Law360 (May 20, 2020, 8:21 PM EDT) -- A new U.S. Patent and Trademark Office program will prioritize the examination of COVID-19-related patent applications from small businesses, and while it could result in patents issuing very quickly, applicants need to make sure the program makes sense for their invention. Here are the top things to consider.
The Program Has a Narrow Scope
The program will fast-track certain patent applications related to the pandemic, without payment of the additional fees accelerated examination usually requires. The office said it aims to provide a final disposition on an application less than a year after it is granted prioritized status, and in as soon as six months if applicants respond to examiners quickly.
The prospect of being able to secure patent protection so quickly will be enticing to many applicants, particularly given the fast-moving nature of the pandemic. But the program has significant limits: It is only open to small companies, will initially be limited to 500 applications, and is available only for specific types of inventions.
The program could provide cost savings and the prospect of securing a patent quickly. But Jeff Wolfson of Haynes and Boone LLP said, "I'm not sure it will help that many people because of the limits on the numbers and the fairly precise requirements involved."
The program covers only products or processes that are subject to U.S. Food and Drug Administration approval for COVID-19-related uses. So while it will likely cover most vaccines, therapeutics and diagnostic tests related to the disease, other inventions that might be useful in fighting the pandemic would be left out. And there may be some gray areas in what qualifies, such as personal protective equipment intended for medical professionals that requires regulatory approval.
Crucially, the prioritized examination program is available only for applicants the agency defines as small entities, which include universities and small businesses with no more than 500 employees, or micro entities, which must meet additional criteria.
As a result, the numerous large pharmaceutical companies pursuing coronavirus treatments can't take advantage of it, which attorneys said appears to be the USPTO's bid to provide help to companies that most need it.
"I think they're balancing interests, so on the one hand, they want to help promote innovation in this area. But on the other hand, they are a user-fee-funded agency, so they probably made the calculation that if big companies have promising coronavirus inventions that they want granted quickly, they can pay the fee" for expedited review, said Courtenay Brinckerhoff of Foley & Lardner LLP.
Some applicants have already started taking advantage of the program, which was announced on May 8. According to the USPTO, 10 applications had been filed as of May 15, although none have yet been granted prioritized status.
Fast Patents Can Help Spur Investment
For a small company working on a COVID-19 vaccine, therapy or test, obtaining a patent quickly can be a lifeline that could provide a significant boost to developing the invention or bringing it to market, in ways that could be more impactful than for an established pharmaceutical company.
"Why this is attractive is that if you do have a promising approach that you really believe and you are able to get an early indication of patentability, that could help the small entities attract investors to help take the invention or the technology to the next stage," Brinckerhoff said.
Whether a smaller company is seeking investment, trying to be acquired by a larger company or aiming to generate revenue by licensing its technology, holding a patent will aid in those goals, according to Kristin Connarn of Hogan Lovells.
"One of the main benefits of having a patent granted so quickly, especially if you are a small or micro entity, is that you're then in a much better business position," she said.
Holding a patent can help small companies raise capital, which they can use to further ramp up drug development and clinical trials and manufacturing, which may be crucial during a global health crisis, Wolfson said.
"That's a key part of the process because some people won't invest in a medical treatment unless there's a way of creating a moat around it and protecting it from competition," he said.
By quickly securing a patent during the pandemic, "these companies might be able to raise capital faster, to help come up with a cure faster and distribute that faster," he added.
Speedy Examination May Mean Closer Scrutiny
Those considering submitting a COVID-19-related patent under the program should make sure that their research is sufficiently advanced and the application is narrowly tailored to meet the requirements for patentability, which may be challenging for a disease that has been known for only a few months.
"We have to keep in mind that when a party takes advantage of this, they need to go in with an understanding of precisely what it is that they want to patent," said Scott Marty of Ballard Spahr LLP.
Many inventions related to COVID-19 may be in early stages of development and not ready for FDA approval, he noted. A wide-ranging patent application on a diagnostic test for antibodies related to the disease, for instance, "is probably not a claim that is going to have a whole lot of success, because it's just overly broad."
"We typically advise to say, let's figure out what's working before we figure out what to protect ultimately," Marty said.
For patent applications related to a recently discovered disease like COVID-19, Connarn said, "the hurdle is showing that this actually works, or that this is specific to this type of infection." Doing that will require experimental data and research that might not yet be advanced enough to support a patent application, she said.
"With the shortened timeline, it's hard to do," she said. "You want to make sure before jumping in and filing that you have enough data to support your claims."
For something like a vaccine, if the applicant is not yet exactly sure what the product will look like or what the active components will be, the program may not be a good fit, Brinckerhoff said.
"You might not want to request expedited examination because usually the examiners are going to be looking for pretty specific claims when they're asked to examine and allow a case quickly," she said.
Some companies may consider filing two patent applications, she said: one on their most promising approach and another that is broader and covers other options, in case their research ends up leading them in a different direction.
The Quick Response May Be "No"
Placing a patent application on an expedited examination track means there will be a speedy response from the USPTO, but it may not be the one the applicant is looking for.
"The patent office promises a quick resolution, but the resolution might not be favorable," Brinckerhoff said. "Sometimes you can get a decision of unpatentability quicker, and then you'll have to maybe reassess where you're going with the technology."
If an examiner has questions about whether the invention works or how it differs from existing technology, "quick examination might not work in your favor, especially if you might want or need to obtain more experimental data to support your invention," she said.
The science surrounding COVID-19 is moving quickly, with companies closely monitoring the work being done, so a denial from the USPTO could put the applicant at a disadvantage, Marty said.
"A negative report could absolutely do damage to a portfolio and might identify holes in the intellectual property that you might not want someone to find out," he said.
The patent community will be curious to see how the program operates in practice and what types of patents the office issues or rejects. However, since the program moves so quickly, with decisions coming before the 18-month mark at which patent applications are usually made public, the first information about it will likely come when patents are issued.
"We're all interested in seeing what this program will do, but we won't have visibility into it for a while," Brinckerhoff said.
--Editing by Breda Lund and Jill Coffey.
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