Sparse Patent Protection for Research Tools: Expansion of the Safe Harbor Has Changed the Rules

By Jones, Robert A. | Emory Law Journal, January 1, 2014 | Go to article overview

Sparse Patent Protection for Research Tools: Expansion of the Safe Harbor Has Changed the Rules


Jones, Robert A., Emory Law Journal


ABSTRACT

The protection provided by patent rights benefits society by encouraging inventors to disclose their inventions, but these same rights can be wielded against competitors through infringement suits, causing a chilling effect on later innovation. In the field of pharmaceutical innovation, the Hatch-Waxman Act's safe harbor has provided a defense against infringement, allowing generic manufacturers to quickly bring low-cost drugs to the public while trespassing minimally on the patent holder's rights. The Act's delicate balance of benefits and burdens has been threatened by recent judicial interpretations of the provision's scope. The scope of the safe harbor has been expanded to the point that it reduces the value of patent protection for laboratory tools and methods, and in turn threatens the patent system's role in encouraging innovation in these areas.

This Comment proposes limits to the safe harbor's scope by (1) specifying the types of inventions that are subject to the safe harbor and (2) permitting those patents to be infringed only until FDA approval has been granted. This proposed scope is supported by the legislative history, which referred extensively to the FDA approval process and repeatedly assured drug manufacturers that the purpose of the safe harbor was to reduce delays caused by the FDA approval process. In addition, this scope comports with the broader themes of patent law in that it promotes certainty in the law and provides parties with notice of their rights. However, because the language used in the safe harbor provision is expansive, textualist interpretations of the provision alone tend to worsen rather than solve the problem. For this reason, this Comment advocates legislative action to produce limits on the scope of the safe harbor that will protect and encourage innovation while promoting early access to generic drugs.

INTRODUCTION

Inventors with groundbreaking ideas have the capacity to change the way society operates-even improve others' quality of life-simply by sharing these ideas with the public. When the idea has been shared, however, nothing prevents the public from using the idea without compensating the inventor absent some law to the contrary. Inventors will not have an incentive to disclose their inventions to the public if they cannot expect to receive anything in return for their work. The framers of the U.S. Constitution understood this quandary and granted Congress the power to issue exclusive rights to inventors to practice their inventions "[t]o promote the Progress of . . . useful Arts."1 Congress defined the exclusive patent rights broadly in the Patent Act of 1952, securing for the inventor the exclusive rights to use, make, sell, or offer to sell the patented invention.2 These exclusive rights create a form of monopoly power, which allows an inventor to recoup the cost of innovation and incentivizes further invention and research by the inventor and others. Certain areas of innovation, such as pharmaceutical development, rely heavily on patent protection due to the high cost of research. In addition, pharmaceutical products are regulated by the Food and Drug Administration (FDA), which must approve all drugs before they can be sold to the public. Because the FDA approval process for drugs requires clinical testing, the approval process for a generic version of a drug involves "making" and "using" the drug. If the drug is still covered by a patent, then these acts are infringing acts3: the generic manufacturer simply cannot begin seeking FDA approval until the patent expires.

This overlapping federal regulation in the area of pharmaceutical products provided layers of monopoly protection for the holders of drug patents, to the detriment of consumers. In 1984, Congress created a statutory experimental use exception to patent infringement-the Hatch-Waxman "safe harbor"4-to expedite the entry of generic drugs into the market. This exception involved a delicate balancing of interests between patent owners and generic manufacturers and made it possible for generic drugs to begin the FDA approval process before the patents on the drugs expired.

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Sparse Patent Protection for Research Tools: Expansion of the Safe Harbor Has Changed the Rules
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