Diagnostic Kits/IP in Kits

Patents

Case Law Caselaw that specifically comments on the patentability of diagnostic processes: the machine or transformation of nature test

• In re Bilski, 545 F.3d 943 (C.A.Fed.,2008.)
  • a trading method, not a diagnostic test method was analyzed
  • the test that governs whether a process qualifies patentable subject matter (under )35 USC § 101)

• Lab. Corp. of Am. Holdings v. Metabolite Labs., Inc., 370 F.3d 1354 (2004)
  • at issue was the patentability of a diagnostic process but the case was decided on other grounds the Supreme Court dismissed after initially granting certiorari and hearing oral arguments, in the dissent to the Supreme court dismissal, the process was characterized as unpatentable natural phenomenon

• Prometheus Laboratories, Inc. v. Mayo Collaborative Services 2009 WL 2950232 C.A.Fed. (Cal.,2009)
  • decided September 16, 2009
  • patents claiming methods for calibrating proper dosage of drugs
  • may be applicable to genetic diagnostic processes

ADD MORE ON THIS CASE

Patent Pools

• "An agreement between two or more patent holders to license one or more of their patents to one another, or to license them as a package to third parties who are willing to pay the royalties that are associated with the license." Patent Pools provide a reduction in transaction costs but they also risk anti competitive effects and the shielding of weak patents. (Esther van Zimmeren et al. 2006)
• Advantages
  • The benefits of a patent pool include (Verbeure, B. et al., 2006):
    • possible elimination of stacking licenses,
    • reduction of patent licensing transaction costs,
    • a decrease in patent related litigation.
• Disadvantages
  • While these potential benefits are appealing in many industries, the biotechnology industry lacks standard-driven incentives found in other industries which may reduce the gains possible by creating a biotechnology patent pool. The article hypothesizes that “standards can be an important trigger to set up a pool, as illustrated in the electronics and telecommunications sectors, and this might also be true in the field of genetics” (Verbeure, B. et al., 2006).
  • US Antitrust law limits the behavior of patent pools which have the potential to exert unfair market pressure. (Verbeure, B. et al., 2006)

Patent Clearing Houses

• A "mechanism by which providers and users of goods services and/or information are matched." (Esther van Zimmeren et al. 2006)

The Structure of Patent Clearhouses

• The Zimmeren article provides a useful framework for understanding the patent clearinghouses (Esther van Zimmeren et al. 2006)
  • Five types.
    • Two types of clearinghouses provide access to information on the patented inventions: information clearing houses and technology exchange clearing houses. Information clearing houses provide basic information related to the technology. They have a low barrier to entry but require constant maintenance. The technology exchange clearing house model adds licensing information to the basic information related to the technology to provide a means for initiating negations. (Esther van Zimmeren et al. 2006)
    • There are three types of clearing houses are analyzed that not only offer access to information but also facilitate the use of the patented inventions: the open access clearing house, the standardized licenses clearing house, and the royalty collection clearing house. The open access clearing house provides free use of patented inventions. The standardized licenses clearing house provides standardized licenses for the use of patented inventions. The royalty collection clearing house provides standardized licenses, royalty collection, monitoring of the patents, and a dispute resolution mechanism. (Esther van Zimmeren et al. 2006)

The Advantages and Disadvantages of Patent Clearhouses

• Advantages
  • The Zimmeren article states that clearinghouses provide the advantages of simplifying licensing negotiations, increased visibility of the patent rights, streamlining of royalty collection, and possible decreased enforcement costs.
• Disadvantages (Esther van Zimmeren et al. 2006)
  • The Zimmeren article states the difficulties and problems of clearinghouse include having the potential for anti-competitive effects, loss of patent holder control, high levels of patent holder participation are required for success, set up of the clearinghouse is complex, standardized licenses lack flexibility found in negotiated licenses, and trade secret secrecy data cannot be easily maintained. (Esther van Zimmeren et al. 2006)

Licensing

Licensing Approaches Four licensing approaches considered by the Van Overwalle article: (Geertrui Van Overwalle et al., 2005)

• Free access to the genetic sequences but royalty payments for the commercial test kits
• Licensing to laboratories at a rate that makes the commercial test kit more economical
• Exclusively licensing to a limited number of laboratories
• Biological Innovation for Open Society license that makes improvements to the patent shared as a way to facilitate cooperative invention.

Compulsory Licensing

• A compulsory license occurs when the government or court compels a patent owner to license their rights. There is no general provision for compulsory licensing under the patent statute, only very specific instances where it will be applicable. This has not been applied to licensees in genetics so far. (Geertrui Van Overwalle et al., 2005)

Licensing Behavior

• The likelihood of granting a license for patented DNA sequenceswas was found to be similar for firms and nonprofits but nonprofits were far more likely to grant exclusive licenses. This use of exclusive licensing demands further study to find out if the use of these licenses is justified or merely a default practice with little substantive justification. (Henry, M. et al. 2002)
• A Merz article investigating genetic test patent history for Hemochromatosis (HFE) gives a detailed patent history is developed to show how patent ownership and licensing complexities can have measurable effect on the development and performance of genetic testing. (Merz, J.F. et al., 2002)
  • The patent ownership of HFE testing begins with Mercator Genetics in 1998. Next, Progenitor, Inc. merged with Mercator and was assigned its patents. SmithKline Beecham Clinical Laboratories then became the exclusive license of Progenitor’s HFE patents. Following the licensing deal, SmithKline Beecham Clinical Laboratories was sold to Quest Diagnostics. Finally, Bio-Rad Laboratories, Inc., acquired the HFE patents from Progenitor. (Merz, J.F. et al., 2002)

Trade Secret

Trade Secret Caselaw

• Microbiological Research Corp. v. Muna, 625 P.2d 690, 700 (Utah 1981)
  • Holding: no combination secret found for a diagnostic kit when the process included nothing more than the "skill and knowledge of the trade"
  • Facts:
    • a medical diagnostic kit manufacturer against a former microbiologist employee
    • At issue was the trade secret protection of "certain techniques and chemical formulations in the manufacturing process of the diagnostic kits"developed by the former microbiologist employee (59 A.L.R.4th 641)
  • The court's analysis

1. Information claimed as trade secrets was published in the medical literature
2. The information known to others in the microbiologist's field of expertise
3. The information was part of the microbiologist's own skill and knowledge.

• Trade secret protection does not prevent other researchers from independently discovering, disclosing, and using their discovery.
  • Limitations of trade secret
    • However, filed but unpublished patent application may block use of the discovery if the researcher is not first to invent.
    • The experimental use exception (Madey v. Duke) is very narrow. (14 MITTLR 43)
• "Thus, while the unavailability of gene patents may lead to disclosure delays, arguably these costs are outweighed by the benefits of preserving new gene discoveries for the genetic commons." (14 MITTLR 43)

14 MITTLR 43 Michigan Telecommunications and Technology Law Review RESTORING THE GENETIC COMMONS: A "COMMON SENSE" APPROACH TO BIOTECHNOLOGY PATENTS IN RESTORING THE GENETIC COMMONS: A Fall 2007 (Approx. 31 pages)

• Reverse Engineering
  • A product may be "reverse-engineered"
  • With diagnositic kits: "What the inventor typically sells is a reagent test kit or apparatus for use in practicing the method. [FN17] The method must be disclosed to the buyer and cannot be kept as a trade secret." (13 ALBLJST 145,149)
    • For these reasons patent protection is preferred for elements of the kit that can be reverse engineered or must be disclosed with sale.

13 ALBLJST 145 Albany Law Journal of Science and Technology PROTECTING BIOTECHNOLOGICAL INVENTIONS IN BRAZIL AND ABROAD: DRAFT, SCOPE AND PROTECTING BIOTECHNOLOGICAL INVENTIONS IN BRAZIL AND ABROAD: DRAFT, SCOPE AND INTERPRETATION OF CLAIMS 2002 (Approx. 23 pages)

Navigation

Main Page Diagnostic_Kits