Legislation threatens patent protections and future innovation

Tom Wilbur
Tom Wilbur January 12, 2022

Legislation threatens patent protections and future innovation.

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Recently introduced legislation, the “Restoring the America Invents Act (RAIA),” if enacted, would push the Patent Trial and Appeal Board (PTAB) of the U.S. Patent and Trademark Office to grant more requests to institute administrative patent trials. Not only would the RAIA prohibit the PTAB from deferring to federal courts when there is an imminent district court trial that would resolve the issues, it would encourage federal courts not to move forward with trials. This would reduce the power of the federal district courts and elevate the PTAB over presidentially-appointed federal judges.

While supporters of this legislation inaccurately characterize their proposal as a way to address drug pricing, the fact is that discretionary denials of IPRs under Fintiv – a precedential decision by PTAB that created factors for PTAB judges to rely on in deciding whether to institute an administrative proceeding or instead defer to active litigation in federal court – are relatively rare in the biopharmaceutical industry and have little if any relationship to drug pricing. According to a recent report, only a minuscule 8 out of 604 relevant PTAB trial institution decisions had mentioned Fintiv.

Learn more about the IPR process here.

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*Chart source: FINTIV Denials in Drug Cases

Instead, a significantly larger portion of PTAB’s use of discretionary denials of IPRs have related to patents owned by or challenged by large tech companies. In fact, the data clearly suggest that it is overwhelmingly challengers of tech patents, not those related to the biopharmaceutical industry, that would benefit most from the PTAB’s inability to apply the Fintiv factors when determining whether to institute a PTAB trial.

There are ways to appropriately address patient affordability, but misguided legislation aimed at addressing an IP problem that doesn’t exist is not it. Learn more about better ways to help patients at PhRMA.org/BetterWay.

Topics: Patents, Intellectual Property