Profit is at the heart of every IPR, says Kyle Bass

Hedge fund manager Kyle Bass has fired a response to a motion filed by biotechnology company Celgene seeking to sanction him over “abusive” patent challenges, stating that profit motive is at the centre of every inter partes review (IPR) filing.

Bass, who heads the Coalition for Affordable Drugs, filed an opposition to Celgene’s motions for sanctions on Tuesday, August 11.

Celgene had said Bass lacked any “competitive interest” in filing IPRs against two of its patents and described these IPRs as “abusive” and demanded that the Patent Trial and Appeal Board (PTAB) sanctions Bass.

The biotech accused Bass of using the IPRs to “bet against, or short, the shares of companies ... and wager on rivals that could benefit”, ultimately to “line” his and the coalition’s own pockets.

At the centre of the dispute are patent numbers 6,045,501 and 6,315,720—both owned by Celgene.

Bass filed an IPR against the ‘720 patent, which covers a method for helping a patient avoid the adverse side effects of drugs used to treat teratogens, in April this year.

The ‘501 patent, called “Methods for delivering a drug to a patient while preventing the exposure of a foetus or other contraindicated individual to the drug”, was challenged by Bass in May.

Bass hit back by stating that at the “heart of nearly every patent and nearly every IPR, the motivation is profit”.

“Having an economic motive for petitioning the government simply does not turn the petition into an abuse of process,” he added.

In the latest motion, Bass said the price of Celgene’s drugs covered by both patents—Revlimid, Thalomid and Pomalyst—are “artificially high” and this is due to the US Patent and Trademark Office issuing “poor quality patents” such as those in question.

Bass protested that his actions are not an abuse of process and that the PTAB lacks the authority to sanction him because it has not yet decided to institute IPR proceedings.

Bass has requested the requested sanctions be dismissed.

Neither Celgene nor Sarah Spires, patent attorney at law firm Skiermont Puckett and representing Bass in the dispute, had responded to a request for comment at the time of publication, but we will update the story should either party get in touch.