Pharma Industry Relieved as USPTO Decides to Withdraw Controversial Patent Laws

Tafas Versus Kappos Case to Be Dropped

The U.S. Patents and Trademarks Office (USPTO) has announced that it has withdrawn its intention to implement four controversial patent laws, which sought to place a limit on the number of patent applications filed by firms, reports PharmaTimes.com. This was particularly applicable to follow-on patent claims filed by pharma firms.

According to the David Kappos, the new director of the USPTO, his reasons for dropping the indicated regulations, labelled "Final Regulations", included the following:

• The regulations have been unpopular from the beginning and were not received well by the applicants.
• The USPTO should incentivise innovation and develop rules that are responsive to applicants' needs to bring their products to market.
• The announcement is in line with the USPTO's ambitions to engage with the applicant community more effectively and make the organisation more efficient, responsive, and transparent to the public.

Kappos' announcement will see the USPTO and pharma firm GlaxoSmithKline (GSK; U.K.), which had opposed the rules, file a joint motion to dismiss ongoing litigation on the matter. The next hearing on the case, known as "Tafas versus Kappos" (previously "Tafas versus Dudas"), which was an en banc rehearing at the U.S. Court of Appeals for the Federal Circuit, was due shortly, although no date had been fixed. This will now not take place.

Outlook and Implications

The news has been cheered by the American Intellectual Property Law Association (AIPLA), Pharmaceutical Research and Manufacturers of America (PhRMA), and the Biotechnology Industry Organization (BIO) that supported GSK's lawsuit against the USPTO. The withdrawal of the Final Regulations will mean that the possible threat to the pharma industry's practise of ever-greening patents has been lifted, at least in the short term. However, the lack of a court verdict on the matter could mean that the issue could resurface, particularly since it is in line with other U.S. policies of reducing delays in generic entry.

The change in heart has been triggered by the change in management at the USPTO, with Kappos taking over after President Barack Obama came to power. The regulations in question were drawn up under the previous President Bush Administration in 2007, which would have permitted applicants to file only two continuation applications and one "Request for Continued Examination" (RCE) per application family, and only five independent claims and 25 total claims per application.

However, the withdrawal of the regulations means that the USPTO will have to find an alternative to reducing the current backlog in processing patents and trademarks and improve efficiency. The government body's timescales for reviewing applications has steadily increased since the 1990s, with the regulator's backlog reaching an average of 32 months, with a total of 1.2 million pending applications by the end of 2008. While this not only delays product entry into the market, it also threatens the intellectual property rights of the patent-pending product. The USPTO has a practice of publishing details of patent applications 18 months after filing for public viewing, with significant delays in filing and granting of patent, and the backlogs increase the threat of similar products entering the market.