Alnylam CEO Forecasts "Perfect Storm" for Biomedical Patents

    By Donald Zuhn --

In an Op-Ed piece appearing in last Saturday's edition of The Boston Globe, Alnylam Pharmaceuticals Inc. Chief Executive Officer Dr. John Maraganore (at right) wrote about a "perfect storm" that is building against biomedical patent protection.  In an article entitled, "Good for iPods, but bad for patients," Dr. Maraganore asserted that "[p]ending decisions by the Supreme Court, the patent office, and Congress could fundamentally change the ground rules for patent protection within the life sciences industry to such a degree that in a decade we may not have an industry remaining."

Alluding to KSR Int'l Co. v. Teleflex Inc. and MedImmune, Inc. v. Genentech, Inc., Dr. Maraganore contended that the Supreme Court had "significantly shifted the 'goal line' for inventiveness standards in patents, making it much harder for patents to be awarded," and had "destabilized patent licensing."  With respect to the U.S. Patent and Trademark Office's attempt last year to promulgate its draconian continuation and claims rules, the Alnylam CEO argued that the Office was "seeking to change its review process for patent applications by placing shorter limitations on the needed time it takes to invent biotechnological innovations."  Finally, Dr. Maraganore pointed to the efforts in the House and Senate to enact legislation that would "introduce new ways to challenge issued patents after their issuance, resulting in prolonged periods of patent uncertainty," as well as "limit the scope of damages to those who violate patents, encouraging a lackadaisical attitude among infringers."

Dr. Maraganore places the blame for the patent reform bills squarely at the feet of the information technology industry, which he asserts has a view of patents (i.e., they are little more than a nuisance) that is fundamentally at odds with the view held by the biotech industry.  He argues that "the patent changes sought by information technology firms would be nothing short of disastrous for the millions of patients around the world that have benefited from biomedical breakthroughs in diagnosing, treating, and curing disease."

Noting that biotech companies spend about $750 million over a decade to generate a single drug, Dr. Maraganore contends that the development of new medicines is only possible because of the availability of substantial capital investments, which in turn are only possible because of the financial incentives that patents provide to investors.  Dr. Maraganore concludes by encouraging the Senate to "reject or substantially alter the pending bill in light of its potentially devastating impact upon biomedical research," and take the time needed to evaluate the consequences of recent Supreme Court rulings on patent protection.

While Dr. Maraganore may be the first to describe the actions of the three branches of government as constituting components of a biomedical patent perfect storm, he is not the first to point out this three-pronged attack on the U.S. patent system.  For example, last spring we reported on a white paper issued by the California Health Institute which concludes that a handful of Supreme Court decisions, Congress' attempt to enact patent reform legislation, and the Patent Office's push for new patent rules would combine to reduce the value of life sciences patents and thereby have a "chilling effect on biomedical investment and innovation."  Nevertheless, Dr. Maraganore should be commended for adding his voice to the debate, as well as for providing us with such an apt metaphor.

Comments

[Sean]

I would point out that it is not only the S.Ct. but also the CAFC that is contributing on the judicial side.

In particular, the CAFC adopts new theories of inequitable conduct every time someone proposes a new one, frequently takes a nonsensical reading of statutes and regulations, and in general seems to be as anti-patent as the Sup.Ct. in many ways.

There have been some favorable developments, such as the heightening of the willful infringement bar, but in general any appeal to the CAFC seems to be a crapshoot, with the outcome tied to which panel of judges is drawn.