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P At E N t S

Biotech innovation in a first-to-file world


Jennifer A Camacho
You may win the race, but can you take home the prize?
he Leahy-Smith America Invents Act (AIA), signed into law on September 16, 2011, represents the first major legislative overhaul to the United States patent laws in 60 years1. The implementation of the AIA is already under way, but it will not be completed until March 16, 2013, when the final provisions come into effect. Although the AIA brings many significant changes to US patent law, perhaps the most significant will be the conversion from a first-to-invent system to a first-to-file system, which will harmonize the US patent system in this regard with that of nearly every other country in the world. The immediate implication of a first-to-file system is that it places each inventor in a race to be the first to file a patent application claiming the invention. This will be true across all industries, but the shift comes at a challenging time for the biotechnology industry, as recent court decisions have elucidated the inherent risk in biotech innovation of filing too early and realizing it too late. In an industry in which innovation is just as likely to develop overnight as it is over a decade, the tension between a first-to-file system and the necessity to fully develop an invention to ensure that all other legal patent requirements are met may make it even harder for the inventor who wins the race to take home the patent. Understanding prior art and the first-to-file provisions under the AIA Under the present system, only the first inventor of an invention may be granted a patent claiming it. That will change on March 16, 2013, when the first-to-file provisions of the AIA come into effect. All patent applications having an effective filing date on or after March 16, 2013, will be subject to the new first-to-file provisions. Under the AIA, the first-to-file system will be
Jennifer A. Camacho is at Greenberg Traurig LLP, Boston, Massachusetts, USA. e-mail: camachoj@gtlaw.com

implemented through key revisions to the criteria defining prior art for the purpose of determining the patentability of a claimed invention. What will remain largely unchanged, however, will be all the other legal requirements that must be met before a patent will be granted on any invention. To be sure, a claimed invention will still be required to meet the core patentability requirements under US patent law: novelty and non-obviousness over the prior art2. But on March 16, 2013, the statutory requirements defining prior art will change, and with them, the US will convert to a first-to-file system. Under the present system, the date of invention has a crucial role in defining what is and what is notprior art for the purposes of determining novelty and non-obviousness of the claimed invention. In some situations, an inventor may disqualify prior art by showing an earlier date of invention. Further, if two separate inventors each file a patent application claiming the same invention on the same date, only the inventor who proves that he was the first to invent the claimed invention is entitled

to a patent. Once the AIAs first-to-file provisions are in effect, the crucial date for defining prior art will shift to the patent applications effective filing date3. Under the new provisions, an inventor may no longer use a prior date of invention to disqualify another inventors claim of prior art or to bypass an inventor with an earlier filing date. As a result of the AIAs revisions to the criteria for prior art, nearly all patent applications filed under the first-to-file system will be subject to an expanded definition of potentially novelty-destroying prior art. However, the AIA also provides for some new exceptions. One key exception concerns public disclosures by either the inventor or someone who obtained the information from the inventor. Such disclosures will not be prior art as long as they were made within one year of the filing date of the patent applicationin essence, this exception provides a one-year grace period for the inventors own disclosures. It is important to note that this grace period applies to patent rights in the United States only. Such public disclosures may foreclose patent rights in other countries. Another exception concerns disclosures made in patents and in published patent applications. Such disclosures will not be prior art if the disclosed subject matter was obtained, either directly or indirectly, from the inventor. In addition, such disclosures will not be prior art if the inventor publicly disclosed the claimed invention before the effective filing date of the patent or patent application containing such disclosure. That means that a patent may be granted to an inventor who is the first to publicly disclose an invention but the second to file a patent application claiming it, provided that the inventor files his patent application within one year of his public disclosure. One final exception provides that a disclosure made in a patent or patent application will not be prior art to a claimed invention if
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the disclosed subject matter and the claimed invention are commonly owned. Under certain circumstances, the common-ownership exception will apply to disclosures of all parties to a written joint-research agreement if the claimed invention was made by one or more parties as a result of activities within the express scope of the agreement. The impact of a first-to-file system on biotech innovation and patenting Like many industries, the biotech industry relies on patent rights to protect key inventions. Strategic patent rights, or the likelihood of securing them, have become crucial value drivers for the spectrum of biotech firms, from start-ups to large pharmaceutical companies. This is evident in the way venture capital funding in an early-stage biotech company fluctuates with the assessment of the companys patent portfolio and prospects for future innovation, and in the reluctance of innovator pharmaceutical companies to engage in a resource-intensive drug development program without strong prospects for patent exclusivity. To continue to secure valuable patent rights, biotech innovators must respond to the new system by filing patent applications on key inventions more quickly than ever before. How will this affect innovation and patenting in the biotech industry? The answer lies not in the race to be the first to file a patent application, but in the added challenges that the biotech industry will face in ensuring that all other legal requirements are satisfied before that patent application is filed. Identifying patent-eligible subject matter. A threshold requirement under statute 35 USC 101 of the US patent law is that a claimed invention must be drawn to patent-eligible subject matter. To be patent-eligible, the claimed invention must be a new and useful process, machine, manufacture or composition of matter or a new and useful improvement to one of the foregoing. In Diamond v. Chakrabarty4, the US Supreme Court identified three exceptions to the broad categories of patent-eligible subject matter provided in 35 USC 101. Those exceptionslaws of nature, physical phenomena and abstract ideaseffectively preclude the patenting of phenomena of nature, products of nature and mental processes5. The scope of certain exceptions to patenteligible subject matter has been addressed in the context of biotech inventions in two recent court decisions. In Mayo Collaborative Services et al. v. Prometheus Laboratories, Inc.6, the claimed invention covered methods for determining patient-specific dosing for a drug to treat autoimmune diseases. The invention was
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based on the discovery of a correlation between the safety and efficacy of a specific dosage and level of metabolites measured in a patients blood. The Supreme Court held that the patent claims were drawn to patent-ineligible laws of nature and that the claimed invention did not add enough to transform it into patent-eligible processes that apply natural laws. In The Association of Molecular Pathology et al. v. United States Patent and Trademark Office et al. 7 (Myriad), the US Court of Appeals for the Federal Circuit considered the patent eligibility of isolated DNA molecules corresponding to two human breast-cancer genes: BRCA1 and BRCA2. At the center of the controversy in Myriad was the question of whether the challenged claims were directed to compositions of matter and processes that are eligible for patenting under 35 USC 101, or to products of nature, which are not eligible for patenting under 35 USC 101. Confirming the long-standing practice of the US Patent and Trademark Office, the Federal Circuit held that isolated DNA molecules are patenteligible compositions of matter. However, that decision was vacated by the Supreme Court on March 26, 2012, and the case has been sent back to the Federal Circuit for reconsideration in light of the Supreme Courts decision in Prometheus.As such, the patent eligibility of isolated genes is, at present, in question. Patent eligibility under 35 USC 101 also requires that the invention be useful. For a claimed invention to meet this requirement, it must have a specific and substantial utility that confers a significant and available benefit to the public8. In In re Dane K. Fisher et al.9, the Federal Circuit found that the claimed invention, which recited a series of expression sequence tags (ESTs) for proteins with unknown structure and function, did not meet the utility requirement. Rather, the Federal Circuit found that the ESTs were useful only for research to identify other potentially useful inventions. The court further stated a patent on the claimed ESTs would amount to a hunting license. Satisfying the written description and enablement requirements. Beyond the patent-eligibility threshold, US patent law requires that the patent specification provide a written description of the claimed invention with enough detail to demonstrate that the inventor actually invented itthat is, the description must show that the inventor is in possession of the invention10. The amount of detail required to satisfy this requirement varies depending on the nature and scope of the claims and on the complexity and predictability of the relevant technology. For biotech inventions, the amount of detail necessary

has proven somewhat hard to pin down as the industry has developed. As the Federal Circuit has explained, the written-description requirement is intended to prevent inventors from claiming future inventions11. It also ensures that a patent is granted only to those who actually perform the difficult work of inventionthat is, conceive and complete the final invention12. The written description must be more than a mere wish list or plan for obtaining the claimed invention13. Several recent court decisions address the written-description requirement in biotech inventions. In Billups-Rothenberg, Inc. v. Associated Regional and University Pathologists, Inc. et al.14, the Federal Circuit considered whether the written-description requirement was satisfied for a claimed method of identifying whether an individual is predisposed to hemochromatosis, a disease caused by specific genetic mutations. As claimed, the method relied on detection of a mutation in a gene encoding a nonclassical major histocompatibility complex class I heavy chain. The presence of such a mutation is indicative of a predisposition of the disease. The court found that the inventor had not identified the sequence for any genetic mutation useful for diagnosing hemochromatosis at the time the patent application was filed and, as such, the patent merely represent[ed] Billupss research plan. Quoting Regents of the University of California v. Eli Lilly and Company, the court concluded that an adequate description of a DNA requires more than a mere statement that it is part of the invention and reference to a potential method for isolating it; what is required is a description of the DNA itself.15 Similarly, in Centocor Ortho Biotech, Inc. and New York University v. Abbott Laboratories et al.16, the Federal Circuit found that the patent specification at issue had insufficient written description to support a patent claim to an isolated recombinant antibody to TNF-a or an antigenbinding fragment comprising a human variable region. The court noted that the patent specification did not describe a single antibody that satisfied the limitations of the claimed invention and did not disclose any relevant identifying characteristics or even a single human variable region. In Ariad Pharmaceuticals, Inc. et al. v. Eli Lilly and Company17, the Federal Circuit considered the sufficiency of the written description for a claim drawn to a method for reducing expression of cytokines by reducing the activity of the transcription factor NF-kB. The Federal Circuit held that the written description was insufficient because, in part, the patent specification did not describe a single molecule that would reduce the activ-

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ity of NF-kBthat is, the molecules required to perform the claimed methods were not described. In In re Marek Z. Kubin et al.18, the Federal Circuit considered whether the written description was sufficient to support a claim to an isolated nucleic acids molecule comprising a polynucleotide encoding a polypeptide at least 80% identical to amino acids 22221 of [the natural killer cell activation-inducing ligand (NAIL) polypeptide], wherein the polypeptide binds [the cluster of differentiation protein] CD48. The patent specification described only two nucleic acid sequences falling within the scope of the claim: the specific coding sequence and the full-length sequence of the gene encoding NAIL. The court held that the patent specification lacked a sufficient written description to claim the broad class (or genus) of isolated nucleic acids when only two examples (or species) and no variants had been disclosed. As a separate requirement, the specification must also include a description of making and using the invention, written such that someone of ordinary skill in the field could make and use the invention without undue experimentation19. Although the written-description and enablement requirements are separate and distinct, the Federal Circuit has found, Perhaps there is little difference in some fields between describing an invention and enabling one to make and use it, but that is not always true of certain inventions, including chemical and chemical-like inventions. Thus, although written description and enablement often rise and fall together, requiring a written description of the invention plays a vital role in curtailing claims that do not require undue experimentation to make and use, and thus satisfy enablement, but that have not been invented and thus cannot be described20. Staying competitive in a first-to-file world By definition, nearly all biotech innovation is rooted in biological processes, phenomena or productswhether they are naturally occurring, synthetically engineered or otherwise derived. For some biotech inventions, it may be challenging to distinctly identify a patenteligible invention until later in the innovation process, and the written-description requirement may be nearly insurmountable without additional development and confirmatory research. The further the invention gets from its biological roots, the easier those tasks may be. To avoid falling short of the threshold for patent eligibility, biotech innovators should think twice about filing a patent application immediately on the heels of a discovery unless a distinctly patent-eligible invention and its specific utility can be readily identified. Even then, the biotech innovator should consider seriously whether the claimed invention is concrete enough to be supported by a written description that can withstand scrutiny at the US Patent and Trademark Office and, should the need arise, in court. Despite the unique challenges the first-tofile system holds for the biotech industry, it will be crucial for patent protection that biotech innovators file as early as possible in the innovation processthat is, as soon as a patent-eligible invention can be supported by sufficient written description and disclosed in a manner that would enable someone skilled in the art to make and use the invention. Even in the firstto-invent system, that has proven easier said than done for the biotech industry, as the growing body of case law on biotech patents shows. However, under the first-to-file system, biotech innovators will risk more than ever before if they delay filing in favor of further developing an invention to ensure that the patent application meets the formal requirements. To mitigate this risk, biotech innovators may implement a patent strategy that calls for filing early and often with updated applications as soon as developments arise or additional information comes to light. This may be efficiently implemented by filing serial provisional applications over the one-year period after the filing date of the first provisional application. With this strategy, each provisional application typically builds on the prior applications disclosure and provides additional information to support the claimed invention. If the first filed application is deemed insufficient to support a claimed invention, the inventor may look to a subsequent, updated application for sufficient disclosure and an effective filing date for the invention. If key inventions arise in connection with an ongoing or proposed program of research and development, the biotech innovator may even consider revising the research plan to allow for the development of additional information to augment any applications that were filed early in the innovation process. Conclusion The transition to a first-to-file patent system will present unique challenges for the biotech industry. To succeed under this system, biotech companies must not lose sight of the additional legal requirements that must be met before any patent will be granted. With a well-planned patent strategy, a biotech company can both win the first-to-file race and take home the prize.
COMPETING FINANCIAL INTERESTS The author declares no competing financial interests.
1. US Public Law 112-29 [HR 1249]. 2. 35 USC 102 and 103. 3. See US Public Law 112-29 at Section 3. 4. 447 US 303 (1980). 5. See Gottschalk v. Benson, 409 US 63 (1972) 6. Case No. 10-1150, US (2012). 7. 653 F.3d 1329, (Fed. Cir. 2011). 8. In re Fisher et al., 421 F.3d 1365 (Fed. Cir. 2005). 9. 421 F.3d 1365 (Fed. Cir. 2005). 10. See, for example, Ariad Pharmaceuticals, Inc. et al. v. Eli Lilly and Company, 598 F.3d 1336 (Fed. Cir. 2010). 11. Fiers v. Revel, 984 F.2d 1164 (Fed. Cir. 1993). 12. See Billups-Rothenberg, Inc. v. Associated Regional and University Pathologists, Inc. et al., 642 F.3d 1031 (Fed. Cir. 2011), citing Ariad Pharmaceuticals, Inc. v. Eli Lilly and Company, 598 F.3d 1336 (Fed. Cir. 2010). 13. See Centocor Ortho Biotech, Inc. and New York University v. Abbott Laboratories et al., 636 F.3d 1341 (Fed. Cir. 2011). 14. 642 F.3d 1031 (Fed. Cir. 2011). 15. 119 F.3d 1559 (Fed Cir. 1997). 16. 636 F.3d 1341 (Fed. Cir. 2011). 17. 598 F.3d 1336 (Fed. Cir. 2010). 18. 561 F.3d 1351 (Fed Cir. 2009). 19. In re Wands, 858 F.2d 731 (Fed. Cir. 1988). 20. Ariad Pharmaceuticals, Inc. et al. v. Eli Lilly and Company, 598 F.3d 1336 (Fed. Cir. 2010).

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