AUTM’s Report Breaks Through the Fog on the Hill

Despite its Alphabet’s (Google) motto “Don’t be evil”, the EU has just tagged them with a 200+ billion dollar fine for abusively using their search service to prioritize preferred listings .

Like the other four giant digital platforms whose wealth, power and data enormity are invitations to abuse their virtually users, Google will dispute the EU fine (and its additional order giving Google 90 days to present their plan to reliably clean up their act)

Today’s Report

On its surface, this news item may be of remote interest to TTO’s and US patent holders. But as foreign venues clamp down on big tech their need to maintain bottom-line growth may heighten their abusive conduct here in the US. US Pro-patent interests are painfully familiar with the political clout of the big tech oligopoly. Will the US follow EU’s lead? So far Congress and SCOTUS are allowing themselves to be persuaded by big tech’s words, not their deeds.
At AUTM’s excellent presentation before a standing room only crowd of Hill staffers yesterday, Steve Sasalka referenced the US Chamber’s recent US 10th place world rating of patent strength. This is the result of recent anti-patent activities by Congress, the Courts, and the past administration. The AUTM panel outlined the latest reports commissioned by AUTM and BIO showing the economic contributions of research universities. Steve was flanked by two startup panelists whose operating technology was based on academic research. Both were quiet, straight forward entrepreneurs, clearly not Hill advocates and were thus very persuasive. One of them startled this listener however when with calm and matter-of-fact earnestness he said that Europe was now a preferred patent venue over the US.

Continue reading AUTM’s Report Breaks Through the Fog on the Hill

Take Back the Rights

On March 9, 2017, I will be serving on a panel moderated by former Federal Circuit Court CJ Paul Michel and Robert Sterne Esq. at the USPTO. The UT Panel on the Global Patent Landscape is a well-attended, mixed assembly where patent jurists and practitioners gather to consider patent law developments and trends from a more detached and wider vantage point than daily contention with individual cases allows. Wearing my university hat, I will be joined by representative panelists Paul Evans, Paul Stone, Peter Detkin and Damon Matteo each of whom expertly exercises keystone roles in our innovation ecosystem. Sadly, although there are many pressing issues confronting the IP community our panel preparation calls have inevitably focused on one overriding issue.

Inadvertently or not, SCOTUS, Congress, CAFC and PTAB have combined to drape an iron curtain of enforcement cost and uncertainty over patent enforcement, weakening US patents to the point of risk-adjusted irrelevance. For under-resourced patent holders, a growing cohort growing larger with expanding litigation overuse of post grant process, patents’ statutory presumption of validity has become a presumption of non-enforceability. Biopharma interests may still count on patents, but incumbent ICT operating companies whose efficient infringement business model has substantially reduced patent values see their value now only as weapons to preserve global market share and/or as clubs to beat down component product pricing, daring their suppliers to assert.  In short U.S. Patents are rapidly losing their critical investment attracting role within our national innovation ecosystem. The question now is what we can do about it?   Continue reading Take Back the Rights

Will President Trump Directly Negotiate Medicare Prescription Drug Pricing?

Whether prospective voters took Mr. Trump’s pre-election statements “seriously but not literally” or visa-versa, President Trump’s post-election conduct has DC industry advisors guessing rather than predicting. What happens next at 1600 Pennsylvania Avenue is simply unpredictable. And because White House staff must create coherency between campaign promises, like Mexico’s paying for “the wall” and their post-election implementation, even the President’s express assurances are subject to staff walk-back, revision or reversal. A recent relevant example of such uncertainty resulted from candidate Trump’s commitment last Fall to directly negotiate Medicare’s prescription drug pricing. That commitment’s post-election consequences are now roiling DC biopharma, insurance and PBM life science backwaters, creating waves of pricing uncertainty that also are washing-up along the shores of life science’ commercialization and investment partnerships. Why? Even though the savings impact of directly negotiated drug costs is credibly considered “negligible”, any politically driven intrusion into today’s market-oriented biomedical product pricing will further destabilize life science commercialization, which is already disrupted by post-AIA uncertainties.

During the presidential campaign, when polls showed public support for such direct negotiations, Trump proclaimed that his deal-making skill would annually save the US $300 billion, an absurd exaggeration amounting to almost one-half of Medicare’s entire annual budget. Fact-checkers quickly refuted his claim. Trump’s base believed it. Other disparaging, but less specific, post-election remarks about drug pricing have kept its price reduction fires burning, moving Medicare’s existing price containment infrastructure into the disruptive, unpredictable, and choppy waters of future trade agreements. His outlandish claim was taken literally.

Following a recent highly publicized meeting with prescription drug-makers, the President publicly pledged assurances of more support for biomedical innovation. He praised his visitors citing their creation of many US jobs, especially through startups, and promised FDA regulatory reform to strengthen the price containment of heightened competition. But later that day in Facebook remarks attributed to the President, the meeting’s message took a different tone.

Today I met with pharmaceutical executives at the White House. US drug companies have produced extraordinary results for our country, but the pricing has been astronomical for our country. We have to do better. We have to get lower prices; we have to get even better innovation. I expressed to the executives that I want them to move their companies back to the United States — and I want them to manufacture in the United States. Our trade policy will prioritize that foreign countries pay their fair share for U.S.-manufactured drugs, so our drug companies have greater financial resources to accelerate development of new cures — I think that’s so important! Right now it’s very unfair what other countries are doing to us – and in order to MAKE AMERICA GREAT AGAIN — we all need to work together right here in the United States of America.  

Later when asked about direct Medicare direct negotiation, Press Secretary Spicer said the President “is for it” (starting with question at 29:54 – see video below), adding from his notes: “There is a huge burden on American seniors who are so much more reliant on drug prices… in many cases you have people living on a fixed income. And rising health care costs and prescription drugs continue to be a burden on their ability to live out their lives in an enjoyable manner. [Trump’s] commitment is to make sure that he does what he can and I think rather successfully he can use his skills as a businessman to drive them down.”

With all that’s now going on it seems unlikely that legislative changes in the Medicare Modernization Act (MMA) enabling such negotiations will be enacted. But who knows? When should we begin to worry about such endpoint price intrusion?

The “Wall” issue is instructive. Whenever it seems to fade from public prominence, President Trump himself revives it. We also know that “wall-pricing” is now attracting deficit hawk concern especially if Trump’s approach is to “build it now” and gain trade reimbursement offsets later.  Medicare price negotiators can hope MMA revisions will be overcome by other pending issues but with ACA budget discussions coming to a head, non-interference and related budgetary benefits could move to Hill front burners very quickly. A PBM trade association official summed up his association’s recommendation that PBM’s start Hill discussions now.

If this were a conventional Presidency, then the group would wait to present a strategic update once health officials had clearly laid out their policies. Instead, the group has decided to push forward more aggressively,” he said, “given the political uncertainty, headline risk, and other unique challenges that come with a President more inclined toward quick, instinctive action than the traditional, deliberative decision-making process.

Any way you slice it, added commercialization uncertainty resulting from even negligible savings will be seen by the private sector as a foot-in-the-door for more government price controlling. Accordingly, if or when such congressional discussions start, early stage life science research and investment voices will need to be heard. An excerpt from a recent Kaiser Family Foundation analysis of the issue may be a useful starting point.   

Proponents believe that giving the HHS Secretary the authority to negotiate drug prices on behalf of millions of Medicare beneficiaries would provide the leverage needed to lower drug costs, particularly for high-priced drugs for which there is no competition and where private plans may be less able to negotiate lower prices. Opponents believe the Secretary would not be able to get a better deal than private plans already do and that plans have greater leverage with drug companies because of their whole line of business, but, if the Secretary were able to negotiate lower prices, pharmaceutical companies would reduce their investment in pharmaceutical research and development.

Participants in early stage life science development including research universities and medical centers must watch this issue closely and be ready to join MMA’ s more conspicuous defenders if and when MMA’s ban on Medicare direct negotiations suddenly appears. For more on why competition works better to contain drug pricing please see “Trump Moves Towards Life Science Support” at Ipstrategic.com .

The above article first appeared on ipwatchdog.com.

Trump Moves Towards Life Science Support

The pre-election clamor about prescription drug pricing took an interesting turn last week following President Trump’s meeting with prescription drug-makers at the White House. Earlier this year pricing abuse by rogue firms whose lack of competition in certain markets enabled upward price ratcheting attracted glaring press outrage leading to presidential campaign promises to curb prescription drug pricing if elected. Unfortunately, top down price controls cannot cure this market malady. Indeed, by choking-off investment in basic life science research to develop cures advancing competition they will only worsen it. Post-AIA uncertainty plaguing commercialization is shrinking independent private investment in the long and costly development of high-risk life science products, shielding sole suppliers to certain patient markets from competition. Continue reading Trump Moves Towards Life Science Support

Drug Pricing and Life Science Commercialization

Federation of American Societies for Experimental Biology (FASEB) members number 125,000 including thirty health-focused societies. It is the largest coalition of biomedical research associations in the United States. Widely considered as the policy voice of biological and biomedical researchers, FASAB annually advocates for “stable and predictable” congressionally appropriated federal funding for basic life science research. Its 2017 recommendations for added congressional funding of five federal life science grant agencies highlights recent medicinal therapies flowing from their life science grants. It also states why and by how much grant funding should be increased for each agency. here. Federal funding stability and predictability enable projects already being conducted to continue and enable formation of new commercialization partnerships leading to more promising scientific discoveries through private sector investment. Continue reading Drug Pricing and Life Science Commercialization

The Unsung Job Creator: Intellectual Property

Good short piece on IP economic importance.

Excerpts :

  • “IP plays a crucial role in virtually every American industry. Earlier this year, the Department of Commerce reported that IP-intensive industries support over 45 million U.S. jobs—30% of the nation’s total—and contribute more than $6 trillion—or 38.2%—of United States GDP. The biopharmaceutical industry employed almost 854,000 Americans in 2014.”
  • “If we fail to protect IP rights, both domestically and abroad, we risk jeopardizing one of our greatest drivers of economic growth and competitiveness…”

Continue reading The Unsung Job Creator: Intellectual Property

Canada’s Promise Doctrine Survey and U.S. IPR

It is common knowledge in patent policy circles that China is strengthening its IP standards while we weaken ours. Weakened standards corrode certainty within an innovation ecosystem, discouraging commercialization’s private sector development investment, especially during discoveries’ high-risk early stage tech transfer. Absent such investment, promising inventions cannot become innovative reality. Continue reading Canada’s Promise Doctrine Survey and U.S. IPR

A Discussion Well Worth Watching

Recent emotionally-driven but Bayh-Dole destructive proposals for biopharma price control such as “price-based march-in” and the “UN High Level Panel on Medicinal Access “ Report are ably refuted by Joe Allen who  refers us to a recent Intelligence 2 TV Debate during which it was that demonstrated that rational discussion, rather than simply blaming biopharma for increased overall health care cost is likely to lead to more effective cost-containment outcomes. Emotionally targeted intrusions into our Bayh-Dole based life science commercialization process are not only misdirected but can completely undermine our innovation ecosystem, disrupting NIH’s important basic science commercialization mission in the process. As Joe recommends, Blame Big Pharma for Out of Control Health Care Costs  is a debate “well worth watching”  Continue reading A Discussion Well Worth Watching