THE PATENT REFORM BILL’S UNINTENDED NEGATIVE CONSEQUENCES FOR BRANDED PHARMACEUTICAL COMPANIES
The America Invents Act (AIA) was enacted to remedy numerous perceived problems with the US patent system. The AIA created a new procedure, the inter partes review (IPR), as a way to give accused infringers a faster, less expensive way to fight patent infringement suits, particularly meritless suits by parties asserting bad patents solely in order to get quick settlements.
However, these IPR proceedings, which were meant to help businesses, have alarmed many patentees who fear that the proceedings are “patent death squads”. The IPRs offer significant benefits to those seeking to challenge the validity of patents, most notably a lower standard of proof. In US District courts and the US International Trade Commission (USITC), invalidity of a patent must be shown by clear and convincing evidence – a high standard. In the IPRs, the patent challenger must only provide a preponderance of evidence demonstrating invalidity, which is a substantial advantage. Another difference between IPRs and the traditional district court or USITC case is that any member of the public can file a petition for an IPR, whereas in the other proceedings only entities accused of infringement generally had standing to challenge a patent’s validity. The effect of these advantages is clear; according to our analysis, when the Patent Trial and Appeal Board (which decides IPRs) has reviewed challenged claims in IPR proceedings, 73 percent of the time all of the claims have been found unpatentable and in 13 percent of the cases, some of the claims were held unpatentable.
Jul-Sep 2015 issue