Patent Baristas

The Washinton Times reported that a so-called wild-card patent provision, expected to be proposed to Congress as part of the Bioshield II bill (Senate Bill S.3, Protecting America in the War on Terror Act of 2005), has been modified to overcome objections from companies that manufacture generic drugs.

S.3 would make changes to the earlier Project Bioshield, which authorizes $5.6 billion over 10 years to encourage pharmaceutical and biotechnology companies to work with the NIH to develop antidotes, vaccines and other products to treat and protect against a number of potential biological weapons.

The wild card provision, if enacted, would add up to two years to the exclusive patent term for a patented drug. It’s called a wild card because its designee would get to apply it to any drug for which it holds a patent. For a major pharmaceutical, those two extra years could be worth billions of dollar in revenue. Generic firms are worried that drug companies would wait to apply the wild card until the last minute – thus throwing a monkey wrench into their business plans.

The draft language in the new bill was changed to require the winner of a contract to name the designated drug within 180 days of receiving the contract. Since the wild card cannot be applied until after the company actually gains FDA approval for the new countermeasure, there is a risk that the wild card could be applied to a drug that would go off patent before it can be used, effectively nullifying the whole scheme for the pharmaceutical company.

However, even then not all would be lost. If the patent on the wild-card product does expire, there is still an option in the bill to extend the patent on the countermeasure to make up the time lost getting FDA approval. Under a provision in S.3, the firm with a winning countermeasure drug can choose to have the life of the patent on the new product extended to 17 years. Again, this can mean a massive windfall for the pharma.

The Generic Pharmaceutical Association opposes the changes on serveral grounds. See their position paper here. More info here.

In general, S.3 sets forth provisions concerning bioterrorism preparedness and defense, including provisions for: (1) extending the patent terms for certain countermeasure products; (2) exempting meetings between the Secretary of Health and Human Services and parties developing priority countermeasures from antitrust laws; (3) establishing the Commission on Countermeasure and Vaccine Regulation; (4) prohibiting a State from establishing requirements different from certain Federal food and drug laws; (5) allowing tax credits for vaccine and countermeasures manufacturing and research; and (6) requiring procedures for inspecting imported live animals.

In a bit of a gruesome political tie-in, it also increases the death gratuity payable to survivors upon the combat-related death of a member of the Armed Forces and increases the maximum life insurance payable for a member of the uniformed service or a veteran. This will put anyone opposed to the bill in a bind – they have to choose between allowing the controversial measures or looking like they are “against the fallen troops” – a no win situation.

Several groups, such as the National Vaccine Information Center (NVIC), are concerned about vaccine safety and have come out against the bill because of its provision that would preempt any state legislation regulating vaccines or vaccine components (read: Thimerosal or mercury) and it proposes to take away the rights of states to even warn citizens about potential injuries attributable to vaccines and drugs.

Other proposed provisions that raise eyebrows include the broadening of the definition of “countermeasure,” which could make almost any medicine eligible for patent extensions. The definition could be applied to commonly prescribed drugs that treat secondary effects of a bioterrorist attack, such as migraines, anxiety and even erectile dysfunction.

“To retain respect for sausages and laws, one must not watch them in the making.”

– Otto von Bismarck

In what may be a sign that blogs have jumped-the-shark, the current issue of BusinessWeek has a cover story emblazoned with large letters that “Blogs Will Change Your Business. Look past the yakkers, hobbyists, and political mobs. Your customers and rivals are figuring blogs out. Our advice: Catch up…or catch you later.” They cite some sobering statistics that there are now over 9 million blogs with about 40,000 sprouting up each day. Granted, a lot are the daily musings of the likes of Girly Shoes, who writes often about her last job (see “The Last Post Ever About My Old Job“). But others make you take a closer look at the business case for the use of a blog, e.g., the FastLane Blog set up by GM’s Vice-Chairman, Bob Lutz. While the blog is carefully edited by the PR department, GM deserves some credit for opening up a window to one of its most senior executives. (Note to Bob: Love the site but you still need to build better cars)

This article may also come from the fact that BusinessWeek itself has spawned a half-dozen of its own, professionally run blogs, including a “new blog on blogs” called Blogspotting. Although, if you look at the posts on Blogspotting, it seems to have not found it’s way yet. It features posts pondering “Mainstream press barely mentions blogs” and “Mainstream media’s alleged strategy on blogs.” Blogspotting even asks the question “What do you want this blog to be?” I suppose it’s nice they asked but you’d think with having professional staffers running the blog they’d know what they wanted.

BW has several other blogs (all run by professionals) like Tech Beat, posted by a half dozen staffers. This has a fair bit of useful information, including the ironic Overcoming Blog Overload post on tagging.

But, I could be misguided. The Business 2.0 blog reported that the advertising on BoingBoing.net brings in about $500,000 a year in change for the group. Maybe the Baristas need to start talking to Starbucks about a joint venture.

Merck & Co. announced it intends to file an appeal with the U.S. Supreme Court asking to overturn the ruling that the patent on its blockbuster osteoporosis drug Fosamax will expire a decade earlier than expected.

The U.S. Court of Appeals for the Federal Circuit rejected a Merck & Co. request to reconsider a decision that the patent on its blockbuster Fosamax osteoporosis drug would expire by February 2008, a decade earlier than expected. Fosamax is Merck’s second-best-selling drug with sales of about $3.2 billion worldwide last year.

Israeli-based generic drug maker Teva Pharmaceutical Industries Ltd. challenged the patent on the once-weekly version of Fosamax. A Delaware district court upheld the Merck patent in 2003 but in January 2005, the Federal Circuit overturned the decision and said the Fosamax patent would expire by February 2008.

Dennis Crouch has a nice summary on his Patently Obvious blog here.

Merck, with the amicus support of Pharmaceutical Research and Manufacturers of America (PhRMA), had filed a petition for rehearing en banc but the CAFC denied the request, thus maintaining the panel decision. The denial is here.

At the WIPO General Assembly meetings from September 27 to October 5, 2004 the governments of Argentina and Brazil submitted a proposal for “the Establishment of a Development Agenda for WIPO”. The proposal was co-sponsored by Bolivia, Cuba, Dominican Republic, Ecuador, Egypt, Iran, Kenya, Peru, Sierra Leone, South Africa, Tanzania and Venezuela. The Development Agenda proposal asked for fundamental changes in WIPO. Some of the proposals were specifically directed at the special concerns of developing countries, while others were efforts to redirect WIPO to give more weight to general consumer and public interests in matters concerning patents, copyrights and other intellectual property rights. Among the proposals for a Development Agenda is a proposal for a “Treaty on Access to Knowledge and Technology”. The Development Agenda proposal, the WIPO General Assembly decision and many of the comments and discussions are available here.

World Intellectual Property Organization (WIPO) took the step of agreeing to consider the impact of its decisions on developing nations — including assessing the impact of intellectual property law and policy on technological innovation, access to knowledge, and even human health. There is much at stake since WIPO decisions affect everything from the availability and price of AIDS drugs, to the patterns of international development, to the communications architecture of the Internet. As part of the agreement, WIPO held meetings to discuss the “Development Agenda“, endorsed by hundreds of individuals and public-interest non-governmental organizations (NGOs) including EFF and the Consumer Project on Technology (CPTech) through the Geneva Declaration on the Future of WIPO.

As reported by the EFF, the first session of the Inter-Sessional Intergovernmental Meeting (IIM) on a Development Agenda for WIPO was held from April 11 to 13, 2005, where 99 Member States, 16 Intergovernmental Organizations (IGOs) and 41 Non-Governmental Organizations (NGOs) participated in the session. The IIM decided to admit, on an ad hoc basis, 17 non-accredited NGOs, as per the attached list, without implications as to their status for future WIPO meetings. More info is available here, here and here.

Wired ran an interesting article on the struggle relating to Bioprospecting detailing how companies are traveling to the deepest parts of the jungle, the highest mountains and, even the antarctic, to hunt for plants and animals with commercially valuable properties. The question, of course, is who should reap the rewards?

Thus, the discussion at U.N. headquarters was to debate strategies that developing countries can adopt to attract investments in drug research based on genetic resources.

The concept behind bioprospecting is not new and one of the first major deals was in 1991, when the pharmaceutical giant Merck made an agreement with Costa Rica’s National Biodiversity Institute to collect and prepare specimens for inventory. The first payment was $1 million, but it’s not clear how any future revenue generated from pharmacological discoveries would be shared with indigenous peoples.

However, many countries are looking to protect indigenous peoples’ rights to ownership of the traditional knowledge associated with their land, and to promote sustainable development. The most important is the Convention on Biological Diversity, which came into effect in 1993, but which the United States has yet to ratify. And then there is the Agreement on Trade-Related Aspects of Intellectual Property Rights, commonly known as the TRIPS Agreement.

Although the Convention on Biological Diversity has established a framework for allowing access to biological resources, it assumes that individual states in fact have sovereignty over these resources, a presumption that does not hold for every resource. Additionally, it is already a problem to figure out who is doing the collecting and for what purpose. Bioprospecting often involves consortia composed of public and private entities. Delineating where scientific research ends and commercial activity begins becomes a difficult task, notes a report from the U.N. University Institute of Advanced Studies entitled “The International Regime for Bioprospecting: Existing Policies and Emerging Issues for Antarctica.” The document was drafted in preparation for a biodiversity meeting, the Seventh Conference of Parties to the Convention on Biological Diversity, held in Kuala Lumpur, Malaysia, this past February.

The report calls for the development of regulations to govern bioprospecting that would address a series of basic questions: Who owns the continent’s genetic resources? How can scientists legitimately acquire biomaterials? What measures should researchers take to protect extremophiles? Who owns the products that eventually get marketed commercially from these discoveries?

I wonder how this can be effectively enforced whenever plants and animals often can migrate and thrive (invade?) another territory. How can there be regulatory control over every species? I have a friend who, while doing studies on a plant from another continent, had its seeds put into the local area waters. (Basically, the cleaning people came into the lab and removed the special filters on the floor drain so they could wash the floor – and washed the seeds right down the drain!) These plants found a new, indigenous place to live.

Critics often condemn bioprospecting as a loss to Third World countries. Bioprospectors are seen as carrying off native plants, animals, microorganisms and other natural products with potential commercial value. Then science transforms these products into outrageous profits for wealthy investors.

Yes, abuses do occur but bioprospecting is not a get-rich-quick scheme. Out of 10,000 natural organisms screened for useful compounds, maybe one results in a new drug or other commercial product, and this only after many years of analysis and testing that typically cost hundreds of millions of dollars. Moreover, bioprospecting can be done responsibly. Development of products based on the genes, chemical compounds and structures of natural organisms can benefit not only consumers and commercial firms, but farmers, local communities and natural ecosystems as well.

Rather than bash bioprospecting, a more useful approach might be to understand how a poor country can maximize benefits from its biological resources.

Groklaw, which advertises itself as “When you want to know more but don’t know where to look” has put together an exhaustive list of links in a Patent Resource Page. Frankly, I was starting to get carpal tunnel syndrome just scrolling through the list.

While heavy on software patent and Open Source issues, it is worth noting for those in virtually any field. Check out their great resources for info on patents, patent law, international aspects and even resources regarding patent busting and submarine patent issues.

The House Subcommittee on Intellectual Property circulated a discussion draft a Patent Reform Bill. Since it’s just a draft, it’s not worth over-analyzing at this point but it is interesting to get a glimpse at the topics that may be subject to amendment.

The proposed legislation includes changes to:

• Creating a post-grant opposition procedures
• Willfulness damages award not merely on the knowledge of a patent
• Remove right for an injunction for infringing activity
• First-to-file rights
• Expanded definitions of prior art (but see above)
• Assignee may file for the application
• Best mode requirement
• Duty of candor and unenforceability
• Limits on damages when invention is a portion of a larger product
• Publication of all patent applications after 18 months
• Prior user rights

I would like to see a first-to-file change to bring us into alignment with the rest of the world but I won’t hold my breath. There is certainly going to be some arguments over these types of changes. A Senate Committee on the Judiciary, Subcommittee on Intellectual Property, will hold a hearing on “The Patent System Today and Tomorrow,” Thursday, April 21, 2005 at 2:30 p.m. in Room 226 of the Dirksen Senate Office Building. Senator Hatch will preside.

Dennis Crouch has an excellent on-going discussion of the bill in a series of posts here, here and here. The Draft Patent Statute is posted here (182 KB).

The Baristas will need to mull over the details over a grande and a scone. We’ll keep you posted on substantive changes.

Best Barista, Troels Overdal Poulsen of Copenhagen carried 12 liters of fresh, whole milk from his native Denmark to Seattle in beating five other finalists winning the sixth annual World Barista Championship.

The contestants competed in an against-the-clock competition that required each barista to make four espressos, four cappuccinos and four “signature” drinks in just 15 minutes. They were also allowed 15 minutes to set up and clean up, and were judged in part on cleanliness.

Poulsen’s signature drink, called ESB for “enhanced sensory balance,” mixed pepper, espresso and lavendar. More here. Download poster here.

A federal judge in Indianapolis upheld Eli Lilly’s patent on Zyprexa,(USP 5,605,897) a treatment for schizophrenia that was among the top-selling drugs in the United States last year, with $2.4 billion in sales.

Judge Young’s verdict comes more than a year after the trial in the case. Lilly sued Zenith Goldline Pharmaceuticals, Dr. Reddy’s Laboratories, and Teva Pharmaceuticals, which had filed applications with the Food & Drug Administration to make generic olanzapine, the active chemical in Zyprexa.

Lilly had sued three generic drug companies to protect its patent, after the generic companies claimed that the patent was invalid because Zyprexa is too similar to other chemical compounds whose patents have already expired. In a 224-page ruling, Judge Richard L. Young of Federal District Court backed Lilly’s position, finding Zyprexa different from the other compounds and worthy of protection.
The verdict protects Lilly’s monopoly on selling Zyprexa in the United States until 2011, when its patent expires.

Ivax had the most at stake. The company had obtained the right to six months of exclusive sales on five separate dosages of Zyprexa in exchange for being the first to file a challenge to the olanzapine patent. Dr. Reddy’s had the right to marketing exclusivity on one dosage. Teva didn’t actively participate in the lawsuit and agreed to abide by Young’s ruling.

Ivax and Dr. Reddy’s said they will appeal. The case is headed to the U.S. Court of Appeals for the Federal Circuit in Washington, which specializes in U.S. patent law. The Federal Circuit threw out the Prozac patent in 2000 after Lilly won the original case in Indianapolis.
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