When PTAB proceedings were first introduced, the technology industry was quick to take advantage of this new alternative to district court litigation. On the other hand, the biotechnology and pharmaceutical industries were a bit more cautious. That hesitation is now changing and AIA petitions in the bio/pharm space are on the rise. Managing Intellectual Property contacted Finnegan partner Mark J. Feldstein for his insight.
Feldstein said, "I think everyone was a little reluctant to basically lose all of your defenses by estoppel if you don’t win the IPR. I think that people have become a little less hesitant to file an IPR and make plans. But people are getting more comfortable with it now."
By the end of July 2016, the number of biotechnology and pharmaceutical petitions was up 7% from the previous fiscal year. 63% of bio/pharm petitions were instituted and survival rates were nearly three times higher than patents in the electrical/computer industry.
Regarding freedom-to-operate, Feldstein noted that it's a path that individual inventors can take advantage of to try and invalidate a patent. He said, "If you’re still in development, you don’t have a declaratory judgment basis to go and try to invalidate a patent in district court, but you can go and invalidate it in the PTAB." Feldstein also commented on how PGR proceedings have proven to be more beneficial to bio/pharm patent holders because challengers have "written description and enablement attacks in a PGR that you don’t have in an IPR." For competitor-to-competitor litigation, "usually, someone’s just got a broad, blocking patent on an entire field and a PGR is the only way to go and knock those out" before the new pharmaceutical has come to the market.
Lastly, Feldstein commented on the procedural hindrances to proving non-obviousness or indicia of commercial success in an IPR. He said, "I think that’s one issue for patent owners going forward because you often rely on objective indicia. You have a $3 billion drug that everyone wants to copy. If it was so obvious, why didn’t someone else make it before? But it doesn’t seem to get as much traction in the PTAB as it does in district court," in spite of the impressive survival rate of biotech and pharmaceutical patents in the PTAB.