A Medical Device Daily

The amount of patent trawling over the past couple of decades has been a source of ire and, in some cases, tremendous expense for industry, as was heard in a recent Senate Judiciary Committee hearing (Medical Device Daily, June 8 & 11, 2007). Nonetheless, patent reform has been a long time in coming. Most proponents of patent reform are taking heart, however, as both houses of Congress managed to move patent reform bills out of committee that, if passed, will reshape the patent landscape in dramatic ways.

Last Wednesday, the House Judiciary Committee voted to send its version of the Patent Reform Act of 2007 (H.R. 1908) to the full house, albeit with six amendments that will complicate efforts to get the bill a full up-or-down vote before Congress leaves town for the August recess. Parliamentary procedure requires that those six amendments will have to be reviewed before being incorporated into the bill, making quick passage unlikely.

One of the original provisions in both the bills is a first-to-file provision, which says that regardless of who invented the article first, the party who filed the patent first has the patent. This is the approach used in most other nations in the developed world.

Howard Berman (D-California), the primary sponsor of H.R. 1908, pointed out that comprehensive patent reform has incurred a lot of legislative drag in the past. In an interview with arstechnica.com, he said “the time to reform the system is way past due.” Berman also said in that interview that he hopes “to take this bill to the full House for a vote before we break for August recess,” which seems an unlikely outcome.

The patent trolling issue was the subject of some discussion in the June 7 hearing of the Senate Judiciary Committee, with Mary Doyle, senior VP and general counsel for personal digital assistant maker Palm (Sunnyvale, California), stating that technology that draws on multiple components is the subject of substantial patent harassment.

Doyle said that her employer had spent several million dollars fending off a suit based on the use of the word “card,” which is used to describe several components in the firm’s line of PDAs. Some of the threats come from entities with a number of claims that they present to the alleged infringer, and once the infringer knocks down one threatened claim, “another patent lines up to take its place.”

Doyle said that the threat of treble damages that are imposed when willful infringement is determined constitute an illegitimate but effective source of leverage.

The Senate Judiciary Committee approved its version of the bill (S. 1145) last Thursday, which included an amendment that would make it more difficult to sue banks for patent infringement for technologies used to clear checks, such as check imaging systems. The Senate bill also carries an amendment by the committee’s ranking minority member, Arlen Specter (R-Pennsylvania), which would cut down on jurisdiction shopping by plaintiffs. The amendment would require that plaintiffs file suit in the jurisdiction where the infringement is alleged to have taken place or in the jurisdiction where the plaintiff or the defendant is located.

CMS reopens comment period for CTP

The Centers for Medicare & Medicaid Services reported this past Thursday that it has reopened the docket for comment on its clinical trial policy (CTP) for another 30 days.

The agency released the first draft in April and when the more-or-less final version was published earlier this month (Medical Device Daily, July 12), a number of comments suggested that “Medicare contractors had been paying claims for hospital services involving patients in various types of clinical trials outside the terms” of the previous policy, which CMS published in 2000.

The problem stems from the fact that the 2000 CPT contained language that did not explicitly require the agency to pay for clinical trials for devices that are already covered if those trials examined the device in off-label use or sought to develop refinements of surgical or other procedures, even for on-label use. This created an obvious dilemma for hospitals and makers of devices and diagnostics. While there have been few, if any, reports of resulting reimbursement problems, the possibility that CMS could arbitrarily deny reimbursement left a lot of device and diagnostics makers uneasy. The original draft of the 2007 CPT did not fix this problem, hence much of the commentary on the April draft of the 2007 CPT.

In a statement, acting CMS administrator Leslie Norwalk said that the current proposal “will address ambiguities about Medicare coverage in research studies and what items and services are reasonable and necessary for beneficiaries participating in clinical research studies.” She said that the revised version “will expand access for Medicare beneficiaries while providing important patient protections.”

The comment period will close August 18, and CMS said it will hold an “open door forum” August 7, although the press release did not name a site. CMS will publish a final rule by Oct. 19.