Patent News

Jul. 13, 2015

Intellectual Asset Management (IAM): More opposition to IPR changes highlights the tough road ahead for any US patent reform legislation, by Richard Lloyd

This post originally appeared in Intellectual Asset Management on July 13, 2014.

If patent reform legislation is going to pass in this Congress, consensus will be needed over any reform of the inter partes review process. Since Kyle Bass and Erich Spangenberg started challenging the validity of a series of life sciences patents earlier this year, IPR reform has become the big reform issue for the pharma and biotech communities.

As this blog’s interview with Kyle Bass last Friday underlined, he is clearly committed to a long game. For an industry that derives so much value from its IP, like pharma, the challenges from Bass are a significant threat, even if the patents under review represent a very small chunk of the industry’s patent universe.

With the tech sector, which has become the most frequent user of IPRs, opposed to any measures that would weaken its ability to bring reviews, we have a very clear divide on a key reform issue which doesn’t leave legislators much wiggle room. One option that has been proposed by the sponsors of the PATENT Act, which includes the leadership of the Senate Judiciary Committee, is to give brand name pharmaceutical companies an effective exemption from the IPR process.

At the end of last week, however, a powerful group of organisaitons “representing consumers, health insurance plans, and pharmacy benefits managers” – including AARP and the health insurance body BlueCross BlueShield Association – spelled out their opposition to that kind of carve-out in a letter to the leaders of the House and Senate Judiciary Committees. The group insisted that while they supported the PATENT Act, they had serious concerns over attempts to modify the proposed legislation which would give Big Pharma its IPR exemption.

“We strongly oppose any exemption from the IPR process for drug and biologic patents,” the letter stated. “We are particularly concerned that such as exemption would provide little protection against a widely-used practice known as “evergreening” where manufacturers make minor modifications to existing products in order to extend patent protection for years.”