Newsletter for Leaders in the Medical Device Industry – May 2012

Counting Down to Patent Reform: Steps That Medical Device Companies Can Take to Prepare
By Courtenay C. Brinckerhoff ([email protected])

Although President Obama signed the Leahy-Smith America Invents Act into law on September 16, 2011, most of the changes that will affect Patent Office Practice will not take effect until September 16, 2012 or March 16, 2013. Nevertheless, now is the time to prepare for these changes. This article highlights what will change in September and how medical device companies can prepare for the first-to-file changes that will take effect in March.

The full article, published by MD+DI on April 19, 2012, is available online at http://tinyurl.com/d9jsgne.

Reexamination requests are generally on the rise at the USPTO, and nowhere is the increase more evident than in the important field of medical devices. Determining whether to invest resources into a patent reexamination proceeding can be very complicated: What is your company’s position in the marketplace relative to its competitors? Are you currently facing potential threats of patent litigation? Are you currently in patent litigation? Are you considering entry of a new product into a heavily patented market? The analysis is further complicated by the recent and dramatic changing landscape of reexamination practice, whether due to shifting precedent at the Federal Circuit or the implementation of the America Invents Act (AIA) passed very recently by Congress. At the end of the day, a reexamination (or, in the future, a possible post-grant review proceeding under the AIA) can provide a considerable return on investment if embarked upon, considering all the relevant factors.

Consider, for example, the Federal Circuit’s recent decision in Marine Polymer Technologies, Inc. v. Hemcon, Inc. In Marine Polymer, the Federal Circuit en banc overturned a previous panel decision holding that arguments made by a patent holder during reexamination could lead to intervening rights that could release competitors from liability for infringement. The court eventually held that intervening rights only arise if claims are substantively amended or if new claims are added. The result of Marine Polymer may affect the evaluation of whether to file a reexamination request if one goal of the request is to at least obtain intervening rights that could limit potential downstream liability. To maximize the potential for amendments, a requestor should consider whether the request will necessarily force a patent holder to amend or add claims during reexamination. If the request merely results in successful argument by the patent holder against a combination of prior art references, then one might consider finding stronger references. That said, other good reasons to pursue a reexamination might still otherwise exist (for example, to possibly obtain a stay in pending patent litigation).

Meanwhile, changes induced by the AIA also will shift the analysis for determining whether to pursue reexamination. The AIA provides a novel alternative to reexamination entitled, “post-grant review.” The post-grant review process provides a wider range of tools for challenging patent validity than traditional reexamination practice, but also provides a more narrow time period in which to challenge the validity of an issued patent. Given the frequency of reexamination requests against medical device patents, and the active monitoring of competitor patent portfolios within the medical device industry, it seems natural that some of the first uses of the post-grant review procedures will be against medical device patents. This has implications not only for those seeking to challenge the validity of an issued patent, but also for those prosecuting medical device patent applications. As an applicant for a patent, you will want to make sure your patents can survive any post-grant review challenge. Post-grant review will be available only for patents with a priority date on or after March 16, 2013.

Additionally, the USPTO has proposed a variety of rule changes implementing the AIA that include substantial fee increases to reexamination requests. While these increases have not yet been implemented, they will surely factor into the determination of whether to file a reexamination request going forward. It is worth noting that the AIA also makes further substantive changes to existing reexamination practice, the details of which we will not delve into here.

Before committing to a reexamination request, consult with your attorney to consider the goals of the request in light of these changes to reexamination practice.

How to Respond to Consent Decrees
By David L. Rosen ([email protected])

The FDA has ratcheted up its regulatory enforcement posture over the past several years. The agency has increased its inspection of firms, especially where there are product complaints, recalls or where there is a history of repeated, violative inspectional observations. Although FDA has a number of enforcement tools available, including, Untitled Letters, Warning Letters, seizures and injunctions, there has been an increase in FDA’s use of consent decrees as a means to compel firms and responsible individuals to comply with cGMPs, quality system requirements (QSRs), FDA regulations, and the Federal Food, Drug, and Cosmetic Act (FD&C Act). The provisions of these consent decrees are particularly onerous and it takes considerable time and resources to meet the required terms and conditions, which if met, allow the company to return to full, independent manufacture and distribution of products.