Making drugs available at affordable prices: how universities' technology transfer offices can help developing countries

Legal context: In recent years, the prices at which medicines are soldin, and to, developing countries has become a hot politicalsubject affecting the international pharmaceutical industry.Specific legislative measures have followed the political debate,including (1) the EU Regulation 816/2006 on ‘compulsorylicensing of patents relating to the manufacture of pharmaceuticalproducts for export to countries with public health problems’and (2) the The Doha Declaration adopted by the Fourth MinisterialConference of the World Trade Organisation (WTO) in 2001, andthe subsequent Decisions by the WTO General Council to implementthe Declaration in August 2003 and to amend the TRIPs (Trade-RelatedAspects of Intellectual Property Rights) Agreement in December2005. Universities are increasingly considering whether to includeterms in their licence agreements with pharmaceutical companiesthat address this issue. Key points and practical significance: Universities may wish to consider whether it is part of theirmission to negotiate special terms in licence agreements tobenefit the developing world. Where universities decide that,in principle, they wish to include ‘humanitarian-licensing’clauses in their licence agreements, they need to find a formof words that is likely to achieve their objectives and be acceptableto pharmaceutical industry licensees. This article considerssome of the options and suggests some specimen wording.     

Markem v Zipher--the Court of Appeal provides guidance on entitlement proceedings

Legal and practical context. The Markem v Zipher Court of Appealjudgment provides useful guidance on patent entitlement proceedingsand, more generally, on the conduct of litigation. Key points. (i) Patent entitlement. To bring an entitlementaction under sections 8, 12, and 37 a party must invoke a breachof some rule of law. Validity is only relevant in entitlementproceedings where a patent or part of it is clearly and unarguablyinvalid. A claim-by-claim approach is not appropriate in proceedingsunder sections 8, 12, and 37 and ‘invention’ inthese sections refers to information in the specification. Theproper approach to entitlement should be to identify who contributedto the invention and determine whether he has any rights tothe invention. (ii) Litigation generally. A witness should be cross-examinedas to the truthfulness of his evidence whenever a party wishesto challenge that evidence. Where a party has more than onecause of action relating to the same factual background, considerationshould be given to bringing all causes of action in the sameproceedings to avoid a future claim being struck out for abuseof process. Practical significance. This case highlights the importanceof a properly pleaded case and of the ongoing need to reviewthe case strategy throughout proceedings.     

Claim construction and the extent of patent protection: A comparative analysis of the Phillips en banc Federal Circuit decision

Legal context. The United Kingdom's House of Loads in Kirin-Amgenand the United States Court of Appeals for the Federal Circuitin Phillips addressed similar issues with respect to the methodologyof claim interpretation and the fundamental rules and policiesfor determining the extent of patent protection. This articlewill review Phillips and Kirin-Amgen from the comparative lawperspective. It will compare the UK and US rules and patentpolicies with their German and Japanese counterparts, discussingthe bases for these differences and examining them from theperspective of patent policies, specifically with respect tofair protection and legal certainty. Key points. Despite the use of the same rule and methodology,legal commentators and patent professionals emphasize the differencesin the extent of patent protection in different jurisdictions.Such differences result from the availability of the doctrineof equivalents. For jurisdictions such as the UK, the US andJapan, where courts seldom apply the doctrine of equivalents,the differences result from the way in which the courts conductclaim construction. These courts use the perspective of a hypotheticalperson to support a broad or narrow claim construction, reflectingthe weight given to the competing patent policies. Practical significance. This article cites key cases for claimconstruction and the doctrine of equivalents in four major patentjurisdictions: the UK, the US, Germany and Japan. Knowledgeof the case law trends in these jurisdictions is essential fordrafting patents documents and enforcing patents.     

Securing Compliance Through the WTO Dispute Settlement System: Implementation of DSB Recommendations

The World Trade Organization (WTO) dispute settlement systemhas been making substantial contributions to improved compliancewith the WTO Agreements. Of particular note are the elaboratemultistage mechanisms installed in the system that facilitateand ensure the implementation of the DSB recommendations. However,these multistage mechanisms are not devoid of problems and shortcomings.Several improvements are proposed by Members and scholars buta number of disagreements exist, reflecting varied understandingof the nature of the dispute settlement system. Against thisbackground, this article first analyses the nature of the disputesettlement system. It argues that the primary purpose of thedispute settlement system is not to secure compliance in abstractobut to settle a dispute and remedy injury, and its compliancefunction is exerted only in the course of dispute settlement.Thereafter, in the light of the nature of the dispute settlementsystem, this article presents a comprehensive analysis of themanner in which the multistage mechanisms currently functionand how they should function.     

A step back in time: nineteenth century US patent law revisited

‘A book may be good for nothing; or there may be onlyone thing in it worth knowing; are we to read it all through?’(Samuel Johnson) This section is dedicated to the review ofideas, articles, books, films and other media. It will includereplies (and rejoinders) to articles, the evaluation of newideas or proposals, and reviews of books and articles both directlyand indirectly related to intellectual property law.

A Treatise on the Law of Patents for Useful Inventions, FourthEdition By George T. Curtis 1873; Boston: Little Brown Books.Reprinted 2006; Clerk, New Jersey: Lawbook Exchange. Price:US$150, ISBN: 1584775807, pages xxxvii + 749   In the United Kingdom, the great patent treatise of the twentiethcentury     

Patent construction after Amgen: are patent claims construed more widely or narrowly than previously?

Legal context. This article considers the UK Courts' approachto patent construction since the House of Lords' decision inKirin-Amgen Inc v Hoechst Marion Roussel Limited, which washanded down in October 2004, and seeks to examine whether theUK Courts' construction of patents is wider or narrower thanpreviously. Key points. The available data appear to suggest that thereis little difference in outcome, whether the old Improver testis applied or the new Kirin-Amgen test; of more significanceremains the nature of the wording of the patent claims themselvesand the correct identification by the trial judge of the inventionunderlying the patent. Practical significance. By eschewing a literal approach andrefining the test used in order to ensure both compliance withthe EPC and consistency with courts in other European countries,the UK Courts continue to provide an attractive forum for resolutionof patent disputes.     

Canadian court upholds arbitration clause in patent licence dispute

A Canadian court has held that a dispute relating to warrantiesin a patent licence agreement regarding inventorship and ownershipof the invention should be resolved by arbitration, pursuantto the arbitration clause in the agreement.     

Wilfulness redefined: In re Seagate

In In re Seagate Tech. LLC, the US Court of Appeals for theFederal Circuit redefined wilfulness relating to patent infringement,altered how wilfulness will be litigated, and as a result, manycompanies may reconsider their defensive opinion policies.     

Competition Law and IP Licensing: a refreshing analysis of the modern approach

Technology Transfer and the New EU Competition Rules is a refreshing,invigorating ‘from first principles’ explanationof how IP licensing agreements should be analysed for compliancewith the new EU competition law regime. The modernized competitionlaw regime is only ‘new’ in the sense that it hasbeen in existence for less than three years, but the authorscan be forgiven this slightly liberal use of the word, giventhat their aim throughout the book is very obviously to shakeintellectual property and competition lawyers out of the oldcomfortable, rigid, formulaic approach to IP, and into a worldwhere a much more fluid and arguably sophisticated approachis required.     

FRANDly fire: are industry standards doing more harm than good?

Legal context: The role of IP rights in standards; the meaning of the obligationimposed by many standards bodies on essential patent holdersto licence on fair, reasonable, and non-discriminatory (‘FRAND’)terms; the example of IPR policy of the European TelecommunicationsStandards Institute; recent US developments. Key points: Industry standards are of key commercial and technical significance.Yet many standards are currently burdened by litigation betweenessential patent holders and licensees. Such standards bodieshave been slow to give guidance on the meaning of the obligationsimposed on essential patent holders. This article takes theexample of the obligation to licence essential patents on FRANDterms, analysing the obligation in the context of European competitionlaw. The article concludes with some suggestions for pointsfor companies to include in their internal policies on licensingstandards essential patents. Practical significance: The meaning of the obligation to licence on FRAND terms is veryimportant for licensors and licensees alike. This article putsthe obligation in context and discusses the various approacheswhich may be taken in practice.     

Profit Neutrality in Licensing: The Boundary Between Antitrust Law and Patent Law

We address the patent/antitrust conflict in licensing and developthree guiding principles for deciding acceptable terms of license.Profit neutrality holds that patent rewards should not dependon the rightholder’s ability to work the patent himself.Derived reward holds that the patentholder’s profits shouldbe earned, if at all, from the social value created by the invention.Minimalism holds that licenses should not be more restrictivethan necessary to achieve neutrality. We argue that these principlesare economically sound and rationalize some key decisions ofthe twentieth century such as General Electric and Line Material.     

House of Lords simplifies the law on patent entitlement

The House of Lords has held that, to claim entitlement to another'spatent or patent application, a person need only prove thathe was the inventor of the subject-matter of the patent, anddoes not also need to invoke ‘some other rule of law’as required previously by the Court of Appeal in Markem v Zipher[2005] RPC 31.     

Injunctive relief in US patent practice

Legal context. Injunctive relief is available in civil actionsin the United States. Patent litigation is no exception andthe US patent statute explicitly permits it. Because it is aneffective remedy, injunctive relief is commonly sought togetherwith the monetary (legal) remedies which are available to patentowners when enforcing patent rights. Key points. On 15 May 2006 the US Supreme Court in eBay, Incet al v MercExchange, LLC altered the prevailing practice sayingthat ‘the decision whether to grant or deny injunctiverelief rests within the equitable discretion of the districtcourts, and that such discretion must be exercised consistentwith traditional principles of equity, in patent disputes noless than in other cases governed by such standards’. Practical significance. This article will focus on the availabilityof permanent injunctions in patent infringement actions in lightof the Supreme Court's recent ruling in eBay, Inc et al v MercExchange,LLC.     

Mal dato, ma ben ricevuto

Mal dato, ma ben ricevuto is a rather untranslatable Italianexpression which refers to acts that are based on wrong assumptionsbut whose final results (might) make everybody better off. MsSueffert's article is a good example. In her article, Ms Sueffertsuggests that the USPTO might reduce patent examiners' workloads—andthe resulting tendency towards granting patents that shouldnot be granted in the first place—by using ‘softscientists’ (psychologists, economists, political scientists,     

Irish 'Lipitor' litigation: High Court favours broad claim construction

In its first significant judgment on claim construction in over25 years, Ireland's High Court approved the principles laiddown by the English House of Lords in Kirin-Amgen, holding thatWarner-Lambert's ‘Lipitor’ patent is not limitedto a racemic mixture and refusing Ranbaxy a declaration of non-infringement.     

PATENT HOLDUP AND OLIGOPSONISTIC COLLUSION IN STANDARD-SETTING ORGANIZATIONS

Current controversies over patent policy place standard-settingorganizations (SSOs) on a collision course with antitrust law.Recent theoretical research conjectures that, in an SSO, patentowners can "hold up" patent users in the sense of demandinghigh royalties for a patented input after the SSO has adoptedthe patented technology as an industry standard and manufacturerswithin the SSO have incurred sunk costs to design end productsthat incorporate that standard. Consistent with this conjecture,actual SSOs have recently sought no-action letters from theAntitrust Division for a variety of amendments to SSO rulesthat would require or request, at the time a standard is underconsideration, the ex ante disclosure by the patent owner ofthe maximum royalty that the patent owner would charge underthe regime of fair, reasonable, and nondiscriminatory licensing.This price information—which is characterized as the "cost"of the patented input—would, under at least one recentSSO rule modification, be a permissible topic for potentialusers of the patent to discuss when deciding whether to selectit in lieu of some alternative standard. This exchange of informationamong horizontal competitors would occur ostensibly becausethe cost of the patented technology had been characterized assimply one more technical attribute of the standard to be set,albeit an important technical attribute. The Antitrust Divisionand the Federal Trade Commission have jointly stated that suchdiscussion, by prospective buyers who are competitors in thedownstream market, of the price of a patented invention thatmight become part of an industry standard should be subjectto antitrust scrutiny under the rule of reason rather than therule of per se illegality. The rationale that the antitrustagencies offer for applying the rule of reason to such conductis that such horizontal collaboration might avert patent holdup.The Antitrust Modernization Commission (AMC) similarly endorsedthe view that rule-of-reason analysis is appropriate for exante discussion of royalty terms by competing buyers of patentedtechnology. This rule-of-reason approach, however, is problematicbecause it conflicts with both the body of economic researchon bidder collusion and with the antitrust jurisprudence oninformation exchange and facilitation of collusion. Put differently,because of their concern over the possibility of patent holdup,the U.S. antitrust agencies and the AMC in effect have indicatedthat they may be willing in at least some circumstances to forgoenforcement actions against practices that facilitate oligopsonisticcollusion by encouraging the ex ante exchange of informationamong competitors concerning the price to be paid for a patentedinput as an implicit condition of those competitors' endorsementof that particular patented technology for adoption in the industrystandard. However, neither the proponents of these SSO policiesnor the antitrust agencies and the AMC have offered any theoreticalor empirical foundation for their implicit assumption that theexpected social cost of patent holdup exceeds the expected socialcost of oligopsonistic collusion. This conclusion does not changeeven if one conjectures that such collusion will benefit consumersby enabling licensees to pass through royalty reductions intheir pricing of the downstream product incorporating the patentedtechnology. Proper economic evaluation of the plausibility ofthe pass-through conjecture will require information about thecalculation of royalty payments; the demand and supply elasticitiesfacing the licensees; and the structure of any industries furtherdownstream between the manufacturer and the final consumer.Consequently, the magnitude of this effect will likely be amatter of empirical dispute in every case. Moreover, such ajustification for tolerating horizontal price fixing finds nosupport in antitrust jurisprudence. Given the analytical andfactual uncertainty over whether patent holdup is a seriousproblem, it is foreseeable that antitrust questions of firstimpression will arise and affect a wide range of high-technologyindustries that rely on SSOs. However, there is no indicationthat scholars and policy makers have seriously considered whetheroligopsonistic collusion in SSOs is a larger problem than patentholdup.     

A primer on US antitrust claims against patentees under Walker Process

Legal context: In the wake of two recent cases from the Federal Circuit onthe subject, this article provides an introduction to the WalkerProcess doctrine under US law. Under the doctrine, a patenteewho knowingly enforces a patent procured by intentional fraudon the patent office may lose its immunity to antitrust claims,should it act to enforce its patent. Key points: Walker Process fraud refers to a knowing and deliberate fraudperpetrated on the patent office as opposed to mere acts ofinequitable conduct. Proving that a patent applicant engagedin Walker Process fraud does not by itself prove liability foran antitrust violation. The accused infringer must still provethe individual elements of an antitrust claim. Antitrust claimsbased on Walker Process fraud require significant time and resourcesto litigate. Practical significance: With the allure of mandatory treble damages and attorney's fees,antitrust claims based on Walker Process fraud can serve asa potent counterclaim for an accused infringer's arsenal. Butthe legal requirements and resources needed to successfullylitigate these claims to a conclusion may temper their effectivenessfor the typical patent-infringement suit.     

Compulsory licensing and interim measures in Merck: a case for Italy or for antitrust law?

Legal context: This paper examines an important decision of the Italian CompetitionAuthority in a case concerning the compulsory licence of IPrights. The oddity of the case lies in the fact that the dominantposition of the defendant seemed to be due, rather than to thefact that the latter held certain IP rights, to a peculiar defacto situation. Key points: As a result, the competition authority did not apply the testthat is traditionally used in cases of abuses involving IP rights,but the plain ‘essential facilities’ doctrine. Practical significance: The case shows that the borderline between these two types ofabuses is a difficult one to draw, and more generally that thecomplex relationship between competition law and IP is in needof clarification. The paper also deals with the issue, raisedby the same case, of whether, in the absence of national provisionto this effect, national competition authorities have any powerto issue interim measures.