|
The patent bill in its present form picks winners and losers among American industries
with different business models.
|
|
The patent law has always applied the same standards to all types of inventions
whether the discovery covers beds, shoes, airplanes, biotechnology, software or
flatware. The PRA preserves this two-century-old tradition of the patent law. It contains no
special rules that apply only to some inventions and not to others. As areas of invention have
changed, the patent law has been repeatedly amended to reflect new marketplace realities.
Most recently the patent law was revised in 1952, before the invention of the microprocessor,
cell phones, transistor radios, biotechnologies and computers. While the current law works
well for long established technologies, both the National Academy of Sciences and the Federal
Trade Commission have concluded that the law needs to be changed to keep pace with
modern times. The PRA updates the law to ensure quality is maintained in the grant of patents
and rights are fairly enforceable. These changes are sensible and balanced. They follow the
trend established by half a dozen Supreme Court cases, each of which has been decided in
ways that cure imbalances in the law. The PRA is the proper expression of Congress' role as
the entity charged with ensuring our laws are modern and up to date.
|
|
|
Patent Reform Act of 2007 would hurt American competitiveness by empowering Chinese
and Indian citizens to both evade their intellectual property obligations and undermine the
interests of American inventors.
|
|
|
This is a fanciful charge without foundation in the bill as reported by the Judiciary
Committee. Improving patent quality � ensuring that only meritorious inventions
receive a patent � is a high priority of the bill. Every witness before the Judiciary Committee, at
over 20 hearings held over the past three Congresses, testified that poor patent quality creates
severe and present problems. The Patent and Trademark Office proposed establishing a post
grant opposition system to challenge patents. As introduced, H.R. 1908 adopted the PTO's
proposal. It would have created a post grant opposition mechanism enabling challenges of
patents within 12 months of their being issued, or at any time during the life of the patent, the
so called "second window" if the challenger could meet certain very rigorous criteria.
The bill as introduced came under considerable criticism, primarily by US drug makers. Their
objection was limited to the "second window." They argued that the ability to challenge a
patent at any time would empower the very kind of challenges those quoted in the India Times
greet with such glee. The Judiciary Committee took these concerns to heart. H.R. 1908 as
reported on a voice vote by the Committee no longer has a "second window" for post grant
opposition. The bill permits challenges only in the first 12 months after a patent is granted. For
most drugs, because its takes about 7 years after the patent is granted to begin selling the
drug, these challenges will simply not be available when a drug is actually marketed.
|
|
|
Patent reform will weaken America's global economic standing.
|
|
|
The opposite is true: patent reform will strengthen America's global competitiveness;
doing nothing will weaken it. As the Council on Foreign Relations reported in 2006,
"Failure to rein in the patent regime could have global repercussions. To hinder innovation is to
hinder the dynamic competitiveness of U.S. companies� [S]ignificant problems with patents
put the U.S. system at a disadvantage vis-�-vis more balanced and less costly foreign [patent
systems]."
|
|
|
Patent reform will drive jobs overseas.
|
|
|
The patent system today discourages U.S. job growth. Productive companies are
spending billions of dollars to defend themselves against patent lawsuits. The cost of
defending an average patent lawsuit is between $2 million and $4.5 million. Furthermore, prior
to 1990 there had been only one patent damages award in history larger than $100 million, yet
in the past five years, there have been at least ten judgments and settlements in that category,
and at least four that topped $500 million. One topped $1.5 billion. This is money that could be
invested in creating high-paying jobs.
|
|
|
Patent reform is being rushed through Congress.
|
|
|
Congress has considered patent reform legislation � and key issues like post-grant
review and apportionment � in each of the last three sessions. In that time, the House
and Senate Judiciary Committees have called more than 20 hearings on patent reform � and
that's not even counting the hearings on pharmaceutical-specific patent issues. For years
before that, the issue has been widely debated in policy circles, driven in large part by a
groundbreaking 2003 study by the Federal Trade Commission, which found serious flaws in the
patent system and called for Congress to take action.
|
|
|
Patent reform will inhibit universities' ability to research.
|
|
|
While universities had some initial concerns with the Patent Reform Act, it has since
been amended to protect them. The Patent Reform Act will weed out questionable
patents, making it easier for universities to navigate the patenting process, and it will provide
universities with a cost-efficient tool to challenge patents without having to litigate. Many
universities that remain opposed to patent reform have substantial financial ties to
pharmaceutical manufacturers.
|
|
|
Patent reform will keep life-saving drugs off the market.
|
|
|
The patent system has been tailored over the past several decades to protect pharmaceutical
manufacturers and to make it easier for pharmaceutical manufacturers to
protect their intellectual property. Such patent protections enable pharmaceutical manufacturers
to reap record profits from the sales of their drugs. The Patent Reform Act of 2007 will not
undermine the ability of pharmaceutical manufacturers or biotech companies to protect their
intellectual property. In fact, the FTC has even found that the patent system today inhibits the
development of new drugs: "firms in the biotech industry reported that they avoid infringing
questionable patents and therefore will refrain from entering or continuing with a particular
field of research that such patents appear to cover. Such effects deter market entry and
follow-on innovation by competitors and increase the potential for the holder of a questionable
patent to suppress competition."
|
To download this fact sheet, click here.
|
