Importance of Patent Protection in the Life Sciences Industry Michael R. Samardzija, PhD Partner
Why is IP important to a company?
Drug Development Center for  Drug Evaluation & Research • PRODUCT SAFETY • PRODUCT EFFICACY • PRODUCT SAFETY • SURROGATE E...
Medical Device Development Center for  Devices  Radiological Health • PRODUCT SAFETY • PRODUCT EFFICACY • PRODUCT SAFETY •...
Drug Development Pathway Unmet Need Target Identification & Validation Product Concept Lead Optimization & Preclinical Tes...
R&D Expenditures Publicly Traded Companies
R&D Expenditures Comparison to other industries
Pharma Landscape Source: AXA Framlington * Value of products losing patent protection as a percentage of total company sal...
The Valley of Death VC Investment IPO Window PRE 2000 PRE 2000 TODAY TODAY Research Preclinical Phase I Phase II Phase III...
Recent Significant M&A Transactions <ul><li>Roche-Ventana Acquisition  </li></ul><ul><li>$3.4Billion </li></ul><ul><li>Inv...
Why have IP? Competitors Enemies Public Customers Employees Vendors Know-How Ideas Inventions
Why have IP? Competitors Enemies Public Customers Employees Vendors Know-How Ideas Inventions
How to read claims Boss!  The claims, the claims!!!
Types of Claims Process   e.g., method of making a drug, methods of use Machine e.g., medical imaging instrument Compositi...
IP Strategies – Related Applications BioPharmaceuticals Making the molecule (process) Pharmaceutical Compound (formulation...
IP Strategies – Related Applications Device Vacuum chamber in which  the diamond like coating (blade coating) is applied S...
Transitional Phrases <ul><li>&quot;comprising&quot;  is open-ended and does not exclude additional, unrecited elements or ...
Opinion of Counsel
Opinion of Counsel <ul><li>Need  for a license? </li></ul><ul><li>Value  of license or of the property? </li></ul><ul><li>...
TYPES OF IP OPINIONS Freedom to operate The scope, validity, and enforceability Confirming ownership Confirming transferab...
Due Diligence
Due Diligence <ul><li>Searches </li></ul><ul><li>Scope of exclusive rights? </li></ul><ul><li>Are patents valid and enforc...
Due Diligence <ul><li>Ask  all of the questions (even if they are obvious) </li></ul><ul><li>Start from inventorship </li>...
Patent Valuation <ul><li>Conduct due diligence </li></ul><ul><li>Cited art </li></ul><ul><li>Scope of claims </li></ul><ul...
Valuation of Patents
Value of an issued patent vs. a patent application <ul><li>Presumption of validity </li></ul>
Patent Valuation <ul><li>Obtain a copy of the file-wrapper </li></ul><ul><ul><li>Scope of claims </li></ul></ul><ul><ul><l...
IP Strategies – Related Applications BioPharmaceuticals Making the molecule (process) Pharmaceutical Compound (formulation...
<ul><li>It is worth investing, make sure </li></ul><ul><li>that you have adequate protection. </li></ul><ul><li>There are ...
<ul><li>Contact information: </li></ul><ul><li>Michael R. Samardzija, PhD </li></ul><ul><li>Partner </li></ul><ul><li>Brac...
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Importance Of Patents In The Life Sciences Industry

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Importance Of Patents In The Life Sciences Industry

  1. 1. Importance of Patent Protection in the Life Sciences Industry Michael R. Samardzija, PhD Partner
  2. 2. Why is IP important to a company?
  3. 3. Drug Development Center for Drug Evaluation & Research • PRODUCT SAFETY • PRODUCT EFFICACY • PRODUCT SAFETY • SURROGATE EFFICACY Investigational New Drug (IND) • MANUFACTURING • VALIDATION New Drug Application (NDA) Marketing Approval Data Data Good Laboratory Practices Good Clinical Practices Quality System Regulations (QSR)
  4. 4. Medical Device Development Center for Devices Radiological Health • PRODUCT SAFETY • PRODUCT EFFICACY • PRODUCT SAFETY • PRODUCT EFFICACY Investigational New Device (IDE) • MANUFACTURING • VALIDATION 510K Pre Market Approval (PMA) Clearance Approval Data Data Good Laboratory Practices Good Clinical Practices Quality System Regulations (QSR)
  5. 5. Drug Development Pathway Unmet Need Target Identification & Validation Product Concept Lead Optimization & Preclinical Testing Preclinical Design Concept Phase I Safety Prototype Phase II Efficacy Clinical Prototype Phase III Large Clinical Testing Field Input Registration Regulatory Clearance Final Product Product Launch Market Support Studies Marketed Product Time to Market: 10-12 YEARS Investment Capital: US$800MM
  6. 6. R&D Expenditures Publicly Traded Companies
  7. 7. R&D Expenditures Comparison to other industries
  8. 8. Pharma Landscape Source: AXA Framlington * Value of products losing patent protection as a percentage of total company sales over next five years
  9. 9. The Valley of Death VC Investment IPO Window PRE 2000 PRE 2000 TODAY TODAY Research Preclinical Phase I Phase II Phase III NDA Approval Post Marketing TIME COST
  10. 10. Recent Significant M&A Transactions <ul><li>Roche-Ventana Acquisition </li></ul><ul><li>$3.4Billion </li></ul><ul><li>Invitrogen-Applied Biosystems </li></ul><ul><li>$6.7Billion </li></ul><ul><li>Roche-Genentech Acquisition </li></ul><ul><li>$46.8 Billion </li></ul><ul><li>Gilead-CV Therapeutics $1.3Billion- Renexa (patent rights licensed from Roche originally) </li></ul>Teva - CoGenesys $400M Albumin fusion platform for delivery of peptides/proteins, lead in PII for neutropenia Pfizer - Encysive $191M Thelin for PAH marketed in EU Fujifilm – Toyama $1.1B Phase II influenza treatment portfolio of 12 compounds
  11. 11. Why have IP? Competitors Enemies Public Customers Employees Vendors Know-How Ideas Inventions
  12. 12. Why have IP? Competitors Enemies Public Customers Employees Vendors Know-How Ideas Inventions
  13. 13. How to read claims Boss! The claims, the claims!!!
  14. 14. Types of Claims Process e.g., method of making a drug, methods of use Machine e.g., medical imaging instrument Composition of Matter e.g., new drug Article of Manufacture e.g., medical device, diagnostic kit, drug formulation
  15. 15. IP Strategies – Related Applications BioPharmaceuticals Making the molecule (process) Pharmaceutical Compound (formulation) Nucleotide, Protein, Antibody Method of Use Formulation, Efficacy Fragments, Derivatives, Analogues New Molecule Do not overlook the novel research technology that may be invented on the way to discovering a blockbuster drug Building a fortress around the basic invention/technology
  16. 16. IP Strategies – Related Applications Device Vacuum chamber in which the diamond like coating (blade coating) is applied Single point cartridge loading system – avoiding upside down attachment Indicator strip signaling when the shaver is no longer experiencing &quot;the optimal shave&quot; Rubberized contour grip for better handling New forward pivot design positioning the blades in an optimal shaving position Use of 3 staggered blade getting progressively closer to the skin Mach 3 Core Technology Building a fortress around the basic invention/technology
  17. 17. Transitional Phrases <ul><li>&quot;comprising&quot; is open-ended and does not exclude additional, unrecited elements or steps </li></ul><ul><li>&quot;consisting of&quot; excludes any element, step, or ingredient not specified in the claim </li></ul><ul><li>&quot;consisting essentially of&quot; limits scope of claim to specified materials or steps &quot;and those that do not materially affect the basic and novel characteristic(s)&quot; of claimed invention. </li></ul>
  18. 18. Opinion of Counsel
  19. 19. Opinion of Counsel <ul><li>Need for a license? </li></ul><ul><li>Value of license or of the property? </li></ul><ul><li>Avoidance of enhanced damages </li></ul><ul><li>What is the risk of infringement? </li></ul><ul><li>Important business decisions </li></ul><ul><li>Do we invest in, buy, or sell the company? </li></ul><ul><li>Do we sue? </li></ul>
  20. 20. TYPES OF IP OPINIONS Freedom to operate The scope, validity, and enforceability Confirming ownership Confirming transferability
  21. 21. Due Diligence
  22. 22. Due Diligence <ul><li>Searches </li></ul><ul><li>Scope of exclusive rights? </li></ul><ul><li>Are patents valid and enforceable? </li></ul><ul><li>Is there freedom to operate? </li></ul><ul><li>Does the company own/have rights to IP? </li></ul><ul><li>Is litigation pending/expected? </li></ul><ul><li>Patent term expiration </li></ul>
  23. 23. Due Diligence <ul><li>Ask all of the questions (even if they are obvious) </li></ul><ul><li>Start from inventorship </li></ul><ul><li>Ask to see whether anything had been disclosed before the filing date </li></ul><ul><li>Ask if all relevant prior art was cited </li></ul><ul><li>See that all maintenance fees had been paid on time </li></ul><ul><li>Ask how information was disclosed to other entities </li></ul><ul><li>Ask how the compound was transferred to others entities </li></ul>
  24. 24. Patent Valuation <ul><li>Conduct due diligence </li></ul><ul><li>Cited art </li></ul><ul><li>Scope of claims </li></ul><ul><li>Types of claims </li></ul><ul><li>Likelihood of obtaining claims </li></ul><ul><li>Communication from USPTO </li></ul>
  25. 25. Valuation of Patents
  26. 26. Value of an issued patent vs. a patent application <ul><li>Presumption of validity </li></ul>
  27. 27. Patent Valuation <ul><li>Obtain a copy of the file-wrapper </li></ul><ul><ul><li>Scope of claims </li></ul></ul><ul><ul><li>Types of claims </li></ul></ul><ul><ul><li>What was given up during prosecution </li></ul></ul><ul><li>Is (or was) there any litigation? </li></ul><ul><li>Copies of licensing agreements </li></ul><ul><li>Understanding the patent landscape </li></ul><ul><li>Expiration date </li></ul>
  28. 28. IP Strategies – Related Applications BioPharmaceuticals Making the molecule (process) Pharmaceutical Compound (formulation) Nucleotide, Protein, Antibody Method of Use Formulation, Efficacy Fragments, Derivatives, Analogues New Molecule Do not overlook the novel research technology that may be invented on the way to discovering a blockbuster drug Building a fortress around the basic invention/technology
  29. 29. <ul><li>It is worth investing, make sure </li></ul><ul><li>that you have adequate protection. </li></ul><ul><li>There are many ways to protect </li></ul><ul><li>you innovations. </li></ul><ul><li>Build a fortress not a brick. </li></ul>Take Steps Toward Success
  30. 30. <ul><li>Contact information: </li></ul><ul><li>Michael R. Samardzija, PhD </li></ul><ul><li>Partner </li></ul><ul><li>Bracewell & Giuliani LLP </li></ul><ul><li>711 Louisiana Street </li></ul><ul><li>Suite 2300 </li></ul><ul><li>Houston, TX 77002 </li></ul><ul><li>(713) 221-1112 </li></ul><ul><li>[email_address] </li></ul>©2009 Bracewell & Giuliani LLP

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