Biotechnology and Pharmaceutical

Patenting

Rodney L. Sparks, J.D., Ph.D.Senior Biotechnology Patent

CounselUniversity of Virginia Patent

Foundationrodney@uvapf.org

434-243-6103

Disclaimer

• Please note that no legal advice is being offered and no attorney-client relationships will arise during this presentation.

IP Rights are Provided for in the Constitution• Article I, Section 8: “The

Congress shall have power to …promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries”

Policy Behind IP Rights

• IP Law seeks to promote creativity

• The property rights granted protect the creators’ opportunities to recoup their investment and earn a profit, and encourages them to invest their time and efforts in developing new products and services

Four Types of Intellectual Property

•patents

• copyrights

•trademarks

•trade secrets

Four Types of Intellectual Property con’t.

• Patents cover compounds, machines, and processes

• Give the right to exclude others from making,

using, offering for sale, selling, importing (they

do not necessarily allow you to practice your own

patent!)

•Copyrights cover works of authorship reduced to a tangible means of expression

• Give exclusive rights to copy, distribute, perform,

display, make derivative works

Four Types of Intellectual Property con’t.

•Trademarks indicate source of goods and services

• prevent others from “passing off”

•Trade Secrets are legally protected secrets

• misappropriation is unlawful, but reverse

engineering is fair game

• Utility (useful): proposed or demonstrated use

• Novelty: not previously described in a publication

• Non-obvious: not suggested by combinations of publications

• Enablement: one of “ordinary skill” in that field can carry it out (lack of data)

• Written Description: you can only claim as much as you actually invented (lack of data)

• Best Mode: at the time of filing

Patent requirementsAn invention is not patentable unless it is useful, novel, and non-obvious

What is Patentable?

What is Patentable?

“Anything under the sun made by man”• New chemical compounds, e.g., drugs, pesticides• Methods of producing new compounds• Methods of diagnosing or treating diseases,

including biomarkers, delivery systems, and vaccines (no gene therapy in humans)

• New uses for old compounds• Purified natural materials, e.g., DNA, enzymes• New formulations or mixtures, e.g., alloys, shampoo• Transgenic animals or plants (excluding humans)• Devices (stents, machines, orthopedic devices,

prosthetics, etc., and novel and non-obvious modifications thereof)

• Methods of performing a function by computer software

• Methods of doing business • Methods of processing digital signals

WHAT IS NOT PATENTABLE?

• Patent law provides for what is patentable and for what is not patentable.

• An invention is not patentable if it falls into one of the following categories: perpetual motion device; anti-gravity device; abstract ideas or mental processes; laws of nature or scientific principles; naturally occurring substances; an invention disclosed publicly more than 12 months ago (includes sale, offer to sell, exhibit at a trade show, publication); substituting superior material for inferior material; (cont).

WHAT IS NOT PATENTABLE? (con’t.)• a mere change in size, form, or shape;

literary, dramatic, musical, and artistic works (these are subject to copyright laws); data structures or programs per se; mere mathematical algorithms; nonfunctional descriptive material; electromagnetic signals; human beings; an invention that is inoperative; an invention which can only be used for illegal or immoral purposes (such as a torture device); and an invention solely useful in making atomic weapons.

WHAT IS NOT PATENTABLE? (con’t.)

• Mere discoveries are not patentable

• A discovery can be thought of as something which adds to human knowledge, but does so by observation. Discoveries include such things as identification of a new species of plant, a new biochemical pathway, naturally occurring substances, or laws of nature.

• Once a discovery is made a modification or new use of the discovery might be patentable.

Correlation Between Patentability and Commercial Value of an Invention• NONE! (not quite true, but it makes my

point)

• A patentable invention may have little or no commercial value

• An invention with a lot of commercial value my have little chance of being patented

• Dilemma- Without the potential for adequate patent protection, most companies will not invest in a technology

Invention Disclosure Triage

PatentProtection

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Copyright 2003UVA Patent Foundation

All Rights Reserved

Evaluation of New Invention Disclosures

To File or Not to File?

General Triage Factors to Consider:

1. Preliminary Assessment of Patentability (with an eye toward written description and enablement issues due to too little data and on novelty and obviousness issues exposed in a prior art search)

2. Pre-market Analysis

3. Commercial Potential

From invention to patent• Bad things- Public disclosure before filing-

results in lack of novelty (kills foreign rights; starts one year clock for filing in the U.S.); also possible obviousness issues

• Presentations

• Publications (remember abstracts, web)

• Grant applications (once awarded- if

federal)

• In use

• Good things- Inventors are diligent in filing invention disclosures

• Lab notebooks (identify inventors and

dates)

Good Invention Disclosure-for a cheaper and better result

• Invention has been fully completed and many examples are in the invention disclosure; make it easy for the licensing associate and attorney to review it and to be able to cut and paste necessary portions of the disclosure in an efficient manner

Good Invention Disclosure-for a cheaper and better result

• Well organized- such as draft manuscript; a grant proposal, but only if there are a lot of preliminary data; (keep total documents to a minimum if possible)

• Editable (Word, etc.)• Keep cited references to a minimum

Bad Invention Disclosure-results in a more expensive and less desirable result• Unorganized• Incomplete - missing sections such as

materials and methods; incomplete description of results or figures; figures with no accompanying legend or which are not described in the text of the disclosure

• Multiple unrelated documents (meeting abstract + manuscript rough draft + grant proposal draft + PowerPoint presentation = piecemeal disclosure)

• Uneditable files (pdf, etc.)• A poster in PowerPoint

• Invention- disclose to UVAPF (180/year)

• Triage

• File Provisional application- 1 year (perform inventorship determination if necessary; remember- authorship is not the same as inventorship)

• File International/PCT application- 1.5yr

• Nationalization: file in US, other countries

then you wait 2-3 years

• Prosecution, 1-2 years-

• Issued patent (maybe), 20 year term from filing date (costs from $50k to $750k, depending on the global scope)- Patents can be challenged

The patenting process

Provisional Patent Applications

• The current PTO filing fee is $110• With in-house patent counsel you

can draft and file many more provisional patent applications than with outside law firms where reasonable applications cost from $2,500 to $12,000 in attorney’s fees.

• We file 150/year!

Conversion of a Provisional Patent Application to a PCT

Application• This decision requires more effort and is tougher to make because the expenses are much higher at this point (about $5k just in government filing fees)

• If a licensee has been found in the year since the provisional has been filed or if there is a good chance for a license agreement, a PCT application is usually filed.

How do universities use patents?

• Universities patent and license the invention (allowed by Bayh-Dole Act)

• A license is a contract in which the patent owner allows a company to make, use, offer for sale, sell, and/or import the patented article or use the patented method

• In exchange, the “licensee” company pays the patent owner royalties (usually a % of sales) and other payments (e.g., up-front fees, milestone fees)

• Royalties on successful products can be huge! (even more than a graduate student’s stipend)

Ownership of IP at UVA

• Patents

• UVA owns inventions by contract

• Bayh-Dole Act (allows universities

to own federally funded research)

• Co-ownership with other entities

• MTAs, sponsored research

agreements, consulting can modify

ownership

The UVA Patent Foundation-(technology transfer)• Protection and licensing of UVA’s

inventions

• Bayh Dole government reporting

• Advice on intellectual property for UVA (primarily for patents; some for trademarks and copyrights)

UVA and the UVA Patent Foundation Honor

Inventors

2010 UVA Inventors of the YearTim Macdonald and Kevin Lynch

Some Familiar UVA Inventors

PATENT MYTHS

Myth #1: An inventor needs to know how an invention works

•The inventor does not need to understand how or why their invention works.

•If an inventor discovers a new method of curing cancer, it does not matter how the method works, just that it works.

PATENT MYTHS

Myth #2: An inventor needs a prototype

•If the invention is such a simple device that drawings and a description will allow one of ordinary skill in the art to make or practice the invention, that is all that is needed. In fact, if the invention is simple enough, actual reduction to practice may not be necessary (forget about this for biotechnology).

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PATENT MYTHSMyth #3: An idea is patentable

•Although an idea is not patentable, if that idea has been formulated in such detail that it can be so clearly described in the specification that one of ordinary skill in the art could make or practice the invention based on the details provided in the specification, then it might be possible to get a patent on the idea.

•Few technologies other than simple machines or simple processes fall into this category.

PATENT MYTHSMyth #3: An idea is patentable (cont.)

For most technologies, such as biotechnology, the standards of written description and enablement are so high it is difficult to get a patent even when there is substantial data and actual reduction to practice!

PATENT MYTHSMyth #4: The preferred or best way of practicing an invention can be kept secret by exclusion from a patent application

Patent law requires that the “best mode” of practicing the invention be included in the application, if a best mode is known. Failure to comply can result in invalidation of a patent. If secrets are to be kept, then they must be protected as a trade secret and are not allowed in patent law.

Rodney L. Sparks, J.D., Ph.D.

Senior Biotechnology Patent Counsel

University of Virginia Patent Foundation

434-243-6103 rodney@uvapf.org