The Cross-Border Biotech Blog

Biotechnology, Health and Business in Canada, the United States and Worldwide

Mixed Reaction to U.S. Patent Reform

Guest post by Andrew Franklin, a colleague in the Pharmaceuticals and Life Sciences practice at Norton Rose.

With the passage of the America Invents Act of 2011, the United States’ patent system will change from a “first-to-invent” system to a “first-to-file” system for granting patents. Under the new system, patents will be granted to the first person to submit an application to the U.S. Patent and Trademark Office (“USPTO”) as opposed to the first person who first  invented the subject matter of the invention. This is the most significant change to US patent law since 1952.

While this legal reform aligns the US patent law with the rest of the world, it has been met with mixed reaction.

PTO Reaction

The USPTO’s webpage on the America Invents Act states that “[t]he new law will afford more certainty for patent applicants and owners, and provide the USPTO the resources needed to operate efficiently and issue high-quality patents.” Dennis Crouch at PatentlyO reports that “[t]he USPTO, under the leadership of Director David Kappos, strongly supports the legislation for two primary reasons: (1) funding and (2) international harmonization.  Under the new law, the USPTO is very likely to be able to spend more money on much needed programs that address my administrative concerns listed above.  With harmonization, the USPTO has the potential of working more closely with worldwide patent agencies to improve the patent prosecution process.”

Academic Reaction

PatentlyO also notes that the legislation does “nothing to directly assist the US Patent Office (USPTO) with issuing patents in (1) a timely manner; (2) for only deserving inventions; and (3) that concretely and understandably define the scope of the patent right.”

PatentlyO also includes a post quoting a collection of reactions by other legal scholars to the US reforms.  A podcast commentary from Courtenay Brickerhoff, partner at Foley & Lardner LLP, is available on the Burill Report’s website.

Industry Reaction

The Biotechnology Industry Organization (“BIO”) supports the new America Invents Act. BIO’s President and CEO Jim Greenwood stated that: “BIO applauds the Senate’s passage of The Leahy-Smith America Invents Act as it marks the conclusion of a long and vigorous debate on how to best modernize our nation’s patent system. The improvements made by the bill will benefit all sectors of the national economy by enhancing patent quality and the efficiency, objectivity, predictability and transparency of the U.S. patent system.”

Karl Uhlendorf, Deputy Vice President of the Pharmaceutical Research and Manufacturers of America (PhRMA), is also in favour of the reforms stating the new legislation will “encourage innovation, promote patent certainty and provide for a strong Patent and Trademark Office (PTO).” Uhlendorf also notes that the reforms would “creat[e] efficiencies for inventors seeking patent protection in the U.S. and other markets.”

Canadian Connection

Canada implemented a first-to-file system in 1989 and Professors Abrams and Polk from the University of Pennsylvania examined the effect of the rule change by a comparative analysis of 1 million Canadian and American patents. Abrams and Polk found “a significant drop in the fraction of patents granted to small inventors in Canada coincident with the implementation of first-to-file.” The also found “no measurable changes in patent quality.” Abrams and Polk believe that the US reforms will likely reduce the number of patents filed by independent or sole inventors.

Conclusions

The effects of the new system will be closely monitored as the legal reforms take effect.  US inventors should (continue to) file patent applications in a timely manner in order to maintain a competitive edge in the new legal landscape.

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