CAPA: The USPTO Must Prioritize Patent Quality And Restore The IPR System To Its Proper Focus

WASHINGTON D.C. – As part of its ongoing campaign to safeguard the U.S. patent system and stop Big Pharma from gaming the system, the Coalition Against Patent Abuse (CAPA) this week filed comments with the United States Patent and Trademark Office (USPTO) outlining its concerns regarding the increased use of discretionary denials by the Patent Trial and Appeal Board (PTAB) and the proposed codification of practices that would continue this trend of using discretionary denials to get rid of otherwise meritorious petitions to review potentially bad patents.

“The proposed changes being made by the USPTO regarding its approach to discretionary denials are unraveling Congress’s express will in creating mechanisms to stop bad patents at the USPTO. If enacted, these changes would open the flood gates for significantly more discretionary denial decisions down the road. This practice will result in the delayed entry of generic competition and increase the cost of prescription drugs for Americans. Rather than codifying current misguided policies and practices around the use of discretionary denials, the USPTO should re-prioritize patent quality and restore the inter partes review (IPR) system to its original intent – resolving the problems of erroneously-granted patents quickly and at a lower cost than litigation,” stated CAPA Executive Director Matthew Lane.

The Following Comments Were Made In CAPA’s Filing With The USPTO:

  • Invalid Patents Interfere With Price-Lowering Generic And Biosimilar Competition
    • Generic competition among small molecule drugs reduces drug prices for Americans by an average of 79%. Biosimilar competition is newer, but is projected to save patients 15%-45% over the next five years, possibly more. While other countries have already experience large price drops due to the expiration of biologic drug patents and the entry of biosimilar competition, drug prices will remain high if invalid and weak patents continue to inhibit biosimilar competition from entering the marketplace here in the United States.
  • Inter Partes Review Eliminates Invalid Drug Patents, Lowering Prices
    • The Inter Partes Review (IPR) process established by the America Invents Act (AIA) is quick, efficient, and a less expensive means of challenging potentially erroneously granted pharmaceutical patents is especially important to speed up the entry of competition and reduce drug costs for American patients and payors. Just look at one example where prices for an important drug used to treat opioid addiction, Suboxone, fell by about 50% compared to its peak brand price after a successful IPR challenge combined with other litigation.
  • Discretionary Denials Allow Erroneous Patents to Stand, Harming Patient Consumers
    • The current practice of denying IPR petitions for reasons other than the merits is alarming and can deprive Americans of the vital price reductions that come with generic and biosimilar competition. When the USPTO discretionarily denies a patent for IPR review, it could potentially delay competition, resulting in a significant cost to American patients and payors. The USPTO must justify that the harm of allowing a likely-invalid patent to stand is tolerable.
  • Multiple IPR Petitions On Drug Patents Are Often Justified
    • Multiple IPR petitions can be filed on a patent for good reasons. Drug patent challenges are often so complicated that petitioners need to file multiple petitions at the same time because of the word count limits on a single IPR petition, especially when many claims are being challenged. Nevertheless, the Board has discretionarily denied all but one of these multiple-IPR petitions, depriving petitioners of the ability to fully develop their arguments and create a complete evidentiary record. This results in petitioners having to pursue these additional arguments in court rather than settle them more efficiently through an IPR proceeding.
  • Parallel Litigation Should Not Be A Cause to Discretionarily Deny IPR
    • The USPTO should be careful in using its discretionary denial authority to deny petitions based on trial dates in parallel litigation. The USPTO’s reasoning is that these trial dates can occur before the IPR process would conclude, but this reasoning is often faulty. Trial dates can be pushed back. Furthermore, petitions are being denied based on the trial dates of unrelated parties when multiple parties are challenging the same patent. This does not account for the possibility that some parties may settle, or that certain parties are better positioned to challenge a patent with the best information.

The USPTO can reduce drug costs and encourage generic competition by focusing on improving patent quality through the IPR process rather than looking for reasons to avoid examining valid concerns over a patent’s validity.

Read CAPA’s comments filed with the USPTO here.