Articles
An Intellectual Property Primer - Patents
December 1, 2004
Patent law can protect any "new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof." A patent covers specific features of a product or steps of a process, as defined in the patent's claims, and the patent can be enforced to prevent competitors from offering those features or performing those steps. A U.S. patent owner has the right to "exclude others" from making, using, selling, or offering to sell the patented invention in the United States, or from importing the patented invention into the United States. The trade-off for receiving this exclusive bundle of patent rights is that you have to fully disclose your invention in a patent application. Patents are protected solely by federal law. With Internet-based businesses, where a product or service is unique, patent coverage may be particularly important. If your method of doing business is unique, you also may be eligible to obtain a patent on the particular business method, thereby making it impractical for others to copy your business concept. In order to obtain a patent an invention must be (i) new, (ii) non-obvious, and (iii) useful. Utility patent protection lasts for 20 years from the date your application is filed with the Patent and Trademark Office (or the earliest priority date claimed if the application is based on an earlier filed application). Design patents are a special category of patents that protect the new, non-obvious, and the ornamental design of a product and provide protection for a period of 14 years from the date the patent is issued.
With respect to patents on pharmaceutical products, modifications to the patent laws have been made to balance the competing interests of pharmaceutical companies. The three phases of required clinical trials can take anywhere from four to ten years to complete. When the clinical trial phases are complete, a pharmaceutical company can then file a New Drug Application ("NDA"), which can take anywhere from an additional two to seven years for review and approval. As you can imagine, these processes can severely erode the duration of patent protection for a new or "pioneer" drug (recall that a patent is valid for 20 years after your filing date), so the pharmaceutical companies wanted longer patent terms for their pioneer drugs. On the other side are the companies that want to develop and market generic versions of those pioneer drugs. Ordinarily, in order to avoid infringement, the company wanting to develop the generic version would have to wait until the patent expired on the pioneer drug and then begin its own process of clinical trials and FDA approval. To balance the interests of the pharmaceutical companies, Congress passed the Hatch-Waxman Act in 1984. Under Hatch-Waxman, the term of a patent for a pioneer drug may be extended for up to five years to make up the time lost during the clinical trial process and FDA approval of the NDA. In exchange, manufacturers of generic drugs can (i) make use of a patented drug while the patent is still in force for the purpose s of gathering the data necessary to obtain FDA approval, and (ii) take advantage of a streamlined review process for generic versions by filing an Abbreviated New Drug Application ("ANDA").
