Patent Baristas

The Senate has confirmed Former Washington Gov. Gary Locke as Commerce Secretary by unanimous consent. The United States Department of Commerce is the Cabinet department of the United States government concerned with promoting economic growth and operates the Patent and Trademark Office (PTO).

President Obama will now be looking to choose an Under Secretary of Commerce and PTO Director.  Secretary Locke’s responses to questions from Senator Sam Brownback (R-Kansas) on patent reform at his confirmation hearing may shed some light on what we can expect. The Commerce secretary nominee emphasized that patent laws should not benefit some industries over others and that their impact on jobs should be considered when evaluating new laws:

SEN. BROWNBACK: There has been legislation proposed in Congress over the past few years to change the patent laws, and it has become very contentious. The proponents are a group of high tech and financial services companies, and on the other side there is a larger group of companies from a variety of industries manufacturing, green tech, nanotech, biotech, pharmaceuticals, venture capitals. … Do you agree that we should not be changing our patent laws in a way that chooses one group of companies over another? If you are confirmed, do you feel you can consider this issue impartially and help guide the debate to a place where not choosing high tech over manufacturing, for example?

LOCKE: If confirmed, I would work with Congress on patent reform legislation that would enhance innovation by fairly balancing the interests of innovators across all industries and technologies. I agree that patent law reform should not favor one industry or any particular area of technology over another.

SEN. BROWNBACK: Many high-tech companies that oppose S. 515, the Patent Reform Act of 2009, rely on their ability to protect their patented innovations by receiving damage awards from proven patent infringers. The proposed legislation changes the way damages are calculated, making infringement far less costly. In your role overseeing the USPTO, would this concern you? Are you concerned that this well-meaning patent legislation will actually hamper U.S. innovation?

LOCKE: Innovation is critical to creating jobs and bringing us out of the current economic downturn. Any statutory proposal must be weighed in terms of its effect on job creation and promotion of innovation. If confirmed, I will review all patent reform proposals that perspective.

SEN. BROWNBACK: The high-tech sector is divided between those who primarily invent and those who primarily package and market inventions. It is understandable that, just as any business wants to cut its costs, some high-tech companies who pay for others’ patents would want to reduce the costs for the patents they purchase or license from other high-tech companies. The damages provisions of the Leahy patent bill, S. 515, would have the effect of devaluing patents. Are you concerned that degrading patent holders’ rights might be a tempting short-term response that could have serious long-term consequences for our economy?

LOCKE: If confirmed, I would not support any statutory reform that devalues patent holder’s rights.

SEN. BROWNBACK: In your questionnaire you indicate that you hold stock in Microsoft, a member of the Coalition for Patent Fairness, a group that has been lobbying in favor of the Leahy patent bill. Given your personal interest in this company, how can you guarantee that you will approach the patent reform debate objectively?

LOCKE: If confirmed I am confident that I can and will continue to exercise my best objective judgment in all policy matters and I commit to consult with Ethics officials to ensure that my involvement in this area is entirely consistent with Ethics rules.

SEN. BROWNBACK: If you are confirmed you will inherit a serious problem at the Patent and Trademark Office that was created by known as “fee diversion.” It occurs when the Administration or Congress redirects the patent and trademark application fees paid by inventors, research universities and innovation companies to other spending. Currently the backlog of patent applications is nearly 800,000 applications and it takes at least 31 months to issue the patent. …  Since PTO is not funded with taxpayer dollars but with user fees, do you support the permanent ending of fee diversion?

LOCKE: The mission is critical to American innovation and invention. If confirmed, I will maintain the threshold principal that all user fees paid for services should remain with the USPTO as it has for the last years. If confirmed, I will work to continue that the user fees stay with the Office to be spent on managing and improving USPTO operations.

SEN. BROWNBACK: I recently joined Senators Feingold, Kyl, Wyden, Grassley, and Bond in sending a letter to Judiciary Committee Chairman Leahy asking that the Committee not rush patent reform legislation and work with those voicing concerns about the bill. … I am very concerned that this bill is intentionally being rushed when there is no Commerce Secretary nor is there an Under Secretary of Commerce for Intellectual Property (PTO Director). Do you agree that this sweeping legislation that will greatly impact the economy should not be considered until the Administration has its Commerce Secretary and PTO Director confirmed?

LOCKE: The administration will be better able to participate in this critical legislative process when political leadership is nominated, confirmed and in place at USPTO. If confirmed, I will be actively involved in representing the Administration’s views with stakeholders and Members of Congress on this landmark legislation.

The Japan Patent Office has just announced a new policy to help stimulate the economy.  It relates to the fees for filing a request for examination.  Apparently, the Japan Patent Office is not the only patent office to experience a large drop in the number of patent applications being filed.  The JPO’s annual report shows that the office received 396,291 applications in 2007 or about, 12,000 less than 2006.   This could have something to do with the fact that like the EPO and the USPTO, the JPO currently grants under 50% of the applications that it examines.

Specifically, starting April 1st and running for a period of two years, an applicant for a patent with the JPO can file a request for examination but delay payment of the fees for up to one year!  The payment will be due one year from filing the request, but if payment is not made at that time the JPO will issue an Order to Amend asking for the payment.  Failure to pay within a stipulated deadline will result in abandonment of the application. This delay can be taken anytime within the 3 year period for filing the request for examination.

This would seem to allow a client to delay a substantial outlay of funds at an early stage while still retaining a place in the queue for examination. This may be beneficial to many patent filers in these economically stressful times.  Note that this is not effective for expedited examination.

For those looking for a fast track to a patent, however, might want to make use of the JPO’s trial “super accelerated examination.”  According to the JPO, Keio University received a patent for a process for detecting toxic metals following a screening process that took just 17 days.

To make use of the system, the JPO requires the following:

1. Applicants have already requested an examination, but for which the examination process has not yet started (i.e., Reasons for Refusal and other office actions have been taken)
2. Working invention-related application, applications filed by an applicant or a licensee who has already commercialized the invention or plans to commercialize the invention within two years from the filing date
3. Internationally filed Applications, that is, applications that were filed with both the JPO and at least one foreign IP Office
4. Applicants file online

The JPO is planning to continue the test for at least six months and lead to the revision and official operation of the system after considering the opinions of the applicants who used the test system.

There have been mutterings and papers for some time about the EPO restricting the filing of divisional applications. They were viewed by some at the EPO as a thorn in the side of 3rd party rights.

It is now official – the EPO Administrative Council met 26 March 2009 and considered the filing of divisional applications to be “abusive” so they have signed off on an EPC rule change to Rule 36 severely limiting the opportunities to file divisional applications.

Under present Rule 36 EPC, a divisional application can be filed at any time before grant, abandonment or withdrawal of the parent case.

The new rule will restrict this deadline in two ways:

1.  If the EPO do not raise an objection of unity of invention. Any divisional application(s) can only be filed within 2 years of the first communication from the examining division; and

2.  If the EPO do raise an objection of unity of invention. Any divisional application(s) can only be filed within 2 years of the first communication from the EPO (not when acting as the International Search Authority) which identifies that there is more than one invention.

Here are some examples of how the new rule will work:  An applicant can voluntarily file a first divisional from an original parent application, and a second divisional, from the first divisional.  However both divisionals must be filed in the 2 years after the first examining division communication on the original parent application.

If the EPO identifies 3 different inventions in a search report on an original application, then the applicant must file divisional applications to each of the 2 additional inventions within two years of that search report. However, if one of those divisionals provokes a new lack of unity objection, then the new objection starts a fresh 2 year term for filing divisional applications for the newly-identified inventions.

There will be clarification to this proposed system in the year before the new rule takes effect. In the meantime, if you have any specific questions on how the new system will operate, please let us know.

The new rule will come into force on April 1, 2010. There will be a 6 month grace period, until October 1, 2010, for filing divisional applications outside the new two year periods.

(via Forresters, London)

In a game of one-upmanship,  Sen. Jon Kyl (R-AZ) introduced — and apparently with a straight face — Senate bill (S. 610) as an alternative to the earlier introduced bills, S. 515 and H.R. 1260.  While differing in the standard for showing  inequitable conduct, the bill still retains the dreaded applicant quality submissions (AQS) that has been removed from S. 515 and H.R. 1260.

Instead of requiring applicants to perform searches and submit the closest prior art with analysis with respect to the claims, S. 610 provides that the PTO may offer incentives to applicants to submit such search reports.  And we use the word “incentive” loosely here.  It also contains the DataTreasury “Check 21” provision for making use of the Check Imaging patents a noninfringment.

This is probably a non-starter but some pertinent sections are outlined below:

SEC. 4. DAMAGES.

(a) In general:

(1) COMPENSATORY DAMAGES.—Upon finding for a claimant, the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as determined by the court.

(2) INCREASED DAMAGES.—When the damages are not found by a jury, the court shall assess them. In either event the court may increase the damages up to 3 times the amount found or assessed. Increased damages under this paragraph shall not apply to provisional rights under section 154(d) of this title.

(3) LIMITATION.—Subsections (b) through (h) of this section apply only to the determination of the amount of reasonable royalty and shall not apply to the determination of other types of damages.

(b) HYPOTHETICAL NEGOTIATION.—For purposes of this section, the term ‘reasonable royalty’ means the amount that the infringer would have agreed to pay and the claimant would have agreed to accept if the infringer and claimant had voluntarily negotiated a license for use of the invention at the time just prior to when the infringement began. The court or the jury, as the case may be, shall assume that the infringer and claimant would have agreed that the patent is valid, enforceable, and infringed.

(c) APPROPRIATE FACTORS.—The court or the jury, as the case may be, may consider any factors that are relevant to the determination of the amount of a reasonable royalty.

(d) COMPARABLE PATENTS.—

(1) IN GENERAL.—The amount of a reasonable royalty shall not be determined by comparison to royalties paid for patents other than the patent in suit unless—

(A) such other patents are used in the same or an analogous technological field;
(B) such other patents are found to be economically comparable to the patent in suit; and
(C) evidence of the value of such other patents is presented in conjunction with or as confirmation of other evidence for determining the amount of a reasonable royalty.

(2) FACTORS.—Factors that may be consid
ered to determine whether another patent is economically comparable to the patent in suit under paragraph (1)(A) include whether—

(A) the other patent is comparable to the patent in suit in terms of the overall significance of the other patent to the product or process licensed under such other patent; and
(B) the product or process that uses the other patent is comparable to the infringing product or process based upon its profitability or a like measure of value.

(e) FINANCIAL CONDITION.—The financial condition of the infringer as of the time of the trial shall not be relevant to the determination of the amount of a reasonable royalty.

…

SEC. 11. INEQUITABLE CONDUCT.

(a) IN GENERAL.—Except as provided under this section, a patent shall not be held invalid or unenforceable on the basis of misconduct before the Office. Nothing in this section shall be construed to preclude the imposition of sanctions based upon criminal or antitrust laws (including section 1001(a) of title 18, the first section of the Clayton Act, and section 5 of the Federal Trade Commission Act to the extent that section relates to unfair methods of competition).

(b) INFORMATION RELATING TO POSSIBLE MISCONDUCT.—The Director shall provide by regulation procedures for receiving and reviewing information indicating that parties to a matter or proceeding before the Office may have engaged in misconduct in connection with such matter or proceeding.

(c) ADMINISTRATIVE PROCEEDING.—

(1) PROBABLE CAUSE.—The Director shall determine, based on information received and reviewed under subsection (b), if there is probable cause to believe that 1 or more individuals or parties engaged in misconduct consisting of intentionally deceptive conduct of a material nature in connection with a matter or proceeding before the Office. A determination of probable cause by the Director under this paragraph shall be final and shall not be reviewable on appeal or otherwise.

(2) DETERMINATION.—If the Director finds probable cause under paragraph (1), the Director shall, after notice and an opportunity for a hearing, and not later than 1 year after the date of such finding, determine whether misconduct consisting of intentionally deceptive conduct of a material nature in connection with the applicable matter or proceeding before the Office has occurred. The proceeding to determine whether such misconduct occurred shall be before an individual designated by the Director.

(3) CIVIL SANCTIONS.—

(A) IN GENERAL.—If the Director determines under paragraph (2) that misconduct has occurred, the Director may levy a civil penalty against the party that committed such misconduct.

(B) FACTORS.—In establishing the amount of any civil penalty to be levied under subparagraph (A), the Director shall consider—

(i) the materiality of the misconduct;

(ii) the impact of the misconduct on a decision of the Director regarding a patent, proceeding, or application; and

(iii) the impact of the misconduct on the integrity of matters or proceedings before the Office.

(C) SANCTIONS.—A civil penalty levied under subparagraph (A) may consist of—

(i) a penalty of up to $150,000 for each act of misconduct;

(ii) in the case of a finding of a pattern of misconduct, a penalty of up to $1,000,000; or

(iii) in the case of a finding of exceptional misconduct establishing that an application for a patent amounted to a fraud practiced by or at the behest of a real party in interest of the application— (I) a determination that 1 or more claims of the patent is unenforceable; or (II) a penalty of up to $10,000,000.

Apparently, the U.S. Court of Appeals for the Federal Circuit could not bear to see an end to the drama between the U.S. Patent and Trademark Office and its customers over proposed patent application rules.  The CAFC set out a mixed opinion on the rules proposed by the USPTO saying that they are procedural but in conflict with law in part.  Tafas v. Doll, __ F.3d __ (Fed. Cir. 2009)(Prost, J.).

The result can be summed up in the courts statement that:

[W]e are mindful of the possibility that the USPTO may in some cases attempt to apply the rules in a way that makes compliance essentially impossible and substantively deprives applicants of their rights.  In such cases, judicial review will be available under 5 U.S.C. § 706. 

Thus, if the USPTO sticks it to you, you get to spend all your time and money trying to convince a court to overturn the result.  Nice.

To recap, the USPTO tried to issue new rules labeled Changes to Practice for Continued Examination Filings, Patent Applications Containing Patentably Indistinct Claims, and Examination of Claims in Patent Applications, 72 Fed. Reg. 46,716 (Aug. 21, 2007).

Two of the new rules, Final Rule 78 and Final Rule 114, pertain to continuation applications and requests for continued examination (“RCEs”) and were issued – according to the USPTO — to address the “large and growing backlog of unexamined patent applications.”

Rule 78 governs the availability of continuation and continuation-in-part applications.  Under the rule, an applicant is entitled to file two continuation applications as a matter of right.  An applicant wanting to file more than two continuation applications must file a petition “showing that the amendment, argument, or evidence sought to be entered could not have been submitted during the prosecution of the prior-filed application.”

Rule 114 provides for similar treatment of RCEs.  Under the rule, an applicant is allowed one RCE as a matter of right.  For each additional RCE, the applicant must file a petition “showing that the amendment, argument, or evidence sought to be entered could not have been submitted prior to the close of prosecution in the application.”

Rule 75 requires an applicant who submits either more than five independent claims or twenty-five total claims to provide the examiner with information in an examination support document (“ESD”).

Rule 265, requires an applicant to conduct a preexamination prior art search, provide a list of the most relevant references, identify which limitations are disclosed by each reference, explain how each independent claim is patentable over the references, and show where in the specification each limitation is disclosed in accordance with 35 U.S.C. § 112, ¶ 1.

In the original case, the district court first determined that that the USPTO did not have substantive rule-making authority but does have procedural rule-making authority.  The district court then declared that the Final Rules were invalid after finding that they are “substantive rules that change existing law and alter the rights of applicants” under the Patent Act.”

The USPTO then appealed.

The CAFC agreed that the USPTO only had procedural authority but said that all four rules were procedural and that the USPTO had the authority to go ahead and make them.  But, it said that Rule 78, which limited continuations and CIPs, was in conflict with U.S. patent law and was not valid. While the CAFC found that the other rules were not in conflict with existing law, the court remanded the matter to the district court to determine if the USPTO followed the proper procedures in enacting those rules.

The USPTO argued that the crux of the matter is not whether the rules are substantive or procedural, but whether they fit within a reasonable interpretation of USPTO authority to “establish regulations, not inconsistent with law, which . . . shall govern the conduct of proceedings in the Office . . . [and] facilitate and expedite the processing of patent applications.”  Also, the USPTO argued that even if the substantive/procedural framework is applicable, the Final Rules are clearly procedural.

First, the CAFC set out that § 2(b)(2) “does not vest the USPTO with any general substantive rulemaking power,” rejecting the USPTO’s argument that the substantive/procedural distinction is immaterial in this case.

While the USPTO also argued that Chevron deference is required for the threshold question of whether § 2(b)(2) vests the USPTO with substantive rulemaking authority and that its interpretation of various sections of the Patent Act, and its accordant belief that the Final Rules are consistent therewith, is also entitled to deference, the CAFC disagreed:

We are not persuaded by the USPTO’s arguments in this case that Chevron deference should be extended to the issue of whether § 2(b)(2) provides substantive rulemaking authority.  …  Because we decline to accord deference with respect to the question of whether the USPTO has substantive rulemaking authority, our conclusion above that the USPTO does not have such authority is unaffected by Chevron.

[On] review of a procedural rule that has been issued by the USPTO, we will give Chevron deference to the USPTO’s interpretation of statutory provisions that relate to the exercise of delegated authority.

The parties agreed that the USPTO has authority to make procedural rules.  They disagree, however, as to how the boundary between “substantive” and “procedural” rules should be defined.

The CAFC set forth the only slightly helpful outline stating:

While we do not purport to set forth a definitive rule for distinguishing between substance and procedure in this case, we conclude that the Final Rules challenged in this case are procedural.  In essence, they govern the timing of and materials that must be submitted with patent applications.  The Final Rules may “alter the manner in which the parties present . . . their viewpoints” to the USPTO, but they do not, on their face, “foreclose effective opportunity” to present patent applications for examination.

We are of course aware that the impact of Final Rules 78 and 114 will be largely dependent on how the USPTO interprets when amendments, arguments, and evidence “could not have been submitted during the prosecution of the prior-filed application” or “prior to the close of prosecution.”

The district court looked at public comments to conclude that the USPTO “intends to deny additional applications in almost all circumstances” such that Final Rules 78 and 114 are in fact “hard limits” on continuation applications and RCEs.

The CAFC, living in a parallel universe where the Patent Office works to accommodate the needs of its customers [applicants] said that it is “not binding on the courts, which will be free to entertain challenges to the USPTO’s application of the Final Rules, including its view of when amendments, arguments, and evidence could not have been submitted earlier, under the standard set forth in 5 U.S.C. § 706.”

The district court found that Final Rule 78’s requirement for the third and subsequent continuation applications was inconsistent with the text of 35 U.S.C. § 120 and this court’s precedent.

The CAFC held that:

We agree with the district court that Final Rule 78 is inconsistent with § 120, although we rely on narrower grounds.  Section 120 unambiguously states that an application that meets four requirements “shall have the same effect, as to such invention, as though filed on the date of the prior application.”  …

The use of “shall” indicates that these are the exclusive requirements, and that all applications that meet these requirements must receive the benefit provided by § 120.  …

Thus, Rule 78 is invalid because it attempts to add an additional requirement—that the application not contain amendments, arguments, or evidence that could have been submitted earlier—that is foreclosed by the statute.  Because the statute is clear and unambiguous with respect to this issue, the USPTO’s reliance on Chevron and Brand X is unavailing.

Expect everyone to find something to dislike about this ruling.  Don’t expect an en banc hearing.  Will Congress ever step up and fix this mess?

The full text of the Pathway for Biosimilars Act (H.R. 1548) introduced in the House has now been released.  The Act is set to amend the Public Health Service Act in order to establish a pathway for the licensure of biosimilar biological products, and for other purposes.

The Act provides for the following:

EXCLUSIVITY FOR FIRST INTERCHANGEABLE BIOLOGICAL PRODUCT

The Secretary shall not make a determination under paragraph (4) that a second or subsequent biological product is interchangeable with the same reference product for which a prior biological product has received a determination of interchangeability until 24 months after the later of–

(A) the date of the first commercial marketing of the first biosimilar biological product determined to be interchangeable for that reference product; or

(B) with respect to a product marketed before the date the product is determined to be interchangeable, the date that the product is determined to be interchangeable.

…approval…may not be made until the date that is 12 years after the reference product was first licensed…

EXCLUSIVITY FOR REFERENCE PRODUCT

(A) EFFECTIVE DATE OF BIOSIMILAR APPLICATION LICENSURE- Subject to subparagraph (D) and paragraph (8), approval of an application under this subsection may not be made effective by the Secretary until the date that is 12 years after the date on which the reference product was first licensed under subsection (a).

(B) FILING PERIOD- An application under this subsection may not be submitted to the Secretary until the later of–

(i) the date of commencement of a proceeding for issuance of guidance pursuant to paragraph (9) with respect to the product class within which the product that is the subject of such application falls; or

(ii) the date that is 4 years after the date on which the reference product was first licensed under subsection (a).

(C) FIRST LICENSURE- For purposes of this paragraph, the date on which the reference product was first licensed under subsection (a) does not include the date of approval of a supplement or of a subsequent application for a new indication, route of administration, dosage form, or strength for the previously licensed reference product.

(D) MEDICALLY SIGNIFICANT NEW INDICATION- If, during the 8-year period following licensure of the reference product, the Secretary approves a supplement to the application for the reference product that seeks approval to market the reference product for a new indication that, if approved, would be a significant improvement, compared to marketed products, in the treatment, diagnosis, or prevention of disease, approval of an application submitted under this subsection may not be made effective by the Secretary until the date that is 14 years after the date on which the reference product was first licensed under subsection (a).

PEDIATRIC STUDIES.

(A) EXCLUSIVITY- If, before or after licensure of the reference product under subsection (a) of this section, the Secretary determines that information relating to the use of such product in the pediatric population may produce health benefits in that population, the Secretary makes a written request for pediatric studies (which shall include a timeframe for completing such studies), the applicant or holder of the approved application agrees to the request, such studies are completed using appropriate formulations for each age group for which the study is requested within any such timeframe, and the reports thereof are submitted and accepted in accordance with section 505A(d)(3) of the Federal Food, Drug, and Cosmetic Act–

(i) the period referred to in paragraph (7)(A) of this subsection is deemed to be 12 years and 6 months rather than 12 years; and

(ii) if paragraph (7)(D) of this subsection applies, the period referred to in such paragraph is deemed to be 14 years and 6 months rather than 14 years.

(B) EXCEPTION- The Secretary shall not extend the period referred to in subparagraph (A)(i) or (A)(ii) of this paragraph if the determination under section 505A(d)(3) of the Federal Food, Drug, and Cosmetic Act is made later than 9 months prior to the expiration of such period.

(C) APPLICATION OF CERTAIN PROVISIONS- The provisions of subsections (a), (d), (e), (f), (h), (j), (k), and (l) of section 505A of the Federal Food, Drug, and Cosmetic Act shall apply with respect to the extension of a period under subparagraph (A) of this paragraph to the same extent and in the same manner as such provisions apply with respect to the extension of a period under subsection (b) or (c) of section 505A of the Federal Food, Drug, and Cosmetic Act.

Representatives Anna Eshoo (D-CA), Jay Inslee (D-WA), and Joe Barton (R- TX) have introduced the Pathway for Biosimilars Act (H.R. 1548).  The key provision of the Eshoo-Inslee-Barton bill is the 14-year data protection period.  It would offer all new biological drugs a base period of 12 years of data protection with the right to obtain an additional two years once a further indication for use of the product is approved by the FDA.

The California Healthcare Institute (CHI) President and Chief Executive Officer David Gollaher, Ph.D., issued his support for the bill:

While focused on the development of the next generation of innovative medicines, we understand that the increasing cost of healthcare is a growing burden for private-sector and government budgets. In the long term, competition among biosimilar products is likely to yield savings within the U.S. healthcare system. Considering the complexity of large molecule product development and manufacturing, CHI believes that it is possible to develop a successful, science-based FOBs approval pathway. This pathway must employ the best science to ensure the safety of products for patients, encourage price competition among manufacturers, and provide ample incentives to encourage continued private-sector investment in the next generation of breakthroughs.

The CHI contends that the Pathway for Biosimilars Act’ meets these standards:

1. Clear Guidance: As suggested by the FDA’s Chief Scientist in his recent letter to Congress, this legislation requires the FDA to formulate scientific standards for FOBs approval and determination of interchangeability through a flexible, clear, and public guidance process;

2. Clinical Trials and Safety: Ensures that no follow-on product is approved without appropriate and careful scientific demonstration, including the assessment of immunogenicity, that the product is ‘biosimilar’ to the approved reference biological product;

3. Patent Dispute Resolution: Establishes an equitable framework for exchanging information among innovator manufacturers, biosimilar manufacturers and third-party patent holders, such as universities and private research institutes whose scientific breakthroughs are licensed to the private sector for commercial development.

4. Innovation: Encourages future investment in biopharmaceutical research and development by providing at least 12 years of data exclusivity before the FDA can reference the expensive and time-consuming safety and efficacy testing conducted by an innovator in order to approve a follow-on product. This critical element both recognizes that follow-on manufacturers, developing products that are ‘similar’ to innovators’ products, may work around innovators’ patents. The protection of clinical trials data is thus far more important for biologics than for traditional chemical pharmaceuticals; we believe that 12 years of protection will produce outcomes for biotechnology companies similar to those currently in place for traditional pharmaceuticals under the Hatch-Waxman bill of 1984.

The Biotechnology Industry Organization (BIO) president Jim Greenwood said the bill strikes the right balance between innovation and balance. The industry group is against the earlier bill introduced by Rep. Henry Waxman, that would give brand-name biologics just five years of exclusivity, saying it would undercut innovation.  The Eshoo-Barton-Inslee bill “provides patients with the right balance between innovation and competition,” said Greenwood in a statement.

Needless to say, the Generic Pharmaceutical Association (GPhA) released its statement from GPhA President and CEO Kathleen Jaeger opposing the introduction of the Pathway for Biosimilars Act:

Unfortunately, The Pathway for Biosimilars Act is the wrong medicine for patients and our nation’s health care system. This bill will only benefit brand companies by erecting barriers including an unprecedented and unjustifiable 14 years of market exclusivity. Given that there is a minimal difference of less than eight months longer in the development of biopharmaceuticals when compared to traditional pharmaceuticals, there is little justification for excessively expanding exclusivity beyond the Hatch-Waxman model. Excessive exclusivity means that it will be decades before patients have access to affordable biogeneric medicines.

Follow the progress of the Pathway for Biosimilars Act here.

Consumer Reports is using giant jogging pills on treadmills in order to announce its launch of a public campaign in support of comparative effectiveness research to urge policy makers to get behind the effort to provide doctors and patients with independent comparisons of different treatments for medical conditions.The interactive display is set up in Washington’s Union Station today where CU is running some medications through vigorous testing.

While patients have spent about $286 billion on prescription drugs in 2007 alone, about 75 percent of it on brand-name products, drug makers spent about $5.4 billion in 2007 on advertising medicines.  The companies also spend about $15 to $20 billion annually on trade journal advertising and other outreach including in-person sales calls, professional symposia and gifts to spread their message to doctors, pharmacists, benefit managers, and others.

You can stop by and pick up a copy of their latest publication, Best Drugs for Less or learn about Best Drugs for Less online. Best Drugs for Less is supposed to provide “unbiased, independent evaluations to help people choose medicines that are safe, effective, and affordable.”  The magazine is aimed at helping patients and doctors cut through the clutter of drug advertising so they can make informed decisions about their medications.

You can also check out their list of 10 ways to reduce your drug costs.