Mining for gold and avoiding land mines
Remarkable market opportunities exist for innovative developers of infectious disease-related technologies, but such developers need to be aware of the intricacies of patenting technologies in this field, say Helene Carlson and Elizabeth Haanes.
The global rise of resistant infectious agents and the threat of pandemics and bio-warfare create an enormous need in fields such as infectious disease (ID) therapeutics, vaccines and personalised medicine. In addition, global initiatives are providing incentives for commercial entities to develop new diagnostics and improved versions of existing therapeutics and vaccines. The current climate requires ID innovators to take a strategic view of the intellectual property issues surrounding proposed products as well as products in development. A proactive intellectual property strategy over the full life cycle will maximise revenue (mining for gold) and reduce risks such as litigation (avoiding land mines).
Avoiding land mines
Strategic patent considerations are key to profitably commercialising ID products. Information about market needs and competitor activity is useless in the absence of knowledge of potentially blocking patent rights. Who are the players with actualor potential patent rights in your proposed technology area? How can their patent portfolios block or complement your portfolio? Are the patents located in relevant countries? What are the options once the patent rights of others are identified? Before beginning an expensive ID product development programme, developers should investigate the patent landscape to answer these and related questions. Potential development partners will also look closely at these issues before making a commitment.
A patent right provides the right to exclude others from making, using or selling the patented invention, or the right to collect damages for infringement. Thus, even though an ID innovator may own a patent to its own technology, the innovator may not have freedom to practise the technology due to blocking thirdparty patent rights. For example, a broad patent that encompasses a platform technology such as expression of a protein in CHO cells could prevent or ‘block’ an ID innovator from using the patented technology, for example, in the manufacture of a novel subunit vaccine, in the absence of an agreement with the third party. Such an agreement usually takes the form of a licence. Without an agreement, the ID company is open to litigation.
The ID space is riddled with patent ‘thickets’, which can be avoided with careful strategy and planning. A patent thicket is a concentration of patent rights in a particular technological area that is owned by one or more entities. One study found 167 patent families, owned by 75 different entities, directed to malaria antigens. Negotiating all the necessary licences in such an environment may be next to impossible or prohibitively expensive.
Once the potentially relevant patents of others have been identified, what are the options for dealing with them? An infringement analysis will answer the question of whether an identified patent truly dominates the production, use or sale of the proposed ID product—a patent encompassing the target agent, the protein, the small molecule drug, the method of treatment or the method of manufacture. This analysis typically entails close scrutiny of the patent’s file history at the patent office. Assuming that a patent potentially blocks the proposed ID product, the rights may sometimes be obtainable through licensing. This is especially the case for more general patents, such as those encompassing protein expression and purification. However, a direct competitor of the innovator is highly unlikely to license its patents. In that case, a validity analysis or ‘design around’ approach is appropriate. For example, a patent may be invalidated on obviousness or enablement grounds, or it may be avoided by a slight change in the product, such as its formulation. Generally speaking, the narrower the scope of a patent, the more likely it is that a design around solution is possible. Conversely, a broad patent is more vulnerable to a validity attack than a narrow one.
The intellectual property issues outlined present a minefield to ID innovators. Teaming up with a trusted intellectual property advisor provides a competitive advantage over businesses that ignore or defer consideration of these issues, and can simplify navigation through this minefield.
Mining for gold
Strategic use of intellectual property protects the large investment necessary to bring an ID product to market, by preventing copying and facilitating investments and partnerships.
"Strategic patent analysis is most effective when started very early in development, and re-evaluated throughout development and post-launch."
Patent protection for the basic ID technology (the ‘original’ patent) is generally sought very early in the research and development (R&D) process. An original patent may encompass a small molecule therapeutic or a subunit vaccine. However, due to the long regulatory review period, significant patent term is lost by the time the product receives approval. ID innovators may benefit consequently from the US’s Hatch- Waxman Act, which allows patentees to extend patent exclusivity for the product for up to five years after patent expiration due to regulatory delay. On the other hand, the act provides for market entry of small-molecule generics immediately upon expiration of patent coverage. The US recently enacted similar legislation for ‘generic’ biologics, but medical device ID innovators currently have no legal or regulatory framework for approving generics.
Another mechanism for extending exclusivity beyond the original patent is to obtain patents on improvements and downstream processes. Development of the ID product both before and after market approval often leads to important, patentable improvements, such as formulations, new routes of administration, new indications, polymorphs and enantiomers, combination therapies, dissolution profiles, dosing regimens, methods of treating targeted patient populations, methods of manufacturing and methods of purification. The term of a patent is generally 20 years from its first filing date, so a patent on an improvement must have a first filing date later than that of the original patent in order to serve the purpose of extending exclusivity. Because the first filing date of a patent on an improvement is necessarily later than that of the originalpatent, and the improvement must be patentable over the original patent, ongoing patentability analyses along with careful strategic planning for all patent filings throughout the product life cycle can maximise product exclusivity.
ID innovators also find that their patents, both original and improvement patents, are integral to creating partnerships. For example, venture capital firms will investigate whether the ID innovator has exclusivity for the product prior to making an investment. In addition, the ID innovator’s patents can act as leverage in negotiations for cross-licences with potential partners.
Timing
Strategic patent analysis is most effective when started very early in development, and re-evaluated throughout development and post-launch. An initial overview of third-party patents may identify some areas that are blocked and other areas that are free, or relatively free, of third-party rights. This knowledge informs development choices at a point where it is easier to shift strategy if necessary. As development proceeds, new circumstances often drive the need for significant adjustments to a life cycle management plan.
A wide variety of changes could have an impact on product life cycle strategy, for example, new patents, changes in the law and regulation, shifting patient needs and changes in competitor activity. Notably, recent court decisions have called the eligibility of patents for certain method technologies into question. The Court of Appeals of the Federal Circuit (CAFC) held, in In re Bilski (under review by the US Supreme Court), that a method that failed to be tied to a particular machine or to transform the state of an article was not patentable subject matter. Many have interpreted this decision as calling into question the patent eligibility of methods of treatment or diagnosis. In another recent decision (Prometheus), the CAFC held that a method in which a particular drug is administered, its metabolite level is determined and the metabolite level is indicative of a need for adjusting the drug dose is patent-eligible. The decision centred on two findings that are favourable to innovators of methods of treatment and methods of diagnosis: administering a defined drug to treat a condition is transformative to the body and determining a metabolite level is transformative because it requires manipulation of bodily samples. However, the case has been appealed to the Supreme Court, so its final impact is not yet known.
In addition, new global health initiatives, such as the $10 billion pledge by the Bill and Melinda Gates Foundation for vaccine R&D, and GlaxoSmithKline’s establishment of an intellectual property pool for R&D into therapeutics for 16 tropical diseases, stimulate public-private partnerships and other downstream partnering opportunities. Further, implementing proposed market-based incentives may allow ID innovators to participate profitably in health initiatives for developing countries.
In summary, patent-focused product life cycle management is the strategic use of patents and other forms of intellectual property to maintain product exclusivity and revenue streams over the life of a commercially valuable ID product and to avoid expensive litigation. Successful companies initiate a programme at an early stage and continually re-evaluate it during development and after marketing approval, thereby mining for gold and avoiding land mines.
Helene Carlson is an associate at Sterne, Kessler, Goldstein & Fox. She can be contacted at: hcarlson@skgf.com Elizabeth Haanes is a director at Sterne, Kessler, Goldstein & Fox. She can be contacted at: bhaanes@skgf.com
