For many months we have been hearing about the government attempts to “reform” health care in the United States, and this weekend the United States Senate is actually working, yes Senators working on a weekend, as the contentious debate continues. Even a relatively rare Presidential visit to Capitol Hill is scheduled for later this afternoon, presumably so President Obama can rally the troops for whatever lies ahead. While patent policy has not taken center stage in these debates, it is hard to ignore the under current that rages through the debates. Health care costs too much, so costs need to be contained. Of course, market initiatives like a national heath insurance market, which would lower premiums for everyone overnight, are not being considered. Likewise, attempts to prevent those without insurance from clogging up emergency rooms for simple matters like runny noses, sprains, colds and a litany of other ailment is not on the table either, so rather than discussing health insurance premium reform and government sponsored clinics in areas where there is the highest density of uninsured, we are debating a host of other things and trying to squeeze the private sector. I have long wondered why there has been such an all-out patent war against pharmaceutical and biotechnology companies, but the ACLU patent challenge against Myriad Genetics and the assault on biologic from some corners of government has me thinking that the preferred way to control costs in the minds of some politicians is to either stop or dramatically slow medical technology progress through revised patent and innovation policy. That is a mistake, an enormous mistake. We enjoy an ever increasing life span and higher quality medical care than anywhere in the world because of technology and innovative advances in an array of disciplines, and that MUST be preserved.

Hillary Clinton, US Secretary of State

As first reported by Bartholomew Sullivan of The Commercial Appeal, last week, on October 22, 2009, thirty-four members of Congress wrote a letter to Secretary of State Hillary Clinton urging her to steadfastly support strong intellectual property rights and not to given in to international demands that would weaken intellectual property rights, particularly patent rights. The concern expressed by these members of Congress centers around negotiations attempting to obtain an international agreement under the United Nations Framework Convention on Climate Change (UNFCCCC). This letter references a 432-0 vote in the United States House of Representatives on June 10, 2009, relative to an amendment to the Foreign Relations Authorization Bill, which stated that the United States “should prevent any weakening of, and ensure robust compliance with and enforcement of, existing international legal requirements as of the date of the enactment of this Act for the protection of intellectual property rights related to energy or environmental technology” in order to “protect American jobs, spur economic growth, and promote a ‘Green Economy.’”

A press release issued earlier today by the Pharmaceutical Care Management Association (PCMA) explained that a new article published in the New England Journal of Medicine (NEJM) urges Congress and the White House to revisit pending biogenerics legislation that would grant biotech companies an a 12-year exclusivity period for biologics. The press release explains that the experts, who are Harvard researchers and unidentified patent experts are adding “to an emerging consensus, including the Federal Trade Commission, which has concluded that 12 years of market exclusivity for biologics is unnecessary.” I suppose anyone can say anything in a press release. I am still troubled by the arrogance on display by PCMA though. Either they do not know what a “consensus” is, or they are simply intentionally misrepresenting the facts in order to further their own agenda. In either case it is appalling that the discourse relating to patents and exclusive rights has devolved to the point where the truth no longer matters and the masses are mislead by things that simply are not true.

If you have not already read the letter from Commerce Secretary Gary Locke to Senator Patrick Leahy (Chair of the Senate Judiciary Committee) and Senator Jeff Sessions (Ranking Republican Member), you absolutely need to read it to comprehend the massive changes the Obama Administration is supporting with respect to patent reform.  It would be difficult to over exaggerate the magnitude of the changes being supported by the Obama Administration.  Simply put, if the Obama Administration gets its way US patent laws would be completely re-written and substantively changed to a greater extent than at any time since 1790.  In fact, if the Obama supported patent reforms become enacted into law it would probably be much easier to simply pass legislation withdrawing all US patent laws and putting in its place the patent laws presently in existence in the European Union.  If you do not believe a European style patent system is in the best interest of the United States then you had better step up to the plate, because the stars seem to be aligning and before you know it there may not be any remaining US patent laws.  The steaks are high and it seems as if the once hopelessly derailed patent reform legislation is back with a vengeance, like a resurrected Jason a la Friday the 13th.

Professor Arti K. Rai

I wish I had some inside information to pass along, but I do not.  All I can seem to come up with is unsubstantiated rumor and innuendo, but the report the other day from Patently-O that Duke Law Professor Arti Rai is heading to the Patent Office to fill a long vacant policy setting position has too much of a ring of truth to completely ignore.  There have long been rumors associated with Professor Rai given that she is a long-time friend of President Barack Obama, both having been in the same Harvard Law School class.  What we do know is that Rai was a member of the Obama transition team, and was rumored to be on the short list for Undersecretary of Commerce for Intellectual Property, a position that also carries the title and responsibilities of Director of the Patent and Trademark Office.  As practically everyone in the patent bar that came in contact with Professor Rai was kissing her ring in anticipation that she would become the new PTO Director, I heard an unsubstantiated rumor that she had been offered the position and declined.  I want to make as clear as possible that I am writing about rumors, and unsubstantiated ones at that in order to distinguish from hard facts and inside information so that readers understand that this may all be much ado about nothing.  Having said that, as well respected in academic circles as Professor Rai is, it would be an enormous mistake for her to be given a policy setting position within the USPTO.  So allow me for a moment to buy into the rumors and make my case.

Earlier today James Love and James Glassman published what can only be described as an intellectually dishonest op-ed piece on RollCall.com.  The two James either simply do not understand patent law, the biologics legislation they detest or have an agenda that requires lying and obscuring the truth using scare tactics and falsehoods.  I don’t really know whether they are as clueless as their op-ed makes them appear, of if this is an orchestrated effort to persuade public opinion using obviously incorrect conclusions that are thrown about as if they were objective fact.  To be perfectly honest, I couldn’t care less whether they are malicious, misinformed or just stupid.  What I do care about is that their opinions are completely and utterly wrong, the supposed facts they rely on are false and those of us who understand patent law and this particular piece of legislation must do whatever is necessary to prevent to commandeering of patent policy to achieve whatever ill-conceived social agenda they seek to promote.  The cause du jour cannot and must not lead us to make bad innovation policy that will unravel the Constitutional mandate to foster innovation.

Mike Drummond, Inventors Digest

Mike Drummond, the Editor-in-Chief of Inventors Digest Magazine and a decorated journalist, has just  joined the Board of Directors of American Innovators for Patent Reform (AIPR).  AIPR, headquartered in New York, represents a broad constituency of American innovators and innovation stakeholders, including inventors, engineers, researchers, entrepreneurs, patent owners, investors, small businesses, and intellectual property professionals such as patent attorneys, patent agents, tech transfer managers and licensing executives.  Most recently, AIPR has opposed the Patent Reform Act of 2009, which some vocal critics have called “patent deform.”   AIPR is on record as opposing proposed apportionment of damages, post grant opposition and a change to the first-to-file regime, all sensible positions and views that I personally hold myself. When reached for comment, Drummond said: “Ideally, the AIPR will be one of those bodies that becomes irrelevant – we do our job so successfully that odious versions of patent reform die and meritorious patent changes take root. It will be interesting to see what sort of posture the new head of the USPTO takes, and what sort of fight we’re in for.”

Jim Greenwood

On Thursday morning, August 13, 2009, CNBC aired a segment titled Fixing America’s Health Care System on Squawk Box, which is CNBC’s longest running program.  Appearing on the program were Dr. Scott Gottlieb, who is a former FDA deputy commissioner, Tommy Thompson, former Health & Human Services Secretary and Wisconsin Governor and Jim Greenwood, a former Republican Congressman who is currently CEO of the Biotechnology Industry Organization (BIO).  Despite the tone of the questioning, the segment is well worth watching and will no doubt dispel the myths and lack of understanding by open-minded individuals who question why the biotechnology industry wanted 12 to 14 years of exclusivity for biologics, when the FTC said zero years of exclusivity would be sufficient, President Obama wanted no more than 7 years of exclusivity and Congress opted for 12 years of protection.  Co-anchor Joe Kernan started off the questioning by saying: “How did you get 12 years? Why exclude biotechnology from the cost pressures that everyone else is going to have to live under?”  But I guess that type of hostility is to be expected when an NBC “news” organization gets three Republicans in the room.

Once upon a time I used to not get worked up at all about proposals for patent reform, because after all they almost always didn’t seem to go through, or even if they did what was passed was hardly what was suggested. Then, my good friend John White told me several years ago that this time patent reform was going to happen, it was just a matter of time. Since then I have written article after article on proposed patent legislation, followed the issue and even reviewed transcripts from Congressional hearings. The end result is that not much has changed, at least not yet, and for that we should all be thankful.

UPDATED: Tuesday, July 21, 2009 at 6:59pm Pacific Time

The last presentation at the NAPP Annual Conference is presently ongoing, with William Smith of Woodcock Washburn giving a presentation regarding hot topics before the Board of Patent Appeals and Interferences. Smith is a former member of the Board while at the USPTO. His presentation is a good one, and sobering all at the same time. He mentioned my interview with Acting Patent Commissioner Peggy Focarino, and noted that the encouragement of allowances that Commissioner Focarino talked about in my interview is being seen by his firm and evidenced by what he called more “lets make a deal” phone calls from patent examiners who are presumably being told to find ways to issue patents. This coincides with what my firm has seen, and what I have heard from others. Sobering about his presentation so far though is that Smith said he fears that the budget problems facing the Office could cause the PTO to limp through the remainder of fiscal year 2009, and perhaps even limp into fiscal year 2010. He suggested that PTO fiscal year 2010 budget is likely going to be difficult to estimate given current economic conditions, and it is even possible that hiring may not restart in October as had been hoped by many of us.  He then suggested there is a chance that even if Congress passes and President Obama authorizes the borrowing from the Trademark Office, the Patent Office may still have to struggle to keep costs down through the end of fiscal year 2009, which will end on September 30, 2009.  These budget concerns were raised in a high profile way in a Wall Street Journal article titled Backlog, Budget Woes Await Patent Chief, which appeared in the paper earlier today.  I was quoted in the article as being cautiously optimistic of the Kappos nomination, but hoping that he does not take positions only friendly to the high-tech sector.

Last night the United States Senate passed a bill that authorizes the United States Patent and Trademark Office to shift funds between different USPTO accounts in order to avoid the Patent Office having to furlough or terminate patent examiners.  Under the Senate bill the USPTO would be able to shift funds from the Trademark side of the building, which is in the green, to the Patent side of the building, which is substantially in the red.  As I have been explaining for many months, the Patent Office budget is in shambles, and is only getting worse.  The Patent Office has seen a sharp drop in patent revenues in the last six months, and while there are many who will blame the economy, the truth is that budget problems would have been experienced even without an economic downturn, although the PTO budget has turned into a nightmare because the economic downturn has certainly had an impact, and not a helpful impact at that.  The truth, however, is that the Patent Office obtains an overwhelming amount of its funding from patent maintenance fees (I have been told it approaches 70% of Patent revenue) and with the patent allowance rate declining for years thanks to second pair of eyes review, the Patent Office has had the unfortunate circumstance of having to use double the resources to fuel two separate reviews of all applications, while at the same time cutting off future maintenance fee payments because patents were not issuing.

Recently I saw one of Intel’s new TV commercials, oddly enough as I was standing in line at Dunkin Donuts waiting for a coffee. It was playing on the TV positioned perfectly for everyone in line to see, no doubt taking your mind off the wait. I thought this commercial was so awesome I grabbed my cell phone and called my office phone number to remind myself to write a blog post about Intel, the commercial and how inventors are indeed rock stars! As an inventor myself, and a patent attorney who comes in contact with inventors from all walks of life, levels of experience and technology backgrounds, I thought to myself that this commercial is completely brilliant. Way to go Intel, and thanks for making it cool to be an inventor!

Last week an IBM patent application covering an allegedly unique system and method for enhancing productivity.  I typically do not get interested in the bizarre, wacky, ridiculous patent applications that are published because all that is required to have a patent application published is the filing of something, no matter how ridiculous, and the payment of the filing fee.  My all-time favorite stupid patent application relates to a method of walking through doors, which purports to explain how to acquire sufficient hyperspace energy to pull an out of body experience necessary for walking through solid objects.  So the threshold of getting a patent application published is extremely low, and has nothing to do with whether the invention is real or works.  Nevertheless, when IBM files a patent application on something that is rather ridiculous it deserves attention for several reasons.  First, IBM has been protesting low quality patents and claiming that is a reason for needed patent reform that would make it easier to challenge issued patents.  Second, many including myself believe that the next Director of the PTO is likely going to be IBM Vice President and Assistant General Counsel, David Kappos.

As of today, legislative patent reform efforts are working their way through Congress. We are further along the road to legislative reform than at any point in time over the last 4 years, but the ultimate outcome is still not certain. The Senate Judiciary Committee has reported out a version of patent reform, so there is a real expectation that legislative reform will happen at some point during 2009, perhaps soon. It is expected that if Senator Harry Reid (D-NV) brings the legislation to a vote it will be because he has the votes to pass the legislation. If the Senate passes patent reform there will be patent reform. The House of Representatives has consistently passed patent reform, and there is every expectation that President Barack Obama will sign the bill, thus the Senate is, as is typically the case, in charge.

For some time now I have been writing about how a patent stimulus plan would revitalize the economy, but I am all fired up today after a flurry of comments and e-mail exchanges regarding some of my recent blog articles. It is way past time to rethink the patent application process and how patent prosecution is carried out by patent examiners.  I know I am starting to sound like a broken record, a dog with a bone, or perhaps even the patent equivalent of Sean Hannity, harping on the same things over and over and over again, but it is necessary at times to get your message heard unfortunately.  In any event, call me whatever you want, but the reality is that unless and until the Patent Office actually starts granting patents in a technologically relevant time frame there is little or no chance that innovation will lead to the growth that can and historically has pulled us out of troubled economic times.  There is simply no benefit applying for a patent on a high-tech, cutting edge solution when that application likely will remain pending for at least 3 years, and more likely 4, 5 or 6 years.  That is not a technologically relevant time frame.  A technologically relevant time frame means a patent must issue before the invention is obsolete!