BIO 2015: IPR not a ‘death squad’, says former PTAB judge
Scott Kamholz (pictured below), a former judge at the Patent Trial and Appeal Board, recently returned to law firm Foley Hoag as partner. LSIPR spoke to him at this year’s BIO International Convention, where he explained why the inter-partes review is not a “death squad” for patents.
LSIPR: As a former judge at the PTAB, what is your view of the board’s utility as a forum for challenging life sciences patents?
SK: Pharma is not is not a major area for inter partes review (IPR). The last numbers I saw put [the percentage of instituted cases] at less than 10%. It’s hard to say whether that’s because it’s under-utilised in pharma, or that it’s just more heavily utilised in other areas. If you think of the Apples and Samsungs who are going at each other constantly trying to destroy each other’s patents and they’re racking up a lot of cases.
There are a million little things to fight about in high-tech, and it’s constantly turning because Apple doesn’t sit still.
It’s not that biopharma doesn’t care, or that IPR isn’t the right venue, it’s just that the issues are a lot more granular—that there’s much less of continuum of innovation in pharma. In pharma, we don’t have incremental change; we have big changes. I adjudicated IPRs with billion-dollar patents.
LSIPR: Is the IPR process petitioner-friendly? Does work need to be done to redress that balance?
SK: It is absolutely not petitioner-friendly. It appears to be, which is entirely deceptive.
In IPRs, the petitioner files a petition, the patent owner can file a preliminary response, and then the board decides whether to institute a trial. At the beginning of IPR, and even nowadays, the rate at which they instituted the cases was close to 100%. The percentage is now more in the low-to-mid 70s, and that number is dropping, but it’s not like it’s dropped tremendously. There’s still a more than two-thirds chance that you’ll get a trial instituted.
But that does not mean it’s petitioner-friendly, because the standard of instituted trial is whether the petitioner has demonstrated a reasonable likelihood that it will win, not that it has made a slam-dunk case.
LSIPR: Why has the rate of institution dropped?
SK: At the beginning of IPR, nobody knew what the board was going to do with these cases. Was it going to be patent-owner friendly, was it going to be petitioner-friendly? If you challenged a patent on IPR and you lost, would that just kill your defences in court?
Nobody knew what was going to happen, so who was going to put their necks out and try this thing? Somebody with a case where they weren’t sure that they could win, or a case where they think “if this doesn’t win, I don’t know what will”. It was the latter. Low-hanging fruit, as people like to say. You went with the easy case that you couldn’t possibly lose, so there was an extraordinary selection bias in the first phase of IPR filings. People were afraid to use it.
They see that the forum institutes 19 out of 20 of these cases and everybody piles in.
People are mistaking percentage institution rate for a percentage success rate. Because, nobody knew—they thought that if the board’s instituting trial, that means we’re going to win, right? That means we’ve won the case unless the patent owner could come up with a miracle. That’s not the case.
We’re not a death squad; when a patent comes to us, it doesn’t leave in shreds. So what we need is to drill down to the claim level. If somebody challenges ten claims, and one of them survives, who won the case? The patent owner won the case [as the petitioner is potentially infringing the single claim kept intact]. The petitioner can win 90% of the case and still lose. So what we care about is how many claims are surviving the process. It turns out that 60% of claims survive the process.
The 2015 BIO International Convention is taking place in Philadelphia from June 15 to 18.
