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Drug Patents Come Under Fire in New House Bill

John Gilberston \ June 20, 2019

A new bill in Congress is proposing to alter the way drug patents are administered.  The Terminating the Extension of Rights Misappropriated (TERM) Act, H.R. 3199, would require that any patents on a drug which were issued after the drug’s first patent would be presumed invalid when the first patent expires.  

Supporters of the measure, introduced by Rep. Hakeem Jeffries, D-N.Y., say it is intended to combat “evergreening,” a practice in which drug companies obtain multiple patents which cover different aspects of the same drug, with the goal of extending a drug’s patent protection beyond the life of its original patent.  Sponsors of the bill argue that curbing this practice will ultimately reduce drug prices by limiting the patent protection of branded drugs to a single patent term. This would allow generic drugs to come to market more quickly, thereby spurring competition.

The bill purports to accomplish this by altering the existing burden scheme.  As the law stands now, an issued patent enjoys a presumption of validity; the burden is on the challenger to prove otherwise.  Under the new bill, the burden would shift to the patent owner to prove that the subsequent patents “cover patentably distinct inventions from the invention claimed in the first such patent to expire.”  In other words, a patent owner, after proving the patent’s validity to the USPTO during prosecution, would have the burden of proving it all over again if it is ever challenged in litigation.  

This change would have substantial implications for patent and IP attorneys, but likely faces significant hurdles on the path to becoming law.  Because “double patenting” is already prohibited by law, patents which are issued by the USPTO have been prosecuted through the PTO’s comprehensive review process and have been deemed to involve an inventive concept.  An example might be a novel method of delivering a patented drug to the relevant area of the body, which may not have been known at the time of the drug’s original patent. An issue thus arises as to whether Congress has the authority to undermine the property rights associated with that subsequent patent for reasons more closely related to policy than to an invention’s patentability.  This is particularly so in light of the fact that the bill only addresses drug patents, and no other technologies.

The bill is also likely to face legal challenges from patent owners who have spent considerable time and money to secure a patent, only to have it presumed invalid for no other reason than its timing.

While many patent attorneys consider this measure unlikely to pass in its current form, always be sure to consult a licensed IP attorney with any questions about how these proposed changes may affect your IP portfolio.  

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