Patent Baristas

Today, I gave a webinar presentation with Ken Phelps, President of Camargo Pharmaceutical Services, on the interaction of patents and exclusivity of drugs approved by the FDA under section 505(b)(2). Ken is an expert at 505(b)(2) filings so my job (covering patent issues) was pretty easy.

Ken notes that large pharma and small start-ups alike are keenly interested in these filings with no signs of letting up. It’s not hard to see why. Section section 505(b)(2) drug applications find a unique (although often neglected) place between innovative drug NDAs and and the generic ANDAs.

Section 505 of the Federal Food, Drug, and Cosmetic Act describes three basic types of new drug applications:

1. an application that contains full investigations of safety and effectiveness (section 505(b)(1));
2. an application that contains full investigations of safety and effectiveness but where at least some of the information required for approval comes from studies not conducted by or for the applicant and for which the applicant has not obtained a right of reference (section 505(b)(2)); and
3. an application that contains information to show that the proposed product is identical in active ingredient, dosage form, strength, route of administration, labeling, quality, performance characteristics, and intended use, among other things, to a previously approved product (section 505(j)).

An important benefit of 505(b)(2) applications compared to Abbreviated New Drug Applications (ANDAs) is the ability to earn market exclusivity. Like ANDAs, 505(b)(2) submissions must include all relevant patents and patent certifications and are subject to the same Paragraph IV challenges and litigation, including a 30-month stay. However, 180-day exclusivity is not granted.

So, what type of information can an applicant rely on?

1. Published literature (a literature-based 505(b)(2)). If the applicant has not obtained a right of reference to the raw data underlying the published study or studies, the application is a 505(b)(2) application; if the applicant obtains a right of reference to the raw data, the application may be a full NDA (i.e., one submitted under section 505(b)(1)).

2. The Agency’s finding of safety and effectiveness for an approved drug to the extent such reliance would be permitted under the generic drug approval provisions at section 505(j). This approach is intended to encourage innovation in drug development without requiring duplicative studies to demonstrate what is already known about a drug while protecting the patent and exclusivity rights for the approved drug.

What kind of application can be submitted as a 505(b)(2) application? The applications are for either (a) new chemical entity (NCE)/new molecular entity (NME) or (b) changes to previously approved drugs — changes of the type described immediately below may not require review of information other than BA or BE studies or data from limited confirmatory testing:

• Dosage form
• Strength
• Route of administration
• Substitution of an active ingredient in a combination product.
• Formulation
• Dosing regimen
• Active ingredient, e.g., a different salt, ester, complex, chelate, clathrate, racemate, or enantiomer of an active ingredient in a listed drug containing the same active moiety.
• New molecular entity, often a prodrug of an approved drug or the active metabolite of an approved drug
• Combination product
• Indication
• Rx/OTC switch
• OTC monograph
• Naturally derived or recombinant active ingredient
• Bioinequivalence, where absorption is different from the 505(j) standards

You cannot submit an application that is a duplicate of a listed drug and eligible for approval under section 505(j) or submit an application where the only difference is the extent to which the active ingredient(s) is absorbed or otherwise made available to the site of action is less than the listed drug.

Why is all this trouble worth it? In a word: Exclusivity. A 505(b)(2) application may obtain 3 years of Waxman-Hatch exclusivity if one or more of the clinical investigations, other than BA/BE studies, was essential to approval of the application and was conducted or sponsored by the applicant.  An applicant can get 5 years of exclusivity if it is for a new chemical entity.  A 505(b)(2) application may also be eligible for orphan drug exclusivity or pediatric exclusivity.

Approval or filing of a 505(b)(2) application, like a 505(j) application, may be delayed because of patent and exclusivity rights that apply to the listed drug.  This is the case even if the application also includes clinical investigations supporting approval of the application.

The 505(b)(2) application requires applicant to file patent certifications with application and serve notice on NDA holder and patent owner. This patent information will be published in the Orange Book when the application is approved. The types of filings include:

1. Paragraph (I): no patent was listed in Orange Book
2. Paragraph (II): listed patent has expired
3. Paragraph (III): listed patent will expire before requestedapproval
4. Paragraph (IV): listed patent is invalid or will not be infringed

The great thing about this is, if approved, is that the applicant will enjoy complete exclusivity. If the approval is for a new chemical entity (NCE), the exclusivity prohibits a generic manufacturer from submitting an ANDA for 5 years from date of NDA approval. Although, if an ANDA includes a paragraph IV certification, an ANDA can be filed after 4 years, but any 30-month stay is extended by up to 1 year (to expire 7-1/2 years after NDA approval).

An application for new clinical indications for approved products receive three years of exlusivity. This exclusivity prohibits FDA approval (but not submission) of an ANDA for 3 years after NDA/sNDA approval. Therefore, ANDA approval can come exactly 3 years later.

The period of time of exclusive marketing rights is granted by FDA at the time of approval and cannot be challenged or voided. The time runs from the date of approval, except for pediatric exclusivity, which attaches to an existing exclusivity or patent period.

All this and patent protection may apply also. What’s not to love?

I usually try to keep up with various to-do’s but one item that I’ve been behind on lately is reviewing some books on my shelf. One book that I’ve recently perused is “Patents for Business: The Manager’s Guide to Scope, Strategy, and Due Diligence” by attorney M. Henry Heines (Praeger Publishers, Westport, CT (2007)).

Patents for Business is just like it sounds. Written for the corporate manager responsible for patentable inventions. From “What is a patent?” to patent strategies, the book is a very readable and informative introduction to intellectual property issues. While not a Grisham novel, it is written in a very approachable style that makes the best of a topic that can often be dry and tedious in its details.

Heines provides complete coverage of the issues, methods, and art of managing patents including ways of identifying prior art, understanding the differences between novelty and obviousness, and the critical inquiries of whether or not a company will have the ability to conduct its business, or have freedom to operate — all based on the author’s real-world experiences.

One subject that I see critically lacking in manager’s is a full understanding of global patenting, especially the differences in allowable subject matter.  Heines provides a good overview of the various national and regional patent systems around the world.  This is a topic that will only continue to gain importance in corporate mission statements.

This type of book should be required reading for those tasked with the burden of building and maintaining a patent portfolio. Of course, if it were, we wouldn’t get to bill so many hours.

Patents for Business: The Manager’s Guide to Scope, Strategy, and Due Diligence is available on amazon.com.

The United States Patent and Trademark Office (USPTO) is initiating a pilot program in which the applicant who complies with certain requirements will receive the results of a prior art search conducted by the examiner, via a condensed Pre-Interview Communication, and then be permitted to conduct an interview with the examiner to discuss the cited prior art references prior to the first Office action on the merits (see flow chart).

The requirements for the pilot program are set forth in the notice entitled “First Action Interview Pilot Program” (available here). An interview under this pilot program would advance prosecution of the application because it would enhance the interactions between the applicant and the examiner, provide applicant the opportunity to resolve patentability issues one-on-one with the examiner at the beginning of the prosecution process, and facilitate possible early allowance.

Bio/Pharma people are SOL, though.  The pilot program is only for applications that are either (1) classified in Class 709 (Electrical Computers and Digital Processing Systems: Multi-Computer Data Transferring) and assigned to an art unit in either group 2140 or 2150; or (2) classified in Class 707 (Data Processing: Database and File Management or Data Structures) and assigned to an art unit in group 2160.

Currently, granting an interview before first action on the merits of a new application is within the discretion of the examiner, who has not yet searched the case, and a showing may be required to justify the granting of the interview. See MPEP § 713.02. The pilot program provides a procedure which, if followed, makes the granting of an interview non-discretionary.

The effective date for this change in practice is: 28 April 2008.

It seems that — on the spur of the moment — ProBlogger has declared today Blogger Appreciation Day and has asked readers to email another blogger to let them know that you appreciate something about them. He also suggested writing a post with your words of appreciation.

I have a lot to be appreciative for and, frankly, I don’t always stop and take the time to let people know that I really do appreciate their efforts. I especially appreciate all the great bloggers I’ve had the privilege of interacting with over the years.

I started making a list of all the great blogs but it became a little overwhelming in size. Then, while mulling over my laundry list of people to recognize, I realized that one group of bloggers I really need to thank are those that (without prompting) link to Patent Baristas in the course of discussion on their own blogs.

So, in commemoration of the Semi-Official First Annual Blogger Appreciation Day, here are some of the blogs that have linked to Patent Baristas over the last month or so. I hope that you will take a look at these great sites and maybe find a new gem to add to your list of favorites.

•  
  • IP ThinkTank blog
  • Pharmababble
  • Securing Innovation
  • Xconomy
  • Orange Book Blog
  • What About Clients?
  • Innovators Network
  • LawPundit
  • lexferenda
  • IP News & Transactions
  • Boycott Novell
  • Blawg Review
  • Law Bites
  • California Biotech Law Blog
  • Antitrust Review
  • IPCentury
  • IP Law Top 10 Sources
  • IPNewsFlash
  • BlawgIT
  • Biosink
  • FDA Law Blog
  • Traditional Knowledge Bulletin
  • Patently-O
  • Ephemeral Law

I’m certain that there are more out there that I’ve not seen. Please feel free to leave your thoughts and links in the comments section below.

Negotiations in the Senate on patent reform bill S. 1145 seemed to break down this week after Sen. Arlen Specter released a statement saying:

The Chairman [Sen. Leahy] and I differ on a number of aspects of the proposed patent reform legislation. . . . . The principal sticking point is the issue of how to assess damages in patent infringement lawsuits. We thought we had reached an agreement on this matter, but the language continued to shift, so we do not yet have a deal on the package. I am hopeful that we can reach an agreement, but more work has to be done to get it right.

The crumbling continued after Sen. Jeff Sessions apparently withdrew his support for an amendment to the patent reform bill that would exempt banks that unlawfully use patented check imaging technology from paying damages. The provision would have required the federal government to pay $1 billion to DataTreasury over 10 years as compensation for taking its property under the amendment (read: your tax dollars). Now Sessions says he will no longer support the amendment because of questions about its constitutionality.

Amici briefs for and against software and business method patents are flying at the CAFC over Ex Parte Bilski. The sides are lining up pretty much as you’d expect as everyone tries to influence an en banc Federal Circuit panel that will reconsider the scope of patentable subject matter as it relates to business methods. Most of these briefs support Bilski and urge the CAFC to not change section 101 — that is, keep a relatively broad view of what is patentable subject matter. A good summary on the briefs is at Patently-O.

This probably won’t end the heated debate over the threshold for patentable subject matter, though, as many parties are just flat out against patenting of business methods. Among the questions to be answered are: When does a claim that contains both mental and physical steps create patent-eligible subject matter? Whether a method or process must result in a physical transformation of an article or be tied to a machine to be patent-eligible subject matter under section 101?

A controversy has been brewing over the MBA degree of Heather Bresch, Mylan’s COO, after a Pittsburgh newspaper questioned it. West Virginia University officials awarded her an MBA retroactively last October. (via Pharmalot)

Cincinnati Reds inked a deal to hold spring training in Goodyear, Ariz., in 2010. The Reds and Cleveland Indians will share a 10,000-seat stadium.

The Federalist Society has just put the latest edition of its journal Engage online, with individual webpages for separate articles, so as to make it easier for bloggers to link to us. I’m sending you the journal in case you find something of interest.

Fortunately for bloggers, we can now get aromatherapy with our laptops. (via Securing Innovation)

All I want now is my 3G iPhone.

Ortho-McNeil kept it’s exclusivity on topiramate after a district court blocked Mylan Labs from infringing Ortho-McNeil’s U.S. Patent No. 4,513,006 covering Topomax® (topiramate), an anticonvulsive drug used to treat epilepsy. The trial court also reset the effective approval date for Mylan’s Abbreviated New Drug Application (ANDA).

The United States Court of Appeals for the Federal Circuit affirmed the district court rulings on claim construction, inequitable conduct, obviousness, and enablement. Ortho-Mcneil Pharmaceutical v. Mylan Laboratories (07-1223).

Mylan filed an ANDA with the FDA with a paragraph IV certification asserting that Ortho-McNeil’s ‘006 patent is invalid or not infringed. Ortho-McNeil sent the usual congratulatory note (a lawsuit), triggering a 30-month stay on approval of Mylan’s ANDA.

After a Markman proceeding to decide what words mean what in the patent, the district court rejected Mylan’s position that the ‘006 patent doesn’t cover topiramate. The court then ruled against Mylan’s affirmative defenses of unenforceability due to inequitable conduct and invalidity based on obviousness and non-enablement.

Mylan argued that the district court improperly construed the word and to mean or in independent claim 1, and under the proper (Mylan’s) construction, the claim does not cover topiramate.

Claim 1 of the ‘006 patent is for a sulfamate of the following formula (I):

wherein X is oxygen; R1 is hydrogen or alkyl; and R2, R3, R4 and R5 are independently hydrogen or lower alkyl and R2 and R3 and/or R4 and R5 tgether may be a group of the following formula (II):

wherein R6 and R7 are the same or different and are hydrogen, lower alkyl or are alkyl and are joined to form a cyclopentyl or cyclohexyl ring.

In the molecule topiramate, R2 and R3 and R4 and R5 together are a group of formula (II), wherein R6 and R7 are methyl. Mylan argued that the use of the term and precludes the claim from encompassing topiramate. In context, the term and falls between several R group recitations: R2, R3, R4, and R5 are independently hydrogen or lower alkyl and R2 and R3 and/or R4 and R5 together may be a group of formula (II) (emphasis added).

Mylan argued that the phrase contains two independent claim limitations: (1) that “R2, R3, R4, and R5 are independently hydrogen or lower alkyl” and (2) that “R2 and R3 and/or R4 and R5 together may be a group of formula (II).” Under Mylan’s construction, both of these limitations must be met in order for a compound to infringe. Both of these limitations are not met in topiramate. None of the R2, R3, R4, and R5 subunits are hydrogen or lower alkyl because both R2 and R3 and R4 and R5 together are a group of formula (II).

Au contraire, mon amie. The court said that the claim language depicts two subsets of compounds, but does not require their simultaneous existence:

In one subset of compounds covered by claim 1, the groups R2, R3, R4, and R5 are independent of one another, in which case, according to the claim, they are either hydrogen or lower alkyl. In a second subset of compounds covered by claim 1, the R2 through R5 groups are not independent, but rather R2 and R3 are together, and/or R4 and R5 are together, to form either one or two groups of formula (II). Topiramate is an example of this type of compound. In it, R2 and R3 are arranged together in a group, as are R4 and R5. Thus, as used in this claim, and conjoins mutually exclusive possibilities.

The claim also does not use and in isolation but in a larger context that clarifies its meaning. Specifically, and appears in conjunction with the adverbs independently and together. As the district court explained, these terms signal that and links alternatives that occur under the different conditions of independence or togetherness. In context, it is clear that one of the subunits (R2, R3, R4, or R5) does not always have to be either a hydrogen or lower alkyl.

The court said that it did not need to look at extrinsic evidence but did anyway:

Nonetheless, this court notes that dictionary definitions of and, while most often listing the additive sense as the most common usage of the term, also show usage of the term to connote alternatives. Webster’s Third New International Dictionary (2002). In the circumstances of this case, the use of and to express alternatives was chosen and adequately expressed by the applicant. Thus, extrinsic evidence too offers support for the district court’s reading of the disputed term.

In light of the plain language of independent  claims, the specification, and the extrinsic evidence, the court decide that claim 1’s use of the term and means or.

Good news for Ortho-McNeil. Sales of topiramate exceed $1 billion annually.

Forest Labs had a bit of a reversal of fortune in its patent dispute with Caraco Pharmaceutical Labs over its drug Lexapro®, which is used to treat depression and generalized anxiety disorder.

The U.S. Court of Appeals for the Federal Circuit reversed and remanded the case back to the U.S. District Court, which had dismissed Caraco’s request for a declaratory judgment of noninfringement. Caraco Pharmaceutical Labs v. Forest Labs (07-1404).

Caraco’s action was dismissed for lack of Article III jurisdiction on the grounds that it had been rendered moot when Forest unilaterally granted Caraco a covenant not to sue for infringement of the patent-in-suit, U.S. Patent No. 6,916,941.

What’s interesting is that Forest’s covenant not to sue did not eliminate the controversy between the parties. So, the court held that Caraco’s declaratory judgment action presents a continuing Article III controversy.

In filing its Lexapro® NDA, Forest listed two patents in the FDA’s Orange Book, namely: U.S. Patent Nos. Re. 34,712 and 6,916,941. The ’712 patent includes claims covering substantially pure forms of escitalopram, the active ingredient of Lexapro®. The ’941 patent generally covers crystalline particles of escitalopram oxate of a particular size range, as well as dosage forms containing particles of this size range, and methods of manufacturing particles in this size range. The ’712 patent expires in 2012; the ’941 patent expires in 2023.

The first ANDA applicant to file a Paragraph IV certification for Forest’s ’712 and ’941 patents was Ivax Pharmaceuticals. Therefore, Ivax is entitled to 180 days of generic market exclusivity, which will begin either on the day it begins marketing its generic drug, or on the date a court determines that the ’712 and ’941 patents are invalid or not infringed—whichever comes first.

Forest thanked Ivax by suing them for infringement of the ’712 patent, the earlier of the two patents to expire. Ivax counterclaimed that the ’712 patent was invalid. Despite suing Ivax on the ’712 patent, Forest did not sue Ivax for infringement of the ’941 patent.

By holding the ’941 patent card, Forest kept it from an invalidity or noninfringement challenge by Ivax. Forest won and obtained a judgment that the drug described in Ivax’s ANDA infringed the ’712 patent. Because Ivax didn’t obtain a judgment that both of Forest’s Orange-Book-listed patents are invalid or not infringed it didn’t get its 180-day exclusivity period.

The court said that only two pathways remain open to subsequent Paragraph IV ANDA filers who seek to trigger Ivax’s exclusivity period before the ’712 patent expires in 2012.

First, a subsequent Paragraph IV ANDA filer could obtain a court judgment invalidating the ’712 patent, which would allow the FDA to approve Ivax’s drug. With FDA approval, Ivax would be legally free to sell its generic drug, and its exclusivity period would be triggered on the day of its first commercial marketing.

Second, a subsequent Paragraph IV ANDA filer could trigger Ivax’s exclusivity period immediately—regardless of when Ivax begins marketing its drug—via the court-judgment trigger. However, because Ivax was the first Paragraph IV ANDA filer with respect to both the ’712 and ’941 patents, a subsequent Paragraph IV ANDA filer can only activate Ivax’s exclusivity period via the court-judgment trigger by obtaining a judgment that both the ’712 and ’941 patents are invalid or not infringed.

If a subsequent Paragraph IV ANDA filer is not able to pursue either of these two pathways to triggering Ivax’s exclusivity period, then Ivax’s exclusivity period cannot begin until the ’712 patent expires in 2012. Ivax’s exclusivity period will not be triggered on the date the ’712 patent expires unless Ivax actually begins marketing its generic drug on that date. Even if Ivax does so, the FDA will still be restricted from approving any subsequent Paragraph IV ANDA until 181 days after the date the ’712 patent expires.

In short, absent an event triggering Ivax’s exclusivity, all subsequent Paragraph IV ANDA filers, including Caraco, will be denied entry to the drug market for a significant time. These subsequent Paragraph IV ANDA filers will be precluded from the market regardless of whether the generic drugs described in their ANDAs infringe Forest’s Orange-Book-listed patents and regardless of whether Forest’s patents are valid.

Got that?

So, when Caraco filed an ANDA for generic escitalopram that included a Paragraph IV certification for Forest’s ’712 and ’941 patents, Forest sued Caraco for infringement of the ’712 patent — Forest did not sue Caraco on the ’941 patent.

Since Caraco has an economic interest in determining whether the ’941 patent is invalid or not infringed by the drug described in its ANDA — because only a judgment of invalidity or noninfringement with respect to both the ’712 and ’941 patents can trigger Ivax’s exclusivity period.

Forest filed a motion to dismiss Caraco’s action on the grounds that the action did not present a “case” or “controversy” as required by Article III of the Constitution. In its motion, Forest argued that there was no controversy because Caraco did not have a reasonable apprehension of suit on the ’941 patent. Forest hinged its entire argument for dismissal on the covenant not to sue, stating: “There is no controversy because we gave a covenant not to sue.” The district court agreed, stating from the bench that “[t]here’s a covenant not to sue on the ’941 so there’s not going to be any loss, there’s no threat of lawsuit.”

In overturning the decision, the court found that the district court failed to take into account the more recent cases:

(1) In, MedImmune v Genentech, the Supreme Court said that whether a declaratory judgment action presents an Article III controversy must be determined based on “all the circumstances,” not merely on whether the declaratory judgment plaintiff is under a reasonable apprehension of suit.

(2) In Novartis v. Teva, the CAFC held that where an NDA holder brings an infringement suit against a Paragraph IV ANDA filer on only one of several Orange-Book-listed patents covering its NDA, the ANDA filer has standing to seek a declaratory judgment on any of the NDA holder’s remaining Orange-Book-listed patents for that NDA. However, Novartis had not been decided at the time so Ivax never sought a declaratory judgment that Forest’s ’941 patent was invalid or not infringed by its generic drug. Even though Novartis only sued Teva on one of its Orange-Book-listed patents, this was sufficient to trigger a 30-month stay barring Teva’s ANDA from approval under 21 U.S.C. § 355(j)(5)(B)(iii).

In reversing and remanding, the CAFC pointed out that:

First, the dissent states that there is “no basis to conclude that the first-filing generic manufacturer will, or is likely to, delay bringing its product to market after the ’712 patent expires.” We agree. What the dissent fails to recognize, however, is that the injury upon which Caraco’s suit is premised is the delay (in triggering Ivax’s exclusivity period) between now and when the ’712 patent expires in 2012, not any delay (in triggering Ivax’s exclusivity period) after the ’712 patent expires. Thus, the dissent is in error when it notes that our analysis requires speculating as to when Ivax decides to market its drug after the ’712 patent expires.

Second, the dissent states that we assume that a first Paragraph IV ANDA filer who unreasonably delays in marketing its drug cannot lose its right to exclusivity. The dissent is incorrect. Our conclusion that the first filer in this case, i.e. Ivax, cannot forfeit its exclusivity period is not based on an assumption, but rather the texts of the Hatch-Waxman Act and the MMA. A s discussed, the MMA amendments to the Hatch-Waxman Act include a grandfather provision that specifically exempts a certain class of Paragraph IV ANDA filers, including Ivax, from being subject to the MMA’s 180-day exclusivity forfeiture provisions. Accordingly, it cannot plausibly be argued that Ivax may nevertheless forfeit its exclusivity period.

Third, the dissent states that our analysis “assumes that [Caraco] will prevail in its non-infringement claim—an uncertain assumption at best.” We make no such assumption, nor need we. A plaintiff need not prove it will prevail on the merits of its case in order to prove that it has standing to bring the case. Steel Co., 523 U.S. at 89 (“It is firmly established in our cases that the absence of a valid (as opposed to arguable) cause of action does not implicate subject-matter jurisdiction, i.e., the courts’ statutory or constitutional power to adjudicate the case.”).

Expect to see more on this issue. Forest had Lexapro sales of about $2.5 billion last year.

More at the Orange Book blog and IPBiz.

After months of meetings and redrafting work, the U.S. Senate is said to be ready to make a move on the patent reform bill, S. 1145. Various senators are said to be working behind the scenes drafting amendments with some compromises being made on section 11 of the bill, a/k/a “Applicant Quality Submissions (AQS).”

The Intellectual Property Owners Association (IPO) is urging everyone to contact their senators to get the section on AQS banished.

Meanwhile, the Bush Administration still has concerns. Carlos Gutierrez, the Secretary of the U.S. Department of Commerce, sent a letter to Senator Patrick Leahy urging the preferences of the Administration. Specifically, he emphasizes the importance of section 11 (Applicant Quality Submissions). Interesting, given that this is one of the stupiderest provisions of the bill.

Specifically, Gutierrez states:

The Administration strongly supports the AQS provision in the bill in its current form and believes that enactment will prove to be the strongest step toward improved patent quality. By reducing the number of poor quality and imprecise applications, applicant quality standards will result in dramatic reductions in patent pendency and backlog, as well as reduce the likelihood of excessive litigation. The current misalignment of information incentives slows and degrades the patenting process.

If this sounds like it was written by the Patent Office itself, you’re right. The Patent Office is an arm of the Commerce Department and Gutierrez is merely falling in line. The letter states that “[t]here is no one who has greater opportunity, information, or incentive to explain why an application deserves a patent grant than the applicant.”

The Administration also supports changes to the doctrine of inequitable conduct arguing that the inequitable conduct standard should require actual fraud. The Administration also supports post-grant patent review avenues to challenge a patent’s validity.

For the record, the Administration’s big concern is changes to the assessment of damages in patent infringement cases — exactly the issue for which the Coalition for Patent Fairness said that they would fight to the death. Currently, courts generally consider the value of the entire product when any part of it infringes a patent. The proposed changes would allow judges to base damages only on the “economic value properly attributable to patent’s specific contributions over the prior art.”

The Administration is willing to support methods that identify the factors and evidence relevant to the determination of damages and to consider only those factors when making their determinations. Such a “gatekeeper” function would promote transparency without limiting necessary discretion.

What’s not been determined is whether or not shifting more burden to the applicant really is the most efficient way to achieve better quality examination.

George Margolin, Vice President, Professional Inventors Alliance, poses the question in his response to the Coalition for Patent Fairness. Margolin asks if the Coalition argument is: “Someone who invents the “X” key shouldn’t be able to sue the keyboard maker for the value of all the letters,” then, “Who would be dumb enough to BUY a keyboard WITHOUT the X or A or E KEY or any other crucial key?”

Noteworthy in all this discussion is that Jon Dudas, Commissioner of Patents, stated that each patent application costs the USPTO $4,200, while basic filing fees are under $1,000. [Note to readers: Does anyone know where this number comes from or can verify the accuracy?] This sounds funny given that the patent office brings in more money that it spends on operations. I guess they forgot to mention that they get the other $3200 (and much more) by forcing you to file multiple divisionals and endless continuations in order to get something allowed.

If you want to be heard, call the capitol switchboard, 202/224-3121, and ask to be connected to your senators’ offices.

See the letter here: commerce-ltr.pdf