Blog Big Molecule Watch July 12, 2022

USPTO Outlines New Initiatives Regarding Drug Pricing

On July 6, 2022, Katherine Vidal, the Undersecretary of Commerce for Intellectual Property and Director of the USPTO, published her response to the letter sent by Janet Woodcock (former acting FDA Commissioner) to the former Director of the USPTO, Andrew Hirshfield. Concurrently, Director Vidal and Commissioner Califf published a blog post summarizing the steps the Biden Administration is taking to promote competition and lower drug prices. We previously posted on the original Woodcock letter.

As a reminder, the letter from Commissioner Woodcock was sent to Director Hirshfield pursuant to Executive Order 14036 (Executive Order on Promoting Competition in the American Economy | The White House), which focused on promoting competition in the American economy, including with respect to pharmaceuticals. With respect to drug pricing, the Executive Order states that the “Secretary of Health and Human Services shall: … (vi) to help ensure that the patent system, while incentivizing innovation, does not also unjustifiably delay generic drug and biosimilar competition beyond that reasonably contemplated by applicable law, not later than 45 days after the date of this order, through the Commissioner of Food and Drugs, write a letter to the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office enumerating and describing any relevant concerns of the FDA.”

Director Vidal’s letter of July 6, 2022 summarizes several initiatives designed, in collaboration with the FDA, to “get[] generic, biosimilars and more affordable versions of [] drugs into the hands of Americans.” The letter outlines five initiatives to strengthen the patent system including: (1) enhancing collaboration between the government agencies such as between the USPTO and the FDA; (2) improving procedures at the USPTO to ensure that it “issues robust and reliable patents”; (3) improving the process for challenging issued patents; (4) improving public participation; and (5) evaluating new proposals that incentivize drug development.

To enhance collaboration between the USPTO and the FDA, the letter notes that the USPTO will, among other tasks, (a) provide patent examiners with training on publicly available FDA resources that can be used for prior art searches; (b) identify ways to ensure consistency in representations made to the USPTO and the FDA, for example by requiring applicants to submit to the USPTO any information submitted to other agencies; and (c) develop procedures for notifying the FDA of AIA proceedings regarding Orange Book and Purple Book-listed patents.

To ensure that the USPTO “issues robust and reliable patents,” it plans to (a) increase the time examiners may use to examine patent applications, especially where there are large numbers of related co-pending applications; (b) ensure that examiners know of relevant prior art and statements from PTAB proceedings that may impact examination of patent applications before them; (c) improve access to references identified in Information Disclosure Statements; (d) increase involvement of Quality Assurance specialists in continuation applications and in reviewing declaratory evidence provided by Applicants; (e) revisit whether it is good public policy to allow the use of terminal disclaimers to overcome obviousness-type double patenting rejections; and (f) consider ways to increase the use of third-party submissions in patent examination proceedings.

Further, to improve the process for challenging issued patents, the letter proposes several changes to PTAB proceedings. These include the following: (a) applying additional scrutiny of continuation applications and applications where declarations are used to support patentability; (b) allowing third party input in PTAB proceedings; and (c) weighing “the utility and integrity of the patent system …when deciding whether to institute AIA petitions.”

As described in the blog post, the purpose of these initiatives are to incentivize and protect the work required to bring life-changing medicines to the public. According to Director Vidal, “these initiatives will . . . expand the resources available for assessing patentability and addressing instances of patents being used improperly to delay competition.” Furthermore, “[t]hrough these initiatives, the USPTO will protect against the patenting of incremental, obvious changes to existing drugs that do not qualify for patents,” which “can lead to lower drug prices because drug companies will not be able to unjustifiably delay generic competition based on trivial changes to a drug product.”

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