On Monday, a group of over 50 members of Congress sent a letter urging the Department of Health and Human Services (HHS) and the National Institutes of Health (NIH) to use a little-known statutory provision to take action against high drug prices. Their goal is laudable, and HHS and the NIH should certainly offer guidance in this area – but the existing law offers only a partial solution to the problem as the legislators describe it.
The members of Congress wrote to remind HHS and the NIH of a provision in the 1980 Bayh-Dole Act giving the government “march-in rights” to patents resulting from government-funded research. More specifically, the statute spells out a range of conditions under which the government may require a patentholder to grant licenses on reasonable terms to others to practice the patent. The government may require such a license where “action is necessary to alleviate health or safety needs which are not reasonably satisfied,” 35 U.S.C. § 203(a)(2), or where the benefits of the invention are not being made “available to the public on reasonable terms,” 35 U.S.C. § 201(f). The legislators argue that many drugs today violate these conditions, as even many insured Americans cannot access prescription drugs without incurring significant financial harm.
Although the “march-in rights” provision has existed in the statute since 1980, it has never been exercised by the federal government, even when it has been specifically asked. And some of these cases have been paradigmatic examples where “health or safety needs” are not being satisfied. A December 2015 study notes that in Bayh-Dole’s history, there have only been five petitions requesting that the NIH exercise its march-in rights. Three of those requests were based on high prices for drugs for HIV/AIDS and glaucoma, and one was based on a persistent drug shortage which may have caused the deaths of people with Fabry disease, a rare condition. (The fifth petition involved a medical device under patent litigation at the time.) The NIH denied each request. Some scholars argued that if the NIH denied the Fabry disease petition, where Genzyme’s drug shortages lasted for multiple years and caused great suffering, possibly including death, there may be no circumstances under which the NIH would grant such a petition.
Last week, the FDA issued a report presenting 20 case studies of laboratory-developed tests (LDTs) that have or may have harmed patients, in support of its ongoing efforts to impose greater regulatory oversight on LDTs. The report came just before yet another House Energy & Commerce Committee hearing on the issue, and the timing of its release may have been motivated in part by questions FDA officials faced at the last Congressional hearing, about the existing evidence of harm to patients. The report categorizes the 20 case studies into seven groups, organized by the primary problem posed by the LDT: those with a high degree of false positives (the test yields a positive result when the disease is not present), those with a high degree of false negatives (the test yields a negative result when the disease is present), those which yield both false positives and false negatives, those which test for a factor seemingly unrelated to the disease in question, those linked to treatments based on disproven scientific concepts, those which affirmatively undermined the drug approval process, and of course, “other.”
Jessica L. Roberts is the Director of the Health Law and Policy Institute and an Associate Professor of Law at the University of Houston Law Center. She specializes in health law, disability law, and genetics and the law. Prior to UH, Professor Roberts was an Associate-in-Law at Columbia Law School and an Adjunct Professor of Disability Studies at the City University of New York. Immediately after law school, she clerked for the Honorable Dale Wainwright of the Texas Supreme Court and the Honorable Roger L. Gregory of the Fourth Circuit Court of Appeals.
Professor Roberts’ research operates at the intersection of health law and antidiscrimination law. Her scholarship has appeared, or is forthcoming, in the Indiana Law Journal, the William and Mary Law Review, the Iowa Law Review, the Minnesota Law Review, the University of Illinois Law Review, the Notre Dame Law Review, the Vanderbilt Law Review, the University of Colorado Law Review, the American Journal of Law and Medicine and the Journal of Law and the Biosciences, among others. Professor Roberts teaches, or has taught, Contracts, Disabilities and the Law, Genetics and the Law, and Health Law Survey. In 2015, she received the university-wide Teaching Excellence Award and the Provost’s Certificate of Excellence. Professor Roberts was named a 2018 Greenwall Faculty Scholar in Bioethics.
Regular readers of this blog will recall that I often think and write about the interaction between the induced infringement doctrine in patent law and medical method patents of various kinds (previous blog posts are here and here). Until the recent en banc decision in Akamai v. Limelight, courts had been extremely reluctant to attribute the actions of multiple parties to a single actor for purposes of assigning infringement liability. These cases have largely involved business method or software patents, but I had hypothesized in prior work that this analysis would extend to medical method patents, making them difficult to enforce.
Last week, Judge Tanya Walton Pratt of the U.S. District Court for the Southern District of Indiana provided evidence for the opposite proposition. Eli Lilly had sued a set of generic drug companies for patent infringement, arguing that they had induced physicians to infringe a set of method-of-treatment claims involving a chemotherapy drug. The problem for Lilly was that its claims require action by both physicians and patients, who must take certain other medications, including folic acid, before the physician administers the chemotherapy drug. Judge Pratt was tasked with determining whether the actions of the patient in preparing for their chemotherapy could be attributed to the physician. She ruled that because the physician “directs or controls the patient’s administration of folic acid,” “the performance of all the claimed steps … can be attributed to a single person, i.e. the physician.” As a result, the generic companies could be held liable for infringement.
One problem with Judge Pratt’s ruling is that it fails to confront the single Federal Circuit opinion to have considered and rejected this argument. McKesson Technologies, Inc. v. Epic Systems Corporation dealt with a patent on electronic communication between physicians and their patients. In that case, the Federal Circuit had occasion to consider how the doctor-patient relationship fits into the induced infringement paradigm. Judge Linn’s opinion concluded that “[a] doctor-patient relationship does not by itself give rise to an agency relationship or impose on patients a contractual obligation such that the voluntary actions of patients can be said to represent the vicarious actions of their doctors,” declining to attribute the patients’ actions to their physicians for purposes of assigning liability.
Yesterday, the Court of Appeals for the Federal Circuit issued a unanimous en banc ruling in Akamai v. Limelight, altering the reach of patent liability for induced infringement of a method claim under 35 U.S.C. § 271(b). This is the second time the en banc court has considered Akamai. Three years ago, in a splintered decision, a majority of the court had ruled that liability for induced infringement was possible where no single entity had performed all the steps of a claim, but where those steps were divided between two or more parties, one of whom had induced the other(s) to infringe. In 2014, the Supreme Court reversed, essentially reinstating this single entity rule, and after a panel opinion largely adopting the Supreme Court’s reasoning, a unanimous en banc court has now broadened – at least somewhat – the scope of divided infringement liability, relative to the Supreme Court’s decision.
More specifically, the Federal Circuit concluded that an entity may be held liable for others’ performance of steps of a method claim “in two sets of circumstances: (1) where that entity directs or controls others’ performance, and (2) where the actors form a joint enterprise.” Noting the court’s prior holdings that these circumstances are met where there is an agency relationship between the relevant actors or there are explicit contractual duties to perform the steps of the method claims, the en banc court added another such circumstance in which liability may be found: “when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that performance.” Because this third condition was present in the case under consideration, the Federal Circuit deemed Limelight liable for infringement.
Exactly thirteen months ago, after the Supreme Court’s decision but before the Federal Circuit had considered the case on remand, I had blogged here about the case’s potential implications for diagnostic method patents. (For those interested in this field, I then wrote a longer article about diagnostic technologies more broadly, which features a more detailed explanation of this issue.) Essentially, my argument was that the increasing restrictions the courts have placed on patentable subject matter under 35 U.S.C. § 101 would interact with these new divided infringement rules.
Since its creation in 1982, the Court of Appeals for the Federal Circuit (CAFC) has been a magnet for controversy and criticism. While I do not align myself with those critics, it would be foolish to not acknowledge the problems that are present with the CAFC. For instance, for the vast majority of federal law, when law develops differently in different circuits, the Supreme Court is able to observe those developments, and decide which interpretation is most desirable. Because the CAFC has sole jurisdiction over patent law appeals, patent law is not subject to these circuit splits. While splits temporarily hamper uniform justice, they do allow for experimentation, enabling different legal interpretations to be tested in real life. In this way, splits can allow an appellate body to make a more informed decision regarding which interpretation should be followed.
The lack of circuit splits in patent law can be problematic, given accusations that the CAFC has succumbed to a form of institutional capture by the patent lobby. Critics highlight the CAFC’s decision in Amazon and eBay as evidence of this capture. In Amazon, the CAFC found a broad presumption of irreparable harm, allowing for broad extension of preliminary injunctions in future cases of patent infringement (even though they overturned the injunction at issue in the case). This patent-holder-friendly standard was ultimately overruled in eBay, after the CAFC applied its nearly automatic injunction standard. The Supreme Court overturned this decision, and dialed back the presumption, in large part because it was seen as too favorable to patent holders.
This morning, the House of Representatives passed the 21st Century Cures Act by a vote of 344-77, achieving a truly bipartisan result in a difficult political environment. (I’ve blogged about the Act severaltimesnow, and the House Energy & Commerce Committee has a clear section-by-section summary here.) There is much to like in the bill (such as the increased NIH funding), much to be concerned about (such as some of the provisions abbreviating FDA review of drugs and devices), and much whose value will depend on implementation. It’s also not certain that any of these provisions will ultimately become law – the Senate has yet to even introduce its own draft bill, let alone vote on it or achieve a consensus with the House. But I wanted to use this post to draw attention to a new amendment to the Act that was introduced a few days ago and approved by the House this morning prior to the vote on the full bill.
Representatives Todd Young (R-IN) and Andy Harris (R-MD) introduced an amendment creating an Innovation Prize Program within the NIH. As the text stood on Wednesday (speakers on the floor of the House today suggested that some of this language is likely to change, if it has not already changed), it instructed the Director of the NIH to create the fund in service of one or both of these two goals: 1) “Identifying and funding areas of biomedical science that could realize significant advancements through the creation of a prize competition” and 2) “Improving health outcomes, particularly with respect to human diseases and conditions for which public and private investment in research is disproportionately small relative to Federal Government expenditures on prevention and treatment activities, thereby reducing Federal expenditures on health programs.” The Director is also given wide discretion to design prize competitions, including whether they involve a lump-sum award at the end or are parceled out in milestone payments along the way.
Our analysis deals with a seminal judgment on the controversial and sometimes even emotionally debated European “Broccoli” and “Tomato” patents, which has captivated the European patent and plant science communities for many years: On March 25, 2015, the EBA of the European Patent Office (EBA) finally issued its much awaited decisions on the consolidated referrals G2/12 (“Tomato II”) and G2/13 (“Broccoli II”), clarifying the exclusion from patentability of essentially biological processes, such as conventional crossing and selection, and in particular its impact on the patentability of claims for products resulting from such processes. The so-called “Tomato II” case concerned an invention entitled “method for breeding tomatoes having reduced water content and product of the method,” whereas the so-called “Broccoli II” case involved an invention of a “method for selective increase of the anticarcinogenic glucosinolates in brassica species”. Continue reading →
On Friday, the Court of Appeals for the Federal Circuit affirmed the district court’s judgment of invalidity of several claims in Sequenom’s diagnostic method patent on the grounds that they were not directed to patent-eligible subject matter under the relevant section of the Patent Act, 35 U.S.C. § 101. The case, Ariosa v. Sequenom, is important not only to those who have been following the recent back-and-forth between the Federal Circuit and Supreme Court on patent-eligible subject matter, but also to those who study medical innovation, as it implicates questions of innovation incentives and of access to an important new technology.
The case involves a technology known as non-invasive prenatal testing, or NIPT. Previously, pregnant women seeking to determine whether their fetuses possessed particular genetic abnormalities only had the option to undergo procedures, like amniocentesis, which pose a risk to the developing fetus. The scientists in this case made a startling discovery: there is a small amount of fetal DNA circulating in the pregnant woman’s plasma and serum. These portions of maternal blood samples had previously been discarded as medical waste, and the idea that genetic abnormalities could be discovered through a non-invasive procedure like a blood draw, which poses no risk to the health of the fetus, was groundbreaking. A patent on the method of detecting the fetal DNA in the mother’s serum or plasma was obtained, and Sequenom commercialized a test to practice the patent. Sequenom was soon embroiled in litigation with Ariosa and other companies which it believed were infringing its patent.
On Tuesday, the Supreme Court issued its opinion in Commil USA, LLC v. Cisco Systems, Inc., in which it held that a defendant’s belief that a patent is invalid is not a defense to induced infringement of that patent under 35 U.S.C. § 271(b). Four years ago, in a case called Global-Tech, the Court had held that a defendant could not be liable for induced infringement unless it had knowledge not only of the patent’s existence but also that its behavior constituted patent infringement. In Commil, six Justices clarified that a defendant who has knowledge of a patent’s existence but believes it to be invalid may still be held liable for inducing its infringement. (Justice Scalia dissented and was joined by Chief Justice Roberts, with Justice Breyer recused.)
Commil raises several issues for discussion, but I want to talk about just one here: the majority’s fixation on the distinction between infringement and validity. The key passages of Justice Kennedy’s opinion, on pages 9 through 11, seem to rest heavily on preserving the separation between these two issues. Essentially, as Justice Kennedy puts it, “because infringement and validity are separate issues under the Act, belief regarding validity cannot negate the scienter required under §271(b).” Justice Kennedy is clearly correct as a formal matter. We ask different legal questions when adjudicating issues of infringement and validity, we apply different burdens of proof to the two questions, and we involve different parties in their resolution.
But Justice Kennedy’s opinion ignores the close practical relationship between the two issues. By contrast, scholars and practitioners have long recognized the tension between infringement and validity as instantiated in patent litigation. A patentee wants its patent to be construed broadly, to ensure that the defendant’s invention falls within its bounds. Yet at the same time, the patentee must avoid claiming too broadly, or its patent may be invalidated on precisely those grounds. (Defendants typically advocate the opposite positions.)
A new piece by David Farber, Preeya Noronha Pinto, Bill of Health contributor Arthur Caplan, and Alison Bateman-House the Health Affairs blog:
Over the past year, state Right-to-Try (RTT) laws that claim to enable terminally ill patients to access unapproved, experimental drugs, biologics, and devices have swept the nation. As of early May, seventeen states have enacted RTT laws (most recently, Florida and Minnesota), and bills creating such laws are currently pending in over twenty state legislatures.
Although these laws have created an expectation that terminally ill patients will be able to quickly access potentially life-saving treatments by being exempted from the rules of the U.S. Food and Drug Administration (FDA), this expectation is, quite simply, false.
In a recent series of decisions, the Supreme Court has begun to express concern that some patents suppress innovation. And it has done so in a number of cases that turn on what used to be a sleepy backwater of the patent law: 35 U.S.C. § 101. This statute says, simply, that “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, … may obtain a patent therefor, subject to the conditions and requirements of this title [i.e., the other requirements of the patent law].”
You might think that this language means that all you have to do is figure out whether an invention falls into one of the permitted categories. If it does, it’s something that can be patented (assuming you meet the other requirements — which are numerous). But no! Over the past few decades, the Supreme Court has engrafted a whole new set of judge-made requirements onto this statute: you cannot get a patent on something that is a “law of nature,” a “product of nature,” or an “abstract idea.” And starting in 2010, the Court put real teeth into these doctrines. […]
On 18th December 2014, the CJEU rendered its’ much-anticipated decision in C‑364/13 International Stem Cell Corporation v Comptroller General of Patents (ISCC). Qualifying its’ earlier ruling in Brüstle v. Greenpeace (Brüstle) with regard to non-fertilised human ova stimulated by parthenogenesis, the Court held that in order to constitute a ‘human embryo’ – and thus to be unpatentable under the EU Biotechnology Directive – the stimulated ovum must have the “inherent capacity to develop into a human being”. This would allow patents on innovative parthenotes which had not been genetically modified to achieve totipotent capabilities. Hence the judgment establishes a crucial limitation of the broad interpretation of “human embryos” in Brüstle, where the CJEU held that parthenotes are covered by the term “human embryo” since they are “capable of commencing the process of development of a human being”. The ISCC decision is to be welcomed since it provides an ethically justifiable leeway for patenting and offers reasonable support to the commercial viability of European cell therapy research. Yet, ISCC’s impact still depends on national implementations and only applies to certain hESC cells. Thus, further clarifications would be helpful concerning other non-totipotent hESCs.
February 23, 2015 5:00 PM Griswold Hall, Room 110 (Harvard Law School) 1525 Massachusetts Ave., Cambridge, MA [Map here.]
Professor Kapczynski’s presentation, “Order Without Intellectual Property Law: The Flu Network as a Case Study in Open Science,” is available upon request. Please contact Jennifer Minnich (firstname.lastname@example.org) if you would like a copy.
Amy Kapczynski is an Associate Professor of Law at Yale Law School and director of the Global Health Justice Partnership. She joined the Yale Law faculty in January 2012. Her areas of research including information policy, intellectual property law, international law, and global health. Prior to coming to Yale, she taught at the University of California, Berkeley, School of Law. She also served as a law clerk to Justices Sandra Day O’Connor and Stephen G. Breyer at the U.S. Supreme Court, and to Judge Guido Calabresi on the U.S. Court of Appeals for the Second Circuit. She received her A.B. from Princeton University, M. Phil. from Cambridge University, M.A. from Queen Mary and Westfield College at University of London, and J.D. from Yale Law School.
On 26th November 2013, the Danish Agency for Science, Technology and Innovation organized an expert meeting on “Synthetic Biology & Intellectual Property Rights” in Copenhagen sponsored by the European Research Area Network in Synthetic Biology (ERASynBio). The meeting brought together ten experts from different countries with a variety of professional backgrounds to discuss emerging challenges and opportunities at the interface of synthetic biology and intellectual property rights. The aim of this article is to provide a summary of the major issues and recommendations discussed during the meeting.
The ERASynBio consortium consists of 16 governmental funding bodies from 12 EU Member States (Austria, Denmark, Finland, France, Germany, Greece, Latvia, Netherlands, Portugal, Spain, Slovenia, and UK) and two Associated Countries (Norway and Switzerland)
Dame Sally Davies, the Chief Medical Officer of England, warns that we are approaching an antibiotic apocalypse. A former chief economist at Goldman Sachs estimates that unless dramatic action is taken now, antimicrobial resistance could kill 50 million people a year and cause $100 trillion in cumulative economic damages.
In the US, dire warnings have issued from the Centers for Disease Control and Prevention (CDC), the President’s Council of Advisors on Science and Technology, and the President himself through an Executive Order on Combating Antibiotic-Resistant Bacteria in September 2014 (summary here). The President’s new budget asks for $1.2 billion to be spent on antibiotic resistance. […]
I am pleased to announce two new publications on (1) “European patent strategies under the UPCA” and (2) “Synthetic Biology & Intellectual Property Rights”:
1) Minssen, T & Lundqvist, B 2014, ‘The ”opt out” and “opt-in” provisions in the Unified Patent Court Agreement – Impact and strategies for European patent portfolios‘ , published in N I R (Nordic IP Review), vol 2014, nr. 4, s. 340-357.
Abstract: Many questions concerning the UPC’s jurisdiction during the transitional period for European Patents under Article 83 UPCA remain unsolved. Focusing on the “opt in” and “opt out” choices under Article 83 (3) & (4), this paper discusses the legal nature and prerequisites of these provisions, as well as the options and strategic choices that patent proprietors and applicants are facing. Considering the pros and cons of the emerging unitary system in light of a persisting uncertainty of how to interpret relevant stipulations, it is emphasized that there will be no clear-cut solutions. Rather the suitability of each approach will have to be evaluated on a case-by-case basis, taking into account all circumstances surrounding an invention, its patent-claims and the underlying business strategy. Recognizing that the worst thing to do is to do nothing at all, we conclude with a summary and some general remarks.
Who has standing to challenge a patent’s validity? And under what circumstances can Congress define an injury for the purpose of creating Article III standing? Those questions underlie a new petition for certiorari filed by Consumer Watchdog, who is asking the Supreme Court to reverse a Federal Circuit opinion holding that Consumer Watchdog lacked Article III standing to challenge a patent on embryonic stem cells.
Consumer Watchdog, a non-profit consumer organization, requested an inter partes reexamination of a patent on embryonic stem cells held by the Wisconsin Alumni Research Foundation (WARF), alleging that the patent should be invalidated on several grounds. After a lengthy administrative process, the Patent Trial and Appeal Board (PTAB) upheld the patent as valid. Consumer Watchdog subsequently appealed, under sections of the Patent Act that expressly permit third-party requesters (like Consumer Watchdog) in inter partes reexamination proceedings to appeal to the Federal Circuit if they are “dissatisfied” with the PTAB’s decision or if any “final decision [is] favorable to the patentability” of the claims in question. The Federal Circuit held that Article III’s case or controversy requirement imposes a separate, irreducible constitutional minimum requirement on standing — and that Consumer Watchdog hadn’t met that requirement. Continue reading →