Patent Baristas

What:

Known by many names within the industry – non-practicing entity (NPE), patent assertion entity (PAE) and most infamously as “patent trolls” – NPEs over the past few years have single-handedly spawned a sub-specialty of patent litigation.  It’s certainly big business.  It’s estimated that the average patent suit involving NPEs results in $122 million in lost wealth for the defendant,  not to mention the millions of dollars often spent in litigation costs, lost work hours and time-consuming negotiations.

Offered as a one-day event to minimize time spent out of the office and in contrast to more general IP litigation events, American Conference Institute’s NPE Litigation conference provides an opportunity for attendees to network with colleagues while engaging in an open discussion with peers who are also being confronted with the same issues.

Presenting practical strategies for:

• Approaching settlement and license negotiations with an NPE – How to Obtain Favorable Results from Your Settlement and License Negotiations
• Utilizing reexam, motion practice, claim construction and the Markman hearing to preemptively address weak IP
• Effectively asserting key defenses – divided or joint infringement, prior commercial use laches and patent pools
• Making the decision of whether or not participate in a patent pool, defensive patent aggregation group or joint defense agreement Gain and discuss best practices for successfully defending against this new breed of patent infringement claim and walk away with practical tips and proven strategies for ensuring your client achieves success in its next action involving an NPE.

When:

Where:

Millennium UN Plaza
New York, NY

How:

Seats at this event are expected to go quickly given the great interest in this topic. Reserve a space now for a member of your IP and litigation departments by calling 1-888-224-2480; faxing your registration to 1-877-927-1563 or registering online at www.AmericanConference.com/NPE.

PatentBaristas.com is a Media Sponsor of this event.  Readers of Patent Baristas are entitled to $200 off the current conference price tier.   The discount code you will need for this is: PB 200.

United States Patent and Trademark Office (USPTO), Invent Now® and the National Academy of Inventorsâ„¢ invite you to the Florida Regional Inventors Conference, a great chance to get practical advice from expert USPTO staff and to network with fellow creative entrepreneurs.

Space is limited, so click here to register early.

The conference will be held April 27-28, 2012 at the Embassy Suites Hotel located on the campus of the University of South Florida.  Presentations and workshops will be conducted by Senior USPTO officials, Supervisory Patent Examiners, trademark attorneys, successful inventors and intellectual property experts.

Speakers will include Teresa Stanek Rea, Deputy Under Secretary of Commerce for Intellectual Property and Deputy Director of the USPTO; Mark Reyland, Executive Director, United Inventors Association; John Calvert, Senior Advisor, Office of Innovation Development, USPTO; Catherine Cain, Trademark Attorney, Legal Policy Office, USPTO; Wayne Brass, Small Business Development Center Certified Business Technology Consultant; Sandra Campbell Director, Florida US Export Assistance Center; Pamela Riddle Bird, CEO of Innovative Product Technologies; and Mark Jensen, winner of the 2010 Collegiate Inventors Competition.

Afternoon breakout sessions will focus patent and trademark basics, searching sessions for patents and trademarks, advanced patent prosecution, insight on the America Invents Act (AIA) and local resources available to inventors.

A pre-conference workshop on patent basics will be held on April 26 from 5-7 pm and will be repeated as a breakout session on April 27. A networking reception will be held Friday evening, April 27, 2012.

The registration fee is $80.00 per person  ($70 for seniors or students) and includes all sessions and presentations, morning and afternoon refreshments, lunch both days and the networking reception. If you have questions about registration or have difficulty registering please contact Invent Now at 330-849-6878.

If you have questions about the conference agenda, please call Matthew Palumbo at 571-272-7517.

The day after the Supreme Court issued its  decision in Mayo v. Prometheus, the USPTO issued a letter to the Patent Examining Corps that provides preliminary guidance to examiners and promises that more detailed guidance is forthcoming.

MEMORANDUM

DATE:            March 21, 2012

TO:                 Patent Examining Corps

FROM:           Andrew H. Hirshfeld, Associate Commissioner For Patent Examination Policy

SUBJECT:      Supreme Court Decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc.

Yesterday, in a unanimous decision, the Supreme Court held that the claims in Mayo Collaborative Services v. Prometheus Laboratories, Inc. (Mayo) effectively claim a law of nature and are not patent-eligible under 35 U.S.C. § 101. The purpose of this memorandum is to provide preliminary guidance to the Patent Examining Corps. Additional guidance on patent subject matter eligibility under 35 U.S.C. § 101 will be issued soon.

Claims to Law of Nature Itself Are Not Patent-Eligible

The claims in Mayo are directed to a process of medical treatment. Claim 1 is representative:

A method of optimizing therapeutic efficacy for treatment of an immune-mediated gastrointestinal disorder, comprising:

(a) administering a drug providing 6-tmoguanine to a subject having said immunemediated gastrointestinal disorder; and

(b) determining the level of 6-tmoguanine in said subject having said immune-mediated gastrointestinal disorder,

wherein the level of 6-thioguanine less than about 230 pmol per 8×10 red blood cells indicates a need to increase the amount of said drug subsequently administered to said subject and

wherein the level of 6-thioguanine greater than about 400 pmol per 8x 10 red blood cells indicates a need to decrease the amount of said drug subsequently administered to said subject.

The Supreme Court found that because the laws of nature recited by the patent claims – the relationships between concentrations of certain metabolites in the blood and the likelihood that a thiopurine drug dosage will prove ineffective or cause harm – are not themselves patenteligible, the claimed processes are likewise not patent-eligible unless they have additional features that provide practical assurance that the processes are genuine applications of those laws rather than drafting efforts designed to monopolize the correlations. The additional steps in the claimed processes here are not themselves natural laws, but neither are they sufficient to transform the nature of the claims.

In this case, the claims inform a relevant audience about certain laws of nature. Any additional steps consist of well-understood, routine, conventional activity already engaged in by the scientific community. Those steps, when viewed as a whole, add nothing significant beyond the sum of their parts taken separately. The Court has made clear that to transform an unpatentable law of nature into a patent-eligible application of such a law, one must do more than simply state the law of nature while adding the words “apply it.” Essentially, appending conventional steps, specified at a high level of generality, to laws of nature, natural phenomena, and abstract ideas cannot make those laws, phenomena, and ideas patent-eligible.

The decision rested upon an examination of the particular claims in light of the Court’s precedents, specifically Bilski, Flook and Diehr. The Court repeated the long-standing exceptions (laws of nature, natural phenomena, and abstract ideas) to categories of patent eligibility defined in 35 U.S.C. § 101. In conducting the analysis, the Court addressed the “machine~or-transformation” test explained in Bilski with a reminder that the test is an “important and useful clue” to patentability but that it does not trump the “law of nature” exclusion. A claim that recites a law of nature or natural correlation, with additional steps that involve well-understood, routine, conventional activity previously engaged in by researchers in the field is not patent-eligible, regardless of whether the steps result in a transformation. On the other hand, reaching back to Neilson, the Court pointed to an eligible process that included not only a law of nature (hot air promotes ignition) but also several unconventional steps (involving a blast furnace) that confined the claims to a particular, useful application of the principle.

Preliminary Guidance on Examination Procedure

As part of a complete analysis under 35 U.S.c. § 101, examiners should continue to examine patent applications for compliance with section 101 using the existing Interim Bilski Guidance issued July 27, 20 I0, factoring in the additional considerations below. The Interim Bilski Guidance directs examiners to weigh factors in favor of and against eligibility and reminds examiners that, while the machine-or-transformation test is an investigative tool, it is not the sole or a determinative test for deciding whether an invention is patent-eligible,

Examiners must continue to ensure that claims, particularly process claims, are not directed to an exception to eligibility such that the claim amounts to a monopoly on the law of nature, natural phenomenon, or abstract idea itself. In addition, to be patent-eligible, a claim that includes an exception should include other elements or combination of elements such that, in practice, the claimed product or process amounts to significantly more than a law of nature, a natural phenomenon, or an abstract idea with conventional steps specified at a high level of generality appended thereto.

If a claim is effectively directed to the exception itself (a law of nature, a natural phenomenon, or an abstract idea) and therefore does not meet the eligibility requirements, the examiner should reject the claim under section 101 as being directed to non-statutory subject matter. If a claim is rejected under section 101 on the basis that it is drawn to an exception, the applicant then has the opportunity to explain why the claim is not drawn solely to the exception and point to limitations in the claim that apply the law of nature, natural phenomena or abstract idea.

The USPTO is continuing to study the decision in Mayo and the body of case law that has evolved since Bilski and is developing further detailed guidance on patent subject matter eligibility under 35 U.S.c. § 101.

As you know, the Supreme Court issued its opinion in Mayo v. Prometheus, an important intellectual property case for biotech.  The Court held that the correlation between blood test results and patient health is not patentable.

Under Prometheus, new patents involving correlations between natural phenomena must do more than simply recite the natural correlation and then tell the user to apply it. Rather, correlation patents must confine themselves to particular applications of these correlations applied in new ways and not simply using well-known steps. In addition, Prometheus rejected a “look ahead’ approach that would allow courts to get around the patentable subject matter question by changing to an analysis of patentability under 35 U.S.C. Sections 102 or 103.

The case mainly concerned the status of the machine-or-transformation test when determining patent eligibility:

On remand, the Federal Circuit characterized the central question as whether Prometheus’s claims are drawn to a natural phenomenon, the patenting of which would entirely preempt its use, or whether the claims are only drawn to a particular application of the phenomenon.  Mayo argued, before the Federal Circuit and again this past week before the Supreme Court, that this was the sole controlling standard, and that Bilski stood for the proposition that, while the machine-or-transformation test is a helpful clue, it cannot be outcome-determinative in this analysis.   According to Mayo, even if the claims passed the machine-or-transformation test, more analysis, such as a robust preemption analysis, would be necessary to make a subject-matter eligibility determination.  Prometheus, on the other hand, argued that the Bilski ruling only meant that patents which did not satisfy the machine-or-transformation test were not necessarily unpatentable, but did not go so far as to say that some patents that do satisfy the test are unpatentable.

An earlier judgment was vacated and the case remanded to the U.S. Court of Appeals for the Federal Circuit for further consideration in light of Bilski v. Kappos, 561. The Federal Circuit, reversing the district court, upheld Prometheus’s patent claims covering a means to measure the level of 6-thioguinine (6-TG) and 6-methylmercaptopurine (6-MMP), which indicates that an adjustment in drug dosage may be required at certain metabolite levels.

The district court decided as a matter of law that the asserted claims were drawn to non-statutory subject matter and as such, unpatentable.  However, the Federal Circuit held that methods of treatment claims fall within the realm of patentable subject matter. Prometheus Laboratories, Inc. v. Mayo Collaborative Services (08-1403).

In Mayo v. Prometheus, the Supreme Court emphasized the concern over patents that disproportionately tie up the use of underlying natural laws, thereby inhibiting their use in the making of further discoveries, particularly in fields not contemplated by the patentee.

The Court stated, “to transform an unpatentable law of nature into a patent-eligible application of such a law, a patent must do more than simply state the law of nature while adding the words ‘apply it.’”

Further, the Court stated, “the claimed processes are not patentable unless they have additional features that provide practical assurance that the processes are genuine application of those laws rather than drafting efforts designed to monopolize the correlations”.

Held: Prometheus’ process is not patent eligible.

Justice Breyer delivered the opinion for a unanimous Court:

(a) Because the laws of nature recited by Prometheus’ patent claims—the relationships between concentrations of certain metabolites in the blood and the likelihood that a thiopurine drug dosage will prove ineffective or cause harm—are not themselves patentable,the claimed processes are not patentable unless they have additional features that provide practical assurance that the processes are genuine applications of those laws rather than drafting efforts designed to monopolize the correlations. The three additional steps in the claimed processes here are not themselves natural laws but neither are they sufficient to transform the nature of the claims. The “administering” step simply identifies a group of people who will be interested in the correlations, namely, doctors who used thiopurine drugs to treat patients suffering from autoimmune disorders. Doctors had been using these drugs for this purpose long before these patents existed. And a “prohibition against patenting abstract ideas ‘cannot be circumvented by attempting to limit the use of the formula to a particular technological environment.’ ” Bilski, supra, at ___. The “wherein” clauses simply tell a doctor about the relevant natural laws, adding, at most, a suggestion that they should consider the test results when making their treatment decisions. The “determining”step tells a doctor to measure patients’ metabolite levels, through whatever process the doctor wishes to use. Because methods for making such determinations were well known in the art, this step simply tells doctors to engage in well-understood, routine, conventional activity previously engaged in by scientists in the field. Such activity is normally not sufficient to transform an unpatentable law of nature into a patent-eligible application of such a law. Parker v. Flook, 437 U. S. 584, 590. Finally, considering the three steps as an ordered combination adds nothing to the laws of nature that is not already present when the steps are considered separately.

(b) A more detailed consideration of the controlling precedents reinforces this conclusion.

1. Diehr and Flook, the cases most directly on point, both addressed processes using mathematical formulas that, like laws of nature, are not themselves patentable. In Diehr, the overall process was patent eligible because of the way the additional steps of the process integrated the equation into the process as a whole. These additional steps transformed the process into an inventive application of the formula. But in Flook, the additional steps of the process did not limit the claim to a particular application, and the particular chemical processes at issue were all “well known,” to the point where, putting the formula to the side, there was no “inventive concept” in the claimed application of the formula. 437 U. S., at 594. Here, the claim presents a case for patentability that is weaker than Diehr’s patent-eligible claim and no stronger than Flook’s unpatentable one. The three steps add nothing specific to the laws of nature other than what is well-understood, routine, conventional activity, previously engaged in by those in the field. Pp. 11–13.
2. Further support for the view that simply appending conventional steps, specified at a high level of generality, to laws of nature, natural phenomena, and abstract ideas cannot make those laws,phenomena, and ideas patentable is provided in O’Reilly v. Morse, 15 How. 62, 114–115; Neilson v. Harford, Webster’s Patent Cases 295, 371; Bilski, supra, at ___–___; and Benson, supra, at 64, 65, 67. Pp. 14–16.
3. This Court has repeatedly emphasized a concern that patent law not inhibit future discovery by improperly tying up the use of laws of nature and the like. See, e.g., Benson, 409 U. S., at 67, 68. Rewarding with patents those who discover laws of nature might encourage their discovery. But because those laws and principles are “the basic tools of scientific and technological work,” id., at 67, there is a danger that granting patents that tie up their use will inhibit future innovation, a danger that becomes acute when a patented process is no more than a general instruction to “apply the natural law,”or otherwise forecloses more future invention than the underlying discovery could reasonably justify. The patent claims at issue implicate this concern. In telling a doctor to measure metabolite levels and to consider the resulting measurements in light of the correlations they describe, they tie up his subsequent treatment decision regardless of whether he changes his dosage in the light of the inference he draws using the correlations. And they threaten to inhibit the development of more refined treatment recommendations that combine Prometheus’ correlations with later discoveries. This reinforces the conclusion that the processes at issue are not patent eligible, while eliminating any temptation to depart from case law precedent. Pp. 16–19.

(c) Additional arguments supporting Prometheus’ position—that the process is patent eligible because it passes the “machine or transformation test”; that, because the particular laws of nature that the claims embody are narrow and specific, the patents should be upheld;that the Court should not invalidate these patents under §101 because the Patent Act’s other validity requirements will screen out overly broad patents; and that a principle of law denying patent coverage here will discourage investment in discoveries of new diagnostic laws of nature—do not lead to a different conclusion.

628 F. 3d 1347, reversed.

6th Annual
Paragraph IV Disputes
Expert Insights on Hatch-Waxman Litigation Strategies for Brand Names and Generics

April 24-25, 2012
Workshops: April 23 and 26, 2012
Marriott New York Downtown
New York City

Each spring, leading pharmaceutical patent litigators for brand name and generic drug companies gather in New York City at American Conference Institute’s (ACI’s) Paragraph IV Disputes conference to discuss, debate, and analyze the latest trends, judicial rulings and legislative developments affecting Hatch-Waxman litigation.  Come and be part of this industry-leading think tank:  meet with the leading legal minds in this area and access the information which will help you master the critical competencies needed for the new era of Hatch-Waxman litigation.

An experienced faculty comprised of respected and renowned counsel for brand name and generic pharmaceutical companies will help you develop your new plan of attack for 2012 and beyond.  They will provide insights on all facets of Paragraph IV litigation: pre-litigation concerns – the commencement of suit – final adjudication – and every step in between.  Sessions will address the key elements of Paragraph IV litigation in addition to some of the most pressing and recent controversies surrounding Paragraph IV cases, including:

• The impact of the AIA on Hatch –Waxman litigation
• Carve-outs, use codes and labeling
• Claim construction conundrums
• Prior art obviousness and obvious-type double patenting
• Inducement of infringement and divided infringement
• Inequitable conduct
• Damages

This conference will also bring you the opportunity to hear from renowned federal jurists and a key official from the Federal Trade Commission. Learn firsthand how the bench analyzes the theories of your case and what the FTC deems as “fair and foul” in the settlement of pharmaceutical patent disputes.

Informative and hands-on workshops will complete your conference and networking experience:

• Hatch-Waxman and BPCIA 101 — A Primer on IP Basics and Regulatory Fundamentals will provide you with the patent and regulatory backdrop for the more in-depth Hatch-Waxman litigation controversies discussed in the main conference;
• A Working Group Session on Assessing The Impact of New PTO Procedures Under the AIA on Paragraph IV Litigation will address how new pre- and post issuance procedures may alter certain components of Paragraph IV litigation and parallel proceedings between the Federal Courts and PTO; and
• The Master Class on Settling Paragraph IV Disputes: Drafting and Negotiating Strategies for Brand-Name and Generics will give you practical and hands-on strategies for drafting and negotiating settlement agreements that will pass muster with the FTC.

Seats at ACI’s Paragraph IV Disputes 2011 sold out. Reserve your place now before it is too late.

Register now by calling 1-888-224-2480, faxing your registration form to 1-877-927-1563 or logging on to www.AmericanConference.com/Paragraph IV.  Special group rates are also available. A $200 discount is available to Patent Baristas readers.

What:

The only event where the industry leaders driving the business of biosimilars come together to set the standards shaping the rapidly evolving legal and regulatory landscape.

Whether you are on the branded or generic side, you cannot afford to miss this opportunity because you will:

• Hear directly from the FDA on how they will implement the abbreviated pathway
• Benchmark your strategy against market leaders such as Amgen, Dr. Reddy’s,
• Eli Lilly, Merck, Momenta, Pfizer, Sandoz and many more
• Gain priceless knowledge from the actual scientists, economists, in-house
• and outside counsel thought leaders blazing the FDA’s biosimilar pathway
• Network with peers facing the same regulatory, research and development cost, and patent management challenges in an true knowledge sharing environment

With an estimated $150 billion in potential biologics revenue at stake annually and a wave of patent expirations starting in 2014, there will be a hard-fought battle to protect and increase market share.

When:

Tuesday, May 22 to Wednesday, May 23, 2012

Where:

New York Marriott
East Side
New York, NY

How:

Register for ACI’s Biosimilars Conference  by calling 888-224-2480, faxing your form to 877-927-1563, or registering online at www.AmericanConference.com/Biosimilars.

PatentBaristas.com is a Media Sponsor of this event.  Readers of Patent Baristas are entitled to $200 off the current conference price tier.   The discount code you will need for this is: PB 200.

Legal IQ has  launched a new white paper on Intellectual Property (IP) Portfolio Management Trends and Success Factors 2012, which reviews the recent challenges and changes in IP.  It draws upon the insight of leading legal professionals from across the world, and across Patents and Trademarks. They share how they view the future and plan to tackle the legal challenges and changes in IP.

To see the full survey result of 600 legal professionals, more key trends for 2012, and to read case studies from leading experts in the field, download the complete white paper at Legal IQ’s 2^nd Annual Global Patent Congress website here.

All trends indicate an underlying drive to realign and grow in the face of changing technological, economic, and industry conditions. Portfolio management strategy is a cornerstone of success and a driver for growth. An openness to embrace the growing availability of new technology is also key to enable greater efficiency.

Some of the key findings of the white paper include:

• Cost Control is of Importance to 93.6% of Trademark professionals and 96.4% in Patents
• Most Business-Critical Activities: Alignment of Trademark/Patent Assets with Business Strategy
• Key Future Investment for Trademarks will be Consultancy, and for Patents, Software.

To find out about Legal IQ’s 2^nd Annual Global Patent Congress www.patentcongress.com/news, taking place 25 – 26 September in Copenhagen, simply call+44 207 036 1300 or email enquire@iqpc.co.uk.

More commentary on the compulsory license granted by the Indian Patent Office for Bayer’s drug Sorafenib Tosylate (Nexavar):

I read your follow-up post on compulsory licensing.  In it, you state that average income in India is $8000.  I have no idea what your source is, but you are regrettably wrong.  Average gross salary in India in 2010 (per Wikipedia) was $1,330.  Nominal GDP per capita was $1,527 in 2011.  You can’t use purchasing power parity numbers for this analysis (and even then you would be off by about $5000) because the whole issue is that Indians can’t buy Nexavar in rupees at locally-sensible prices in the same way that milk in India is priced locally and is probably a lot cheaper than the approx. 40 rupees per liter that we pay in the U.S.

Also consider that $1,330 per year is the average, gross salary.  Because of income equality, something like 80% of the population in India lives on less than $400 per year per family.  This is a gross salary, and does not reflect disposable income after income taxes, payroll deductions and local sales taxes.  Also consider that the in the vast majority of households only men work, so the $1330 earned by the average male head of household is the total income.  Finally, family sizes are much larger than in the West, and there is no safety net so people need to save for their own medical care and retirement.

In light of this income disparity and poverty, it makes sense for India to have a compulsory licensing regime.  Nothing says that Indian values or laws have to mirror American ones — whether it relates to IP, freedom of speech, or speed limits.

Your point that the government is not helping is not helpful — India has something like $3 per person per year to spend on healthcare.  Treating one patient with Nexavar would mean leaving almost 2,000 people with absolutely no healthcare at all.

While Bayer may have faced some difficulties dealing with the local market, by pricing the drug where they did they made it clear that they intended to capture the few thousand upper class cancer patients in India who have wealth comparable to U.S. upper-income households, and leave the rest of the country without access to Nexavar during Bayer’s patent exclusivity period.

The compulsory licensing scheme does not really hurt Bayer except for the few million dollars they may have earned from the wealthy cancer patients in India.  Bayer is free to charge very high prices to recoup its investment and earn its ROI in the part of the world that can afford Nexavar.

What Bayer should have done is manufacture Nexavar in India through a local joint venture, sell it at a locally-affordable price, and use its control of the JV to prevent export.

Sachin Jay Darji
Certified Specialist in Real Property Law

Not sure what to say other than I agree with the points in this letter. I couldn’t fine the original document that listed salaries but gapminder.org lists the Indian income per person (GDP/capita) as $2,972.  Regardless, my point wasn’t that many in India cannot afford expensive drugs.  That’s a given.

I want people to have access to drugs  and I’m not suggesting people with the inability to pay should be denied healthcare.  My issue is why must Bayer pay the full brunt?  Why only Nexavar?  Once you make the argument that people without means should gain access to drugs based on income regardless of property rights, why isn’t every drug subject to the same license?

I agree Bayer did not do themselves any favors in not making the drug more widely available.  I just am uncomfortable that no one else has to pay.  Not the wealthy.  Not governments.  No sharing of economic burden.  Oh, well, I think this horse has been beaten enough.

It is a conundrum.