Patent Docs

Patent Profile: CellCyte Genetics Announces Issuance of Patent on Stem Cell Delivery Method

    By Donald Zuhn --

Last week, CellCyte Genetics announced that it had been granted U.S. Patent No. 7,282,222, which relates to methods for delivering stem cells to a target tissue in a mammal using glycoconjugate to traffic the cells to a desired organ.  According to CellCyte's press release, the Kirkland, Washington based biotech company, which has exclusively licensed the '222 patent from the U.S. Department of Veterans Affairs, plans to use the patented technology to develop stem cell enabling therapeutic products for efficient delivery and significantly increased retention of adult stem cells to target organs such as the heart.

CellCyte's first product in development, CCG-TH30, is designed to target autologous bone-marrow-derived (adult) stem cells to the heart of patients after a heart attack/  CellCyte Chief Scientific Officer Dr. Ronald Berninger noted that CCG-TH30 has been shown in preclinical models to increase stem cell retention to 77% as opposed to the 6% retention level of conventional methods.  In addition, unlike conventional methods that require an invasive procedure, CCG-TH30 can be delivered intravenously.  A video outlining the CellCyte's technology can be viewed here.

The '222 patent issued from U.S. Application No. 10/388,964, filed March 14, 2003, and claims the benefit of U.S. Provisional Application No. 60/364,498, filed March 15, 2002.  Representative independent claims 1, 3, 5, and 7 of the '222 patent recite:

1.  A method for targeting a hematopoietic stem cell to the heart of a mammal comprising administering an asialoorosomucoid to the mammal prior to administration of the cell to the mammal, whereby the cell is directed to the heart.

3.  A method for targeting a mesenchymal stem cell to the heart of a mammal comprising administering an orosomucoid to the mammal prior to administration of the cell to the mammal, whereby the cell is directed to the heart.

5.  A method for targeting a hematopoietic stem cell to the liver of a mammal comprising administering an orosomucoid to the mammal prior to administration of the cell to the mammal, whereby the cell is directed to the liver.

7.  A method for targeting a mesenchymal stem cell to the liver of a mammal comprising administering an asialoorosomucoid to the mammal prior to administration of the cell to the mammal, whereby the cell is directed to the liver.

The Wall Street Journal's Problem with the U.S. Constitution

    By Kevin E. Noonan --

Continuing its obliquely negative coverage of U.S. Patent law, Peter Lattman of The Wall Street Journal is shocked (shocked!) to find that the University of California is immune from patent infringement suits, despite being an avid participant in obtaining patents on technology developed by its faculty researchers.  In an article entitled "Critics Take Aim at California's Patent Shield" published yesterday, Mr. Lattman accurately reports that the University receives more patents than any other American university:  it has made $521 million in royalty and fee income over the past five years, and received almost 29,000 "foreign and domestic" patents over that period.  (Of course, the foreign patents are irrelevant to the point of the article, but they certainly inflate the numbers.  According to the U.S. Patent and Trademark Office website, the number of U.S. patents granted to the Board of Regents of the University of California over this 5-year period is actually 2,567 patents.)

California has benefited from patent protection because it can (and does) sue infringers in federal court.  The article specifically mentions major settlements from suits against Genentech ($200 million), Monsanto ($185 million) and Microsoft ($30 million).  Conversely, and what has roused Mr. Lattman's ire, is that California cannot be sued for its own infringement, terming the University, and the State of California "Teflon."  (Curiously, without using the ® symbol.)  Prompting the article is a recent decision by the Court of Appeals for the Federal Circuit affirming a decision from the District Court for the Northern District of California, Judge Marilyn Hall Patel presiding, that California was immune from a lawsuit by Biomedical Patent Management Corp. over a patent on a method for screening fetuses for birth defects.  Judge Patel, Mr. Lattman reports, was unhappy with this immunity, noting that private universities "enjoy no such advantage."

And, Mr. Lattman reminds us, the problem is not limited to California (citing Texas and Massachusetts as other examples of state universities invoking the immunity) because all state universities have been held to fall within the scope of the immunity.  This is relevant because, since passage of the Bayh-Dole Act in 1980 permitting (actually, encouraging) universities to patent the technological results of their faculty's research, state universities "have become major players in the patent world," with "vast amounts of intellectual property."  This has resulted in "billions of dollars in revenue" garnered from patent licensing to private enterprise.

But Mr. Lattman's problem is not with the U.S. patent system, it is with the Constitution.  As the article acknowledges, the source of the immunity is the 11th Amendment to the Constitution, which reads:

The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.

The concept of sovereign immunity stems from British common law, banning lawsuits against the king.  Although not explicitly stated in the Amendment, the Supreme Court has interpreted 11th Amendment immunity to extend to actions of a citizen against the state in which she resides.  Hans v. Louisiana, 134 U.S. 1 (1890).  The rationale behind the immunity conferred by the Amendment is that the "States entered the federal system with their sovereignty intact," Blatchford v. Native Village of Noatak, 501 U.S. 775 (1991), and that "the sovereign immunity of the States neither derives from nor is limited by the terms of the Eleventh Amendment.  Rather, . . . the States' immunity from suit is a fundamental aspect of the sovereignty which the States enjoyed before the ratification of the Constitution, and which they retain today," Alden v. Maine, 527 U.S. 706 (1999).  Although Alden sets out this rationale for the scope of the immunity, it is important to recognize that Alden was a 5-4 decision, with the dissenting justices believing that the States had surrendered sovereign immunity when they ratified the Constitution.  The immunity is also limited to state action, and is not shared by "lesser" jurisdictional entities like municipalities or counties.

Moreover, the immunity is not absolute.  It can be waived, and many states (as well as the federal government) have waived sovereign immunity in suits for tort and contract.  Certain U.S. Constitutional provisions trump the immunity, such as the Bankruptcy Clause and the 14th Amendment.  However, patent law does not fall within any federal law exemption, and the Supreme Court has recently decided expressly that States enjoy sovereign immunity against suits for patent infringement.  Florida Prepaid Postsecondary Education Expense Board v. College Savings Bank, 527 U.S. 627 (1999).

But sovereign immunity is not limited to patent infringment lawsuits, and indeed there are even more "outrageous" consequences of applying the doctrine.  For example, sovereign immunity is expected to shield Virginia Tech (a state school) from liability resulting from the shooting rampage that killed several students in April.  Pursuant to Virginia's limited waiver of sovereign liability for torts, suits will be limited to proof of state negligence and are capped at a maximum recovery of $100,000.

Thus, the issue is the Constitution, not patent law.  The Supreme Court has not seen fit to include patent law within the power of Congress or the federal judiciary to abrogate; indeed, Justice Kennedy, writing for the Court in the Alden case, expressed the belief that Congress lacked the power to force States to waive sovereign immunity in patent cases.  Although bills have been introduced to force States to waive sovereign immunity in order to be eligible for patent protection, Congress has never passed one.  The only sure remedy would be to amend the Constitution, something there appears to be little political impetus or will to do.

ADDENDUM:

As Mark Rosen properly notes, there are instances where Congress can impose waiver of sovereign immunity on a state, but it isn't as simple as legislation that would require waiver in order for states to be entitled to patent protection.

If there was a pattern or record of states violating the 14th (due process) or 5th (takings/eminent domain) Amendments with regard to property rights, then the Court in Florida Prepaid could consider the action constitutional.  The quotation from the case reads as follows (emphasis added):

Thus, under the plain terms of the Clause and the clear import of our precedent, a State's infringement of a patent, though interfering with a patent owner's right to exclude others, does not by itself violate the Constitution.  Instead, only where the State provides no remedy, or only inadequate remedies, to injured patent owners for its infringement of their patent could a deprivation of property without due process result.

                                      * * *

Congress, however, barely considered the availability of state remedies for patent infringement and hence whether the States' conduct might have amounted to a constitutional violation under the Fourteenth Amendment.  It did hear a limited amount of testimony to the effect that the remedies available in some States were uncertain.

It isn't clear whether the law could be selective (along the lines of "if a state is found to provide no or inadequate remedies for patent infringement") or whether it would require a finding that state were generally providing no or inadequate patent infringement remedies.  It does point to a relatively clear path for Congress to address the question without having to amend the Constitution.

Ventana Opens Its Books to Roche

    By Donald Zuhn --

Last summer, we reported that Roche had made an offer to acquire Ventana Medical Systems, Inc. for $75 per share, or approximately $3 billion.  In response, Ventana's Board of Directors announced that it had determined that Roche's offer was "inadequate in multiple respects and contrary to the best interests of Ventana's stockholders," and therefore, was recommending that its stockholders not tender their shares to Roche.  Since July, Roche has extended its tender offer four times, and following Roche's fourth extension in October, Ventana announced that more than 99.5% of its investors had turned down Roche's overtures.

On the heels of Roche's fourth extension, Ventana released a statement on Tuesday that it had entered into a confidentiality agreement with Roche which "will allow Roche to commence due diligence and have appropriate access to non-public information regarding Ventana to better understand the Company's business prospects and the inherent value in companion diagnostics."  Ventana's Board of Directors took the opportunity to reiterate that Roche's $75 offer was "grossly inadequate . . . as reflected by that fact that Ventana's share price has consistently traded well above Roche's offer and our stockholders have overwhelmingly rejected that offer four times."

Reuters reported today that, according to some analysts, Ventana could be worth as much as $90 per share as a stand-alone business, and therefore, that Roche may have to increase its bid to $100 if it intends to close the deal.  Ventana's stock closed at $88.94 on Wednesday.

Ventana's patent portfolio includes at least 51 U.S. patents and 36 U.S. patent application publications.

For additional information regarding this topic, please see:

• Roche's press release regarding the confidentiality agreement
• "Ventana's Board Urges Stockholders Not to Tender Their Shares; Roche Responds," July 11, 2007
• "Roche's Bid for Ventana Medical Systems Hits Snag," July 10, 2007
• "Roche Commences Tender Offer for Ventana Medical Systems," June 27, 2007
• "Roche Makes Offer to Acquire Ventana Medical Systems," June 26, 2007

Post-GSK: Where Do We Go from Here? - Accelerated Examination

    By Kevin E. Noonan --

The following is part of a continuing series on how to address the very real problems facing the U.S. Patent and Trademark Office.

A day after the day of rejoicing for inventors, patent practitioners, examiners, and seemingly all of civilization, fair-minded people will concede that the U.S. Patent and Trademark Office faces a daunting task.  After years of neglect - from Congress raiding the users' fees, an inadequate number of examiners, technology-driven increases in the number of applications filed, and a "count" system that has not rewarded a style of examination that encourages prosecution to a definitive end point - the Office is facing a massive backlog of applications without sufficient resources to process them in a timely manner.

If the patent bar is gladdened by District Court Judge Cacheris' decision enjoining implementation of the new rules - representing an attempt, albeit a misguided one, on the part of the Office to address the pendency and backlog problems - it behooves us to propose alternatives.  Patent Docs will be posting a series of such proposals, and we invite our readers to provide their own ideas.  As they used to say in the days of the counterculture, "if you are not part of the solution, you are part of the problem."  Patent Office management clearly thinks the patent bar is part of the problem; it would be satisfying to prove them wrong.

Accelerated examination

A little more than one year ago, the Patent Office revised the procedures relating to accelerated examination.  Prior to the change, an applicant could file a "Petition to Make Special" in certain circumstances, including applicant age (if the inventor was at least 65 years old), ongoing activities of a third party that would constitute infringement once a patent was granted, and for certain technologies including treatments for cancer and acquired immune deficiency syndrome.  The Office abolished this system effective August 26, 2006 (while continuing the old practice on the basis of health or age) in favor of a pilot program permitting an applicant to obtain accelerated examination if the applicant was willing to satisfy certain new requirements.

The benefit of accelerated examination is a "promise" that the applicant would obtain a patent within 12 months from filing.  The requirements are:  the application must be complete upon filing, be filed electronically, and specifically request accelerated examination; that it contain no more than 3 independent claims and 20 total claims and not contain a multiply-dependent claim; applicants agree to telephone restriction requirements, and to pursue claims to only one invention (i.e., not to traverse the restriction), and further that applicants agree to telephone interviews even prior to a first Office Action on the merits; and that a pre-examination search is performed.  Examination occurs with "special dispatch" and all actions except a final rejection are subject to a one-month shortened period for response; extensions of time are not allowed except for unavoidable delay, and failure to timely respond results in abandonment.  The most burdensome aspect of the process is that a simple information disclosure statement does not suffice to bring prior art to the examiner's attention.  Rather, applicants are required to provide a detailed explanation of the art, along the lines of the "examination support document" that is a part of the Office's new rules enjoined by Judge Cacheris of the District Court on October 31st.

The Office has touted this program as a way for an applicant to avoid long pendency times for inventions that would benefit from having patent protection obtained rapidly.  There are certainly technologies that have (relatively) rapid obsolescence times and that could benefit from this program (see "Could Creating a U.S. 'Utility Model' Patent Fulfill the 'Need' for Patent Law Reform?"); according to Office statistics, 650 applications have been designated for the program and the Office has granted 97 patents since the program went into effect (see "AE Petitions Status").

As has become its penchant recently, the Office seems to be onto something here, but its own bureaucratic approach and some fundamentally flawed assumptions have prevented it from using the accelerated examination procedure more broadly (and some of this depends on unnecessarily burdensome requirements).  The program could be useful in addressing the Office's major problem - the backlog of unexamined applications - with only a few small changes.  First, permit an applicant to designate any application, especially pending ones, to fall within the scope of the modified accelerated examination schedule proposed here.  Second, have the decision point be at 18 months rather than one year, to give applicants and the Office sufficient time for a proper examination.  Third, retain the limitations to a single invention but with a total of 5 independent and 25 total claims, as in the enjoined new rules.  Fourth, retain the expedited examination schedule (shortened statutory response periods and limitations on extensions-of-time) to prevent the program from failing to meet its main goal, reducing the backlog.  Fifth, continue the emphasis on telephone conferences between the Examiner and applicant's representative and require all formal submissions to be made using the electronic filing system (EFS).

The major difference between the current system and the one proposed here is that an applicant would not file an examination support document.  Instead, as part of the telephonic interview the examiner and applicant's counsel would fully and frankly discuss the art and, in short, provide verbally all of the substantive information now required in the document.  The difference is that none of this would become part of the written record.  While seemingly counterintuitive, such a scheme is the only way, in view of the current status of the law regarding inequitable conduct, that counsel would be comfortable having the type of discussion required to expedite examination.

Although seemingly radical, on reflection this concept is much less so.  For example, it is true that such a system would run counter to the prevailing trend to increase transparency in the examination process, including such features as publishing pending U.S. applications and making the prosecution history publicly available upon publication.  However, it is informative to remember that less than 10 years ago U.S. applications were not published, and the Republic survived the prior two hundred twenty-four years with a patent system of confidential, ex parte prosecution.  Moreover, the American Inventor Protection Act of 2000, which required U.S. patent applications be published, did not require the Office to make a published application's file history publicly available prior to grant.  It gave the Office the authority to do so but did not require it, and consequently many applicants had their counsel file applications prior to the November 2000 deadline date to prevent public access to their "ex parte" prosecution files.  Similarly, it has only been in the past decade that the Office had required applicants and examiners to put formal interview summaries in the prosecution file history; prior to this change, interview summaries like "prior art discussed with applicant's counsel and agreement reached" were common, with no additional information being available.

Additionally, present practice is replete with applicants and their representatives putting qualifying language on the record to prevent courts and accused infringers from misconstruing statements that could later be taken out of context.  Phrases like "without acquiescing to the asserted grounds of rejection" and "although applicants dispute the interpretation of the art in the Action" and "solely in an effort to expedite prosecution of the pending claims to allowance" are frequently encountered in the remarks section of many Office Action responses.  This tendency has been exacerbated by the expansive view of prosecution history estoppel, both with regard to claim interpretation as well as the application of the doctrine of equivalents, espoused by the Federal Circuit over the past decade or so.  The purpose of this qualifying language is merely to prevent an accused infringer from making an ex post facto argument that prosecution was undertaken in bad faith.  This is the risk every applicant and their counsel takes, since allegations of inequitable conduct have been and continue to be a "veritable plague" on the patent system.

Even though almost always alleged, however, inequitable conduct is rarely proven.  While this is due in part to the heavy burden required to establish inequitable conduct, the burden is no heavier than the burden required to prove invalidity (i.e., clear and convincing evidence).  Yet invalidity is found more frequently than inequitable conduct.  While a number of explanations can be proffered for this result, the most likely one is also the simplest:  that the overwhelming majority of applicants and their counsel simply do not commit inequitable conduct.  For applicants, the potential costs (including Walker Process damages) of an inequitable conduct determination by a District Court discourages any tendencies towards committing inequitable conduct, while most counsel are unlikely to risk their livelihoods and the disqualifying wrath of Mr. Harry Moatz and the Office of Enrollment and Discipline for any one patent or client.  Indeed, one of the paradoxical accusations raised against applicants and their counsel as a justification for ESDs is submission of cumulative art, which is almost always motivated by the fear of an inequitable conduct allegation.  Thus, it is reasonable to assume that for the vast majority of cases there would be no enhanced risk of inequitable conduct should the Office permit an applicant's representative to have an ex parte, off-the-record, full and frank discussion of the art with an Examiner.

The benefits of this practice are just all of the purported benefits of the proposed (and enjoined) ESD system.  Examiners would benefit from having applicants prioritize the prior art based on how close the art is to the claimed invention, and would also benefit from being able to have applicants point out the portions of the art that disclose elements of the claimed invention.  Good-faith applicants, the overwhelming majority, would be in the best position to know the patentable distinctions with the art and thus have no substantive impediment towards pointing out where the art disclosed, and did not disclose, the elements of the claimed invention.  Moreover, knowing this discussion was part of the patentability process would encourage applicants to have their counsel perform a pre-filing search, which would result in more focused claims in these applications.

The Office could also reserve the right, upon good cause provided, for the Examiner to propose that certain portions of the information covered in such an ex parte discussion become part of the prosecution file history, most probably without attribution.  Applicants could always have the opportunity to drop out of the accelerated examination program should they disagree with an examiner's decision to make such information of record.  Applicants would retain the right to prevent the Office from disclosing the nature of any such admissions upon request, although doing so would result in foreswearing the advantages of the accelerated examination program.  For applicants, the advantage is obtaining patents more rapidly.  For the Office, the advantage is eliminating some portion of the backlog within 18 months, as well as the possibility of expanding the program to maximize the number of applications choosing to exercise this option.

Whether one thinks that this scheme has merit will depend on whether they believe that the overwhelming majority of applicants and their counsel engage in good-faith efforts to zealously obtain the greatest extent of protection that their invention legitimately deserves, or if one believes that applicants and their counsel routinely engage in inequitable conduct during patent prosecution (despite empirical evidence to the contrary).  Put more bluntly, if one believes (as current Office management seems to) that their customers and counsel are liars and thieves actively trying to "game" the system to obtain a benefit they don't deserve, then the scheme proposed herein will appear hopelessly naïve and unworkable.  If however, as both evidence and common sense would persuade the unbiased observer, it is the best interests of applicants and their counsel to honestly prosecute patent applications to allowance, and if that is in fact what happens in almost all instances, then perhaps it would be possible to actually craft a system where the Office and their customers work together to ensure that granted U.S. patents are valid and enforceable.  The Office declaims loudly that such a cooperative effort is what they want; it is time they took steps that would help us believe them.

For additional articles in the "Post-GSK" series, please see:

• "Deferred Examination," November 12, 2007
• "Co-owned, Co-pending Applications," November 11, 2007
• "Increased Fees for Continuations," November 8, 2007
• "Regional Patent Offices," November 7, 2007
• "Tailoring Protection and Examination," November 6, 2007
• "Annuities," November 1, 2007

Post-GSK: Where Do We Go from Here? - Deferred Examination

    By Donald Zuhn --

The following is part of a continuing series on how to address the very real problems facing the U.S. Patent and Trademark Office.

A day after the day of rejoicing for inventors, patent practitioners, examiners, and seemingly all of civilization, fair-minded people will concede that the U.S. Patent and Trademark Office faces a daunting task.  After years of neglect - from Congress raiding the users' fees, an inadequate number of examiners, technology-driven increases in the number of applications filed, and a "count" system that has not rewarded a style of examination that encourages prosecution to a definitive end point - the Office is facing a massive backlog of applications without sufficient resources to process them in a timely manner.

If the patent bar is gladdened by District Court Judge Cacheris' decision enjoining implementation of the new rules - representing an attempt, albeit a misguided one, on the part of the Office to address the pendency and backlog problems - it behooves us to propose alternatives.  Patent Docs will be posting a series of such proposals, and we invite our readers to provide their own ideas.  As they used to say in the days of the counterculture, "if you are not part of the solution, you are part of the problem."  Patent Office management clearly thinks the patent bar is part of the problem; it would be satisfying to prove them wrong.

Deferred examination

Patent Docs readers have proposed a number of suggestions for helping the U.S. Patent and Trademark Office deal with its pendency and application backlog problems (we'll have more on readers' suggestions in another article).  One proposal that has been frequently suggested is that the Patent Office allow applicants to defer examination.

Such a deferred examination system exists in Japan, where an applicant can put off examination for up to three years after filing (see "Procedures for Obtaining a Patent Right" at the JPO website).  If an applicant has not requested examination within three years of filing, however, the application will be regarded as irretrievably withdrawn.  By requiring applicants to request examination, and thereby defer examination by withholding such a request, the Japan Patent Office does not waste valuable examination resources on an application the applicant may later deem to be of little value.  In addition, an applicant can request examination immediately after filing in order to expedite prosecution of applications the applicant deems to be more valuable.

Two Patent Docs readers noted that the U.S. Patent Office already has a deferred examination system in the form of the suspension of action provisions of 37 C.F.R. § 1.103.  Under Rule 103(a), an applicant may request a suspension of action of up to six months "for good and sufficient cause," provided that a reply by applicant to a pending Office action is not outstanding.  Under Rule 103(b), an applicant can secure a three-month suspension, but only for a continued prosecution applications (CPA).  Under Rule 103(c), an applicant can request a three-month suspension upon filing a request for continued examination (RCE).  The provision of Rule 103 that the two astute readers were specifically pointing to, however, is 103(d), which permits an applicant to defer examination for up to three years provided that the applicant has not filed a nonpublicaton request (or has rescinded the nonpublication request), the application is in condition for publication, and the Patent Office has not issued an Office action under 35 U.S.C. § 132 or a notice of allowance.  For the deferred examination request under Rule 103(d), the Patent Office even provides a form:  PTO/SB/37.

It seems, therefore, that the U.S. Patent Office already has a deferred examination system that appears to be the equal of Japan's deferred examination system.  So why are these provisions of the rules (especially Rule 103(d)) so little known and so little used?  Perhaps it has something to do with the Patent Term Adjustment ramifications of requesting a suspension of action or deferred examination under Rule 103(a)-(d).  According to M.P.E.P. § 709, such a request "will cause a reduction in patent term adjustment accumulated (if any) under 37 CFR 1.703."  More likely, however, it's because the system has one significant difference from Japan's deferred examination system.

In Japan, the default is no examination and an applicant can request examination at any time after filing.  Thus, in Japan, an applicant can request examination immediately, wait three years to request examination, or wait anytime in between to request examination.  In the U.S., however, the default is examination, an applicant must request deferral, and at the time of this request, must specify a deferral period of up to three years.  According to M.P.E.P. § 709:

Once the deferral of examination has been granted, the application will not be taken up for action by the examiner until the suspension period expires.  For example, if an applicant files a request for deferral of examination under 37 CFR 1.103(d) for the maximum period permitted under the rule in an application that claims priority of a foreign application filed 1/3/00, the action by the Office on the application will be suspended and the application will automatically be placed in a regular new case status on the examiner's docket on 1/4/03 (36 months from the effective filing date of the application, i.e., 1/3/00).

Thus, it would seem from this portion of the M.P.E.P. that in the U.S., an applicant will be stuck with the deferral period originally requested.  In other words, if an applicant chooses a deferral period of three years and circumstances change, tough luck; the applicant could be out three years of patent term adjustment.  However, as usual with the USPTO, everything is not always as it seems.  According to M.P.E.P. § 709(D), an applicant can "submit[] a request for termination of the suspension of action prior to the end of the suspension period," and such a termination "will be effective when an appropriate official of the Office takes action thereon."  Of course, it's unclear how long the Patent Office might take to terminate the suspension of action, and for certain biotech or pharma patents, the loss of even a few months of adjusted patent term could cost a patentee millions.

Clearly, U.S. applicants would be better off with a Japanese-style deferred examination system in which no examination is the default, examination must be requested, and an examination request can be lodged at anytime between filing and three years after filing.  Because the current U.S. deferred examination system appears to see so little use (Patent Docs readers who have requested deferred examination in the U.S. are encouraged to submit comments regarding their experience), the USPTO might also benefit from the implementation of a Japanese-style deferred examination system by allowing the USPTO to expend examination resources on applications that applicants deem to be the most valuable.

For additional articles in the "Post-GSK" series, please see:

• "Co-owned, Co-pending Applications," November 11, 2007
• "Increased Fees for Continuations," November 8, 2007
• "Regional Patent Offices," November 7, 2007
• "Tailoring Protection and Examination," November 6, 2007
• "Annuities," November 1, 2007

The IPO’s Marc Adler on Patent “Quality”

    By Kevin E. Noonan --

It's getting harder and harder for patentees, applicants, and their counsel to know who their friends are.  First there was the silence of the major industry groups in the face of the new continuation and claim limitations rules since enjoined by Judge Cacheris in the Federal District Court in Virginia (see "Breaking A Very Long Silence").  This situation has improved noticeably, however, since GlaxoSmithKline sued the Patent Office.  Several amici filed briefs in support of GSK's (and Dr. Tafas') preliminary injunction motion, and several others have sought leave from the court to file amicus briefs in support of GSK's (and Dr.Tafas') substantive allegations in their respective complaints.

Now comes the Intellectual Property Owners, specifically their President, Marc Adler (at right), who has taken the opportunity at this time to support (unwittingly or not) the fanciful bases the Patent Office has used to justify its ill-conceived new rules.  In an address to the Trilateral Public Users Conference in Washington last Thursday, Mr. Adler admonished patent applicants and their counsel to join with the different patent offices represented at the conference (the U.S., Japanese, and European Patent Offices) to improve the "quality" of patents obtained by applicants.  In this, Mr. Adler sounded vaguely like Patent Commissioner Doll, who has defended the new rules, even when his evidence seemed contradictory (see "They Just Don't Get It - 'Patent Reform' at the USPTO") on the grounds that the Office was trying to improve patent "quality."  The general substance of Mr. Adler's talk (his presentation is available here) was sufficiently generic to resemble patent platitudes.  However, the talk also presented as justification for its admonitions some survey results produced by the IPO directed to patent "quality."  Those results and the way they were used suggest, charitably, a certain naiveté concerning the zeitgeist of the patent world today.

The survey asked a seemingly innocuous question:  how do you rate the quality of patents being issued in the U.S. today in your industry or field of technology?  The responses were reported as follows:  0% outstanding; 3.8% more than satisfactory; 40% satisfactory; 47.5% less than satisfactory; and 3.8% poor.  On its face, this survey thus indicates that more than 50% of respondents thought the quality of patents granted in the U.S. were less than satisfactory.  However, upon closer inspection there are a number of deficiencies in this analysis.  First, the survey responses date from September 2005, and since the question it asks requires a determination that must have been developed over time, the impressions forming the basis of the answers must be even older, towards the turn of the century.  It is certainly the case that the Office was dealing with several challenges over that timeframe that could have negatively affected quality.  These include considering for the first time business method patents in the wake of the Federal Circuit's State Street decision; the tidal wave of human gene patenting applications resulting from the culmination of the Human Genome Project; the changes in patent examination resulting from new utility and written description guidelines promulgated January 6, 2001; the changes in patent law caused by the American Inventor Protection Act; and the cumulative effect of more than 15 years of Congressional fee diversion that left the Office ill-equipped to effectively deal with these challenges.

However, this reasoning concedes that there is (or was) objectively a patent quality problem.  Unfortunately the survey was not objective; it asked for a subjective evaluation (and a qualitative one at that) of patent "quality."  There is no indication that the survey defined what the elusive attribute called "quality" is, and indeed in this context "quality" is like beauty - although it is probably in the purse rather than the eye of the beholder.  There are also self-interest issues involved:  a respondent (all of whom were corporations) could believe that the "quality" of U.S. patents had gone down because for the first time competitors were using patents to prevent such corporations from doing what they liked without interference.  Citing "quality" issues also provides a bit of a fig leaf for an entity that wants to appear to support the patent system (particularly for its own patents) but cast doubt or aspersions on patents of others, especially when those others are asserting their rights to the corporation's detriment.  Perhaps a more telling way of asking the question would have been to ask:  how do you rate the quality of patents being issued in the U.S. today to you in your industry or field of technology?  Of course, it is unlikely that the responses would have been quite the same if the question had been asked like this.

The bigger problem with Mr. Adler's remarks is that they presuppose (much like the Patent Office presupposes) that the problems with the U.S. patent system are caused by patent applicants and their counsel.  (This is a little like saying the problem with poverty in this country is poor people.)  It is likely that almost without exception American patent applicants want "quality" patents, if the term "quality" is defined as patents containing sufficient disclosure and claims of appropriate scope to satisfy the statutory requirements of patentability.  There are a number of practical reasons why this is so.  The most obvious is that a patent that fails to satisfy these requirements is invalid, and no one wants to incur the significant costs of trying to enforce an invalid patent.  Moreover, Rule 56, the duty of candor, and the threat of an inequitable conduct charge provides ample incentive for applicants and their counsel to provide to the Patent Office whatever information is known to them.  The frequency with which inequitable conduct is charged in patent cases (Judge Markey's "veritable plague" has only gotten worse in the intervening 20 years since he made the comment) has resulted in some inefficiencies such as providing cumulative references to the Office.  However, this practice is self-correcting since it is at least as likely that overciting cumulative references will provoke a charge of "hiding" the most relevant art from the Examiner.  In actuality, of course, most criticisms on these grounds come from failure to cite a critical reference, putting into question the significance of cumulative reference citing to any patent "quality" problem.

Mr. Alder and the IPO are apparently victims of the sea change that the current Patent Office management has effected in the relationship between itself and its customers.  The IPO has been for 35 years at the forefront of efforts to facilitate applicant/PTO interactions and cooperation, sponsoring numerous conferences such as the annual PTO Day every December.  Cooperation, however, is not the hallmark of the current Patent Office regime.  As is evident to anyone who has read the proposed continuation and claim limitation rules as they were published for comment in January 2006, or attended any of the "town hall" meetings held by Commissioner Doll and Mr. Taupin, the Office's legal counsel, or read the Office's reaction to the comments in the rules as promulgated on August 21st, or read the Office's briefs submitted to the District Court or considered their argument at the preliminary injunction hearing, Patent Office management has identified the enemy and they are patent applicants and their counsel.  It is understandable that an organization like the IPO with a history of fostering cooperation with the Office could be caught unawares by this Patent Office about-face, and have difficulty responding to the new reality (at least for now).  But it is equally true that the IPO needs to consider these new realities and the impact that it can have, as a preeminent voice of intellectual property owners, when it speaks about patent "quality."  These days, doing so undermines the very people it intends to represent.

Proposed Agenda for Next BCP Art Group Meeting

The biotechnology, chemical, and pharmaceutical technology groups at the U.S. Patent and Trademark Office are scheduled to hold the next quarterly meeting on December 4, 2007.  The proposed topics for discussion include:

Morning Session (9:00-noon EST)

• Patent Corp Security Program -- (presenter: Don Hajec, Director, TC3600)
• KSR Overview, Court Opinion and PTO Guidelines, and Technology Center-Specific Examples of its Application -- (presenters: Kathleen Fonda, OPLA and Jean Witz, QAS, TC1600)

Afternoon Session (1:15-4:00 EST)

• Issues in Small Organic Molecules -- (presenter: Michael Hartley, SPE, Art Unit 1618)
• 101 Sequence Homology -- (presenter: Dave Nguyen, QAS, TC1600)
• Restriction: Combination/Subcombination -- (presenter: Julie Burke, QAS, TC1600)

These topics may change or additional topics may be added before the schedule is finalized.  The presentation can be attended in person at Madison East GIPA (Global Intellectual Property Academy) large lecture room on the second floor (600 Dulany Street, Alexandria, VA).  In order to attend the meeting in person, you must confirm your attendance by November 27, 2007 with Cecilia Tsang by phone (571-272-0562), fax (571-273-0562), or email ([email protected]).  The meeting will also be broadcast via the web.

Post-GSK: Where Do We Go from Here? - Co-owned, Co-pending Applications

    By Kevin E. Noonan --

The following is part of a continuing series on how to address the very real problems facing the U.S. Patent and Trademark Office.

A day after the day of rejoicing for inventors, patent practitioners, examiners, and seemingly all of civilization, fair-minded people will concede that the U.S. Patent and Trademark Office faces a daunting task.  After years of neglect - from Congress raiding the users' fees, an inadequate number of examiners, technology-driven increases in the number of applications filed, and a "count" system that has not rewarded a style of examination that encourages prosecution to a definitive end point - the Office is facing a massive backlog of applications without sufficient resources to process them in a timely manner.

If the patent bar is gladdened by District Court Judge Cacheris' decision enjoining implementation of the new rules - representing an attempt, albeit a misguided one, on the part of the Office to address the pendency and backlog problems - it behooves us to propose alternatives.  Patent Docs will be posting a series of such proposals, and we invite our readers to provide their own ideas.  As they used to say in the days of the counterculture, "if you are not part of the solution, you are part of the problem."  Patent Office management clearly thinks the patent bar is part of the problem; it would be satisfying to prove them wrong.

Identification of co-owned, co-pending applications

One of the little-discussed provisions of the new rules enjoined by Judge Cacheris of the District Court of the Eastern District of Virginia on October 31st were two disclosure provisions.  37 C.F.R. § 1.78(f)(1) required that applicants prosecuting an application must identify other commonly owned applications or patents having (a) an inventor in common with the application being prosecuted, and (b) a claimed filing or priority date within two months of the claimed filing or priority date of the application being prosecuted.  This rule was comprehensive, in the sense that for an application having an actual filing date of December 1, 2006, claiming the benefit of a nonprovisional application filed on June 1, 2004 and a foreign application filed on June 1, 2003, an applicant would be responsible for identifying all co-owned applications naming one inventor in common that were filed within two months of each of the December 1, 2006, June 1, 2004, and June 1, 2003 dates, according to an example published in the Federal Register to illustrate the rules.

The impetus for this reporting requirement was to prevent an applicant from "cheating" on the new rules by filing related applications naming the same inventors.  This aspect was most directly evidenced by subsection 78(f)(2) of the new rules, which created a rebuttable presumption that an application being prosecuted and other commonly owned application or patent contain at least one patentably indistinct claim when the application being prosecuted and the commonly owned application or patent have (a) an inventor in common, (b) substantial overlapping disclosure, and (c) the same claimed filing or priority date.  Subsection 78(f)(1), however, was broader than was required to identify relevant co-owned and co-pending applications, since it did not encompass the requirement for "substantial overlapping disclosure" (which at least could be understood to be an indication that the applications were sufficiently related to raise the rebuttable presumption.

All this has been discussed at length in earlier posts (see, e.g., "An Analysis of the New Rules: 37 C.F.R. § 1.78(f): Commonly Owned Applications and Patents"), and with Judge Cacheris' injunction granted October 31st they are (at least for now) in abeyance.  Assuming the preliminary injunction becomes permanent after the parties have had a chance to fully litigate the issue, the question becomes whether any part of these reporting requirements could or should survive?  On the one hand, providing this information (particularly under the ministerial guise of submitting a pre-approved Patent Office form) would enable applicants to satisfy at least a good portion of the disclosure requirements implicated in the Federal Circuit's McKesson Information Solutions, Inc. v. Bridge Medical, Inc. decision (see Patent Docs report on that case).  Absent the specific circumstances the Court noted in its decision to uphold a finding of inequitable conduct based on an applicant's failure to disclose the existence of co-pending applications, it should be difficult for an infringer to argue that a patentee committed McKesson inequitable conduct in the face of specific disclosure of such applications pursuant to 37 C.F.R. § 1.78(f)(2) (or some judicially-sanctioned equivalent).

Paradoxically, these disclosure requirements that so concerned members of the patent bar (and their clients) might be useful for reducing the backlog of unexamined patents.  In order to comply with the identification requirement, practitioners would need to know about the existence, content, and priority claims of all commonly owned applications or patents having an inventor in common with the application the practitioner is prosecuting.  This raised a burden under the now-enjoined new Rule 78(f) for practitioners who prosecute applications for larger assignees that employ the services of multiple outside counsel.  For each application, Outside Counsel A prosecuting a first application would need to know the identities of all other applications being prosecuted by Outside Counsels B through Z (and, of course, the converse).  This requirement to merely identify co-owned and co-pending applications is less burdensome in the absence of the more extensive analysis required to comply with now-enjoined new Rule 78(f)(2), but still could represent an administrative nightmare for a corporation such as IBM which has, according to its amicus brief filed in the consolidated Tafas v. Dudas and GSK v. Dudas case, 30,000 pending applications.

And this is where the convergence of the rule and the backlog might take place.  It is at least possible that a company like IBM would conclude that a portion of these pending applications are not sufficiently valuable to justify the administrative costs incurred by complying with the notification rule.  This does not imply that these applications were filed improperly or unnecessarily.  However, it is the case that some applications lose value over time, either because the inventions they protect have not had the expected or hoped-for commercial success, or because these inventions have been overtaken by "new and improved" embodiments (that are the subject of their own applications), or for other business reasons.  It is impossible to know the magnitude of this category of cases, but if it is as little as 10% of IBM's pending  application, the backlog would be reduced by 3,000 applications from just this one applicant.  If this pattern were to apply across the spectrum of just the large companies, by this one administrative device alone the patent backlog could be reduced by 75,000 applications.  This is close to the number (11% of the backlog, or about 82,500 applications) that the Office has said contain more than 5 independent claims and 25 total claims, or more than the number of applications having more than 2 continuations.

There are several advantages to this approach.  First, small, high-tech start-up companies and other small entities (including universities) would be relatively unaffected by the rule, since these companies typically do not have 30,000 pending applications, and the burden of complying with the rules is reduced exponentially the fewer the number of pending applications an applicant has.  Second, it is voluntary.  Third, it does not negatively impact patent rights or the ability to apply for as many patents as an applicant may want.  Fourth, it is not merely an administrative device since it facilitates compliance with disclosure rules highlighted in the McKesson decision.  And lastly, by eliminating the rebuttable presumption portion of now-enjoined new Rule 78(f)(2), it imposes no requirement that an applicant provide statements on the prosecution history record that could be (mis)interpreted later by an infringer to be an admission useful to support an inequitable conduct or invalidity challenge.

It is certainly the case that implementation of this rule would impose some costs on applicants, particularly those with large portfolios of pending applications.  However, this aspect of the rule as a certain equitable attractiveness; although it is not the case that large portfolio applicants are "the problem" (as Patent Office sentiment would have it), these applicants are certainly part of the backlog burden.  Encouraging them to do what they can to help ease the backlog is not unreasonable.

For additional articles in the "Post-GSK" series, please see:

• "Increased Fees for Continuations," November 8, 2007
• "Regional Patent Offices," November 7, 2007
• "Tailoring Protection and Examination," November 6, 2007
• "Annuities," November 1, 2007

Court Report

    By Sherri Oslick --

About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases, and a few interesting cases will be selected for periodic monitoring.

Alcon Manufacturing Ltd. et al. v. Barr Laboratories Inc.
1:07-cv-00718; filed November 7, 2007 in the District Court of Delaware

Infringement of U.S. Patent Nos. 5,641,805 ("Topical Ophthalmic Formulations for Treating Allergic Eye Diseases," issued June 24, 1997) and 5,116,863 ("Dibenz[b,e]oxepin Derivative and Pharmaceutical Compositions Thereof," issued May 26, 1992) following a paragraph IV certification as part of Barr's filing of an ANDA to manufacture a generic version of Alcon's Patanol® (an ophthalmic solution containing olopatadine hydrochloride, used to treat allergic conjunctivitis).  View the complaint here.

Connetics Corporation et al. v. Pentech Pharmaceuticals, Inc.
1:2007cv06297; filed November 6, 2007 in the Northern District of Illinois

Infringement of U.S. Patent Nos. 6,126,920 ("Method of Treating a Skin Disease with a Corticosteroid-Containing Pharmaceutical Composition," issued October 3, 2000) and 7,078,058 ("Corticosteroid-Containing Pharmaceutical Composition," issued July 18, 2006) following a paragraph IV certification as part of Pentech's filing of an ANDA to manufacture a generic version of Connetics' Luxiq® (betamethasone valerate foam, used to treat dermatoses of the scalp).  View the complaint here.

Bayer Healthcare Pharmaceuticals Inc. v. Watson Pharmaceuticals, Inc. et al.
2:07-cv-01472; filed November 5, 2007 in the District Court of Nevada

Infringement of U.S. Patent Nos. 6,787,531 ("Pharmaceutical Composition for Use as a Contraceptive," issued September 7, 2004), RE37,564 ("Composition for Contraception," issued February 26, 2002), and RE37,838 (same title, issued September 10, 2002) following a paragraph IV certification as part of Watson's filing of an ANDA to manufacture a generic version of Bayer's Yaz® (drospirenone & ethinyl estradiol, used for oral contraception).  View the complaint here.

Glaxo Group Ltd. et al. v. Teva Pharmaceuticals USA Inc.
1:07-cv-00713; filed November 2, 2007 in the District Court of Delaware

Infringement of U.S. Patent No. 5,859,021 ("Antiviral Combinations," issued January 12, 1999) following a paragraph IV certification as part of Teva's filing of an ANDA to manufacture a generic version of Glaxo's Combivir® (lamivudine and zidovudine, used in the treatment of HIV-1 infection).  View the complaint here.

Sepracor Inc. et al. v. Lupin Limited et al.
3:07-cv-05265; filed November 1, 2007 in the District Court of New Jersey

Infringement of U.S. Patent Nos. 7,214,683 ("Compositions of Descarboethoxyloratadine," issued May 8, 2007) and 7,214,684 ("Methods for the Treatment of Allergic Rhinitis," issued May 8, 2007), licensed to Schering-Plough, following a paragraph IV certification as part of Lupin's filing of an ANDA to manufacture a generic version of Schering-Plough's Clarinex® (desloratidine, used to treat allergies).  View the complaint here.

Conference & CLE Calendar

November 13-15, 2007 - Pharma and Biotech Collaborative Agreements (American Conference Institute) - New York, NY***

December 3, 2007 - 18th Annual Conference on U.S. Patent and Trademark Office Law and Practice - PTO Day (Intellectual Property Owners Association and U.S. Patent and Trademark Office) - Washington, D.C.

January 9, 2008 - Patent Claim Construction (Law Seminars International) - San Francisco, CA

January 30-February 1, 2008 - Pharma/Biotech IP Due Diligence (American Conference Institute) - New York, NY***

February 15, 2008 - Patent Claim Construction (Law Seminars International) - Chicago, IL

***Patent Docs is a media sponsor of this conference or CLE.

Ocean Tomo® Announces Results of IP Auction Held on October 25, 2007

    By Christopher P. Singer --

On October 30, 2007, Ocean Tomo Auctions, LLC (the auctions arm of Ocean Tomo LLC) announced the results of its live IP auction, held on October 25, 2007 in Chicago.  The announcement indicated that sales from the open bidding session and transactions that immediately followed the open bidding totaled $11,599,500.  Thirty-seven of the 75 lots available were sold on the day of the event, making it one of Ocean Tomo's most successful IP auction to date, based on percentage of lots sold during the event.  The lots not receiving bids meeting the seller's minimum reserves could be traded privately.  The average sale price per lot was $305,250, with the highest sale price being $1,925,000.  Ocean Tomo's next live auction is scheduled for April 1-2, 2008 at the Ritz-Carleton in San Francisco.  Intellectual property owners can submit their IP for consideration by calling 312-377-4851 or by visiting http://www.oceantomoauctions.com.

Patent Docs Celebrates One Year of Operation

One year ago today, the authors listed on the sidebar to the left -- Donald Zuhn, Kevin Noonan, Jason Derry, Chris Singer, and Sherri Oslick -- began publishing Patent Docs, a weblog focusing on recent developments in biotech and pharma patent law.  Chris Singer penned the first new Patent Docs article, which discussed the electronic submission of Sequence Listings via the EFS-Web.

In the year since our first new post, we have published over 600 more articles covering changes in Patent Office rules and procedures affecting biotech and pharma patent prosecution, summarizing court decisions impacting biotech and pharma patent litigation and prosecution, reporting on biotech and pharma news, and highlighting newly issued biotech and pharma patents.  Over the past year, Patent Docs has provided in-depth coverage of the new continuation and claims rules and the GSK case, the KSR decision and the Patent Office's response to KSR, proposals for improving the U.S. patent system, patent reform, the gene patenting and stem cell debates, biologics legislation and biosimilars, and compulsory drug licensing.  We have also reported on every biotech or pharma patent lawsuit filed in the past year.

We would like to thank Dennis Crouch of Patently-O for all of his help in getting this project off the ground.  We would also like to thank Mark Chael, Rob Dailey, Baltazar Gomez, Kwame Mensah, Suresh Pillai, and Brad Crawford for their contributions.  More importantly, however, we would like to thank all of you for reading Patent Docs, as well as everyone who has taken the time to submit comments and those who have subscribed to the Patent Docs e-mail newsletter (if you haven't yet subscribed, you can do so by entering your e-mail address in the box to the left).  We enjoy hearing from readers, so if there's anything you want to tell us or if there's a topic or issue that you think we should be writing about, please feel free to contact us at: [email protected].

Post-GSK: Where Do We Go from Here? - Increased Fees for Continuations

    By Kevin E. Noonan --

The following is part of a continuing series on how to address the very real problems facing the U.S. Patent and Trademark Office.

A day after the day of rejoicing for inventors, patent practitioners, examiners, and seemingly all of civilization, fair-minded people will concede that the U.S. Patent and Trademark Office faces a daunting task.  After years of neglect - from Congress raiding the users' fees, an inadequate number of examiners, technology-driven increases in the number of applications filed, and a "count" system that has not rewarded a style of examination that encourages prosecution to a definitive end point - the Office is facing a massive backlog of applications without sufficient resources to process them in a timely manner.

If the patent bar is gladdened by District Court Judge Cacheris' decision enjoining implementation of the new rules - representing an attempt, albeit a misguided one, on the part of the Office to address the pendency and backlog problems - it behooves us to propose alternatives.  Patent Docs will be posting a series of such proposals, and we invite our readers to provide their own ideas.  As they used to say in the days of the counterculture, "if you are not part of the solution, you are part of the problem."  Patent Office management clearly thinks the patent bar is part of the problem; it would be satisfying to prove them wrong.

Increased filing fees for continuation applications

Under the current fee regime, Patent Office filing fees can be broken down into fixed and variable, where the fixed fees are charged for every application but the variable fees are applicant-dependent.  For example, the fees for a utility application containing no more than 3 independent claims and 20 total claims is made up of the basic filing fee ($310.00, 37 C.F.R. § 1.16(a)(1)), a search fee ($510.00, § 1.16(k)), and an examination fee ($210.00, § 1.16(o)); all values are for large entities, and the basic filing fee is waived if the application is filed electronically.  Applicant-dependent fees include fees for filing more than 3 independent claims ($210.00 per claim, § 1.16(h)), total claims in excess of 20 ($50.00 per claim, § 1.16(i)) and a surcharge for filing multiply-dependent claims ($370.00, § 1.16(j)).  The Office also charges more for extra sheets of an application ($260.00 per 50 sheets in excess of 100 total; specification, claims, abstract and drawings), a fee reduced for applications filed electronically.

Several comments received at Patent Docs have suggested that one way of handling the backlog of unexamined applications would be to charge applicants a series of increasing fees for each additional continuation or request for continued examination (RCE) filed in an application.  Suggestions have included a 25% surcharge for the second continuation or RCE, a 50% surcharge for the third, a 100% surcharge for the fourth, etc.  Similarly, it has been suggested that claims in excess of 25 have an additional surcharge (some suggestions are as much as $200 per claim, and double that for claims in excess of 50).  The rationale is that these applications are the cause of the backlog and Patent Office burden, using (maybe even overusing if not actually abusing) Office resources that cannot be used for other (presumably more deserving) applicants, and that our capitalist system supports such a "pay-as-you-go" or "pay-for-play" approach.

The difficulty with these suggestions is that they fall into the same trap that caused (or at least encouraged) the ill-conceived Patent Office "new rules."  First, they blame the applicant for years of neglect, underfunding, and mismanagement at the Office.  Second, they are to be applied indiscriminately against applicants with inventions that legitimately require more than 25 claims to fully protect them.  And while they are frankly intended to influence behavior, brief consideration suggests that the behavior they produce will not solve the problem.  For applicants, burdensome excess claims fees will encourage multiple filings, on the same day, of the same application with claims directed towards different aspects of the invention (compositions, methods of making, methods of using, etc.).  It is unlikely that the problems in the Patent Office will be solved by encouraging more applications to be filed.  Examiner behavior will also be influenced; if an examiner "knows" that an invention isn't patentable, but cannot craft an Office action that does not provoke an applicant to abandon the application or appeal the asserted rejection(s), the examiner will simply be able to continue to reject the claims until the cost of another RCE or continuation becomes too burdensome.  And the examiner will be increasing fees for the Office, a behavior unlikely to be discouraged by PTO management.  The experience of applicants in the biotechnology arts relating to restriction practice is indicative of the problem:  during the past 10 years it has not been uncommon for the Office to issue multiple (in excess of 10) restricted groups, with a view towards reducing examiner burden and increasing divisional application filings (having claims of more restricted scope).  Any policy that encourages examiners to "stick to their guns" with a negative consequence for applicants is no better than the new rules the Office promulgated on August 21st; they would put a premium on intransigence among those examiners who believe they "know something is unpatentable when they see it."  This result would also be expected to increase pendency times.

Any system of increasing fees would have to protect those applicants who can least afford excessive patent filing fees.  Exempting small entities is one possibility in this regard.  However, it is not clear that even large corporations (like GSK) would be able to continue to pursue their applications if the fees, and the time in prosecution, increased dramatically.  GSK's strongest argument was that an applicant, any applicant large or small, has an expectation of fair and timely examination, and that this expectation (and any resulting patent) is the benefit obtained in exchange for full disclosure of the claimed invention.  One of the great weaknesses in the new rules was that they frustrated this reasonable expectation, and it would be unfortunate indeed if this frustration became a part of any proposal to address the real problems the Patent Office faces.

For additional articles in the "Post-GSK" series, please see:

• "Regional Patent Offices," November 7, 2007
• "Tailoring Protection and Examination," November 6, 2007
• "Annuities," November 1, 2007

Ranbaxy, Astellas, and Boehringer Ingelheim settle FLOMAX® Suit

    By Sherri Oslick --

Ranbaxy Laboratories, Astellas Pharma US, Inc., and Boehringer Ingelheim Corporation have announced their agreement to enter into a joint stipulation of dismissal without prejudice in their lawsuit over FLOMAX® (tamsulosin hydrochloride, used to treat benign prostatic hyperplasia).  Under the terms of the settlement agreement, Ranbaxy will have the opportunity to launch its generic tamsulosin on March 2, 2010, eight weeks prior to the expiration of the expected pediatric exclusivity.  Ranbaxy received tentative approval for its tamsulosin product on June 20, 2007.

The case is 3:05-cv-02563, filed May 13, 2005 in the District Court of New Jersey, and was filed by Astellas and Boehringer in response to Ranbaxy's paragraph IV certification as part of its filing of an ANDA to manufacture a generic version of FLOMAX®.  The patent in suit is U.S. Patent No. 4,703,063 ("Sulfamoyl Substituted Phenethylamine Derivatives and Process of Producing Them," issued October 27, 1987).  On February 21, 2007, the district court entered final judgment in favor of plaintiffs, and Ranbaxy appealed.  The parties briefed the case before the Federal Circuit, and oral arguments were held on August 8.  On October 30, the parties filed a motion with the CAFC to remand the case to the lower court for further action to effectuate the settlement.  On November 7 the parties moved the lower court to vacate its prior order and dismiss the case; the motion was granted the same day.

For additional information regarding this case, please see:

• Ranbaxy's press release
• Astellas Pharma's press release