Patent thickets


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Patent thickets

  2. 2. INTRODUCTION<br />A patent gives the owner the right to a particular technology. In fact, a patent does not guarantee the right to make or do anything. Instead, a patent gives the patent owner the right to exclude others from making, using, or selling anything that embodies the technology covered by the patent. Originators develop strategies that extend the breadth and duration of their patent protection. Their intent is to delay or block market entry of generics and competing originators.<br />Strategies are:<br /> Patent thickets or clusters<br /> Secondary or follow-on patents<br /> Defensive patenting<br />
  3. 3. PATENT THICKETS<br />“A dense web of overlapping intellectual property rights that a company must hack its way through in order to actually commercialize new technology."<br />Patent thickets are also sometimes called "patent floods" or "patent clusters".<br />The lack of relevant prior art and the abstract nature of the patent claims are the major causes of overlapping patents. <br />
  4. 4. Patent thickets are used to defend against competitors designing around a single patent. Every patentee of a major invention is likely to come up with improvements and alleged improvements to his invention.<br />
  5. 5. FILING OF DIVISIONAL APPLICATIONS<br />A divisional patent application is created where the applicant, either voluntarily or at the request of the examining office, divides out from a patent application ("parent patent application") to one or several (narrower) patent applications ("divisionals"). <br />
  6. 6. INDUSTRIES CREATING PATENT THICKETS<br />pharma<br />semiconductors,<br /> biotechnology, <br />computer software, <br /> telecommunications,<br />nanotechnology etc.<br />
  7. 7. Pharma<br />Thickets arise when trivial modifications like changes in size, color, dosage, delivery mechanism and composition, around a known and patented molecule are either simultaneously or subsequently protected.<br />
  8. 8. Nanotechnology<br />Ex. Carbon nanotubes, a kind of nano material have applications in electronics, electrical, mechanical, thermal.<br />Dendrimers constitute a valuable tool for medical, electronic, chemical.<br />Nanopatents claims are too broad.<br />The existence of high number of patents with broad and sometime overlapping claims add to the problem of thickets.<br />Though a patent is granted to a nanotechnological invention, it becomes unworkable due to the operation of a previously granted patent for a similar invention. The subsequent patent holders, in order to make their patent workable, have to first obtain licenses from the previous patent holders.<br />
  9. 9. Software<br />In industries like computer software, where new developments build upon existing technologies and innovation occurs through small improvements rather than real breakthroughs inventions are usually highly complex and often protected by multiple intellectual property rights. As a consequence numerous licenses are required to produce even a single commercial product. Furthermore, in the software field, the vast proliferation of patents in a relatively short period of time, together with the lack of relevant prior art and, in particular, the special nature of software as an abstract technology, has led to non-novel, obvious, and too broad patents being issued.<br />
  10. 10. Business problem of Patent Thickets<br />In some industries, such as computer hardware and software, firms can require access to dozens, hundreds, or even thousands of patents to produce just one commercial product. Many of these patents overlap, with each patent blocking several others. Moreover, as more and more patents issue on incremental inventions, firms seek more and more patents to have enough bargaining chips to obtain access to others’ overlapping patents. A major problem with this strategy is that the time and money a company has to spend on creating and filing “defensive patents,” which may have no innovative value in and of themselves, could better be spent on developing new technologies. <br />
  11. 11. Economic problem of Patent Thickets<br />In a patent thicket where innovation depends on having access to existing patents held by many different owners, the transaction costs of access can rise substantially because of the costs of negotiating with each of many individual patentees.<br />
  12. 12. Strategic Responses to Patent Thickets<br />Cross-licenses and patent pools are two natural and effective methods used by market participants to cut through the patent thicket, but each involves some transaction cost<br /> Cross-licenses <br />Even if every issued patent met the statutory requirements of novelty, utility, and non–obviousness, the problem of patent thickets would still remain. When the total number of owners of the conflicting intellectual property rights is small, the response to the patent thicket problem has often been to cross–license.<br />
  13. 13. Patent pool <br />A patent pool is a consortium of at least two companies agreeing to cross-license patents relating to a particular technology. The creation of a patent pool can save patentees and licensees time and money, and, in case of blocking patents, it may also be the only reasonable method for making the invention available to the public.<br />
  14. 14. Examples of Patent Thickets<br />Servier v Apotex (UK CoA, 2007)<br /><ul><li>original perindopril patent expired 2003
  15. 15. follow-on patent obtained 2000
  16. 16. crystalline form covered by 2nd patent
  17. 17. produced by method disclosed in 1st</li></ul> ‘innovation’ obvious based on evidence<br /> of Servier’s own expert<br />
  18. 18. Golden Rice<br /> Genetically modified ‘golden rice'—actually developed before the term synthetic biology was widely used—for which more than 70 patent rights needed to be cleared (Potrykus, 2001). This situation can make negotiations difficult and costly.<br />
  19. 19. Toyota:<br />Toyota has purposely built up a patent thicket so thick that basically no one can build hybrid vehicles without paying up:<br />Toyota's goal: to make it difficult for other auto makers to develop their own hybrids without seeking licensing from Toyota, as Ford Motor Co. already did to make its Escape hybrid and Nissan Motor Co. has for its Altima hybrid.<br />
  20. 20. Conclusion<br />Peer–to–Patent system and the reexamination process can be used to exclude or eliminate patents of questionable validity.<br />Improving prior art repositories; <br />Curtailing the patentable subject-matters;<br />Abstract nature of the patent claims<br />
  21. 21. THANK YOU<br />