Global patent strategy can make or break a life sciences company, decades after the paperwork has been filed. As a life sciences company executive, the patenting decisions you make today may have to protect a billion dollar R&D investment and billions of dollars in global sales for up to 25 years in the future. With patent cliffs approaching for a number of blockbuster drugs, increasing competition for limited equity and venture capital funding, and the new America Invents Act (“AIA”) coming into full effect in 2013, patents and patent strategy must be top of mind for life sciences executives.
On March 16, 2013, the U.S. will move from a first-to-invent to a first-inventor-to-file patent system. U.S. patent applications having an “effective filing date” on or after March 16, 2013 will be evaluated against an expanded amount of prior art and U.S. patents granted on such applications will be vulnerable to attack on a wide variety of grounds in the U.S. Patent and Trademark Office (“PTO”). For such applications, it will not be possible to “swear behind” prior art by proving an earlier date of invention.
The effective filing date for a claimed invention is the actual U.S. application filing date or the filing date of the earliest U.S. or non-U.S. application from which the U.S. application claims a right of priority or benefit. To be entitled to the benefit of the filing date of an earlier application, the earlier application must provide a written description of the claimed invention and enable one skilled in the art to make and use the full scope of the claimed invention.
All U.S. applications having a first filing date on or after March 16, 2013, will be subject to the new first-inventor-to-file provisions. Some patent applications having a first filing date before March 16, 2013 and a U.S. filing date on or after March 16, 2013 may also be subject to the new first-inventor-to-file provisions. If an application filed before March 16, 2013 does not provide an adequate written description of or does not enable the full scope of the invention claimed in a U.S. application filed after March 16, 2013, then the U.S. application will be subject to the new first-inventor-to-file law.
The scope of prior art available under the new law is broader than under the current law in two significant ways. Public uses, sales and offers for sale and other information publicly available anywhere in the world before the effective filing date of the application will be prior art under the new law. Under the current law, only public uses, sales and offers for sale and other information publicly available in the U.S. qualify as prior art. Earlier-filed, later-published U.S. patent applications, including PCT applications designating the U.S., will be available as prior art as of their earliest priority date under the new law. This is generally about one year earlier than under the current law, under which earlier-filed, later-published U.S. and PCT/US applications are only effective as prior art as of their actual U.S. or PCT/US filing date.
From September 16, 2012, a new Post-Grant Review (“PGR”) proceeding will be available in the PTO to challenge the validity of a granted U.S. patent. However, PGR will generally only be available to challenge U.S. patents having an effective filing date on or after March 16, 2013. Using PGR, a challenger can attack the validity of a U.S. patent, within 9 months from grant, on any invalidity ground that is a defense to patent infringement, including lack of novelty; obviousness; lack of utility/unpatentable subject matter; failure to meet the enablement, written description or definiteness requirement; and nonstatutory obviousness-type double patenting. These grounds of attack are significantly broader than the strictly prior art-based challenges available today in reexamination proceedings in the PTO.
PGR challenges to patent validity in the PTO will have a greater likelihood of succeeding than district court challenges for several reasons. In the PTO, there will be no presumption that the granted patent is valid. The standard of proof required to invalidate a patent in a PGR proceeding will be by preponderance of the evidence, a lower standard than the clear and convincing proof required in court. In addition, in the PTO claims are given their broadest reasonable interpretation as compared to a court proceeding in which a formal claim construction is undertaken, which may result in a narrow claim interpretation that may be more difficult to invalidate.
To avoid the increased amount of prior art and the risk of a PGR challenge, life sciences companies should consider filing new priority applications before March 16, 2013. In ongoing R&D projects for which a priority application was filed on or after March 16, 2012, consideration should be given to filing a second priority application or a U.S. or PCT/US application with additional subject matter before March 16, 2013.
Going forward, life sciences companies must reevaluate their patent filing strategies in view of the move to the first-inventor-to-file system in the U.S. The effective filing date of a U.S. application will be the date of the earliest patent application that provides an adequate written description of and enables one to make and use the full scope of the claimed invention. It is the patent claims, not the patent description, that define the scope of the protection and the patent owner’s right to exclude. Broad, speculative descriptions with limited technical work and few examples may not be sufficient to meet the enablement and written description requirements and may create undesirable prior art against later inventions such as a specific compound, a new use or a new formulation.
Life sciences patents can be particularly vulnerable to an invalidity attack based on lack of enablement or written description. For example, a claim to a method for treating a disorder by administering an active ingredient in an ascending release dosage form was held invalid for lack of enablement because it covered both osmotic and non-osmotic release dosage forms. The patent specification focused on osmotic release dosage forms, but did mention non-osmotic release dosage forms which were known in the art. The court found that it would have required undue experimentation to make and use ascending release non-osmotic dosage forms at the time the patent was filed. In another case, claims directed to drug-eluting stents utilizing “rapamycin, or a macrocyclic lactone analog thereof” as the therapeutic agent were held invalid for failure to meet the written description requirement. The court found that because the patent contained no examples of macrocyclic lactone analogs of rapamycin and gave no guidance on how to properly determine whether a compound is a macrocyclic lactone analog of rapamycin besides vaguely indicating they must be structurally similar to rapamycin, the patent did not contain sufficient written description support.
In crowded or fast-following technical areas, a “one and done” priority application filing strategy is unlikely to be the most effective under the first-inventor-to-file law. Life sciences companies should consider filing multiple priority applications, as R&D efforts deliver results, in order to get the earliest effective filing date and the earliest effective prior art date against a later U.S. patent or application.
Life sciences companies should also review their internal practices and procedures in light of the new U.S. patent law. For example, many companies have established a filing strategy in which a U.S. provisional application is filed at the same time as a foreign priority application to create prior art in the U.S. This will no longer be necessary because the foreign priority document will be prior art in the U.S. as of its filing date. Because the new law excludes commonly owned earlier-filed, later-published patent applications from being prior art, internal practices relating to ownership and assignment of U.S. patent applications should be reviewed to ensure common ownership on the earliest priority filing date.
A new Inter Partes Review (“IPR”) proceeding will replace the current inter partes reexamination procedure in the U.S. on September 16, 2012. Like PGR, IPR provides an opportunity to challenge the validity of a granted U.S. patent in the PTO. However, only challenges for lack of novelty and obviousness based on printed publications can be made in an IPR proceeding. A request for IPR can be filed against any U.S. patent issued before, on or after September 16, 2012. Generally, a request for IPR can be filed anytime after 9 months from patent grant, unless the challenger has been sued for infringement of the patent. In that case, the request for IPR must be filed within one year of being sued. Any company that has been sued for patent infringement before September 16, 2011 and wants to challenge the validity of the patent in an inter partes PTO procedure must file for inter partes reexamination before September 16, 2012.
With the move to a first-inventor-to-file system, patent interference proceedings will be phased out in the PTO. A patent interference proceeding is the current mechanism to determine which patent applicant is entitled to a patent when two or more applicants are claiming substantially the same invention. For patent applications having an effective filing date on or after March 16, 2013, a new ”derivation proceeding” will be available to an inventor who believes that an earlier patent applicant derived his invention from the inventor and without the inventor’s authorization filed the earlier patent application. Unlike patent interferences, derivation proceedings will not be available to determine which patent applicant is entitled to a patent for common subject matter that was independently invented. To prevail in a derivation proceeding, the inventor of the later-filed application must prove, by substantial evidence, not only that he invented the common subject matter but also that he communicated the invention to the earlier applicant and that the earlier applicant filed a patent application to that invention without authorization. Care should be taken to clearly document any communication of technical information to a third party, even within the context of an established collaboration, prior to the filing of a patent application.
The elimination of interferences in the PTO has raised many questions in the life sciences industry about whether the standards for maintaining bound, handwritten laboratory notebooks can be relaxed and the use of electronic lab notebooks increased. Although patent interferences are relatively rare, with fewer than 70 being declared in the PTO each year, about half of patent interferences involve biotech and chemical inventions. With the additional requirement that an inventor prove that an earlier patent applicant derived the claimed invention from the inventor, not many requests for derivation proceedings are expected to be filed.
Many life sciences companies have adopted gold standard laboratory notebook procedures to ensure the ability to establish the dates of inventive activity under the current U.S. first-to-invent law. Such gold standard procedures are typically time-consuming and burdensome for R&D personnel, involving handwritten entries in a bound, consecutively numbered notebook, signing and witnessing by a third party, non-inventor capable of understanding what has been written, and cutting and pasting pages of instrument printouts into the laboratory notebook. For U.S. patent applications having an effective filing date on or after March 16, 2013, corroborated proof of a date of invention will only be relevant in a proceeding in the PTO or a U.S. court to prove that an earlier patent applicant derived his invention from an inventor who filed later. Derivation will require a showing of both prior conception of the invention by the inventor and communication of that conception to the earlier patent applicant that is sufficient to enable him to construct and successfully operate the invention. Proof of derivation does not have a diligence element as was required in patent interference proofs. Thus, handwritten laboratory notebook entries detailing every element of a project and every measurement of every physical property taken may no longer be necessary. It would, of course, be foolhardy to immediately abandon all established laboratory notebook procedures. However, after considering the potential risks and benefits, life sciences companies may decide to relax the traditional gold standard, handwritten notebooks and increase the use of properly created, authenticated and maintained electronic laboratory notebooks.
Each individual associated with the filing and prosecution of a U.S. patent application has a duty to disclose to the PTO all information material to patentability and the AIA does not change that duty in any way. When conducting a pre-suit investigation, a patent owner may discover that certain potentially relevant information (such as prior art) was not provided to the PTO during prosecution. The AIA will allow patent owners to ask the PTO for “supplemental examination” to consider or correct any information believed to be relevant. Once this information has been considered or corrected, the patent cannot be held unenforceable based on conduct relating to that information.
This new procedure, which will become available for all U.S. patents on September 16, 2012, should present significant potential benefits for patent owners. Unlike regular ex parte reexamination, supplemental examination will not be limited to patents and publications and may include, for example, sales, offers for sale, or public uses; errors in declarations; or issues of utility, written description, or enablement. If successful, supplemental examination may allow a patent owner to strengthen a patent before enforcing it by eliminating potential inequitable conduct defenses.
But the procedure will also have limitations: for example, it will not apply to inequitable conduct allegations that are already being litigated, or that have been detailed in a Hatch-Waxman paragraph IV notice letter received by a pharmaceutical patent owner, before the date of the supplemental examination request.
Although courts have recently tightened the legal standard for inequitable conduct, this defense remains widely asserted because it places the entire patent (and potentially related patents) at risk. Supplemental examination will give life sciences patent owners another strategic option to consider when preparing to enforce their patents.
The AIA represents the first comprehensive overhaul of the U.S. patent system since 1952. Life sciences companies will have to deal with prosecution, enforcement and defense of patents under both the old law and the new law for up to 25 years in the future. Because of the key role patents play in protecting life sciences R&D investment and global sales, patent owners should review their patent strategies to identify short-term actions to be taken before March 16, 2013 and to optimize their practices and procedures to take account of the new law challenges and opportunities going forward.
Michael Flibbert and Marian Flattery are attorneys at Finnegan, Henderson, Farabow, Garrett & Dunner, LLP. Mr. Flibbert leads the firm's chemical and metallurgical practice group, with extensive experience in all aspects of patent law. Ms. Flattery focuses her practice on patent prosecution, global portfolio management, strategic client counseling, and licensing in the chemical, biotechnology, and pharmaceutical areas.