Event Recap: Intellectual Property Panel “From Research to Patent”
by Adrian Rivera-Reyes
On November 10th, the Penn Science Policy Group and the Penn Intellectual Property Group at Penn Law co-hosted a panel discussion focused on intellectual property and how to patent scientific research. The panel included Peter Cicala, Chief Patent Counsel at Celgene Corp.; Dr. Dora Mitchell, Director of the UPstart Program at the Penn Center for Innovation (PCI) Ventures; and Dr. Michael C. Milone, Assistant Professor of Pathology and Laboratory Medicine at the Hospital of the University of Pennsylvania (HUP), and Assistant Professor of Cell and Molecular Biology at Penn Medicine.
The event started with the introduction of both groups by their respective presidents and was proceeded by Kimberly Li giving an introduction of the panelists. Next, Peter gave a short PowerPoint presentation with a general introduction of intellectual property. Below are some key points to understand intellectual property/patent law 1,2:
1) In general, patents provide a “limited monopoly” that excludes others from making an invention, using, offering for sale, selling, or otherwise practicing an invention, but it does not confer upon the patentee a right to use the said invention. Thus, patents serve as a form of protection for the owner.
2) A single invention can only be patented once; once the patent on that invention expires, others may not file to patent the same invention again.
3) In order to confer a patent, the United States Patent and Trademark Office ensures that inventions of patentable subject matter meet the following legal requirements: i) inventions must be novel, ii) inventions must be useful, and iii) inventions must be non-obvious.
4) Utility patents only last for 20 years from the date of filing. After 20 years, anyone can make, use, offer for sale, sell, or practice the invention. A single invention cannot be re-patented after the time is done. In contrast, trademarks or trade secrets last forever, and copyrights last for the lifetime of the author.
5) The United States Patent and Trademark Office follows the ‘first to file’ rule. Thus, the first person or entity to file a patent is the assumed owner.
6) Patents can be invalidated by the United States Patent and Trademark Office.
A clever example discussed by Peter Cicala was the patenting of a new car feature. If X company has submitted and received a patent for a car and Y company makes a new feature for the car, they can patent the new feature (as long as it meets the legal requirements introduced above). Once the patent for the new feature is conferred to Y company then they can produce that one feature, but not the car that was patented by X company, unless a license is provided by X company to Y company. Thus, the patent for Y company only gives them the power to prevent others from making that new feature.
Conferring Patents in the US and Internationally
First, there has to be an invention of some sort. Once there is an invention, a patent is filed. Patents are drafted free-hand, unlike a tax application where one has a specific form to fill. For patents, one has to start from scratch. Patents are usually long (some can reach 500 pages in length) and there are many legal requirements on what to say in the application and how to say it. Eventually, when one files a patent application it will go to the patent office. A patent examiner will, as the name suggests, examine it and deliberate with the patent office over the course of 3-5 years as they point out sections that need further editing, clarification, or justification. There is a lot of back and forth, until the examiner agrees that the invention has satisfied the patent requirements. Then, one pays fees and the patent is awarded. Fun fact: In the US, patents are granted only on Tuesdays.
On a global basis, one files a single international patent and the designated patent offices around the world examine it locally. If an office grants a patent, such patent will only be valid in that jurisdiction. That is why submitting patents cost so much, because one files and pays legal fees for each jurisdiction. For example, if a patent is filed in Japan for a compound, a different entity can manufacture the compound freely in the US, but not in Japan. This is one reason why companies and universities are very careful when filing patents.
Intellectual Property in Industry
Pharmaceutical products start with a great idea, but for every product in the market there are about 10,000 that fail. Therefore, companies file many patents even though many of those patents may not have any commercial value in 5-6 years. It costs about $500K to file (including filing and attorneys’ fees) and receive a single issued patent, which means companies spend a lot in patents (i.e. 10,000 patent submissions each worth $500K)! Out of those 10,000 patents, typically one will make the company about an estimated $5 billion a year in returns.
A student asked, “Is submitting a patent the same price for a university as it is for a company?” In essence, no! The patent office makes a distinction between large and small entities. Small entities, based on requirements provided by the patent office3, pay half the fees, but attorneys charge a fixed price. In the end, small entities save just a small percentage of money. Another question asked by an audience member was “what is patentable in the pharma business?” If one patents a molecule, no one else can infringe or use that molecule itself. That is how companies patent drugs or their associated components. One can also patent dosing regimens, formulations, modes of administration, etc. The compound claim gives the most protection, because it is very hard to make a knock-off of a molecule.
Intellectual Property in Academia
A student raised the issue that there is a lot of communication that occurs in science, especially at conferences, symposia, or amongst colleagues, classmates, etc. That seems to be a big risk in the context of protecting one's intellectual property, but doing so is an unavoidable risk when one does scientific research.
Dora, patent analyst from PCI Ventures, then proceeded to discuss the issues brought up from an academic perspective. She said, “The question raised here is that when one works in an academic institution the work is knowledge based and disseminated to others.... How does one draw the line from all that to protect something valuable?” What most, if not all, academic/research institution do is have their lawyers work very closely with faculty, so that anytime they are about to publish a paper, go to a conference, attend grand rounds, or any other such public appearance, the lawyers will hustle and get an application submitted before such events.
In addition to these more public forums, problems can arise from talking with friends who are not directly associated with the work. An example of this pertains to OPDIVO®, a drug patented by Ono Pharmaceuticals and the Kyoto University in the 90’s, which later was exclusively licensed to Bristol-Myers Squibb who launched the drug. Recently, Dana Farber Cancer Institute sued Ono Pharmaceuticals and Bristol-Myers Squibb because the principal investigator at Kyoto University had periodically consulted a colleague at Dana Farber for his advice. The professor-consultant at Dana Farber would send some data he thought was helpful and consult with them. Dana Farber sued both companies, claiming that the now-retired professor from its institution should be included as an inventor in the patent. Because an inventor of a patent is part-owner, Dana Farber is actually claiming ownership of the patent and will receive compensation from the sales of products under the patent4,5.
Michael, Penn Med professor who works intimately with a team of lawyers from PCI because he regularly files patents, said that balancing confidentiality with science communication is a difficult task. He commented, “I think it comes down to how important one thinks the invention is and a lot of the times the patent will not get developed if it will not bring any money to the owner (company/institution).” Moreover, there has to be a conversation with the university because the university pays for the patent, so it decides what to file. It also depends on the resources of the university. Regarding the work of graduate students or postdoctoral fellows, there are more considerations. Students and postdocs want and need to publish, go to conferences, and present their work in order to move forward with their careers; thus patents can be a rather limiting step for them.
From the industry perspective, Peter clarified that the rule at Celgene is that no one can talk about anything until the patent application is filed. Once the patent application is filed, employees are free to talk to whomever they wish without causing a situation like the one with Dana Farber and Bristol-Myers Squibb, since the patent application has been filed prior to any communication.
Thus, a clear difference between industry and academia is that in industry, things are kept under wraps and then a patent is filed, whereas in academia patents are filed early to make sure that the institution does not lose the rights of patenting by making the information public. Because universities file very early, there is a lot to deal with afterwards. The costs of prosecution are high, and sometimes the application does not make it through the full process, because universities cannot afford to throw $500K for an application if they are not confident on getting a return on the investment. The reason to file for some universities might be purely strategic.
Ownership vs. Inventorship
Another interesting topic discussed, was that of ownership vs. inventorship. There is the notion that ownership follows inventorship. In most cases, people do not file patents on their own; they work for companies or universities. Usually, an employment contract will state that if an employee invents something while employed by that entity, then ownership to a resultant patent will be assigned to the employer. Thus, the person is the inventor but not the owner of the patent; the entity is the owner. For academic research, the Bayh-Dole act was enacted to allow universities to own inventions that came from investigations funded by the federal government6. Dora explained that, “Government officials got together and agreed that they awarded so much money into research and good stuff came out of it, which the government would own but not file patents or do anything with it commercially."
A preliminary list of inventors is written when the patent is filed, but legally the inventors are the people that can point to a claim and say: "I thought of that one." Inventors have to swear under oath that they thought of a particular claim, and need to be able to present their notebooks with the data supporting a claim of inventorship. Inventors are undivided part-owners of the patent, which means that any inventor listed in the patent can license that patent in any way, without accounting for any of the other inventors. Additionally, there is a difference between the people that think about the claims and the people that actually execute the subject matter of the resulting claim. If a person is only executing experiments without contributing intellectually to the idea or procedure, then that person is not an inventor. For those in academic research, this often differs from how paper authorship is decided – usually performing an experiment is sufficient.
The discussion prompted the researchers in the room to be on the lookout for ideas they have that can result in patents, and to be careful when discussing data and results with people outside of their own research laboratory. Also, the discussion exposed key differences between intellectual property lawyers working for universities and industries, as opposed to law firms that have departments working on intellectual property. Ultimately, students felt they gained a basic understanding on how intellectual property works, the rules to file patents, and some intrinsic differences between academic and industry research.
1) United States Patent and Trademark Office – (n.d.) Retrieved December 11, 2016 from https://www.uspto.gov/patents-getting-started/general-information-concerning-patents
2) BITLAW – (n.d.) Retrieved December 11, 2016 from http://www.bitlaw.com/patent/requirements.html
3) United States Patent and Trademark Office – (n.d.) Retrieved December 20, 2016 from https://www.uspto.gov/web/offices/pac/mpep/s2550.html
4) Bloomberg BNA – (2015, October 2) Retrieved December 11, 2016 FROM https://www.bna.com/dana-farber-says-n57982059025/
5) United States District Court (District Court of Massachusetts). http://www.dana-farber.org/uploadedFiles/Library/newsroom/news-releases/2015/dana-farber-inventorship-complaint.pdf
6) National Institute of Health, Office of Extramural Research – (2013, July 1) Retrieved December 11, 2016 from https://grants.nih.gov/grants/bayh-dole.htm