Changes
Jump to navigation
Jump to search
'''H.R.9: *[[Innovation Act ]]*[[Protecting American Talent and Entrepreneurship (2015PATENT)''' Act|PATENT Act]]*[[https://www.congress.gov/bill/114th-congress/house-bill/9 Targeting Rogue and Opaque Letters (CongressTROL)Act|TROL Act]]*Heightened pleading requirements: must show how each limitation of each asserted claim in each asserted patent is found within each [[Support Technology and Research for Our Nation’s Growth (STRONG) Patents Act|STRONG Patents Act]]*Presumption of attorney fees: encourages judges to make a party pay attorney fees if lawsuit or claim is deemed frivolous[[Demand Letter Transparency Act]]*Transparency of ownership: requires plaintiffs to disclose the owner of the patent [[Innovation Protection Act]] ====Legislation Considered in question so the identity of the real parties behind the litigation is clearPrevious Congressional Sessions==== *[[Leahy Smith America Invents Act]]*Will ensure that patent trolls cannot hide behind a web of shell companies to avoid accountability [[Prize Fund for bringing frivolous litigationHIV/AIDS Act]]*Discovery limits: limit discovery in litigation until after a claim construction ruling[[Medical Innovation Prize Fund Act]]*[[The Shield Act]]*Aimed at reducing cost[[Patent Fee Integrity Act]]
'''S.1137: Protecting American Talent and Entrepreneurship (PATENT) Act (2015)''' [https://www.congress.gov/bill/114th-congress/senate-bill/1137 (Congress)]===Drafts of Future Legislation===
'''H.R.2045: Targeting Rogue and Opaque Letters (TROL) *[[Innovation Promotion Act (2015)''' [https://www.congress.gov/bill/114th-congress/house-bill/2045 (Congress)]]
'''S.632: Support Technology and Research ==Prize System for Our Nation’s Growth (STRONG) Patents Act (2015)''' [https://www.congress.gov/bill/114th-congress/senate-bill/632 (Congress)]Inventions==
'''H.R.1249Prize systems could take many different forms: Leahy Smith America Invents Act (20111)''' [http://www.uspto.gov/aia_implementation/billsOpt-112hr1249enr.pdf]*A derivation proceeding is established to replace in systems where the interference proceeding currently employed by government pays at least the USPTO**The purpose is to determine whether a claimed invention in an earlier filed application was derived from monopoly profits that the later filed application*Transitions from First to Invent patent system holder would expect to system receive2) System where priority is given to first inventor to file a patent applicationpatents are exchanged for compensation through an auction*Patent Office itself can rule on egregious claims, throwing them out before defendants are forced 3) Offer cash subsidy to go through consumers who value the patented product more than the marginal cost but cannot afford the pain and expense of patented product at a full trial [http://www.wired.com/2012/11/ff-steven-levy-the-patent-problem/]monopoly price
'''HNo one knows the economic effects of prize systems; there is lack of empirical evidence supporting the benefits of a prize system over a patent system.R.845: The Shield (Saving High-Tech Innovators From Egregious Legal Disputes) Act''' There are several factors that need to be considered in creating a prize system [httpshttp://www.govtrackbu.usedu/congresslaw/billsjournals-archive/113scitech/hr845volume131/documents/wei_web.pdf (BU)]*Introduced in 2013, but was not enacted*Requires an unsuccessful plaintiff in an infringement suit to pay the defendant’s legal fees *Effort to dissuade frivolous patent lawsuits:
The current '''Elimination of Competition''' Opponents criticize patent system allows companies to file pools for the right to exclude if they have a novel, nonpotential of anti-obvious inventioncompetitive behavior and collusion. The right According to exclude creates the World Intellectual Property Organization, "a temporary monopoly for patent pool may be regarded as a certain product, which leads to higher product costs for the consumercartel." [http://www.wipo.int/export/sites/www/ip-competition/en/studies/patent_pools_report. One example of pdf (WIPO)] Patent pools potentially create a patent leading way for companies to exorbitantly high prices would be Daraprimshare competitively sensitive information, a drug produced by Turing Pharmaceuticals. Martin Shkrelisuch as pricing, the CEO of Turing Pharmaceuticalsmarketing strategies, led the charge to increase the price of Daraprim from $13.50 to $750 per pillor R&D information among its members. " [http://www.bbcwipo.comint/export/sites/newswww/worldip-us-canada-34331761competition/en/studies/patent_pools_report.pdf (WIPO)]
Because of such abuses of '''Licensing Practices''' If a patent protectionspool restricts its members from licensing its patents independently, economists it lowers the incentive to produce alternatives and legislators have advocated inflates the costs of goods or technology for a prize system instead consumers. The Department of Justice and Federal Trade Commission state that restrictions on licensing may create "a barrier to entry if existing relationships make it harder for 'new firms to come in and overcome the patent system for pharmaceutical drugsthicket'." [httpshttp://www.washingtonpostjustice.comgov/nationalsites/health-sciencedefault/radical-bill-seeks-to-reduce-cost-of-aids-drugs-by-awarding-prizes-instead-of-patentsfiles/atr/legacy/20122007/0507/1911/gIQAEGfabU_story222655.htmlpdf (DOJ)] Under this system, companies that invent a new drug will receive a lump sum prize. The rights to the drug will then be placed in the public domain, creating generic drugs.
→About
==About==
<onlyinclude>[[Patent Reform|Patent reform]] has recently emerged as an important issue in the [[Small Business |small business]] space.The current patent system in the United States is facing a fair amount criticism on multiple fronts. Skeptics have argued that the current system is broken as it allows the presence of entities called 'patent trolls'. Trolls manipulate small businesses and extort money through patent litigation. Metrics regarding the prevalence of patent trolls are unclear. Several important pieces of legislation have been proposed to combat these reported patent trolls, as well as a "Prize System for Invention", which rewards innovative companies with monetary prizes instead of patents.</onlyinclude>
==Problems with Current Patent System==
*Many patents are approved because [[United States Patent and Trademark Office]] examiners don’t have time or resources to search all the relevant references**The current patent backlog, as of January 2016, is 561,585. [http://www.uspto.gov/dashboards/patents/main.dashxml (USPTO)]**Total Pendency, time between patent filing and patent action, is 26.1 months, as of January 2016. [http://www.uspto.gov/corda/dashboards/patents/main.dashxml?CTNAVID=1004 (USPTO)]***Total Pendency goal time is 20 months by FY2019. [http://www.uspto.gov/corda/dashboards/patents/main.dashxml?CTNAVID=1004 (USPTO)]
* “The past three decades of wanton patent-granting have created a disastrous environment for innovation. Today it’s practically impossible to build anything without violating a patent of some kind—and risking a multimillion-dollar lawsuit for your troubles.” [http://www.wired.com/2012/11/ff-steven-levy-the-patent-problem/ (Wired)]
*Technology industry has too many overly broad patents, leading to incredibly silly patent litigation cases
===Legislation===
The current patent system allows companies to file for the right to exclude if they have a novel, non-obvious invention. The right to exclude creates a temporary monopoly for a certain product, which leads to higher product costs for the consumer. One example of a patent leading to exorbitantly high prices would be Daraprim, a drug produced by Turing Pharmaceuticals. Martin Shkreli, the CEO of Turing Pharmaceuticals, led the charge to increase the price of Daraprim from $13.50 to $750 per pill. [http://www.bbc.com/news/world-us-canada-34331761 (BBC)]
Critics of the current patent system also believe it does not incentivize enough research and development for drugs that benefit society as a whole. [http://articles.economictimes.indiatimes.com/2012-05-28/news/31877151_1_drug-prices-intellectual-property-innovation (Economic Times)]
Because of such abuses of patent protections, economists and legislators have advocated for a prize system (see [[Medical Innovation Prize Fund Act]]) instead of a patent system for pharmaceutical drugs. [https://www.washingtonpost.com/national/health-science/radical-bill-seeks-to-reduce-cost-of-aids-drugs-by-awarding-prizes-instead-of-patents/2012/05/19/gIQAEGfabU_story.html (Washington Post)] Under this system, companies that invent a new drug will receive a lump sum prize. The rights to the drug will then be placed in the public domain, creating generic drugs. The biggest benefit of a prize system is the ability to target research towards a specific problem. With prize money as the incentive, research companies are more likely to devote time and resources towards the identified issue. In addition, the prize system lowers barriers to entry; nontraditional parties are encouraged to participate.
Although the prize system idea sounds promising for individuals requiring medication without high reservation price, the issue of sustained government funding for such endeavors hurts this proposal. Private investors, such as the Bill and Melinda Gates Foundation, offer similar prize systems for pharmaceuticals discoveries. However, if private investment has proven to be effective, why does the government need to intervene?
Legislators have proposed bills that provide for prize systems for a small class of drugs (see [[Prize Fund for HIV/AIDS Act]]).
===Failed LegislationProblems & Considerations Surrounding the Prize System===
'''Valuation Problems'''
What is the criteria for awarding a prize and how much prize money is each innovative drug worth? This is one of the biggest problems in establishing a prize system. Prize payments that are too low won’t provide enough incentive, while payments that are too high may incur resource duplication costs. The prize payment amount also has to be individually tailored to the benefit of the drug. People suggest the value of the payment be dependent on the ‘social value’ of a drug, but how is that social value determined? Will a distinction be made between medically necessary drug inventions and lifestyle improvement drugs (e.g. acne medication)?
'''Timing of Prize Payments'''The timing of the prize payment has to be timed well; if awarded too early other companies may not be incentivized to produce a drug that would’ve been higher quality than the drug that won the prize. After the prize is awarded, incentive to commercialize the drug is reduced since there is no patent system. One potential solution is to defer prize payment until there has been a certain degree of commercialization. '''Administrative Problems'''The MIPF creates a board of trustees that has the responsibility of awarding prize payments. Though the board of 13 members is designed to be unbiased, it is unlikely that they will not be subject to political and external pressures, leading to a distorted allocation of resources. A negative aspect of the patent system is the controversy and dispute that follows patent distribution of benefits. We can expect that there will also be challengers regarding the recipient of prize payments, thus the prize system has to specify how to resolve disputes, and also develop a thorough screening mechanism to confirm the reported benefits of the invented drug. ==Patent Pools== Patent pools are agreements between "two or more patent owners to license one or more of their patents to one another or to third parties." [http://www.wipo.int/export/sites/www/ip-competition/en/studies/patent_pools_report.pdf (WIPO)] Generally, patent pools cover mature and complex technologies that require complementary patents to develop compatible products and services. [http://www.wipo.int/export/sites/www/ip-competition/en/studies/patent_pools_report.pdf (WIPO)] Patent pools are useful when new products are based on multiple existing patents or on one invention with patents on many of its components. [http://www.theglobalipcenter.com/sites/default/files/reports/documents/Prizes__Patent_Pools.pdf (GIPC)] ===Benefits===Ideally, companies are able to reduce costs during product development by using patent pools to share intellectual property assets. Patent pools would be able to increase efficiency and positively affect competition and innovation. [http://www.wipo.int/export/sites/www/ip-competition/en/studies/patent_pools_report.pdf (WIPO)] In a situation in which two companies own different IP assets that are not enough to create specific products, these companies would be blocking each other's patents and preventing the introduction of an innovative product or service to the market. Patent pools deals with these inefficiencies by organizing complementary IP assets under one contract. [http://www.wipo.int/export/sites/www/ip-competition/en/studies/patent_pools_report.pdf (WIPO)] Companies can also reduce the amount spent on litigation by settling disputes with the creation of patent pools. This would benefit small- and medium-sized businesses that usually cannot afford the costs of expensive litigation. [http://www.wipo.int/export/sites/www/ip-competition/en/studies/patent_pools_report.pdf (WIPO)] ===Risks=Prize System for Inventions== Patent pools have many flaws, which may explain why they have been used so infrequently. [http://www.theglobalipcenter.com/sites/default/files/reports/documents/Prizes__Patent_Pools.pdf (GIPC)]
