WTAS: Proposed Unsubstantiated USPTO Rule Change is a Threat to American Innovation

There has been increasing interest from some policymakers in Congress and the administration on terminal disclaimers and their use to resolve obviousness-type double patenting objections. Some proposed policies would even render entire patents unenforceable if a single claim in another patent is found invalid.

The U.S. Patent and Trademark Office (USPTO) stated in a recent proposed rulemaking that their change would help reduce costs for patent challengers, a notion frequently contested by many, based on an unsubstantiated claim pushed by patent critics that a product having numerous patents harms competition. Not only is there no proof of these claims, but the USPTO's recent Drug Patent and Exclusivity Study highlights that "multiple patents associated with a single marketed product are not unique to the pharmaceutical industry and are a common practice in many innovative industries, especially for complex products." Even something as apparently simple as a golf ball can have dozens of patents, each representing a different innovation.

Here is what leading researchers, legislators and other IP experts have said about the impact of the proposed USPTO rule:

• "The Office's proposed rulemaking threatens to turn this inventor-friendly system on its head. Buried in the patent-speak minutiae of 'obviousness-type double patenting' (OTDP) and 'terminal disclaimers' (TDs) is a proposal that would fundamentally make it nearly impossible for inventors to take advantage of filing continuation applications by potentially assessing them a significant penalty if they do - requiring them to agree to the complete unenforceability of their later patents if a single part of their original patent is later found invalid." - Sen. Thom Tillis (R-NC), Ranking Member of the Senate Judiciary Subcommittee on Intellectual Property

• "This proposed rule, which appears to be premised on a misunderstanding of terminal disclaimers and the concept of so-called "patent thickets," would negatively impact incentives for innovation for PhRMA's member companies. This in turn could have negative implications for future life-saving and life-enhancing therapies for patients in need." - David E. Korn and John E. Nappi, Pharmaceutical Research and Manufacturers of America (PhRMA)

• "The Innovation Alliance shares the goals of promoting innovation and competition set forth in the NPRM. But the proposed rule would not advance those goals. Instead, it would impose substantial burdens on both the Office and patent applicants, especially small and independent inventors who are least able to bear those burdens. It would also conflict with both the statute and Federal Circuit authority, leading to likely challenges to the proposed rule as both improper and beyond the Office's authority." - The Innovation Alliance

• "This approach is both ill-advised and improper. It favors accused infringers and patent challengers over the patent owners, technology investors, and licensees who depend on the statutory presumption of patent validity to invent, protect, and deploy innovations. The USPTO's approach will only weaken the United States' innovation ecosystem, which was founded and relies heavily upon patent-incentivized investments." - Stephen J. Susalka, Ph.D., Chief Executive Officer, AUTM

• "Effective and empirical research is the best metric to decide if any policy should be undertaken. In contrast, the current proposals come in response to activists who have equated not only the number but also the mere existence of patents as indications of barriers to access to medicines. While advocates for weakened patent rights for life-saving treatments routinely cite studies that parrot false narratives regarding so-called 'patent thickets' and 'evergreening,' these studies have been rightly criticized for their inaccurate use of underlying data, lack of transparency, and flawed methodology." - Tom Quaadman, Executive Vice President, Global Innovation Policy Center, U.S. Chamber of Commerce

• "BIO believes that the NPRM is unsupported by the factual record, lacks legal authority, lacks a policy justification, is inconsistent with statutory and case law, and would cause extensive harm to the patent system. Because the NPRM lacks any redeeming features, it should be withdrawn immediately." - Courtenay Brinckerhoff and Hans Sauer, Biotechnology Innovation Organization (BIO)

America's IP system promotes competition and is the foundation for new treatments and cures for patients. In order for biopharmaceutical innovators to deliver for patients, they must have confidence in the intellectual property system.

If the USPTO wants to preserve this life saving and life changing innovation, it must withdraw this misguided proposal.

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