Patent Reform Bill Risks Higher Drug Prices and Delayed Generics

Congress is considering a bill that would politicize the patent system, increase the likelihood of errors, and increase costs for everyone. The Medication Affordability and Patent Integrity Act is expected to be on the Senate Committee on Health, Education, Labor and Pensions’ markup schedule in mid-September.

The bill would require drug companies to submit highly technical information, such as data from clinical trials, to the US Patent and Trademark Office and “certify” that such information is consistent with information submitted to the Food and Drug Administration. That sounds simple enough, but there are several reasons why the bill would cause harm if enacted, and lead to the very outcomes that proponents seek to avoid.

First, the legislation allows the Department of Commerce to apply the law “as the Secretary determines appropriate.” This will inject politics into the patent application process because the Secretary of Commerce—a political appointee of the president with virtually no involvement in the actual examination of patent applications—will be pressured to apply the law more or less broadly. That means the scope of the law could change from administration to administration.

Second, the bill will make already complicated patent litigation more expensive. Patent holders will have to defend against “gotcha” claims that they failed to disclose information to the USPTO or that they were inconsistent in some way—even though the information submitted to the FDA was submitted for different reasons under different legal requirements. Courts and juries will have to sift through dense scientific reports and technical data to determine whether a patent applicant met their obligations under the law.

Third, it may stifle disclosure of important information to the FDA, because patent applicants will be worried that certain FDA information somehow will be deemed inconsistent with other USPTO information. Patent applicants also will worry that confidential FDA information will get mixed in with public USPTO information, risking exposure of important trade secrets.

Fourth, it will overwhelm the patent examination process. Out of an abundance of caution, patent applicants will submit a mountain of new data to the USPTO that will slow down consideration of new inventions, create confusion, and trigger mistakes. This will cause a delay in issuing new drug patents, may lengthen the terms of the affected patents, and may postpone the entry of generics to the marketplace.

The patent examination process is still ripe for improvement. Additional time for examination, additional training, and clearer guidance are all needed. But most of what the bill mandates is part of the current patent examination process. For example, if a company submits information to the FDA that is material to the patent application, they must submit it to the USPTO as well.

Everyone wants drugs to be less expensive and more widely available. But this legislation won’t accomplish that goal. Just the opposite—the bill threatens to destabilize patent law and lead to fewer, more expensive drugs.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Coke Morgan Stewart is an intellectual property litigator and senior counsel at O’Melveny & Myers. She served in several senior USPTO roles during the Trump administration and was deputy director of the USPTO in the Biden administration.

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