On May 22, the Supreme Court issued its opinion in TC Heartland v. Kraft, reaffirming its 1957 holding that a corporation only resides in its state of incorporation for venue purposes in patent cases. What does this mean for patent litigation in the E.D. of Texas and beyond? [Read More]
Intellectual property (IP) protections promote innovation and spur research and development into life-saving drugs and medical procedures. Indeed, the existence of robust systems of IP rights in Western industrialized nations is one reason the pharmaceutical industry and medical breakthroughs have flourished there. By contrast, drug companies have struggled in the developing world, where IP protections are either nascent or non-existent.
One would think, therefore, that global policy advocates would encourage strong, uniform IP protections to help ensure the continued development of innovate treatments and broader access to health care in emerging markets. But instead of pursuing this sensible course, an obscure United Nations (UN) body called the High Level Panel on Access to Medicines is poised to release a report that is likely to recommend scaling back IP rights worldwide. This would be a tragedy for millions of ailing patients around the world.
There is no doubt that a substantial need exists to improve access to medicines to the developing world. Approximately one in three patients in the developing world lack access to basic treatments. To solve this problem, the UN must focus on substantial barriers to access such as a lack of infrastructure and training. Yet the panel appears ready to ignore these barriers by myopically and mistakenly focusing on IP rights.
Established last year by UN Secretary General Ban Ki-moon to improve global access to life-saving medications, the Panel was tasked with a mandate “to review and assess proposals and recommend solutions for remedying the policy incoherence between the justifiable rights of inventors, international human rights law, trade rules and public health in the context of health technologies.” Consistent with this charter, the sixteen-member Panel has reviewed proposals to address what it perceives to be a “misalignment” between inventors’ rights and “access to medicines, vaccines, diagnostics and health technologies.” The Panel is currently finalizing a report to the Secretary-General, which includes an analysis of the proposals and its recommendations. The Secretary-General, in turn, plans to make the report available to the General Assembly, and undertake unspecified further action.
Many leaks from the group’s proceedings confirm its plan to emphasize perceived problems with IP rights rather than consider other issues that might hinder access to medicine. The rumors became so pervasive that, in June of this year, the Panel issued an “Official Statement on Speculative Media Reports.” The statement merely avers that the Panel is still working on the report, but it does not in any way deny that the group’s focus is on what it perceives to be a disconnect between access to healthcare and IP rights.
The U.S. State Department has encouraged the Panel to shift its narrow focus on IP rights to tackle the real structural and economic problems that prevent access to health care in the developing world. The Panel should heed the State Department’s advice for one simple reason: There is no “policy incoherence” or “misalignment” between IP rights and access to health care.
For starters, the vastmajority of medicines that have been designated as essential by the World Health Organization (WHO)—350 of 375—are not even under patents. Rather, these medicines are currently available in relatively inexpensive generic varieties.
In addition, many life-changing breakthroughs in drug research and development are made possible only because of America’s (and other countries’) extensive protections for IP. These protections grant companies a period of market exclusivity for original products, providing an incentive for companies and their investors to invest billions in research and development of the next generation of medications. Indeed, where countries have recently adopted more robust IP protections—such as India and China—pharmaceutical development and partnerships with Western drug companies have flourished and improved access to medicine. Furthermore, strong IP protections reduce the incentives for companies to develop fake or counterfeit drugs, thus helping to ensure quality control in the developing world.
Ultimately, the Panel’s mandate to root out policy incoherence between IP rights and health care begs the critical question—do IP rights promote or hinder access to drugs and medical treatments in the developing world? The empirical evidence shows that IP rights improve access to health care in poorer countries. Therefore, the Panel should reconsider its marching orders and release a report that focuses on addressing the political, economic, and structural barriers to medicine in the developing world, rather than punishing companies that are responsible for putting life-saving products on the market. [Read More]
This is an excerpt from the “Introduction and Summary” of the new paper:
The value of copyrights and patent rights is secured and maximized through market exchanges – both outright sales of exclusive rights and through licensing agreements. It is often the case that creative artists or inventors can maximize their economic returns by assigning their rights to more highly capitalized entrepreneurs or commercial enterprises that may be better situated to use, reproduce, or sell the creative works or inventions. Meanwhile, by all estimates patent licensing agreements generate well over a hundred billion dollars annually for American enterprises. And licensing of music, movies, and other copyrighted works through digital media technologies collectively generates billions of dollars each year.
Currently pending on the docket of the United States Supreme Court is the case of Cuozzo Speed Technologies, LLC, v. Michelle K. Lee, Under Secretary of Commerce for Intellectual Property and Director, Patent and Trademark Office, No 15-446, on petition for writ of certiorari. At issue is whether the Federal Circuit should construe claims in patent cases arising from the Patent Trial and Appeal Board (“PTAB”) the same as claims in cases arising from the district courts. A second issue, a matter of horizontal separation of powers, is whether the Federal Circuit correctly held that PTAB decisions to institute inter partes review are judicially unreviewable even if the PTAB exceeds its statutory authority in instituting such proceedings.
On its face, the first issue would seem like a no-brainer: to have any consistency in the federal patent system—a basic tenet of the rule of law—of course the same reviewing court should treat the same language in the same claim the same way, regardless of who brought the case and where. Yet from the start, under the America Invents Act’s new inter partes review (IPR) process, the result has been exactly the opposite. Because Congress intended IPR to be a less expensive surrogate for litigation, however, it seems that the standards should be the same.
For a look at the arguments in favor of ensuring that patent claims are consistently construed in both cases and at the arguments of petitioner on the second issue, see our latest Engage article.