for the assessment of inventive step.  Under the Raising the Bar Act, all information in existence in Australia or overseas can be considered prior art, provided it is capable of being understood and regarded as relevant.  This should increase the volume of prior art taken into account when assessing inventive step.

Sufficiency

The level of disclosure required for provisional applications will be increased and will require a similar level of disclosure required for complete specifications, although provisional applications need not disclose the best method of performance of the invention.

Complete applications will have their disclosure requirements changed.  The law will be amended to conform substantially to the corresponding United Kingdom provision and the new provision states that the complete specification must "disclose the invention in a manner which is clear enough and complete enough for an invention to be performed by a person skilled in the relevant art".  The explanatory memorandum to the Raising the Bar Act, indicates that the subject matter of a claim should be enabled across its "whole width".

Fair Basis

Australia's requirement that a claim needs to be 'fairly based' on matter disclosed in the specification will be replaced with a 'supported by' requirement.

Under the new law, there must be basis in the description for each claim.  Further, the scope of the claims must not be broader than is justified by the extent of the description, drawings, and contribution to the art.  This second aspect of the support requirement appears to be intended to provide a means for rejecting unduly speculative claims.

Currently, it appears settled by the Australian High Court (the supreme court in Australia's court hierarchy) following its decision in Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2004) 217 CLR 274, that there is no link between claim scope and technical contribution in the art.  The Raising the Bar Act attempts to change this and seeks to import a link between these two elements.

Utility

The Raising the Bar Act introduces a new provision which will require a complete specification to disclose a "specific, substantial and credible use" for the invention.  This provision was based substantially on the corresponding US section.  This requirement for a specification to disclose a use for the invention is additional to the requirement for the invention itself to be useful, in the sense of meeting the promise of the invention as described in the specification.

Examination

Under the new system, patent examiners will be able to consider utility and prior use at the examination stage.  These grounds are not available to examiners under the current system.

The standard of proof to be applied by an examiner for all examination tests will be raised to the civil standard (balance of probabilities).  Currently, an Examiner is required to accept a patent application 'unless it appears practically certain' or 'clear' that the patent would be invalid.  Under the new laws, the Examiner will need to be satisfied on the balance of probabilities that a patent would be valid.  These changes will shift more burden on the applicant to show patentability.

Re-Examination

Australia's ex parte re-examination procedure before the patent office (IP Australia) will be modified.  Currently, re-examination only considers the grounds of novelty and inventive step.  However, from 15 April 2013, re-examination will be extended to include the grounds of best method, clarity, fair basis, manner of manufacture, and utility.

Amendments

The amendment provisions will be modified to prevent applicants from adding subject matter to their applications, except when the amendment is to correct an obvious mistake or clerical error.  Whether subject matter has been added is made with reference to the complete specification as filed, as well as "other prescribed documents (if any)".

Schedule 2 – Free access to patented inventions for regulatory approvals and research

Regulatory Exemption

Under the current system, exemption from patent infringement is allowed for use of a patented invention solely connected with generating information for submission to a drug regulation authority for seeking regulatory approval of a pharmaceutical.

From 15 April 2013, exemptions from patent infringement will be broadened beyond pharmaceutical products and will be provided for use solely connected with generating information for seeking regulatory approval for any product.  These changes will be most relevant to certain medical device products and agricultural products that require regulatory approval before market launch.

Experimental use exemption

Australia has now codified an experimental use exemption to patent infringement.

The provision was made effective on 15 April 2012 and applies to acts done for experimental purposes relating to the subject matter of the invention, including:

• Determining the properties of an invention;

• Determining the scope of a claim relating to the invention;

• Improving or modifying the invention;

• Determining the validity of a patent or of a claim relating to the invention; or

• Determining whether the patent would be/has been infringed by the doing of an act.

Schedule 3 – Reducing delays in resolution of patent applications

Divisional Applications

Other significant amendments introduced by the Raising the Bar Act, include changes to practice on divisional applications (Australian divisional applications are often seen as equivalent to U.S. continuation applications).

(1)   Under the current system, it is possible to file divisional applications from applications under opposition (Australia has a post acceptance, pre-grant, third party opposition procedure).  The practice of filing divisionals from applications under opposition is a useful tactic by patent applicants who want to maintain a live application in case the parent application is successfully opposed or substantially narrowed.  From 15 April 2013, it will no longer be possible to file divisional applications from applications under opposition or at the end of the opposition period (3 months from advertisement of acceptance).

Furthermore, under the current system, it is possible to withdraw an opposed application at any time and pursue a divisional application.  The applicant can also wait to see the evidence from the opponent before making a decision to pursue this option and withdraw.  However, under the new system, patent applicants will require the Commissioner's consent to withdraw an opposed application and consent is likely to be withheld if all other divisional applications are removed.

(2)   From 15 April 2013, it will also no longer be possible to convert an application to a divisional or innovation patent off an earlier filed application, e.g., to overcome novelty or inventive step rejections from own application.

Under the current system, where a novelty objection is raised against an applicant's invention citing their own earlier application, the applicant could overcome the objection by converting the later application to make it a divisional of the earlier application.  The Raising the Bar Act will close this option.

Mr. Humphris is a Senior Associate with Wrays and team leader of Wrays' Adelaide office.  Dr. McCarthy is an Associate with Wrays.

News from Abroad: Recent Amendments to the Israel Patent Statute

Pulling the Pace of Prosecution from the Purview of the Applicant

By Daniel Feigelson --

Most readers of this blog are familiar with the situation in which you or your client files a patent application before the invention is ready for commercialization, e.g., the chemical process described therein is still being optimized, or FDA approval will only occur in the (distant) future, or there's not enough investment capital yet to develop the product to a stage ready for launch.  If you're only filing in the USA, you can request that the application not be published, and thus preserve some of your competitive advantage; but let's suppose that that’s not an option here.  So at 18 months from priority, your application publishes.

Now suppose that a competitor sees your published application and submits prior art to the patent office, with comments explaining the relevance of the prior art.  This hasn't been possible in the USA until now, but in accordance with the AIA and the new rules just published by the USPTO, it will become a possibility as of September 16; and for many years it has been possible to make such submissions before the EPO, anonymously.  So although you're not thrilled with the idea of third party participation in the prosecution of your patent application, it's not the end of the world either.

Let's further suppose that the examiner relies on some of the arguments submitted by your competitor and issues an OA in which he says the claimed invention is obvious.  Now let's throw a wrench or two into the works.  First, let's take away your ability to obtain extensions to respond.  If the applicant wants to present evidence of non-obviousness, for example comparative test results, the lack of extensions may put a crimp in those plans, necessitating the premature filing of less-than-ideal responses and ultimately the filing of continuations.  But let's complicate things more:  let's say that instead of the application having waited around the USPTO until its turn for examination arrived -- normally a period of a year or more, time that you could have put to use commercializing the invention -- the examiner picked it up for examination almost immediately after publication.

Moreover, when, several years and several continuation filings later, you finally get a Notice of Allowance and pay the issue fee, a new type of pre-grant inter partes proceeding has been enacted:  the pre-grant opposition.  So the same competitor who (anonymously) submitted prior art now opposes the grant of the patent, during which time you don't have a patent with which to obtain injunctions.  Years later, after the PTO sides with you and all appeals have been exhausted, the patent finally issues -- but there's no provision in the statute to adjust the term of the patent for the delay during the pre-grant opposition period.

The enactment of the AIA notwithstanding, the situation in the USA isn't as bad for patent applicants as the one described above.  But the foregoing scenario encapsulates the current situation in Israel following the adoption on July 9 of a set of amendments to the Israel patent statute.  Pre-grant oppositions, and lack of patent term adjustment to compensate for reduction in the 20-years-from-filing patent term due to patent office delays or delays in grant due to oppositions, have been a part of the patent scene in Israel since the current statute was enacted in 1967.  The principal changes wrought by the current batch of amendments are (a) 18-month publication, (b) submission of prior art by third parties, and (c) third party requests for expedited examination of patent applications.  Taken together with the existing pre-grant opposition procedure, these changes, especially the last one, will make Israel an excellent forum in which to experiment with competitors' patent applications, particularly in the pharmaceutical field.

The provisions for 18-month publication are uncontroversial; as Israel has been a member of the PCT since 1996, early publication of locally filed applications has been long overdue.  18-month publication is accompanied by a provision similar to that in US law, namely that to the extent a granted claim is substantially the same as a claim published at 18 months, after grant of the patent the patentee may sue for infringement retroactively to the date of the publication and recover a reasonable royalty for infringement that occurred between publication and grant.  This represents a change from the law in Israel until now, in which the patent statute provided no recourse for infringing activities that occurred prior to grant of the patent.  PCT applications that enter the national phase are to be published within 45 days of national phase entry, and although strictly speaking this should apply to applications that enter the national phase before the 18-month period has passed, in a recent announcement the ILPTO indicated that it would only publish national phase applications after the PCT application itself is published, i.e., after 18 months from the earliest priority date.

The provisions for submission of prior art by third parties were added to the bill primarily as a result of lobbying by the Israeli generic drug industry, which includes both companies that sell only locally as well as companies with a global reach.  However, due to opposition by the Israel PTO, which did not want to be inundated with third-party comments on prior art, the window for submitting such art is fairly narrow:  such requests may only be filed within two months from the date on which the applicant replies to the ILPTO’s initial request for publications cited in corresponding applications.

The real mischief in the amendments comes with the third party requests for expedited examination of patent applications (TPREEs).  Israel already had a mechanism for applicants to expedite examination of their applications (for example due to the inventor/applicant's age or poor health, infringement of the invention or the applicant's imminent launch of a product).  The idea to extend the ability to make such requests to third parties was the brainchild of the generic pharmaceutical lobby, which asserted that with the adoption of 18-month publication, its members would be left in legal limbo, knowing what the application claimed and possibly being on the hook for infringement of those claims, but not knowing what claims would eventually be granted (and thus what activities would be precluded).  By enabling TPREEs -- so went the proponents' reasoning -- third parties likely to be affected by the patent can ascertain earlier than they otherwise would the activities in which they may and may not engage.

And so was born a new section of the statute (19A(c)) that in unofficial translation reads as follows:

(c)    A person who is not the applicant, is not connected to the applicant does not act on his behalf, may submit to the Registrar a reasoned request, accompanied by a declaration to support the facts, for expedited examination of an application that has been published under section 16A [i.e. 18-month publication – DJF], if one of the following conditions is fulfilled:

(1)    There is a basis for a suspicion that examination of the patent application in accordance with the order in which it was filed will cause the applicant for expedited examination in accordance with this sub-section, who deals in the field of the invention, to defer development or production of a product or process that is claimed in the patent application;

(2)    the time that has passed since the submission of the patent application to the PTO under section 15 or its entry into the national phase under section 48D is unreasonably long, and included in this, is significantly longer in comparison to the time that has transpired until the commencement of examination of other applications of the same class;

(3)    the public good;

(4)    there are special circumstances that justify it.

Even upon first reading, many readers will no doubt have questions regarding the exact meaning and scope of some of the wording of 19A(c), e.g., what does it mean that a party is "not connected to the applicant."  Nevertheless, since the whole point of a patent is to be able to exclude others from making or using the claimed invention, it's clear that almost anyone who competes with the applicant will have standing to file a TPREE, since that third party will be able to say with a straight face that it has to defer the development or production of a product or process while the application is being examined.  The upshot is that if you have a competitor in Israel -- and why would you file a patent application in Israel if you didn't have a competitor here? -- that competitor will probably be able to request that your application be examined immediately.

Moreover, if the PTO has granted the TPREE, new section 19A(e) says that no extensions will be given to the applicant to respond to OAs and the like, "unless the Registrar found that the extension was necessary for reasons that neither the applicant nor his attorney had control over or the ability to prevent."  This is in contrast to the present situation, in which up to 15 months of extensions may be obtained during ex parte prosecution without a show of cause.

So now patent applicants in Israel may be at the mercy of their competitors when it comes to controlling the timing of patent prosecution.  That may force applicants to spend resources on patent prosecution in a manner different than they had planned to, and possibly to disclose information earlier than they would like to (or even to disclose information that they had planned to keep secret altogether).

Where things have the potential to move from mischievous to insidious is when the TPREE is combined with a pre-grant opposition.  Unlike the poorly-named "inter partes reexamination" in the USA, in which the requestor's participation is limited, and in contrast to post-grant oppositions at the EPO in which there is almost never live testimony, pre-grant patent oppositions in Israel are full-blown inter partes proceedings, in which direct evidence is offered by way of affidavit or expert opinion, with the affiant or expert being subject to cross-examination in a hearing at the ILPTO.  The real utility of TPREEs is thus not to facilitate the speedy grant of a patent, but to enable the opposition to begin earlier.  For Israeli companies that operate globally, this will provide an opportunity for a sneak peak at the patentee's arguments and data, in a relatively low-cost manner (discovery in oppositions is far more circumscribed than in court proceedings in the USA) so that when the time comes to do battle in the jurisdictions that matter -- the USA and the EU -- the Israeli companies will be better prepared.

Unlike the other amendments, the provisions for TPREEs will not take effect until January 12, 2013, and the statute does allow for a fee to be set for a TPREE.  However, even if the fee is set relatively high by local standards -- say on the order of $10,000 -- it is expected that many, if not most, applications filed by innovator pharma and biotech companies will be subject to such requests.

However, it is also expected that the TPREE provisions will be subject to legal challenge.  To give one example, Israel's Supreme Court, acting in its capacity as High Court of Justice (a court of first instance set up by the British to deal with administrative law in Mandatory Palestine, now perpetuated in the form of the Israel Supreme Court which also sits as the HCJ) has determined that the right to property is a fundamental right.  A challenge to the TPREE may therefore be advanced on the grounds that the ability to control the rate of prosecution of one's patent application is such a property right, since patent prosecution involves the allocation of capital and resources.  Another example of a likely legal challenge arises from the fact that nothing in the amendments explicitly requires the third party requestor or the ILPTO to notify the applicant that a TPREE has been filed, let alone to give the applicant an opportunity to respond to the request.  There is another section of the statute, section 159, that could be read as giving the applicant the right to respond, but if the ILPTO decides that that section doesn't apply here, the TPREE amendment is likely to be challenged as denying due process.  (If the ILPTO decides that section 159 does apply, look for a third party requestor to challenge the ILPTO's interpretation.)

Even if the TPREE provisions withstand Supreme Court scrutiny, there are steps that applicants may take to minimize the likelihood that their applications will be subjected to a TPREE.  To mention an obvious one, an applicant could file an application in Israel with a set of claims that are fully supported by the specification, but concomitantly file a preliminary amendment that reduces the number of claims to one very narrow claim.  This would limit the ability of third parties to file TPREEs on the grounds that examination of the application will "defer development or production of a product or process that is claimed in the patent application."  While it wouldn't eliminate the other three grounds for making a TPREE, those grounds will likely be more difficult to demonstrate.  The applicant would then be able to re-introduce the canceled claims later, once substantive examination has commenced.

Experienced patent prosecution practitioners will no doubt appreciate other ways, short of abstaining from filing in Israel, to lessen the likelihood of a TPREE being filed or granted.  That's important, because the antipathy to patents that seems to be increasingly fashionable in the USA hasn't yet taken root in Israel.  Although the present amendments raise the risks to the applicant during the patent procurement process, they don't lessen the value of an issued Israel patent:  once parties have patents in hand, Israeli courts are still willing to enforce them.

It is unfortunate that during adoption of the TPREE provisions, the discussion in the Knesset committee focused solely on the pharmaceutical industry, as if there are no other industries that could be adversely affected by the TPREE provisions, which appear to be a uniquely Israeli invention.  While Israel has produced only a handful of new drugs of its own but is home to a thriving generic drug industry that will not be harmed by the TPREE provisions (and only stands to benefit from these in combination with pre-grant oppositions), Israel is also home to many start-ups and many high-tech companies, a reflection of the creativity and smarts that abound in Israel.  Enabling competitors to speed up the rate of prosecution of those companies' patent applications may lead to sub-optimal or even no patent protection for those companies' innovations, ultimately resulting in less innovation, non-growth and non-creation of jobs, and lower tax revenues than the state would otherwise have had.

Mr. Feigelson is a practitioner with 4th Dimension IP and the author of the America-Israel Patent Law blog.

USPTO Expands and Extends Patent Prosecution Highway Programs

By Donald Zuhn --

Since implementing its first Patent Prosecution Highway (PPH) program with the Japan Patent Office (JPO) on July 3, 2006, the U.S. Patent and Trademark Office had established some thirty PPH programs with more than twenty other patent offices.  The USPTO recently increased the number of PPH programs (full or pilot) to thirty-three by establishing a PPH pilot program based on Patent Cooperation Treaty (PCT) work products (PCT-PPH) with the Israel Patent Office (ILPO), and the number of offices with which it has PPH programs to twenty-three by establishing a PPH pilot program with the Colombian Superintendence of Industry and Commerce (SIC).  In addition, the USPTO continued two other PPH programs -- PCT-PPH pilot programs with IP Australia and the Nordic Patent Institute (NPI) -- and fully implemented two other PPH programs -- a PPH program with ILPO and a PCT-PPH program with the Korean Intellectual Property Office (KIPO).

Last week, the USPTO announced the establishment of a new Patent Prosecution Highway (PPH) pilot program with the Colombian Superintendence of Industry and Commerce (SIC).  As with other PPH programs, the USPTO-SIC PPH will permit an applicant having an application whose claims have been allowed in one of the offices to fast track the examination of an application in the other office, such that the latter application is examined out of turn.  In particular, an applicant receiving a ruling from either the USPTO or SIC that at least one claim in an application is patentable may request that the other office fast track the examination of corresponding claims in the corresponding application in that office.  The USPTO-SIC PPH pilot program, which will begin on September 1, 2012, is scheduled to expire on August 31, 2013, but may be extended for up to one year or terminated earlier depending on volume of activity and other factors.  The USPTO's notice regarding the USPTO-SIC PPH pilot program, including requirements for participation in the program, can be found here.

Earlier this month, the USPTO announced that it would be launching a new Patent Prosecution Highway (PPH) pilot program with the Israel Patent Office (ILPO) on August 1, 2012.  The pilot program will apply to qualifying patent applications filed under the Patent Cooperation Treaty (PCT).  Under the USPTO-ILPO PCT-PPH, an applicant receiving a positive written opinion or a positive international preliminary report in a PCT application where the USPTO or ILPO was the International Searching Authority or the International Preliminary Examination Authority may request that the other office fast track the examination of corresponding claims in corresponding applications.  The USPTO-ILPO PPH pilot program is scheduled to expire on July 31, 2013, but may be extended for up to one year or terminated earlier depending on volume of activity and other factors.  The USPTO's notice regarding the USPTO-ILPO PCT-PPH pilot program, including requirements for participation in the program, can be found here.  While announcing the new PCT-PPH pilot program with the ILPO, the USPTO also announced that it was fully implementing the PPH program with the ILPO, effective July 1, 2012.  The USPTO's notice regarding the USPTO-ILPO PPH program, including requirements for participation in the program, can be found here.

The USPTO also announced earlier this month the continuation of a current PPH pilot program with the ILPO (see notice) and a PPH pilot program based on Patent Cooperation Treaty (PCT) work products (PCT-PPH) with the NPI (see notice).  Both PPH programs have been extended indefinitely.

Finally, the USPTO announced in late June that the USPTO and KIPO had agreed to fully implement their PCT-PPH program on a permanent basis starting on June 1, 2012.  The USPTO noted that "[t]he results of the [USPTO-KIPO] PCT-PPH pilot program showed that applicants have been able to expeditiously obtain a patent at an early stage by utilizing petition to make special procedures," and that "the USPTO and the KIPO have been able to reduce duplication of search efforts by exploiting the search and examination results in PCT applications to the maximum extent practicable."  The USPTO's notice regarding the USPTO-KIPO PCT-PPH program, including requirements for participation in the program, can be found here.

With the addition of the above programs, the USPTO has twenty-one PPH programs (full or pilot) in place with IP Australia (IP AU), the Austrian Patent Office (APO), the Canadian Intellectual Property Office (CIPO), China's State Intellectual Property Office (SIPO), the Colombian Superintendence of Industry and Commerce (SIC), the Danish Patent and Trademark Office (DKPTO), the European Patent Office (EPO), the National Board of Patents and Registration of Finland (NBPR), the German Patent and Trade Mark Office (DPMA), the Hungarian Intellectual Property Office (HIPO), the Icelandic Patent Office (IPO), the Israel Patent Office (ILPO), the Japan Patent Office (JPO), the Korean Intellectual Property Office (KIPO), the Mexican Institute of Industrial Property (IMPI), the Norwegian Industrial Property Office (NIPO), the Russian Federal Service for Intellectual Property, Patents and Trademarks (ROSPATENT), the Intellectual Property Office of Singapore (IPOS), the Spanish Patent and Trademark Office (SPTO), the Taiwan Intellectual Property Office (TIPO), and the United Kingdom Intellectual Property Office (UK IPO).  The USPTO has also established twelve PCT-PPH programs with other patent offices:  IP AU, APO, SIPO, EPO, NBPR, ILPO, JPO, KIPO, the Nordic Patent Institute (NPI), ROSPATENT, SPTO, and the Swedish Patent and Registration Office (PRV).  Additional information regarding the various PPH and PCT-PPH programs, as well as links to the appropriate request forms to be used for each program, can be found here.

European Court of Justice Rules Supplementary Protection Certificates Available for "New Medical Use"

By Kevin E. Noonan --

Again in only the span of a few months, the views of the Advocate General of the European Court of Justice (ECJ) have been adopted by Court.  Previously, this pattern resulted in a ban on patenting human embryonic stem cells (see "European Court of Justice Renders Stem Cell Decision").  Last Thursday, the Court agreed with the AG that Supplementary Protection Certificates (SPCs) should be made available for new pharmaceutical uses for known products, providing innovator drug companies with an additional five years of patent protection under circumstances where patent term had been running during the time taken for regulatory approval.

The case came to the ECJ from the UK Court of Appeals, after the Intellectual Property Office (IPO) rejected grant of an SPC to Neurim Pharmaceuticals Ltd., which had developed a formulation of melatonin for treating insomnia.  (Melatonin, produced in the pineal gland, has long been known to be involved in maintaining circadian rhythms in animals including humans.)  In this case, the grounds for the IPO's denial of SPC protection was a previous approval of a different melatonin formulation for use in sheep breeding; under the IPO's interpretation of the law, the sheep use constituted a "first medical use" of the compound, thus precluding grant of an SPC on the insomnia formulation to Neurim.

Five Questions were Presented to the ECJ from the UK Court of Appeals:

1.  In interpreting Article 3 of Regulation 469/2009 ("the SPC Regulation") when a marketing authorisation (A) has been granted for a medicinal product comprising an active ingredient, is Article 3(d) to be construed as precluding the grant of an SPC based on a later marketing authorisation (B) which is for a different medicinal product comprising the same active ingredient where the limits of the protection conferred by the basic patent do not extend to placing the product the subject of the earlier MA on the market within the meaning of Article 4?

2.  If the grant of the SPC is not precluded, does it follow that in interpreting Article 13(1) of the SPC Regulation, "the first authorisation to place the product on the market in the Community" needs to be an authorisation to place a medicinal product on the market within the limits of the protection conferred by the basic patent within the meaning of Article 4?

3.  Are the answers to the above questions different if the earlier marketing authorisation has been granted for a veterinary medicinal product for a particular indication and the later marketing authorisation has been granted for a medicinal product for human use for a different indication?

4.  Are the answers to the above questions different if the later marketing authorisation required a full application for marketing approval in accordance with Article 8 (3) of Directive 2001/83/EC (formerly a full application under Article 4 of Directive 65/65/EEC)?

5.  Are the answers to the above questions different if the product covered by authorisation (A) to place the corresponding medicinal product on the market is within the scope of protection of a different patent which belongs to a different registered proprietor from the SPC applicant?

In May, Advocate General Verica Trstenjak promulgated an Opinion on the matter, concluding that a proper interpretation of the law would entitle Neurim to an SPC on its insomnia formulation.  The Opinion was set forth as a response to a request for clarification of the law from the UK IPO.  The Opinion cast the inquiry as whether "authorisation to place the product on the market as a medicinal product within the meaning of letter (b) must be the first authorisation to place that product on the market as a medicinal product."  The Opinion also set forth the relevant provisions of the law:

Article 1 of Regulation No 1768/92, which is entitled 'Definitions', provides:

'For the purposes of this Regulation:

(a)    "medicinal product" means any substance or combination of substances presented for treating or preventing disease in human beings or animals and any substance or combination of substances which may be administered to human beings or animals with a view to making a medical diagnosis or to restoring, correcting or modifying physiological functions in humans or in animals;

(b)    "product" means the active ingredient or combination of active ingredients of a medicinal product;

(c)    "basic patent" means a patent which protects a product as defined in (b) as such, a process to obtain a product or an application of a product, and which is designated by its holder for the purpose of the procedure for grant of a certificate;

(d)    "certificate" means the supplementary protection certificate;

3.    Articles 3 to 5 of Regulation No 1768/92 read as follows:

'Article 3 – Conditions for obtaining a certificate

A certificate shall be granted if, in the Member State in which the application referred to in Article 7 is submitted and at the date of that application:

(a)    the product is protected by a basic patent in force;

(b)    a valid authorisation to place the product on the market as a medicinal product has been granted in accordance with Directive 65/65/EEC or Directive 81/851/EEC, as appropriate;

(c)    the product has not already been the subject of a certificate;

(d)    the authorisation referred to in (b) is the first authorisation to place the product on the market as a medicinal product.

Article 4 – Subject-matter of protection

Within the limits of the protection conferred by the basic patent, the protection conferred by a certificate shall extend only to the product covered by the authorisation to place the corresponding medicinal product on the market and for any use of the product as a medicinal product that has been authorised before the expiry of the certificate.

Article 5 – Effects of the certificate

Subject to the provisions of Article 4, the certificate shall confer the same rights as conferred by the basic patent and shall be subject to the same limitations and the same obligations.'

4.    Article 7 of Regulation No 1768/92, which is entitled 'Application for a certificate', provides:

'1.    The application for a certificate shall be lodged within six months of the date on which the authorisation referred to in Article 3(b) to place the product on the market as a medicinal product was granted.

2.    Notwithstanding paragraph 1, where the authorisation to place the product on the market is granted before the basic patent is granted, the application for a certificate shall be lodged within six months of the date on which the patent is granted.

5.    Article 13 of Regulation No 1768/92, which is entitled 'Duration of the certificate', provides:

'1.    The certificate shall take effect at the end of the lawful term of the basic patent for a period equal to the period which elapsed between the date on which the application for a basic patent was lodged and the date of the first authorisation to place the product on the market in the Community reduced by a period of five years.

2.    Notwithstanding paragraph 1, the duration of the certificate may not exceed five years from the date on which it takes effect.

In its synopsis of the facts, the Opinion sets forth the claim of Neurim's European Patent for which the SPC was requested:

A pharmaceutical formulation, for use in correcting a melatonin deficiency or distortion in the plasma melatonin level and profile in a human subject, which comprises melatonin in combination with at least one pharmaceutical carrier, diluent or coating, wherein the melatonin is present in the formulation in controlled-release form adapted to release melatonin following administration to a human patient, over substantially the whole of a single nocturnal period of at least about 9 hours, such that melatonin release occurs according to a profile which, taking into account the existing nocturnal profile, simulates a normal human endogenous melatonin nocturnal profile in plasma, in that administration of the formulation at the beginning of said at least about 9 hour single nocturnal period causes melatonin to be detectable in the plasma in an amount which increases to a peak in the course of said period and subsequently decreases to a post-peak minimum essentially at the end of said period.

Market authorization in Europe was granted in 2007 for Neurim's product (Circadin), 15 years after Neurim filed its patent application thus leaving only five years of term for its patent.

The Opinion also described the parties submitting written observations and oral argument before the ECJ:  Neurim Pharmaceuticals, the United Kingdom Government, the Portuguese Government, and the European Commission.  The Commission and Neurim argued that Article 3d does not preclude grant of an SPC on a "medicinal product comprising an active ingredient where an earlier marketing authorisation (A) has been granted which is for a different medicinal product comprising that active ingredient" (with the caveat that the "limits of the protection" from the "basic patent" would not "extend to the medicinal product the subject of the earlier marketing authorization" and all other requirements of Article 3 are met).  The UK and Portuguese governments took the position that a "second" SPC should not be granted on a medicinal product where the active ingredient had previously been the subject of an SPC.

Advocate General Trstenjak addressed the first question by considering a "literal interpretation" of the language of the regulation, and then assessing the result to determine whether it is consistent with "the schemes and objectives" of the SPC regulations to come to her conclusion as to the first Question Presented.  In this analysis, the AG determined that the literal meaning of the words of the regulation would preclude grant of a subsequent SPC where a previous SPC had been granted on a medicinal product containing the same active ingredient.  However, the AG then determined that such a result would be contrary to the "schemes and objectives" of the regulation.  Specifically, the AG noted that is was certainly the case that the same active ingredient could be the subject of patent protection for different formulations and uses, as was the case here:  Neurim had a patent for its Circadin insomnia forumation and Hoechst had a patent for its Regulin product for use in sheep breeding (which had expired in 2007).  As a consequence, the AG's Opinion states that "[i]t must therefore be assumed that, in principle, Article 3(a) permits the grant of more than one supplementary protection certificate for a product."  The AG reached the same conclusion with regard to Article 3(b), because that Article provides for market approval for, inter alia, human and veterinary uses.  The AG's Opinion thus concludes that "Article 3(b) also permits, in principle, multiple supplementary protection certificates for products which are used as active ingredients in different medicinal products."  While Article 3(c) by its plain wording would seem to preclude grant of a subsequent SPC on an active ingredient that had received a prior SPC, the AG concluded that "requirement may not be construed as meaning that only one supplementary protection certificate could be granted for a patented active ingredient or for a patented combination of active ingredients" in view of the ECJ's case law.  Because there is thus a "common feature" of Articles 3(a), (b) and (c), the AG concluded that "the schematic context" of Article 3(d) also suggests that this Article would also permit grant of more than one SPC.

The AG then discussed "teleological" considerations, that is, directed at a consideration of the purpose of the SPC regulations.  Here, the AG noted that "the aim of granting supplementary protection certificates for medicinal products is essentially to extend the term of patent protection for active ingredients used in medicinal products."  Recognizing that protracted regulatory approval proceedings can seriously reduce the patent term remaining when regulatory approval is finally achieved.  The AG appreciates the "view of the European Union legislature" to be that SPCs are needed and granted to remedy the insufficiencies in patent protection occasioned by these long delays in regulatory approval.  Thus:

Those rules [i.e., the SPC Regulations] are intended to achieve a balance between the various interests at stake in the pharmaceutical sector.  Those interests include, on the one hand, the interests of the undertakings and institutions, some of which pursue very cost-intensive research in the pharmaceutical sector and therefore favour an extension of the term of protection for their inventions in order to be able to balance out the investment costs.  On the other hand, there are the interests of the producers of generic medicines who, as a consequence of the extension of the term of protection of the active ingredients under patent protection, are precluded from producing and marketing generic medicines.  It is also relevant in this connection that, in general, the marketing of generic medicinal products has the effect of lowering the prices of the relevant medicinal products.  Against that background, the interests of patients lie between the interests of the undertakings and institutions conducting research and those of the producers of generic medicines.  That is because patients have an interest, on the one hand, in the development of new active ingredients for medicinal products, but, on the other, they also have an interest in those products then being offered for sale as cheaply as possible.  The same applies to State health systems in general which, in addition, have a particular interest in preventing old active ingredients from being brought onto the market in slightly modified form under the protection of certificates but without genuine innovation and thereby artificially driving up expenditure in the health sector.

Applying these factors to the case before the Court, the AG recommended that the "absolute preclusive effect" resulting from a prohibition of a subsequent SPC to Neurim for its Circadin product "would be not compatible with the objectives of [the SPC] Regulation[]."  Conversely, granting an SPC under these circumstances is consistent with Article 54(5) of the European Patent Convention (EPC), which "expressly recognises the patentability of 'second and further medical uses' of substances whose use in other medical processes already forms part of the state of the art."  In the AG's view, "it would therefore be contrary to the aims of Regulation No 1768/92 if, in a case like the main proceedings, an application for a supplementary protection certificate would inevitably be unsuccessful because the patented active ingredient has already been placed on the market in another medicinal product."  The AG emphasizes that the prohibitions of Article 3(c) remain, that "prohibit the grant of more than one certificate for each basic patent" (emphasis in original).

The AG then recognized that while her Opinion is consistent with one line of cases in the ECJ (including Medeva, Georgetown Unversity and Others, and AHP Maufacturing), it is inconsistent with other cases where the ECJ has interpreted the law more stringently.  These cases include Synthon, and Generics (UK), but the AG appears to believe that the Opinion is more consistent with the "first line" of ECJ cases and thus is a sound legal representation.

The AG rendered a recommendation on Questions 2 through 5 more summarily, stating that the term of the SPC for the subsequent approved use is to be made using the same rubrics and limitations as any other SPC.  Question No. 3 the AG answered in the negative, because the "crucial question" is that the product seeking a subsequent SPC does not fall under the scope of any "basic patent" for which a previous SPC was awarded.  Similarly, the fourth and fifth questions were not deemed particularly relevant in view of the AG's recommendations on the first three Questions.

The AG thus concluded that:

[A] supplementary protection certificate for a product which is protected by a basic patent in force may be granted only on the basis of the first authorisation which permits that product to be placed on the market as a medicinal product which is within the scope of protection conferred by the basic patent in the Member State for which the application is made.  The fact that the same product has previously been authorised as a medicinal product for human use or a veterinary medicinal product in the Member State for which the application is made does not preclude the grant of a supplementary protection certificate based on a later authorisation to place that product on the market as a new medicinal product, provided the first-authorised medicinal product is not within the scope of protection conferred by the patent designated by the applicant as the basic patent.

The ECJ's decision to follow the AG's recommendation, while coming as no surprise, certainly changes the landscape for the better for pharmaceutical patents and products in Europe.  It is frequently the case that new uses can be found for old, well-established and characterized drug compounds, and extending the benefit of SPC protection can be expected to shift the investment scales to encourage such new uses.  In a world where the drug pipeline from traditional pharmaceutical companies has dwindled, these considerations may prove crucial to addressing previously unmet medical needs.

The Aussies Are At It Again

    By Kevin E. Noonan --

Last year, the Australian Senate rejected a call for banning patents on human genes in Australia.  This result came after almost a decade of debate, resulting in several Reports (including the 2011 ACIP Report on Patentable Subject Matter, the Senate Gene Patents Report, issued November 24, 2010, and the 2004 Australian Law Reform Commission's Report on Genes and Ingenuity: Gene Patenting and Human Health (ALRC 99 Report) (see "News from Abroad: The Gene Patents Debate in Australia -- An Update").  On November 23, 2011, the Australian government released a combined report (that can be accessed here).  And the Australian Senate determined that the Australian Patent Act of 1990 should not be amended to exclude human genes as patent-eligible subject matter, pursuant to a 124-page report that recommended against passage of the Patent Amendment (Human Genes and Biological Materials) Bill 2010, which was introduced by Senators Helen Coonan, Bill Heffernan, Rachel Siewert, and Nick Xenophon (see "Australian Senate Committee Issues Recommendation on Gene Patenting Bill").

Undaunted, another Member of Parliament (Melissa Parke, the Labor representative from Fremantle, Western Australia), is reported (by Intellectual Asset Management, "Gene patent opponents take the fight back to Parliament") to be ready to introduce a bill to amend Section 18(2) of the Patents Act, as follows:

18(2)  The following are not patentable inventions:
        (a)  human being, and the biological processes for their generation;
        (b)  genetic materials that exist in nature, or are the same as or not markedly different from those existing in nature whether such materials are in situ, isolated or purified;
        (c)  any method that involve the mere comparison of genetic materials or genetic sequences in the provision of a diagnosis for a human being.
18(2)(A)  A reference in subsection (2) to genetic materials includes, but is not limited to, DNA or RNA whether in whole or part or in fragments, however made.

While wrongheaded, this proposal has a few advantages over judicial solutions that may arise in the U.S., for example.  First, it is expressly limited to genetic material, and so avoids the risk of determining that "products of nature" are somehow patent ineligible.  While this bill shares the infirmity with Congressman Becerra's thrice-rejected (or maybe more correctly, ignored) bill to ban "gene patenting" in that it encompasses more than human DNA (thus threatening cucumber or tomato gene patents as well as human ones), it does avoid the risk of finding the antibiotics, anticancer drugs, improved lubricants or silicon formulations, or antibodies (the most common form of biologic drug) would become unpatentable.  It also permits any such ban to be considered by Australia's elected representatives, rather than judges without any particular expertise in technology (some of whom are comfortable overturning the opinions of judges that do have such "special expertise").

But unlike earlier proposals (including last year's), this bill would also ban "applications" of genetic technology, albeit only those that "mere[ly] compar[e]" genetic sequences.  Such claims have already been held unpatentable in the U.S. under the Bilski and AMP v. USPTO precedent.  It is unclear whether claims further reciting other affirmative steps in identifying a sequence would fall within the scope of the proposed ban.  Also precluded from patent protection would be synthetic DNA including oligonucleotide fragments (while blessedly being devoid of a reference to a "magic microscope" as justification for the ban).  It is unclear whether cDNA would be considered "markedly different" under the bill, although this would depend on whether the chemical or informational properties of DNA are considered.

The prospect of the bill being introduced is another testament to the persistence of the anti-gene patenting proponents on the issue, reminiscent of other motivated political factions.  Whether this bill gains sufficient traction to have a chance of passage, or whether political fatigue or indifference prevent its passage will be closely monitored, here and anywhere the issue is seriously considered.

U.S. Trade Representative Issues 2012 Special 301 Report

By Kevin E. Noonan --

On Monday, the U.S. Trade Representative (USTR), Ronald Kirk, issued the 2012 Special 301 Report.  According to the USTR website, the Report "reflects the Administration's resolve to encourage and maintain effective IPR protection and enforcement worldwide."  This effort is "more significant than ever in light of recent U.S. Government data showing that IP intensive industries support as many as 40 million American jobs and up to 60 percent of U.S. exports."  "When trading partners don't protect IPR, they threaten those critical jobs and exports," according to USTR Kirk.  The USTR Report "provides a means for the United States to promote the protection and enforcement of IPR," according to the website announcement, and hails Malaysia and Spain for being removed from the Watch List for their efforts to strengthen copyright protection and combating piracy over the Internet, respectively.  On the other hand, the press release noted that the Ukraine was moved to the Priority Watch List "in light of serious and growing concerns relating to counterfeiting and rampant piracy."

The Report is promulgated pursuant to Section 182 of the Trade Act of 1974, as amended by the Omnibus Trade and Competitiveness Act of 1988 and the Uruguay Round Agreements Act (enacted in 1994).  The Trade Representative is required under the Act to "identify those countries that deny adequate and effective protection for IPR or deny fair and equitable market access for persons that rely on intellectual property protection."  The Trade Representative has implemented these provisions by creating a "Priority Watch List" and "Watch List."  Placing a country on the Priority Watch List or Watch List is used to indicate that the country exhibits "particular problems . . . with respect to IPR protection, enforcement, or market access for persons relying on intellectual property."  These watch lists are reserved for countries having "the most onerous or egregious acts, policies, or practices and whose acts, policies, or practices have the greatest adverse impact (actual or potential) on the relevant U.S. products."

This report, on the state of intellectual property rights worldwide, identifies thirteen countries on a "Priority Watch List" and another 28 countries on the "Watch List," all relating to deficiencies in intellectual property protection in these countries.  The Priority Watch List in the Report lists China, Russia, Algeria, Argentina, Canada, Chile, India, Indonesia, Israel, Pakistan, Thailand, Ukraine, and Venezuela, the same countries that were on this list in last year's Report with the addition of Ukraine.  Countries on this list "do not provide an adequate level of IPR protection or enforcement, or market access to persons relying on intellectual property protection."  On the Watch List this year are Belarus, Bolivia, Brazil, Brunei, Columbia, Costa Rica, Dominican Republic, Ecuador, Egypt, Finland, Greece, Guatemala, Italy, Jamaica, Kuwait, Lebanon, Mexico, Norway, Peru, Philippines, Romania, Tajikstan, Turkey, Turkmenistan, Ukraine, Uzbekistan, and Vietnam; compared to last year, Malaysia and Spain have been removed from the list and Lebanon and Ukraine are on the list this year.  The Report "identifies a wide range of concerns, including troubling 'indigenous innovation' policies that may unfairly disadvantage U.S. rights holders in China, the continuing challenges of copyright piracy over the Internet in countries such as Canada, Italy, and Russia, and other ongoing, systemic IPR enforcement issues presented in many trading partners around the world."  Despite these concerns, the Report evinces a desire to "work[] closely with the governments of [U.S.] trading partners [identified in the Report] to address both emerging and continuing concerns, and to build on the positive results many of these governments have achieved."

The Report notes that public response to a Federal Register Notice used to prepare the Report continued the "enhanced approach to public engagement" instituted last year, with the USTR receiving 42 comments (access to these comments is provided at www.regulations.gov, docket number USTR-2011-0021).  In addition, 12 witnesses provided testimony at a public hearing on February 23, 2012; these witnesses included "representatives of foreign governments, industry, and non-governmental organizations" (available on the USTR website).

The Report notes some "positive developments" in the past year, including copyright amendments that "significantly strengthen[ed] protection of copyrights" in Malaysia.  Also noted were the efforts by the Spanish government to enact the "Ley Sinde," described in the Report as "a law to combat copyright piracy over the Internet."  The Report states that the situation in Spain will continue to be monitored, particularly the "decriminalization [of] peer-to-peer sharing of infringing materials."  Israel was mentioned for enacting a law that protects pharmaceutical companies from "unfair commercial use" of data "generated to obtain marketing approval" of new drugs.  In the Philippines, the Report notes as a positive step promulgation of specialized procedural rules for enforcing intellectual property rights, and Russia was cited for enacting legislation creating a specialized IPR court and to "revise" criminal liability for copyright piracy.  In an "Out-of-Cycle" review, the Report removed the Savelovskiy Market from the "Notorious Markets List" resulting from a plan for stopping distribution of infringing goods.  China was mentioned in this section of the Report for establishing a "State Council-level leadership structure" for coordinating IPR enforcement in China, and states that "China's leadership committed to increased political accountability, as the performance of provincial level officials will be measured based on enforcement of IPR in their regions."  Finally, separate "free trade" agreements between the U.S. and Korea and the U.S. and Columbia were noted for "includ[ing] strong standards for the protection and enforcement of IPR rights."

Several initiatives were also mentioned.  These included the Trans-Pacific Partnership Agreement, between the U.S. and Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam; the Anti-Counterfeiting Trade Agreement (ACTA) between the U.S. and Australia, Canada, the European Union, Japan, Korea, Mexico, Morocco, New Zealand, Singapore, and Switzerland; actions by the World Trade Organization in support of IP rights; bilateral and regional initiatives, including free trade agreements and Trade and Investment Framework Agreements; and the USTR Trade Preference Program Reviews such as the Generalized System of Preferences (GSP) program relating to Russia, Lebanon, and Uzbekistan, and regional programs including the Caribbean Basin Economic Recovery Act (CBERA).  Finally, the Representative "looks forward to continuing engagement with trading partners in bilateral, regional, and multilateral fora to improve the global IPR environment"; including the U.S.-EU Summit, and in the Asia Pacific Economic Cooperation (APEC) forum, and the Organization for Economic Cooperation and Development (OECD).

The Report contains a section on "best practices" among U.S. trading partners, which include reports that "foreign governments are open and transparent in bringing about legislative or regulatory change, and where such governments ensure that there is open dialogue between government officials and affected parties"; the Czech Republic was called out specifically in this regard for its efforts, as were Hong Kong Customs officials.  Cooperation between governments is also mentioned, specifically with regard to efforts in Russia to "combat counterfeit medicines" and "innovative mechanisms" for encouraging IP rights holders to donate or license their IP were also contained in this section of the Report (specifically, the Medicines Patent Pool under the auspices of the World Health Organization and the WIPO Re:Search Consortium among the U.S., Brazil and South Africa).

There is a section of the Report this year regarding "capacity building efforts" that relate to "opportunities for the U.S. Government to work closely with trading partners to address [IPR] concerns."  These efforts are described in the Report as being directed to "building stronger, more streamlined, and more effective systems for the protection and enforcement of IPR," which seems to include an effort to encourage U.S. trading partners to enact criminal penalties for IPR infringement.  The Report documents the efforts of the USPTO's Global Intellectual Property Academy (GIPA) to provide training ("over 5,300 foreign IP officials from 138 countries through 149 separate programs") as well as programs administered by other U.S. government agencies (including the USPTO's Office of Policy and External Affairs; the International Trade Administration; the Bureau of Customs and Border Protection; the Commercial Law Development Program and programs in law enforcement administered by the Departments of Justice and Homeland Security).

A significant part of the Report focuses on "trends" in counterfeiting and copyright piracy, as it has in other years.  This area has "evolved," according to the Report, "into a sophisticated global business involving the mass production and far-reaching sales of a vast array of fake goods, including items such as counterfeit medicines, health care products, food and beverages, automobile and airplane parts, toothpaste, shampoos, razors, electronics, batteries, chemicals, sporting goods, motion pictures and music."  The Report recites a "[s]ustained growth in piracy of copyrighted products in virtually all formats," which "offer enormous profits and little risk."  Online sales of counterfeit goods "will soon surpass the volume of such goods sold" in physical markets, which raise "difficulties" for IPR enforcement.  Also noted is an increase in legitimate businesses, such as courier services, enlisted to deliver infringing goods, as well as the practice of producing the goods and the counterfeit labels separately, specifically mentioning Russia and Paraguay in this regard.  There is also an increase in the difficulty encountered by IPR holders in collecting royalties for public performances of musical works and others, particularly in the Caribbean.  The Report calls for "[s]tronger and more effective criminal and border enforcement" to reverse these trends.  Another "growing" problem is counterfeit pharmaceuticals, either final drug product or active pharmaceutical ingredients (API); Brazil, China, India, Indonesia, Lebanon, Peru, and Russia are cited as countries where the former type of counterfeiting is a problem and China is cited as being a "major source" of counterfeit APIs.

Another section of the Report is concerned with digital piracy, particularly over the Internet, which is "a significant concern in many U.S. trading partners."  "[T]his phenomenon has also made the Internet an extremely efficient vehicle for disseminating copyright-infringing products, replacing legitimate markets for rights holders."  So-called "hybrid" websites offer both pirated and counterfeit goods, creating a "one-stop-shop" for "cheap or free content or goods."  The Report asserts that the U.S. will "will work with its trading partners to combat these growing problems," and urges U.S. trading partners to "adequately implement the WIPO Internet Treaties."  The Report specifically recites a list of trading partners that includes Argentina, Belarus, Brazil, Brunei Darussalam, Canada, Chile, China, Colombia, India, Italy, Mexico, Philippines, Romania, Russia, Spain, Switzerland, Thailand, Turkey, Ukraine, Venezuela, and Vietnam in this regard, and Switzerland is "strongly encourage[d] . . . to combat online piracy vigorously."

Trade secrets and forced technology transfer are identified as problems in "a wide variety of industry sectors" that include "information and communication technologies, services, biopharmaceuticals, manufacturing, and environmental technologies."  Governments are the "problem" with forced technology transfer, which are cited for being used as a quid pro quo for access to markets, requiring the use of products or services where the IPR were locally developed or owned, or requiring disclosure of "confidential business information" in order to obtain regulatory approval.  "The United States urges its trading partners to reject such policies, says the Report, and further urges it trading partners to "take account of the increasingly cross-border nature of commercial research and development, and of the importance of voluntary and mutually agreed-upon commercial partnerships."  Strong IPR protection can "provide incentive for the voluntary transfer of critical green goods and services," providing another and timely rationale for the IPR regime.

As it has for the past few years, the Report contains a section on "Intellectual Property and Health Policy," again specifically mentioning the 2001 Doha Declaration on the TRIPS Agreement.  The Report states that the Declaration "recognized the gravity of the public health problems afflicting many developing and least-developed countries, especially those resulting from HIV/AIDS, tuberculosis, malaria, and other epidemics," and that the U.S. "respects a trading partner's right to protect public health and, in particular, to promote access to medicines for all, and supports the vital role of the patent system in promoting the development and creation of new and innovative lifesaving medicines."  Accordingly, the Report states that the U.S. "respects our trading partners' rights to grant compulsory licenses in a manner consistent with the provisions of the TRIPS Agreement, and encourages its trading partners to consider ways to address their public health challenges while maintaining intellectual property systems that promote investment, research, and innovation."  On the other hand, the Report contains a section relating to the USTR's efforts to "reduce market access barriers faced by U.S. pharmaceutical and medical device companies in many countries," specifically calling out Algeria, Finland, Germany, Greece, Indonesia, Japan, Korea, New Zealand, Poland, Turkey, and Taiwan as countries of particular concern in this regard.  In specific examples, Poland is cited for healthcare reform legislation that "would alter Poland's pricing, reimbursement, and clinical trials policies"; New Zealand, for the "policies and operation of the Pharmaceutical Management Agency; and Turkey with "the lack of fairness and the slow pace of pharmaceutical manufacturing inspections."

The Report contains in a final section a review of U.S. activities in the WTO to resolve disputes with countries such as China and the EU over trade issues.

Section II of Report is a detailed, country-by-country discussion for each country on the Priority Watch List and the Watch List, relating to the activities (or lack thereof) of each country that results in placement of that country on these lists.

As it has for the past several years (and across otherwise very different Administrations), the U.S. Trade Representative Report provides insights into both the concerns of U.S. IP rights holders and the Administration's intentions to work with, cajole, coerce, or threaten other countries to increase protection for IP rights of U.S. IP rights holders.  In contrast with last year's Report, which included an invitation to U.S. trading partners for coordinated efforts in enforcing IPR, this year the Report contains a discussion of the WTO and dispute resolution under GATT/TRIPS, including mention of President Obama's creation of the Interagency Trade Enforcement Center (ITEC) by Executive Order.  The ITEC "will serve as the primary forum within the federal government for USTR and other agencies to coordinate enforcement of obligations under international trade agreements, which can include the identification of unfair trade practices and barriers that involve IPR."  Hardly a "warm and fuzzy" approach to intellectual property rights enforcement, and one that is in stark contrast with the attitude of cooperation against a common enemy (i.e., counterfeiters) evident in last year's Report.  Perhaps the cooperative approach has not worked, but the Report does not contain any strong evidence that the cooperative approach has been given enough time to work.  The Report seems to revert to earlier attempts, generally no more than partially successful, by the U.S. and other Western governments to implement international trade treaties designed to increase IP rights protection.  It remains to be seen if that approach is continued in next year's Report, or if U.S. trade policy will continue to swing through the pendulum of the carrot or the stick regarding international intellectual property rights enforcement.

For additional information regarding this and other related topics, please see:

• "U.S. Trade Representative Releases Special 301 Report on Global IPR," May 4, 2011
• "U.S. Trade Representative Releases Special 301 Report on Global IPR," May 19, 2010
• "New Administration, Same Result: U.S. Trade Representative's Section 301 Report," May 6, 2009
• "Congressmen Criticize U.S. Trade Representative over Special 301 Report," July 1, 2008
• "U.S. Continues Efforts to Protect Patent Rights Abroad," April 29, 2008

News from Abroad: Enlarged Board of Appeal to Consider Breeding Processes Again

In March 2011, we reported on an EPO Enlarged Board of Appeal (EBA) decision on two cases involving the patentability of plant breeding processes (see "The Enlarged Board of Appeal Discusses What Makes An Invention Patentable").  In a unique turn of events, the Technical Board of Appeal (TBA) hearing one of the cases has referred it to the EBA for a second time.

The TBA refers cases to the EBA very rarely, only when a fundamental point of law needs clarification.  Once the EBA makes its decision, clarifying the point of law, it hands the case back to the TBA to continue the appeal in the light of that clarification.  For the TBA to refer the same case twice is unprecedented.

The case is an opposition to a patent for a process of breeding tomatoes, and the tomatoes produced.  The TBA referred it to the EBA to decide what the law means by an unpatentable "essentially biological process."

The EBA decision (G2/07) held that plant breeding processes which do not involve a genetic engineering step are unpatentable.

When the case returned to the TBA, the patent proprietors deleted the process claims, leaving the claims to the tomato products of that process.

The TBA decided that the EBA did not provide guidance on whether products are patentable if they are obtained by an unpatentable process.  The TBA has now referred this question to the EBA.

We do not yet know if the EBA will accept this referral.  Even if it does, it has a history of side-stepping difficult decisions, so may yet not clarify the law for users.  We will report the progress of the referral with interest.

This article was reprinted with permission from Forresters.

Record Number of PCT Applications Filed in 2011

By Donald Zuhn --

Earlier this year, the World Intellectual Property Organization (WIPO) announced that International patent filings under the Patent Cooperation Treaty (PCT) were back on the rise following the 2007-09 recession (see "PCT and EP Filings on the Rise Again").  In particular, WIPO noted that filings had risen 4.8% from 2009 to 2010.  Last month, WIPO announced that filings would be up again in 2011, and that the number of international patent filings would set a new record.  According to the WIPO announcement, an estimated 181,900 PCT applications were filed last year.  Over the past five years, PCT filings look like this:

                                 * estimate

The United States is expected to hold onto the top ranking with 48,596 2011 filings, a 8% increase from the 45,008 applications that were filed in 2010.  China again saw the strongest growth in PCT filings, with applications up 33.4% to 16,406 in 2011.  Japan, Germany, and South Korea again rounded out the remainder of the top five with filings numbering 38,888 (up 21%); 18,568 (up 5.7%); and 10,447 (up 8.0%), respectively.

When sorted by technical field, the top five fields for PCT filings in 2011 were:

(1) Electrical machinery, apparatus, energy: 11,296 applications
(2) Digital communication - 11,574
(3) Medical technology: 10,753
(4) Computer technology: 10,455
(5) Pharmaceuticals: 7, 683

The fields of biotechnology and organic fine chemistry each had more than 5,000 filings, with 5,232 and 5,283, respectively.  While the number of biotech filings rose slightly in 2011 from the 5,219 applications that were filed in 2010, the number of filings for organic fine chemistry was down in 2011 from the 5,511 applications filed in that field in 2010.  Organic fine chemistry was one of only four of the PCT's 35 technical fields that saw filings go down in 2011 (at least as far as WIPO's 2011 estimates are concerned).

According to WIPO's figures, the top ten corporate PCT filers in 2011 were:

(1) ZTE Corp. (China) - 2,826 applications
(2) Panasonic Corp. (Japan) - 2,463
(3) Huawei Technologies Co., Ltd. (China): 1,831
(4) Sharp Kabushiki Kaisha (Japan): 1,755
(5) Robert Bosch GmbH (Germany): 1,518
(6) Qualcomm Inc. (U.S.): 1,494
(7) Toyota Jidosha Kabushiki Kaisha (Japan): 1,417
(8) LG Electronics Inc. (South Korea): 1,336
(9) Koninklijke Philips Electronics N.V. (Netherlands): 1,148
(10) Telefonaktiebolaget LM Ericsson (Sweden): 1,116

Biotech/pharma companies making WIPO's Top 100 filers list included:  Procter & Gamble Co. (#24, 488 applications), Sumitomo Chemical Co. Ltd. (#27, 446), E.I. DuPont de Nemours & Co. (#29, 424), Dow Global Technologies Inc. (#34, 399), Novartis AG (#71, 200), F. Hoffmann-La Roche AG (#75, 189), Merck Patent GmbH (#94, 171), Sanofi-Aventis Deutschland GmbH (#96, 170), and Bayer CropScience AG (#99, 166).

The five university PCT filers in 2011 were:

(1) University of California (U.S.): 277 applications
(2) Massachusetts Institute of Technology (U.S.): 179
(3) University of Texas System (U.S.): 127
(4) Johns Hopkins University (U.S.): 111
(5) Korea Advanced Institute of Science and Technology (South Korea): 103

The top three university filers in 2011 were identical to last year's top three.

The Anatomy of a Compulsory License: Natco Pharma Ltd. v. Bayer Corp. (Indian Patent Office)

By Kevin E. Noonan --

In response to an earlier post on Novartis' challenge to the Indian Patent Office's decision not to grant a patent on its anticancer drug Gleevec® (see "Indian Supreme Court to Rule on Gleevec Patent"), a reader opined that we should appreciate the erudition and wisdom of the patent official in Mumbai responsible for the denial.  He helpfully sent along the decision granting a compulsory license to Natco for Bayer's anticancer drug, sorafenib tosylate (sold as Nexavar®).  A review of the decision indeed provides insights into how officials in India interpret the provisions of its law regarding compulsory licenses.  Such a review also suggests that what may appear to produce a "Catch 22" for Western drug companies can reasonably be considered to be a straightforward application of sound principles in the best interests of the Indian citizenry.

The provision of Indian law at issue is Section 84 of the Patent Act:

84. Compulsory licenses. – 

(1) At any time after the expiration of three years from the date of the grant of a patent, any person interested may make an application to the Controller for grant of a compulsory license on patent on any of the following grounds, namely –

    (a) that the reasonable requirements of the public with respect to the patented invention have not been satisfied . . .

. . .

        (ii) the demand for the patented article has not been met to an adequate extent or on reasonable terms . . .

    (b) that the patented invention is not available to the public at a reasonably affordable price . . .

    (c) that the patented invention is not worked in the territory of India.

With regard to this requirement, the Indian Controller of Patents set out the competing claims of the compulsory license applicant and the patentee.  The applicant alleged that there were ~20,000 liver cancer patients and ~9,000 kidney cancer patients (the populations that benefit from the drug), and that assuming 80% demand there would be a need for about 23,000 bottles of the drug per month to satisfy the demand.  The facts (albeit disputed by Bayer) presented showed no bottles imported into India in 2008, ~200 bottles in 2009 and that there was no evidence for import in 2010.  The significance of these dates and amounts are that the Indian government granted Bayer a patent on the active pharmaceutical ingredient in Nexavar® in 2008, and the Controller assessed Bayer's behavior in fulfilling the "reasonable requirements of the public" during that time.  It was also significant that Bayer did not produce the drug in India, explaining the focus on bottles of imported drug.  The Controller's decision mentioned that failure to manufacture the drug in India was evidence that Bayer had not "taken adequate steps to . . . make full use of the invention."

In addition, and in what is the crux of the matter, the Controller stated that the drug is "exorbitantly priced" and out or reach of most of the people.  The price of the patented drug was quoted in the decision as being Rs.2,80,248/- per month and Rs.33,65,136/- per year, as opposed to the price of Rs.8800/- per month from Natco.  In addition, the Controller stated that while the drug might be available in metropolitan areas (such as Mumbai, Delhi, Chennai and Kolkata) it was not available throughout the country.  Even then the Controller said that the drug was frequently in short supply even in cities and that this was significant because it is a "life saving drug" and not a "luxury item."  Finally, the Controller noted that Bayer's worldwide sales increased from $165M in 2006 to $934M in 2010.  "These figures clearly demonstrate the neglectful conduct of the Patentee as far as India is concerned," he wrote.

The Controller also disregarded Bayer's argument that sales of another Indian generic company, Cipla, should be taken into account in determining whether the Indian market was being reasonably satisfied, noting that Bayer had sued Cipla in Delhi and asked for an injunction to stop these infringing sales.  (In this regard, later in the decision the Controller characterizes this argument as "indulging in two-facedness" and "defend[ing] the indefensible.")  In so doing, the Controller also enunciated an Indian-centric philosophy, stating that "the mandate of law is not just to supply the drug in the market but to make it available in a manner such that substantial portion of the public is able to reap the benefits of the invention" and that "[i]f the terms are unreasonable such as high cost of nRS.2,80,000/-, availability is meaningless."  (This aspect of the decision was illustrated by the Controller's calculation that, at Bayer's prices it would take the "common man" (the lowest-paid government worker) 3.5 years' wages to afford one month's supply of the drug, but Nexavar extends life for the kidney cancer patient by only 4-6 years and the liver cancer patient by only 6-8 months.)  In coming to these determinations, the Controller cited a Bulletin from the World Health Organization; a research article on the "impoverishing effects" of the affordability of medicines in the developing world from PLoS; and an affidavit from James Packard Love, Director of Knowledge Ecology International and co-chair of the Trans-Atlantic Consumer Dialog Policy Committee on Intellectual Property Rights.  (Perhaps) needless to say, these sources did not support Bayer's petition that the Indian government deny a compulsory license to Natco.

For its part, Bayer made the patently correct argument that the cost of drugs supports the pipeline of future drug development and that Bayer "continued to invest major sums into further development of Sorafenib" for treating other cancer types.  Bayer also noted that its investment in new drug development amounted to 8 billion Euros from 2007 to date, and that it takes more than 2 million Euros to bring a new drug to market.  Further research is in the public interest, Bayer argued, and granting Natco a compulsory license would harm the pubic interest in this regard.  In what appears to be an effort to avoid a complete defeat, Bayer also argued that a compulsory license should not benefit those in India ("the Rich class" and "the middle class") who could afford the drug at Bayer's price in an attempt to provide the drug to the "common man" who could not (supporting this argument with affidavits from representatives of the Indian medical and insurance industries).  (The Controller did not reject this argument but questions why Bayer had not instituted such a graduated pricing regime itself.)  But this varying level of the ability to pay, with the varying effects on the question of whether the price was "reasonably affordable" should be sufficient, Bayer argued, to preclude grant of a compulsory license to Natco, since it is a "sine qua non" (or "condition precedent") for a compulsory license that a drug not be available at a "reasonably avoidable price" (although this argument suffered from the fact that the availability of Nexavar® at a "reasonably affordable price" was dependent on sales by Cipla).

The Controller's decision, in favor of granting a compulsory license, was based on his determination that the question of whether a drug was available at a "reasonably affordable price has to be construed predominantly with reference to the public" and under the "admitted facts" of this case these considerations fell in favor of granting the license.

The Controller also considered the fact that Bayer did not "work" the invention in India.  Here, the law was construed with regard to whether the invention was worked "to the fullest extent possible" and here it clearly was not (upon evidence that Bayer had "worked" the patented invention "extensively" in other countries while having the industrial capacity to work the patent, i.e., produce Nexavar®, in india).  "Minimal" working is not enough, according to Natco, while Bayer argued that the extent of working a patented invention depends on the invention and, for Nexavar® the "small global demand" justifies the "strategic decision" to make the drug in Germany.

In making his decision, the Controller noted that the term "worked in the territory of India" had not been defined in the Indian Patent Act, and so he needed to construe the term with regard to "various International Conventions and Agreements in intellectual property," the 1970 Patent Act and the legislative history.  But the Controller seemed more interested in addressing the "crucial argument" of the patentee that the applicant's construction of the term was incorrect because the phrase "default of the patentee to manufacture in India to an adequate extent and supply on reasonable terms the patented article" was deleted from the Act.  He decided that this was "one face of the coin," but that the other was that the phrase was deleted from Section 84(1)(a) with regard to the patented article being "reasonable available to the public" in favor of Section 84(1)(c) which "was made a separate ground for grant of a compulsory license."

In this light, the Controller considered the relevant provisions of the Paris Convention, the TRIPS agreement and the Indian Patents Act of 1970 and decided that the combination of Article 27(1) of TRIPS and Article 5(1)(A) of the Paris Convention supported an interpretation that failure to manufacture Nexavar® in India supported the grant of a compulsory license to Natco (which it termed "reasonable fetter" on Bayer's patent rights).  Ultimately, however, the Controller found ample justification for the compulsory license in Section 83(b) of the Patent Act, which states that "[p]atents are not granted merely to enable patentees to enjoy a monopoly for importation of the patented article" and Section 83(c) that "the grant of a patent right must contribute to the promotion of technological innovation and to the transfer and dissemination of technology."  Coupled with the provisions of Section 83(f) that a patent should not be abused, the Controller construed Indian patent law to require that a patentee work a patented invention in India or license another do to so.

After refusing to adjourn the proceedings based on Section 86 of the law (finding, inter alia, that Bayer had not established any justifiable reason for its "delay" in working the patent in India), the Controller established the terms of the compulsory license, wherein:

i.    the right to make and sell sorafenib is limited to applicant (no sublicensing)
ii.    the compulsorily licensed drug product can be sold only for treatment of liver and renal cancer;
iii.    the royalty shall be paid at a rate of 6%
iv.    the price is set at Rs.74/- per tablet, which equals Rs. 8,800/- per month;
v.    the applicant commits to provide the drug for free to at least 600 "needy and deserving" patients per year
vi.    the compulsory license is not assignable and non-exclusive, with no right to import the drug
vii.    No right for the licensee to "represent publicly or privately" that its product is te same as Bayer's Nexavar®
viii.    Bayer has no liability for Natco's drug product, which must be physically distinct from Bayer's dosage form

The license was granted on March 9, 2012.

What lessons can be learned from Bayer's experience?  Some seem self-evident:  patents granted in India come encumbered with a responsibility to produce the patented article in India, either by the patentee itself or by licensing a local Indian company.  Second, political realities and economics, particularly for drugs, require some mechanism for providing drugs to those who genuinely cannot afford them.  Third, these efforts must be both effective and public; token efforts, specifically efforts that supply much less than the actual demand, will be deemed insufficient.  Finally, by licensing rather than being forced to license, patentees can negotiate (perhaps with more than one local company) rather than having the Patent Controller decide the terms (and those terms can be kept confidential).  While the Controller here was careful to craft the license to prevent the licensee from exporting the drug, not all compulsory licensees will necessarily be so limited, an important consideration in view of the risks attendant on a licensed competitor being able to supply the global market.  The lesson is again learned that foreign drug companies are no match for local drug manufacturers who promise to provide drugs at affordable prices to citizens of India who could not otherwise afford them.  In view of the near certainty that licenses under these circumstances will be granted, it behooves Western drug companies to take the initiative to avoid the outcome Bayer suffered last week.

Indian Supreme Court to Rule on Gleevec Patent

By Kevin E. Noonan --

One of the signal achievements of late 20th Century trade diplomacy was the ratification of the Uruguay Round of the General Agreement on Tariffs and Trade (GATT), and specifically the Trade-related Aspects on Intellectual Property Rights (TRIPS).  These international agreements created the World Trade Organization and changed national practices regarding intellectual property rights protection, which was a quasi quid pro quo for membership.  Part of the GATT/TRIPS related changes mandated that intellectual property rights be expanded and protected without discrimination against non-native patent holders, and that certain national practices (like banning outright intellectual property rights for entire categories of inventions) would cease.

The most economically significant and high-profile of such practices relate to the pharmaceutical industry and specifically to patents on drugs; countries like India frankly refused to patent drugs or to permit actions against Indian companies making generic versions of drugs patented elsewhere.  This all changed, or was supposed to change, with India's ratification of GATT.  However, change comes slowly if at all and the years since Indian ratification of the new system have seen many drugs in many contexts run into national legislation, government agency action, or litigation-related court orders that have thwarted attempts by Indian patent holders, predominantly Western drug companies, from enforcing their patents to prevent generic competition.

This is part of a larger trend, exemplified by passage of the Doha Declaration of 2001 and compulsory licensing provisions in national TRIPS implementing laws.  This has created a crisis for Western pharmaceutical companies, who have seen the trend for compulsory licensing, or the threat of such licenses, expand from anti-AIDS drugs to other drugs less relevant to "national medical emergencies," to where the levels of protection may be lower in the post-TRIPS world than they were before the GATT treaty was signed (see "The Law of Unintended Consequences Arises in Applying TRIPS to Patented Drug Protection in Developing Countries").

While other countries have been more vigorous in using these provisions to reduce their levels of compliance with the spirit if not the letter of TRIPS, including Thailand, Brazil, and Venezuela, India has perhaps created the biggest problem for Western drug companies.  This is because India has a large, educated middle class and a democratically elected government, meaning that India's middle class has the clout to influence the government to act in their (and India's) best interests.  Coupled with its large generic pharmaceutical industry, the outcome is not surprising:  Western pharmaceutical companies have been embroiled in several disputes regarding compulsory licensing and an outright refusal to patent several important drugs, while seeing India provide generic drugs for the rest of the world (ROW) (and, in some instances, including Western countries as well).

The latest patent imbroglio (Novartis v. Union of India) involves imatinib mesylate, sold by Novartis as Gleevec® (in the U.S.) and Glivec® (in the ROW) for the treatment of chronic myelogenous leukemia and certain gastrointestinal cancer.  As reported today in The New York Times ("India's Supreme Court to Hear Dispute on Drug Patents" by Vikas Bajaj and Andrew Pollack), the case has moved through the Indian legal system for six years.  At issue is the application of Section 3(d) of the Indian patent statute:

Section 3(d): the mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere new use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant.

Initially, the Indian Patent Office refused to grant a patent to the drug maker, Novartis.  Novartis appealed, and it has taken until now for the case to arrive at the Indian Supreme Court, which will hear argument later this month.  A great deal is at stake:  while a year's treatment of Gleevec can cost $70,000 in the U.S., Novartis has made attempts to provide it for greatly reduced cost (and, in some cases for free) in an effort to blunt the political pressure to uphold the government's refusal to grant the patent.  Generic Gleevec is available for about $2,500 a year, and various non-governmental organizations, like Doctors without Borders, are afraid this drug (and others like it) will become unavailable if Novartis is granted an Indian patent.

For its part, the Obama administration is reportedly exerting pressure on the Indian government to grant the patent.  NGOs are exerting political pressure of their own, including protesting at a Novartis shareholder meeting in Basel, Switzerland and at several Novartis company locations in he U.S.  The article also reports that the U.S. has demanded that a new treaty for the Pacific region, the Trans-Pacific Partnership, contain provisions requiring member countries to grant patents for drugs like Gleevec, according to what are called "a leaked text of the government's position."  The article also speculates that the case could influence Western drug manufacturers' appetite for investment in India.

As described in the article, the dispute concerns a provision of the law that precludes patent protection for drugs known or developed before 1995 unless it is in a new form that "significantly improves the medicine's 'efficacy,' or effectiveness."  Because the ability to protect new forms of old drugs is common (termed "evergreening"), it is not limited to Gleevec, and this, according to the article, is another source of concern for some groups.  Brook K. Baker, a professor of law at Northeastern University in Boston and a policy analyst for the Health Global Access Project, is quoted as posing the question "Do you get one patent monopoly for the basic ingredient or do you keep tweaking it to get more patents?"  (While not a bad question it ignores the reality that the "old" form of the drug, once off patent, can be made, used and sold free of the patent "monopoly," as illustrated nicely for omeprazole, sold first as Prilosec® and, in altered form, as Nexium®.  No one needs to take Nexium, and omeprazole has been available in the U.S. as a genetic for almost 10 years.)  Ironically, the "earlier" version of Novartis' Gleevec, although patented in the early 1990s, was never marketed as a drug, and the "newer" version was approved at least in part because it is "30 percent easier for the body to absorb" than the older drug.  And of course the earlier version of the drug was not patented in India because India did not grant pharmaceutical patents at that time.  Paul Herrling was quoted as explaining that it is frequently the case that the first embodiment of a drug compound is not what ultimately becomes the approved drug product.  Under these circumstances, India's position would prevent patenting of the actual drug, which frequently has important beneficial properties (compared with the first patented compound, which "might not be absorbed into the bloodstream well enough, or it might be chemically unstable, or unsafe").

The implications of the case extend to other cancer drugs (such as erlotinib, sold by Roche as Tarcera®, and numerous anti HIV drugs, including tenofovir, sold by Gilead Sciences as Viread®).

The positions taken by Professor Baker and Shamnad Basheer, a law professor at West Bengal National University of Juridical Sciences in Kolkata who has filed an amicus brief, provide an interesting perspective.  Professor Baker takes the traditional legal academic view, that Western drug companies "want India shut down as a place that can make early versions of generic medicines that can compete with them" while conceding that "a victory for Novartis would not shut off the production of generic Gleevec or of other existing generics."  Professor Basheer, on the other hand, said that "[i]t is important that the court take on the matter and interpret the law in a way that balances the need for innovation against public health concerns."  His amicus brief argued that the improved "effectiveness" standard needed clarification and that "[i]t would be impractical for drug companies to seek patents only after they have conducted years of clinical trials that could provide definitive proof that updated drugs work better than their older version."  On the other hand, evergreening is an important concern, however, and the Indian government has a legitimate interest in protecting its generic drug industry.

The Indian Supreme Court will make its decision, and thereafter it is possible we will see whether and to what extent either of these positions is correct.

EPO Launches New Machine Translation Tool

By Donald Zuhn --

Last month, the European Patent Office announced the launch of a new machine translation service, Patent Translate.  Patent Translate, which uses Google Translate technology, allows users to translate between English and French, German, Spanish, Italian, Portuguese, or Swedish.  The EPO press release on the launch noted that translations offered by the new service cover approximately 90% of all patents issued in Europe.

The EPO also announced plans to extend the service by the end of 2014 to permit users to translate from and to all 28 languages of the EPO members states, as well as provide for the translation of Chinese, Japanese, Korean, and Russian languages.  The next batch of languages to be added to the system, sometime in 2013, include Danish, Dutch, Finnish, Greek, Hungarian, and Norwegian.

Instructions for using the service can be found on the EPO's Patent Translate webpage (which has been added to the Patent Docs Patent Resources in the right panel).  The new service can be used through Espacenet, the EPO's database of more than 70 million worldwide patent documents, or the European publication server.

The collaboration between the EPO and Google has progressed fairly quickly.  In November 2010, the EPO announced that it had signed a memorandum of understanding with Google to improve access to patent translations in multiple languages.  Under that agreement, the EPO was given use of Google's machine translation technology to translate patents into different languages, and Google was provided with access to EPO patent documents, allowing the company to optimize its machine translation technology.  Less than a year ago, the EPO announced that it had signed a long-term agreement to collaborate on the machine translation service that produced Patent Translate.  The EPO noted that the agreement involved no financial component.  The development of the Patent Translate service was achieved by Google's use of several hundred thousand high quality patent translations to "train" the company's translation system.

EPO President Benoît Battistelli called the launch of Patent Translate "a landmark towards the removal of language barriers worldwide from patent documentation," and suggested that the new service would "facilitate[] the implementation of the unitary patent which includes an important chapter on translation."

In a related development, the EPO and the State Intellectual Property Office of the People's Republic of China (SIPO) announced last fall that the two offices would work together to assure that automatic Chinese-English machine translation tools for patents would be made available to the public within a year.

News from Abroad: EPO Fee Increases from 1 April 2012

By Charlotte Teall --

The European Patent Office ("EPO") recently announced that most of its fees will increase by between 5 and 10 per cent from 1 April 2012.

The changes in fees

A comparison of the old and new fees is given below (this shows the changes in the most common fees paid to the EPO; there are fee increases for other fees which are less commonly paid).

Practical implications

If you know that you want to enter the European regional phase of a PCT application, you should do so before 1 April 2012, to save around 5% on the official fees due.

For example, a typical PCT application might have 35 pages and 15 claims, with the USPTO as the International Searching Authority (ISA).  If that PCT application enters the European regional phase on or after 1 April 2012, the total official fees will be €3215.  If it enters the European regional phase before 1 April 2012, the total official fees will be €3020 (saving slightly more than 5% in the official fees).

Exactly the same principle applies to filing a new European patent application directly at the EPO.  It particularly applies to new divisional applications, where the savings on accumulated renewal fees can be considerable.

Therefore, if possible, you should file new European patent applications (particularly divisionals), and enter the European regional phase of PCT applications, before 1 April 2012.

The EPO has elected not to introduce a new payment structure.  The changes in fees will not change day-to-day practice, save for the need to pay higher official fees.  Therefore, our previous practical advice, for example concerning minimising the number of claims, still applies.

The other major practice change the EPO has proposed from 1 April 2012 concerns the new grant procedure reported here.

This article was reprinted with permission from Forresters.

News from Abroad: Enlarged Board of Appeal Decides Again on Disclaimers

By Jon Gowshall & Charlotte Fox --

Background

The invention protected by a patent is defined in the claims.  Those claims must be new -- they must not cover anything previously published.  The applicant can amend the claims during prosecution of a patent application to grant, particularly to avoid newly-discovered earlier publications, covered by the claims.  In doing so, the applicant can change the claims so that they no longer cover subject matter that the original application taught as part of the invention.

One way to amend claims is to add a disclaimer.  A disclaimer is a negative limitation.  For example, if a claim relates to treating a broad class of disease, a disclaimer would exclude a specific disease within that broad class.

Applicants do not often use disclaimers because the European Patent Office (EPO) has strict rules that an applicant cannot add subject-matter to the application after it is filed.  Unless the disclaimer is, unusually, in the application on filing, the circumstances which allow an applicant to introduce a disclaimer are rare.

The current conditions, under which "undisclosed" disclaimers are allowable, were set out by the Enlarged Board of Appeal (EBA), the highest appeal body at the EPO, in the decision (G1/03).

There is growing uncertainty as to what needs to be included in the original application to provide basis for such a disclaimer.  If the description states that the invention excludes the specific feature you want to disclaim, then there is clearly basis for disclaiming this feature.

The grey area arises if the original description teaches that the invention includes the specific feature to be disclaimed.  Is positive disclosure of the feature adequate basis for disclaiming it?  In other words, does just the subject-matter of the disclaimer need to be disclosed, or must the application also teach that the feature is not part of the invention?

The EPO has referred this question to the EBA.  This decision (G 0002/10) has now issued.

The Decision

 The Board decided that the correct approach is not to decide whether the disclaimed subject-matter is directly and unambiguously derivable from the application.  The correct approach is to look at what subject-matter remains in the amended claim and determine whether this remaining subject-matter is directly and unambiguously derivable from the original application.

Therefore when an applicant wants to disclaim subject matter that was originally disclosed as part of the invention, the fact that the disclaimed subject matter is disclosed is not important.  Instead, the usual added-subject matter test -- is it unambiguously disclosed? -- is applied to the subject matter of the amended claim. 

Practice points arising from the decision

The decision does not state that positively disclosed disclaimers are never allowable.  It therefore may be possible to disclaim a single embodiment originally described as part of the invention.

Unfortunately, whether this is allowed depends on what is actually taught by the application in each case.  In our opinion, such a disclaimer will not be allowed in the great majority of cases.

The decision highlights the importance of carefully drafting the original application.  It is very difficult, after filing, to add subject matter.  It is vitally important that the original application contains as much subject matter as possible.  That should include not only what the applicant already knows about the invention, but as much informed speculation as possible of variations that might be effective.

This article was reprinted with permission from the Forresters "Life sciences update" for Autumn 2011.

Worldwide Patent Filings and Grants on the Rise

By Donald Zuhn --

On Tuesday, the European Patent Office announced that it received 243,000 applications in 2011, which constituted a 3% increase from the 237,500 applications the EPO received in 2010.  The EPO granted 62,115 patents, which was 7% more than the number of patent grants in 2010.  With regard to the geographic origin of filings, the EPO noted that EP filings from China rose from 5% of all filings to 7%, filings from Japan rose from 18% of all filings to 19%, and filings from the U.S. fell from 26% of all filings to 24%.  The Top 10 countries of origin for European filings were:

A more complete list of filings by country of origin can be found here.

EPO President Benoît Battistelli stated that "[c]ontinued patent filings growth and the high percentage of non-European applicants are clear evidence of great confidence in Europe as a place for business," adding that "[t]he EPO will continue to play a leading role in the global patent system."

Earlier this month, IFI Claims Patent Services, a company that produces global patent databases, announced that 224,505 utility patents were issued in the U.S. last year, an increase of 2% over the 219,614 patents that were issued in 2010.  IFI also released a list of the Top 50 companies receiving U.S. patents last year.  IFI's Top 10 were:

The only life sciences company making the list was Du Pont de Nemours, E I & Co.  IFI noted that Asian companies accounted for 25 of the top 50 U.S. patent recipients, with U.S. firms capturing 17 slots.

Last month, Reuters reported that China surpassed the U.S. in terms of application filings in 2010 (figures for 2011 were not yet available).  Citing a Thomson Reuters research report, the article noted that published applications in China had risen by an average of 16.7% annually from 171,000 in 2006 to 314,000 in 2010.  According to the report, published applications are expected to top 500,000 in 2015, with filings in the U.S. and Japan amounting to 400,000 and 300,000, respectively.

In December, the World Intellectual Property Organization announced the release of its 2011 World Intellectual Property Indicators report.  The WIPO report noted that after a considerable decline in worldwide patent application filings in 2009 (a 3.6% decline), filings rose 7.2% in 2010, with China and the U.S. accounting for the greatest share of all filings.  The 7.2% increase constituted the highest growth rate in five years, and the 1.98 million worldwide applications that were filed in 2010 was an all-time high.  The report noted that some 5.17 million worldwide applications were "potentially pending" in 2010.

The WIPO report showed that the U.S. maintained the top spot for patent application filings, with 490,226, and that China slipped past Japan to capture second place with 391,177 filings.  Japan had 344,598 filings.  With regard to technology field, biotechnology filings rose 0.4% between 2005 and 2009 (the latest years for which data was available), pharmaceutical filings were down 0.1%, organic fine chemistry was down 1.3%.

Top Stories of 2011: #3 to #1

By Donald Zuhn --

Reflecting upon the events of the past twelve months, Patent Docs presents its fifth annual list of top biotech/pharma patent stories.  For 2011, we identified a dozen stories that were covered on Patent Docs last year that we believe had (or are likely to have) the greatest impact on biotech/pharma patent practitioners and applicants.  On Monday and Tuesday, we counted down stories #12 to #10 and #9 to #7, and yesterday, we covered stories #6 to #4.  Today, we present the top three stories for 2011.  As with our other lists (2010, 2009, 2008, and 2007), links to our coverage of these stories (as well as a few links to articles on related topics) have been provided in case you missed the articles the first time around or wish to go back and have another look.  As always, we love to hear from Patent Docs readers, so if you think we left something off the list or disagree with anything we included, please let us know.

3.  Federal Circuit Issues Standards for Establishing Inequitable Conduct Defense

In May, the Federal Circuit delivered its en banc opinion on inequitable conduct in Therasense, Inc. v. Becton, Dickinson & Co.  The majority determined that (a) an omitted reference is a material reference only if "but for" its exclusion, the claim or patent would not have issued; (b) a finding of inequitable conduct requires clear and convincing evidence of a specific intent to deceive by the applicant; (c) a court cannot use a "sliding scale" to find inequitable conduct, i.e., it cannot use a strong showing of materiality to overcome a weak showing of intent; (d) both materiality and intent to deceive must be supported by clear and convincing evidence; and (f) courts should apply equity to ensure that the remedy of unenforceability is not imposed for misconduct that was "immaterial to the issuance of the patent."  The opinion was authored by Chief Judge Rader and joined in full by Judges Newman, Lourie, Linn, Moore, and Reyna.  Judge O'Malley joined in part, and Judge Bryson authored a dissenting opinion and was joined by Judges Gajarsa, Dyk, and Prost.  The dissent differed from the majority with regard to the standard for assessing materiality, arguing that the best measure of a material reference is the one used by the U.S. Patent and Trademark Office and codified as PTO Rule 56 (37 C.F.R. § 1.56).  Shortly after the Federal Circuit handed down its decision in Therasense, the USPTO published a notice in the Federal Register proposing to change the Office's definition of materiality in Rule 56 to be consistent with the materiality standard enunciated in Therasense, and seeking comments regarding the proposed change.

For information regarding this and other related topics, please see:

• "Star Scientific, Inc. v. R.J. Reynolds Tobacco Co. (Fed. Cir. 2011)," September 15, 2011
• "USPTO Proposes Change in Duty of Disclosure," July 21, 2011
• "Therasense, Inc. v. Becton, Dickinson & Co. (Fed. Cir. 2011) (en banc): Judge O'Malley's Opinion," May 30, 2011
• "USPTO Studying Therasense Decision, Will Issue Guidance Soon," May 26, 2011
• "Therasense, Inc. v. Becton, Dickinson & Co. (Fed. Cir. 2011) (en banc): The Dissenting Opinion," May 26, 2011
• "Therasense, Inc. v. Becton, Dickinson & Co. (Fed. Cir. 2011) (en banc)," May 25, 2011

2.  Federal Circuit Issues Decision in AMP v. USPTO

Two months after giving the patent community some clarity with respect to inequitable conduct, the Federal Circuit issued its decision in Association for Molecular Pathology v. United States Patent and Trademark Office -- the Myriad gene patenting case.  The decision, however, was somewhat fractured, with Judge Lourie writing for the majority; Judge Moore authoring a concurring opinion, joining certain parts of the "majority" opinion and for other parts, concurring with the result; and Judge Bryson concurring-in-part and dissenting-in-part.  On the substantive issues, the majority reversed the District Court's finding that "isolated DNA" was not patent-eligible under the "products of nature" "exception," affirmed the District Court on the diagnostic method claims under the Bilski "machine or transformation test," and reversed on the sole screening method claim at issue.  Biotech practitioners and applicants no doubt breathed a sigh of relief as to the Court's finding of patent-eligibility for the composition of matter ("gene") claims.  Following the decision, the Federal Circuit denied petitions for panel rehearing filed by both Plaintiffs/Appellees and Defendants/Appellants.  Last month, counsel for Plaintiffs/Appellees (the American Civil Liberties Union (ACLU) and Public Patent Foundation (PubPat)) filed a petition for certiorari with the Supreme Court, ensuring that the case will likely be on next year's Top Stories list.

While the Federal Circuit was addressing the gene patenting issue in the United States, the Australian Senate was addressing the issue Down Under.  In September, the Legal and Constitutional Affairs Legislation Committee of the Australian Senate issued a recommendation that the Senate not pass The Patent Amendment (Human Genes and Biological Materials) Bill 2010, which would have prevented the patenting of biological materials that are identical or substantially identical to materials as they exist in nature (such as genes and proteins).

For information regarding this and other related topics, please see:

• "Plaintiffs File Petition for Certiorari in AMP v. USPTO," December 8, 2011
• "News from Abroad: The Gene Patents Debate in Australia -- An Update," December 1, 2011
• "Like Two Ships Passing in the Night: U.S. and Europe Consider Patent Eligibility of Biological Materials," November 22, 2011
• "Australian Senate Committee Issues Recommendation on Gene Patenting Bill," October 6, 2011
• "Federal Circuit Denies Petition for Rehearing in AMP v. USPTO," September 18, 2011
• "Federal Circuit Denies Plaintiff(s)' Petition for Rehearing in AMP v. USPTO," September 14, 2011
• "Defendants File Petition for Rehearing in AMP v. USPTO," August 30, 2011
• "Plaintiff(s) File Petition for Rehearing in AMP v. USPTO," August 29, 2011
• "Plaintiff(s) File Petition for Rehearing in AMP v. USPTO," August 28, 2011
• "CyberSource and the Tragedy of Bad Analogies," August 24, 2011
• "Is Claim Construction the Key to Patent-eligibility of Isolated DNA?" August 23, 2011
• "WFU Law Professor Says Federal Circuit Failed as 'Keeper of the Constitution' in AMP v. USPTO," August 22, 2011
• "AMP v. USPTO: Standing," August 4, 2011
• "AMP v. USPTO: Judge Bryson's Opinion," August 3, 2011
• "AMP v. USPTO: Judge Moore's Concurring Opinion," August 2, 2011
• "Association for Molecular Pathology v. United States Patent and Trademark Office (Fed. Cir. 2011)," August 1, 2011
• "Standing in AMP v. USPTO: The Plot Thickens," July 29, 2011
• "Federal Circuit Issues Decision in AMP v. USPTO," July 29, 2011
• "Myriad Writes to Federal Circuit on Standing Issue," July 28, 2011
• "AMP v. USPTO: Oral Argument at the Federal Circuit," April 7, 2011
• "Federal Circuit to Hear Argument in AMP v. USPTO," April 3, 2011
• "Curiouser and Curiouser," February 16, 2011
• "AMP v. USPTO -- Briefing Update III," February 8, 2011
• "Amicus Briefs in AMP v. USPTO: AARP," January 27, 2011
• "AMP v. USPTO: Appellees' Brief," January 12, 2011
• "BIO Survey Shows Support for DNA-Based Patents Despite Some Reservations," January 9, 2011

1.  Leahy-Smith America Invents Act Signed Into Law

On September 8, the Senate voted 89 to 9 in favor of H.R. 1249, the House version of the Leahy-Smith America Invents Act (AIA).  The House had passed the bill by a 304-117 margin on June 23.  Eight days following Senate passage, on September 16, President Obama signed the Leahy-Smith America Invents Act into law.  Certain provisions of the AIA took effect within days of enactment (e.g., prioritized examination and a 15% fee surcharge); some provisions will take effect on September 16, 2012 -- one year after enactment (e.g., supplemental examination and inter partes review); and the remaining changes will take effect on March 16, 2013 -- 18 months after enactment (e.g., first-inventor-to-file and derivation provisions).  The effective date provisions of § 3(n) of the AIA, however, will force patent practitioners and applicants to deal with two distinct regimes -- the old first-to-invent and the new first-inventor-to-file -- for years and decades to come.

For information regarding this and other related topics, please see:

• "AIA Overview: Changes in Requirements for the Inventor's Oath or Declaration," October 27, 2011
• "AIA Overview: Supplemental Examination," October 26, 2011
• "AIA Overview: Changes to Provisions Relating to Third Party Submissions of Prior Art," October 24, 2011
• "AIA Overview: Changes to Inter Partes Re-examination," October 23, 2011
• "AIA Overview: Post-grant Review Provisions," October 20, 2011
• "AIA Overview: Prior User Rights Defense," October 19, 2011
• "AIA Overview: First-Inventor-to-File Provisions," October 11, 2011
• "USPTO Seeking Comment on AIA Mandated Studies," October 10, 2011
• "USPTO Implements AIA Changes to Inter Partes Reexamination," September 28, 2011
• "USPTO Updates Fee Schedule, But Does Not Yet Offer Micro Entity Discount," September 27, 2011
• "USPTO Implements Prioritized Examination Track under AIA," September 26, 2011
• "President Signs AIA into Law; USPTO Begins Implementation of Act," September 20, 2011
• "Reaction to Senate Passage of H.R. 1249," September 11, 2011
• "Senate Passes H.R. 1249," September 8, 2011
• "Senate Votes to Invoke Cloture on H.R. 1249," September 6, 2011
• "Senate Cloture Vote on H.R. 1249 Scheduled for Tuesday," September 5, 2011
• "Patent Reform News Briefs," August 17, 2011
• "USPTO Seeks Input on Implementation of Leahy-Smith America Invents Act," August 8, 2011
• "Patent Reform News Briefs," July 12, 2011
• "House Passes H.R. 1249," June 23, 2011
• "Patent Reform Update II," June 21, 2011
• "Patent Reform Update," June 20, 2011
• "Is the End of Fee Diversion Dead in the Leahy-Smith America Invents Act?" June 19, 2011
• "AMA, ACLU and Their Friends Oppose (Leahy-Smith) America Invents Act," June 16, 2011
• "Manager's Amendment (and Others) to H.R. 1249 -- Human Patenting," June 15, 2011
• "Debate over H.R. 1249 Continues," June 15, 2011
• "Manager's Amendment (and Others) to H.R. 1249 -- Second Opinions in Genetic Diagnostic Testing," June 14, 2011
• "Patent Reform News Briefs," June 13, 2011
• "America Invents Act: Quo Vadis?" June 8, 2011
• "Patent Reform News Briefs," June 7, 2011
• "Not Necessarily Patent 'Reform,'" June 2, 2011
• "Commerce Secretary Provides Administration's Views on America Invents Act," May 31, 2011
• "Patent Reform News Briefs," May 11, 2011
• "Boundy Issues Call to Arms on America Invents Act," April 21, 2011
• "More Reaction to H.R. 1249," April 18, 2011
• "House Judiciary Committee Approves H.R. 1249," April 14, 2011
• "Reaction to Manager's Amendment to House Patent Reform Bill," April 13, 2011
• "House Judiciary Chairman Releases Manager's Amendment to H.R. 1249," April 12, 2011
• "Reaction to House Patent Reform Bill," March 31, 2011
• "House Introduces Its Version of 'America Invents Act,'" March 30, 2011
• "Patent Reform Discussion Moves to House," March 29, 2011
• "The Disappearance of Deceptive Intent in S. 23," March 23, 2011
• "'Reform' at the U.S. Patent and Trademark Office," March 22, 2011
• "Few 'Reform' Provisions Remain in S. 23 Relating to the Judiciary," March 21, 2011
• "Additional Opportunities for Pre- and Post-grant Review, and Brand New Patent Trial and Appeal Board in S. 23," March 17, 2011
• "Post-grant Review Provisions of S. 23," March 16, 2011
• "Inventor's Interests, If Not Rights, Limited by S. 23," March 15, 2011
• "What Are the Provisions of the Proposed "First-Inventor-to-File" System in S. 23?" March 14, 2011
• "Obama Administration Supports S. 23," March 9, 2011
• "Reaction to Senate Passage of S. 23," March 8, 2011
• "Senate Passes S. 23," March 8, 2011
• "Senator Feinstein Opposes First-to-File Provisions of Patent Reform Bill (S. 23)," March 3, 2011
• "Patent Reform Bill (S. 23) Debated and Amended on Senate Floor," March 2, 2011
• "More Reaction to Senate Patent Reform Legislation," February 24, 2011
• "Patent Reform Legislation Moves to Senate Floor," February 22, 2011
• "Reaction to Senate Patent Reform Bill (S. 23)," February 9, 2011
• "Judiciary Committee Votes on Patent Reform Bill," February 3, 2011
• "Here We Go Again," January 20, 2011
• "Rep. Latta Reintroduces False Marking Bill in the House," January 18, 2011

Top Stories of 2011: #6 to #4

By Donald Zuhn --

Reflecting upon the events of the past twelve months, Patent Docs presents its fifth annual list of top biotech/pharma patent stories.  For 2011, we identified a dozen stories that were covered on Patent Docs last year that we believe had (or are likely to have) the greatest impact on biotech/pharma patent practitioners and applicants.  On Monday, we counted down stories #12 to #10, and yesterday, we covered stories #9 to #7.  Today, we present stories #6 to #4.  As with our other lists (2010, 2009, 2008, and 2007), links to our coverage of these stories (as well as a few links to articles on related topics) have been provided in case you missed the articles the first time around or wish to go back and have another look.  As always, we love to hear from Patent Docs readers, so if you think we left something off the list or disagree with anything we included, please let us know.

6.  Supreme Court Hears Prometheus & Federal Circuit Decides Classen

Last month, the U.S. Supreme Court heard oral argument in Mayo Collaborative Services v. Prometheus Laboratories, Inc., which involves the patent-eligibility of claims directed to methods for determining whether an effective amount of a drug is being administered to a patient.  A decision in Prometheus should come some two years after the Court issued its opinion on the patent-eligibility of (business) method claims in Bilski v. Kappos.  Shortly after handing down its decision in Bilski in 2010, the Court granted certiorari, vacated the Federal Circuit opinion, and remanded both Prometheus and Classen Immunotherapies, Inc. v. Biogen IDEC.  The Federal Circuit decided Prometheus on remand in December 2010, and last June, the Court again granted certiorari.  The Federal Circuit revisited Classen in August, finding that the claims of one patent in suit were not patent-eligible under § 101, and that the claims of two other patents were patent-eligible, because the latter recite methods that include "the physical step of immunization on [a] determined schedule" and thus are "directed to a specific, tangible application."

For information regarding this and other related topics, please see:

• "Mayo Collaborative Services v. Prometheus Laboratories at the Supreme Court: Oral Argument Tomorrow," December 6, 2011
• "Deciphering the Patent-Eligibility Message in Prometheus, Myriad and Classen," September 20, 2011
• "Classen Immunotherapies, Inc. v. Biogen IDEC (Fed. Cir. 2011) -- Additional Views from Chief Judge Rader," September 8, 2011
• "Classen Immunotherapies, Inc. v. Biogen IDEC (Fed. Cir. 2011) -- Judge Moore's Dissent," September 6, 2011
• "Classen Immunotherapies, Inc. v. Biogen IDEC (Fed. Cir. 2011)," August 31, 2011
• "Another Academic with Solutions to Problems that Don't Exist," January 31, 2011

5.  Supreme Court Interest in Patent Law on the Rise

In little more than a week last spring, the Supreme Court was in the unusual position of issuing opinions on three separate patent cases.  On May 31, the Court in Global-Tech Appliances, Inc. v. SEB S.A. affirmed a Federal Circuit decision upholding a jury verdict that defendants were liable for inducing infringement, finding that willful blindness requires not only the existence of a known risk but a high probability of that risk that is appreciated by the defendant, coupled with active efforts by the defendant to avoid knowing that the induced activities are infringing.  On June 6, in Board of Trustees of the Leland Stanford Junior University v. Roche Molecular Systems, Inc., the Court rejected the idea that employment is enough, absent an agreement, to vest ownership of a patented invention.  Finally, on June 9, the Court in Microsoft Corp. v. i4i Limited Partnership held that 35 U.S.C. § 282 requires an invalidity defense to be proved by clear and convincing evidence.  With the Prometheus decision on tap, and AMP v. USPTO possibly coming before the Court, 2012 will bring even more Supreme Court decisions on important patent law issues.

For information regarding this and other related topics, please see:

• "Microsoft Corp. v. i4i Limited Partnership (2011)," June 9, 2011
• "Board of Trustees of the Leland Stanford Junior University v. Roche Molecular Systems, Inc. (2011)," June 6, 2011
• "Global-Tech Appliances, Inc. v. SEB S.A. (2011)," May 31, 2011

4.  Embryonic Stem Cell Patenting Suffers Setback in Europe

In a blow to human embryonic stem cell (hESC) research in Europe, the European Court of Justice (ECJ) determined in October that hESCs are not patent-eligible subject matter.  The decision evoked Europe's "moral" position against biotech patenting some 30 years ago, which allowed the rest of the world (and predominantly the U.S.) to develop an entirely new industry with little European competition.  With regard to the stem cell decision, the question remains whether the ruling will foster or hinder innovation, and it will take perhaps a generation to understand the full extent of the ban.  While not related to the ECJ decision, California-based stem cell pioneer Geron Corporation announced in November that it was discontinuing further development of its human embryonic stem cell (hESC) programs and would be seeking partners for each of the programs, with the company focusing on its oncology programs instead.

For information regarding this and other related topics, please see:

• "Geron Discontinues hESC Programs," November 16, 2011
• "Comparative Study on Patenting of Human Embryonic Stem Cells," November 16, 2011
• "Let the Experiment Begin: Impact of ECJ Stem Cell Ruling on Synthetic Blood Development," November 15, 2011
• "No More Patents for Cells Derived from Human Embryos in EU," October 18, 2011
• "European Court of Justice Renders Stem Cell Decision," October 18, 2011
• "GOP Candidates Unified in Opposition to Embryonic Stem Cell Research," August 16, 2011
• "European Court of Justice Considers Embryonic Stem Cell Ban," May 11, 2011
• "The Hinxton Group Foresees Stem Cell Issues and Proposes Solutions," April 4, 2011

Top Stories of 2011: #12 to #10

By Donald Zuhn --

Reflecting upon the events of the past twelve months, Patent Docs presents its fifth annual list of top biotech/pharma patent stories.  For 2011, we identified a dozen stories that were covered on Patent Docs last year that we believe had (or are likely to have) the greatest impact on biotech/pharma patent practitioners and applicants.  Today, we count down stories #12 to #10, and then throughout the week, we will work our way towards the top three stories of 2011.  As with our other lists (2010, 2009, 2008, and 2007), links to our coverage of these stories (as well as a few links to articles on related topics) have been provided in case you missed the articles the first time around or wish to go back and have another look.  As always, we love to hear from Patent Docs readers, so if you think we left something off the list or disagree with anything we included, please let us know.

12.  Europe Seeks Unified Patent System

In February, the European Parliament approved a request to use "enhanced cooperation" to launch a reform of the European patent system.  At the time, it seemed to be the last major hurdle to reaching agreement on a unified patent system and court in Europe.  By April, this view appeared to have been too optimistic, as the European Court of Justice ruled that a separate European patent court would violate EU law by taking powers away from courts in EU countries.  Despite the adverse ruling on a unified patent court, the European Commission moved ahead with its plans to create a unified EU patent.

For information regarding this and other related topics, please see:

• "European Patent Reform Suffers Another Setback," April 27, 2011
• "European Parliament Approves Enhanced Cooperation Procedure to Create Unified EP Patent System," March 1, 2011

11.  FDA Drug Approvals at Decade High (Almost)

Trying to counter some of its critics, the U.S. Food and Drug Administration announced in November that the agency approved 35 new drugs in FY 2011, which, with the exception of 2009 when 37 new drugs were approved, constituted the most approvals in the past decade.  Criticism of the FDA has centered around the agency's tougher safety standards, which some argue have slowed down the pace of drug approvals and have hurt the drug industry.  Despite the increase in drug approvals, a Health Affairs paper (published in November 2010, but discussed here in January 2011) contends that extending "data exclusivity" for conventional "small molecule" drugs from the present 5 years under the Hatch-Waxman Act to 12 years (the term given biologic drugs under the Affordable Care Act of 2010) would provide a net benefit in new drugs and increased longevity.

For information regarding this and other related topics, please see:

• "FDA Approves 35 New Drugs in FY 2011," November 20, 2011
• "FDA Drug Approvals for 2011 on Pace to Surpass 2010 Despite New Safety Standards," July 13, 2011
• "Authorized Generics Again under Fire in Senate Bill," February 23, 2011
• "Academic Study Supports Longer Data Exclusivity Term for Conventional Drugs," January 17, 2011

10.  Deficit Debate Delays USPTO Plans

During the first few months of the year, the U.S. Patent and Trademark Office announced a number of new initiatives aimed at decreasing application pendency and increasing examination quality.  However, by April the USPTO announced that the programs, including both Track I examination and the Detroit satellite office, were being put on hold due to budgetary constraints following enactment of the budget for FY 2011 on April 15.  The good news is that several of the initiatives that were delayed last spring were part of the Leahy-Smith America Invents Act (a story for another day).  Of course, securing appropriate funding to implement the new programs will be an entirely different matter (despite Congress' promises to the contrary).  Despite the ups and downs of 2011, the USPTO was able to close the year on a good note when it announced that the number of unexamined patent applications had been reduced to 669,625, which constituted a five-year low.

For information regarding this and other related topics, please see:

• "U.S. Application Backlog Falls to Five-Year Low," October 24, 2011
• "USPTO Publishes Notice Regarding Prioritized (Track I) Examination Delay," May 1, 2011
• "USPTO News Briefs," April 27, 2011
• "USPTO Satellite Offices on Hold," April 25, 2011
• "USPTO News Briefs," April 21, 2011
• "USPTO to Launch Prioritized Examination on May 4th," April 10, 2011
• "USPTO Provides More Details Regarding "Three Track" Examination Proposal," February 7, 2011