MichBio is opposing H.R. 9, referred to as the Innovation Act. The legislation, introduced by House Judiciary Committee Chairman Bob Goodlatte (R-VA) would threaten the ability of innovative bioscience companies to enforce their patents and fund continued R&D. The patent-litigation provisions found within the proposed legislation would make it more difficult, time-consuming, and expensive to enforce legitimate and important intellectual property rights.
The U.S. House is expected to consider the legislation next week and MichBio, in partnership with BIO, AdvaMed, MDMA, and PhRMA has been actively engaging with the Michigan delegation to inform members and staff about the negative impact that this legislation would have on the state’s biosciences industry. Rep. John Conyers (D-MI), ranking member of the Judiciary Committee, has been actively supportive of our industry’s call for further reforms.
MichBio supported a congressional sign-on letter led by Reps. Scott Peters (D-CA) and Ryan Costello (R-PA) that called for important reforms to the USPTO’s inter partes review (IPR) and post grant review processes, and urged that these reforms be included in any patent legislation that is considered by the House. As it stands the provisions would disadvantage small start-ups and emerging companies preferentially.
The IPR process, created as part of the 2011 American Invents Act, was meant to help companies challenge patents by providing a more efficient alternative to the courts. But the process allows overly broad interpretations of claims and has a low standard of proof that favors challenges by trolls. It requires them to prove only that it's more likely than not that a patent is too broad and therefore invalid. That's a very different standard from the one in district court, where judges presume that a patent holder's claim is legitimate unless the challenger clearly and convincingly proves otherwise. As a result, the patent claim “kill rate” is alarmingly higher than that found via the courts. Moreover, the IPR process has been hijacked by patent assertion entities (PAEs) or “trolls” in ways not anticipated.
We believe IPR's "guilty until proven innocent" standard undermines decades of reasonable patent adjudication in the courts. The IPR standard essentially says that patents should not be considered valid at the time they are issued by the U.S. Patent Office. This upside-down proposition will thwart critically needed investment in new drugs.
MichBio will continue to engage on this issue and advocate for changes that can be more supportive of Michigan’s bio-industry.