By Lisa Seachrist
WASHINGTON — Howard Coble, the presumed chair of the House Subcommittee on Courts and Intellectual property, introduced a bill into the 105th Congress that would extend patent exclusivity to compensate companies for delays in patent processing.
The bill, HR 400, would extend patent terms past the legislated 20 years from filing for undue administrative delays at the U.S. Patents and Trade Office (PTO). As a result, biotech companies won't lose patent protections over delays that result from the complex and contentious nature of their patents.
"This is a very favorable bill for biotech," said David Schmickel, patent and legal counsel for the Biotechnology Industry Organization (BIO). "It is a great starting position because it includes all the progress that we made in the 104th Congress."
Patent term became an issue with the approval of GATT in 1994. When the treaty took effect in June 1995, U.S. patents no longer provided 17 years of exclusivity from the time of issuance. Instead, a company or inventor had 20 years of exclusivity from the time that they filed their patent with the PTO. The move provided an incentive to companies to file more complete patent applications and to avoid unnecessary extensions and delays.
Most patent applicants were likely to gain some patent term from these changes as the typical patent takes about a year and a half to be issued, a staff member with the subcommittee told BioWorld Today.
The biotech industry, however, was likely to end up with less and sometimes much less than 17 years of patent exclusivity as a result of complex patent applications that can include several components such as the rights to a particular gene, its mRNA, genetically engineered protein and the protein production method. In addition, interferences * when several inventors claim the same invention — can produce delays that approach a decade for the biotech sector.
As a result, biotech patents could provide as little as 10 years of exclusivity.
"Ninety percent of a drug's price is controlled by its exclusivity," Schmickel said. "How can you afford to take the product to clinical trials and FDA approvals when you can't recoup the investment that can be as high as $400 million?"
The 104th Congress came up with a bill, HR 3460, sponsored by Carlos Moorhead (R-Calif.) and Pat Schroeder (D-Colo.) that addressed the patent term issues and was unanimously approved by both the subcommittee and the Judiciary Committee. That bill, however, never made it to the House floor.
The current bill is by Coble's own admission nearly identical to HR 3460. It provides a guarantee of 18.5 years of patent exclusivity. Inventors are compensated for any delays within the patent office whether as a result of complex reviews or of court appeals to interferences.
"Now there is no way that you can lose patent term," said Schmickel, who expects the bill will pass in the House by summer. "Once the bill passes the House, it should become law rather quickly as the Senate is far less contentious than the House."
The bill is only the first step for protecting patent term for biotech companies. In the 104th Congress, Sen. Orrin Hatch (R-Utah) and Rep. Henry Waxman (D-Calif.) sponsored a bill to allow for extension of patent terms as a result of delays in the approval process at the FDA. That bill was not enacted into law and a new version is expected to be introduced in the 105th Congress. The House leadership, however, has stated that it won't take up Hatch-Waxman until HR 400 or some version of patent reform is enacted.
"We are very pleased by HR 400," Schmickel said. "We worked over the congressional recess to make sure that provisions like those for interferences made it into the bill, and subcommittee took all our changes." *