This week ten members the U.S. House of Representatives from New York wrote to U.S. Patent and Trademark Office Director Michelle K. Lee to express concern with continued abuse of the inter partes review (IPR) system by financial speculators and other third parties with no legitimate interests in the patented technology.
They are calling on her to close the loopholes in a system that were originally intended to stop trolls in the first place. It is an under-reported fact that reverse patent trolls are abusing the IPR system to fundamentally undermine the ability of biotech companies to rely on their patents to raise and invest the hundreds of millions of dollars needed to develop and bring to market the next generation of cures – as well as innovations in sustainable agriculture, renewable energy, and a variety of other bio-based products.
As I discussed in a previous post, there is clear documentation that innovative patent holding companies are being targeted in the form of shake-down letters. These letters always come with thinly veiled requests for financial payment for not challenging a patent. This is in addition to evidence that hedge funds are using this flaw at the PTO as a means of shorting a stock’s value by creating uncertainty within the market about the strength of a drug’s core patents.
BIO applauds the following signatories of the letter and their call to curb abuse of the IPR system by hedge funds and other non-practicing, third-party petitioners:
Representative Nydia M. Velázquez
Representative Chris Collins
Representative Louise Slaughter
Representative Peter King
Representative Elliot Engel
Representative Elise Stefanik
Representative Yvette Clarke
Representative Paul Tonko
Representative Kathleen Rice
Representative Steve Israel
BIO will continue to press congress and the new administration to curb these abuses and protect legitimate patent owners.