Protecting Your Company’s IP in an Emerging Market

Innovative companies have often found that obtaining patents can play an important role in protecting the substantial investment made in developing cutting-edge technologies and products. The holder of a patent has the right to prevent others from infringing the invention claimed, which may convey market exclusivity for up to twenty years. Patent protection also plays an important role in defending companies from the potential threat of patent lawsuits. A well-thought-out patent strategy can be the difference between a long-term success and a short-term novelty, especially in emerging markets like that for CBD products.

The passage of the 2018 Farm Bill federally legalized hemp-derived cannabinoids containing less than 0.3% delta-9 THC. An increase in the number of cannabis-centric patent applications filed and granted followed. For example, our search of CBD-related patent filings showed a 60% increase in filings from 2018 to 2019. A similar number of patents were filed in 2020 with a relatively small drop off in 2021. Many companies developing CBD products clearly worked to stake out their territory and protect their technology.

For its part, the USPTO has issued cannabis-centric patents on many different aspects of CBD-related products. The most common type of patent application concerns medical uses of CBD to treat pain and diseases in humans and animals. One example is U.S. Patent No. 11,154,516 (issued to GW Research Limited in October 2021), which claims a method of treating seizures associated with a type of treatment-resistant epilepsy that involves administering a CBD drug substance. The patent claims cover a variety of formulations, doses, and administration regimens.

The USPTO has also allowed patents on methods of extracting or purifying CBD. For example, U.S. Patent No. 11,117,852 (issued to the University of Mississippi), concerns processes for large-scale isolation of CBD and THC, as well as other cannabinoids. The claimed processes recite several steps, including extracting the plant material, optionally winterizing the crude extract, purifying the extract using column chromatography, base hydrolyzing the isolated individual cannabinoid ester, and optionally re-chromatographing the isolated cannabinoid to increase the purity. The holder of this patent could prevent others from using the claimed method to purify CBD or THC.

The USPTO has also issued patents directed to different methods of delivering CBD and products related to such delivery systems. U.S. Patent No. 11,058,835 (issued to Altria Client Services) relates to devices and methods for use with a vaporizer and claims a capsule with specific characteristics. Other delivery systems that have been patented include vape pens, gel capsules, and consumables such as extracts, oils, foods, and beverages.

When obtaining or considering CBD-centric patents, there are a few important things to consider. First, the scope of patent protection is controlled by the claims that appear at the end of the patent, not by the disclosure of the invention that appears before the claims. Thus, while a full and complete description of the invention is necessary to obtain strong patent claims, if the claims themselves are drafted narrowly or have limitations or flaws, the patent may not offer much protection.

Second, before a patent will issue, the applicant must convince a patent examiner that the invention claimed is allowable. Claims to CBD patents can be rejected for any number of reasons, including for being too similar to previously patented inventions.

Third, even after a patent has issued by the USPTO, it may be found invalid. Issued patents can be challenged at the patent office or in court on a variety of grounds. For example, patent claims may be deemed invalid if directed to patent ineligible subject matter, if the claimed invention was already known or obvious in view of the prior art, or if the claimed invention was not adequately described or enabled by the description in the patent. While the burden of challenging patent claims rests with the party seeking to invalidate the patent, patents are often determined to be invalid after being scrutinized in litigation. 

Working with a patent attorney can help to ensure that you receive the broadest possible patent coverage while minimizing potential invalidity attacks. For example, subject to some exceptions, applicants have received patent claims directed broadly to “cannabinoids” without limiting their inventions to a single or subset of cannabinoids. Such claims provide broad protection and the ability to use their products with a wide range of cannabinoids. However, such broad claims could expose the patents to future invalidity challenges, so it is important for patent applicants to also include dependent claims covering the use of specific cannabinoids and provide examples in the specifications contemplating the use of those different cannabinoids. Similarly, if you are aware of a patent held by a competitor, a patent attorney can help you determine whether the patent claims may be found valid and infringed. Ultimately, patent strategy should be kept in mind, so that you do not find your company outflanked by the competition.