Patents’ Presumption of Validity Routinely Ignored at PTO

In an IPWatchdog post today Neal Solomon suggests his recommendations for striking a better balance at PTAB between petitioners and patent holders. He concludes with the following;
 

“IPRs are a sort of blockage designed by infringers to attack the patent system on the mistaken belief that all patents are bad and weak. The illegitimate procedures embedded in IPRs at the PTAB show that the issue of patent quality driven by the big tech narrative is the source of many problems in the patent system. Ultimately, the costs increase dramatically for patent holders to defend a previously issued patent in the PTO, which provides a huge advantage for infringers to maintain their efficient infringement strategy of ignoring and infringing patents. The low barrier to attack patent validity undermines the incentive to invest in R&D, particularly for capital constrained market entrants, which is required for a healthy economy. Without major changes at the PTO on patent review that will introduce some semblance of due process, the IPR process will be illegitimate and inefficiently undermine the patent bargain.”
Continue reading Patents’ Presumption of Validity Routinely Ignored at PTO

Incoming – Take Cover

In 2013, The Innovation Act that passed so overwhelmingly in the House died that year on the Senate side. You will recall that it was designed to protect big tech’s efficient infringement business model further. It reappeared in 2014, passed Judiciary Committees in both bodies but died without a floor vote when the session ended. Recent developments suggest that it may rear its ugly head again. Congress is woefully undereducated on the workings of our innovation ecosystem. As demonstrated by the Senate Armed Services Committee’s unanimous support for Senator Angus King’s price-based Bayh-Dole march-in proposal, folks the Hill do not understand why adding politically-driven compulsory licensing based on an abstract and unpredictable price calculation formula will deter commercialization in of life science research grants. Would pre-investment due diligence preceding investment in an Alzheimer’s defeating therapy include an estimate of how long it would be before its successful development triggered price-based march-in? You bet it would.

Continue reading Incoming – Take Cover

The New “Reality”

Years ago, on Capitol Hill truth was reality. Twenty years ago, as press communications devolved into sound bites and headline-hunting, “perception” became the new “reality.” Keen DC observers noted then that “whatever wasn’t covered by the press didn’t happen” (even if it did happen). That sad state of affairs next morphed into the notion that if some action was mentioned to the press, it happened (even though it hadn’t happened). But we are now immersed in a new DC era of “alternative facts ” where truth is not reality, mere perception is no longer reality, and DECEPTION has become the new “reality.”

One of this new era’s congressional manifestations is the availability of hearings “witnesses” whose authenticity as a witness is acquired solely by their willingness to “testify” to whatever message a Committee Chair wants to put on the public record. Special interests seeking to deceive the public use them to widen their appearance of support. In the IPWatchdog post (linked below) Steve Brachmann looked behind the Oz-like “curtain” of testimony offered at a recent Darrell Issa hearing designed to revive the faltering patent troll narrative. His report is instructive.

Continue reading The New “Reality”

Issa’s Big Tech Boosters

Darrell Issa, big tech’s chief anti-patent tub-thumper is appropriately taken to the campaign contribution woodshed (below) this week by IPWatchdog’s Gene Quinn. Issa’s great self-esteem baffles pro-patent advocates because unlike most of his Hill colleagues he knows better. Issa is a multiple enforcement patent owner plaintiff. So why does he push so hard for big tech’s anti-patent agenda? Quinn explains.

A significant barrier to future House passage of the Coons Cotton STRONGER Patents Act, his smarmy disdain for the plight of lesser-resourced patent holders is a mystery, except that his next election will be as close as his last unless he raises enough big tech campaign funding to overcome his riled-up opposition. Until he loses instead of winning by a whisker, pro-patent advocates and their big tech oppressors will be holding their breath. The issue of patent progress or more setbacks is clearly at stake.

Continue reading Issa’s Big Tech Boosters

Evan Bayh OpEd and STRONGER Patents Summary

The Hill newspaper has just featured an op-ed by former Senator Evan Bayh, son of Bayh Dole’s co-sponsor. He reiterates many self-inflicted harms recently affecting US innovation especially their adverse impact on lesser-resourced independent inventors and small business that supply new US jobs. In his closing paragraph, he underlines the importance of strong patents to the development of future jobs.

“Ultimately, people and organizations innovate because they expect to reap the financial rewards associated with doing so. America thrives thanks to startups, creative ideas and novel technologies. Thankfully, we can still take steps to restore our patent system to protect patent owners and encourage invention. We need a system that will attract investment, generate jobs, and create a level playing field for companies across the United States. It’s vital for our future and, historically, what America has always done.”

Add to this the new looming harm to life science commercialization promised by enactment KEI’s price-based Bayh-Dole march-in amendment campaign in full swing on Capitol Hill and its is easy to see why to preserve commercialization we must counter this anti-patent activity soon. He also  refers readers to the STRONGER Patents Act, a summary of which is reprinted below.  Continue reading Evan Bayh OpEd and STRONGER Patents Summary

More March-In Whack-A-Mole

Another King-type amendment, offered this time by Rep. Marcy Kaptur at a House hearing regarding HHS, was rejected in committee. Marcy Kaptur has been our heroine in the patent wars. Her willingness to stand up to the Megatech has been courageous and is greatly appreciated.

But as reported by KEI itself, Committee Chair Tom Cole spoke against it.

“Opposition during the Committee’s debate came from Rep. Tom Cole (R-OK), who urged a no vote on the amendment. Rep. Cole stated that while he appreciated the concern of Rep. Kaptur, he thought the amendment would run the risk of upsetting the relationship between the National Institutes of Health and private industry. Rep. Cole also stated that the amendment would be “complicated to implement, as there’s no way to measure to what extent a particularly federally funded study played in the discovery of a new drug.”  (KEI Report linked below.)

Tom Cole is correct. This time he prevailed, but KEI will persist. Its warped interpretation of Bayh Dole resulting in the B-D lethal price-based march in can be expected to pop-up repeatedly whack-a-mole fashion unless KEI is “marched-out” of Hill hearings by home state universities. They must act now by conducting a concerted effort to support NIH’s mission to promote commercialization of promising results of its funded basic research.  If price based march-in amendment can take hold anywhere on the Hill, universities who fail to voice their opposition will have only themselves to blame. KEI’s strategy is clear. They will persist. Each time the legally erroneous notion that availability triggers B-D march-in at a “reasonable price” rather than “available” in satisfactory quantity spreads to a new committee KEI attracts new converts to its misdirected legal interpretation of the march-in’s triggers.

There are two important points embedded in Rep Cole’s sound response. Continue reading More March-In Whack-A-Mole

King Amendment will KO Bayh-Dole

Political support for congressional curbs on abusive drug pricing is traditionally balanced by congressional R&D support to create innovative drugs to cope with new challenges like super bugs, new vaccines and older ailment cures for the likes of Alzheimer’s, cancer, and other presently incurable maladies. Moreover, the drug industry provides many US jobs and university related economic development. This duality balance is reflected in political issue manifestos released today by the leading Democrats Senator Schumer and Representative Pelosi. Each of their statements takes careful aim at abusive drug pricing but also reflects the need to preserve our globally significant economic and medical advantage in US drug development and manufacture.

Accordingly, the abusive conduct of “vulture capitalists” referenced in today’s NYT statement by Schumer is rebalanced by reference to “egregiously” raising the prices of lifesaving drugs “without justification.”

“Right now, there is nothing to stop vulture capitalists from egregiously raising the price of life-saving drugs without justification. We’re going to fight for rules to stop prescription drug price gouging and demand that drug companies justify price increases to the public. And we’re going to push for empowering Medicare to negotiate lower drug prices for older Americans.”

Similarly. Rep. Pelosi’s talking points stress putting “an end” to unjustified price gouging but allow for the transparent procedure to “justify cost increases.”

Aggressive action to lower the cost of prescription drugs – putting an end to outrageous and unjustified prescription drug price gouging, leveraging the power of Medicare to negotiate lower drug prices, and forcing drug manufacturers to open their books and justify cost increases.”

There certainly is a need to curb drug pricing abuse. But there is something familiar about recent and admittedly bad actor drug abuse and the DC practice of interests with unrelated objectives to exploit such abuse by pushing their agendas. We have experienced it before with the anti-patent originators’ use of their troll narrative. And while the drug issue is more politically compelling, the hijacking pattern is much the same. Like the infringer lobby’s efforts to dismantle our entire patent system presumably to curb patent trolls, the Bayh-Dole priced-based march-in lobby led by KEI’s Jamie Love is leveraging recent drug pricing abuse to convert B-D’s reasonable “availability” march-in language into congressionally unintended reasonable “pricing.” Having successfully persuaded Senator King to secure his march-in amendment after failing to pass one in the House, they are trying anywhere and everywhere else in DC to install price-based B-D march-in. Read on for a recent news item depicting Love’s distortions at the FDA.

Continue reading King Amendment will KO Bayh-Dole

King Amendment a Commercialization Killer

While pro-patent advocates worried last week about troll-hyping clap-trap oozing from a House hearing managed by big tech’s slick salesman Rep.  Issa, Bayh-Dole was blind-sided in the Senate. An Angus King commercialization-killer amendment to its must-pass Senate Defense authorization now looms over already shaky biotech investment. How dangerous is this Armed Services Committee Report language? Based on a historically-discredited and persistently rejected interpretation of B-D’s march-in provisions, it automatically imposes compulsory licensing product price caps on “any drug arising from DoD-funded research” if the drug is priced “higher in the United States than the median price charged in the seven largest economies that have a per capita income at least half the per capita income of the United States.”  Huh?

Imagine a commercialization meeting with a putative private sector partner regarding promising parasitic research re Alzheimer’s disease. You are offering to license your promising patented proof of concept now ready for further development. She sadly explains that since its projected nine-year development will cost more than 100 times the amount expended on your university’s primary research, her investment is blocked because her lawyers need to be confident that it has in no way “arisen” from any research funded by a DoD grant. You and they both know that inventions “arise” from past research. The lawyers fear that if this research results in a cure they will be in a court fight over the meaning of “arise,” and they must be assured that DoD funding has not been involved somewhere along the line. Worse she adds, even her quants are unable to reliably predict what the mandatory cockamamie calculation may be nine years and $5 billion dollars from now. Even if the end product is approved by FDA, its patent and price will be legally challenged. You say demand surely will be overwhelming. But she says “that is exactly the problem, the more desired the drug, the more likely its patent and now its price will be challenged and capped in calculations irrevocably tied to foreign price cap freeloading off of US drug research, manufacturing and distribution.

In a short white paper, Biotechnology Innovation Organization (BIO) explains why this imagined conversation’s outcome is so bleak. BIO asks, “What venture capitalist would fund or invest in a life science start-up built around a federally funded invention if the King amendment passed?”
To comprehend the parlous relevance of BIO’s question, please read more.

Continue reading King Amendment a Commercialization Killer

Hag Fish Amendment Crisis

Mother Nature sometimes creates strange, even horrifying creatures. One of these is the Hag Fish which with its eel-like body enters the mouth of larger sick, weakened fish and once inside eats its way out. Our life science patent system has been weakened. This hag fish amendment will weaken it more. Here’s why.

A Senate Committee Report on a key bill that will eventually pass in both bodies includes an amendment misinterpreting the Bayh-Dole Act as authorizing price-control march-in. This is the B-D distorted interpretation repeatedly promoted by KEI. It has been consistently rejected by NIH and more recently by DoD. Why hag fish? Because once this misinterpretation of BD enters the congressional legislative records, it is established and can eat its way through the entire life science research innovation ecosystem by adding more uncertainty to predictable ROI on investments in commercialization partnerships.

With a unanimously-supported Senator Angus King amendment to its Report for the National Defense Authorization Act, the Senate Arms Services Committee directs the Department of Defense (DOD) to use two provisions of the Bayh-Dole Act (P.L. 96-517, as amended) to issue compulsory licenses for any drug arising from DOD-funded research, if such drug is priced “higher in the United States than the median price charged in the seven largest economies that have a per capita income at least half the per capita income of the United States. With this rigid directive in the Report, DoD will feel compelled to comply with incalculable endpoint pricing applicable to life science product price-controls “arising” from DoD-funded research. It is only a matter of time before its interpretation eats its way into to all federally supported life science grants. In light of Committee Chair McCain’s regrettable physical condition, the Committee’s floor consideration of Defense Authorization may be delayed for a while, but it will pass in this form unless we loudly register research university objections to the Report language with our home state delegations.

Continue reading Hag Fish Amendment Crisis

Issa et al

Most of us by now are familiar with the Coons Cotton Stronger Patents Act introduced a few weeks ago. If you have not yet caught up, it is a gem. At my Ipstrategic website, there are three levels of pertinent information including a sponsor press release and a summary of its provisions. We will not repeat them here. Suffice it to say that this artfully crafted proposed legislation restores much of the damage to our patent landscape recently inflicted by Congress and the Courts. It also addresses the troll issue in inappropriately targeted manner. The bill has intelligent bi-partisan backing. Until yesterday it had been the sole occupant of the center ring in the congressional patent law circus.

Yesterday Reps. Issa and House Judiciary Goodlatte initiated the Megatech response igniting a backfire in the House with a hearing designed to revive the tired troll narrative. Being in the majority, they selected three anti patent witnesses. Unfortunately for them, the one minority witness was Former Chief Judge Paul Michel whose knowledgeable testimony itself backfired on the Issa’s plan to counter the Senate bill. Judge Michel won the day with his deep understanding of patent law and policy. He made it clear that our patent system is in crisis and that patent restoration legislation must be enacted.

That means we now have to pass a bill over the objections of the incumbent mega techs and their Congressional water carriers. No small challenge! So far, the “politics” of this fight have gone their way. That will continue to be the case. Home state research universities themselves become a credible RESOURCE to their home state congressional delegations, by credibly explaining as Judge Michel did (see below) what is at stake and why it is important. Research universities can and must do so. Here’s why. . .

Continue reading Issa et al