Academic journal article Research-Technology Management

Implications of the America Invents Act for R&D Managers: Connecting the Patent Life Cycle with the Technology Development Process: The America Invents Act Will Require R&D Managers to Consider Intellectual Property Issues in a Different Light

Academic journal article Research-Technology Management

Implications of the America Invents Act for R&D Managers: Connecting the Patent Life Cycle with the Technology Development Process: The America Invents Act Will Require R&D Managers to Consider Intellectual Property Issues in a Different Light

Article excerpt

The most extensive recent development in US patent law is the Leahy-Smith America Invents Act (AIA, Public Law 11229, 125 Stat. 284 [2011]). (1) AIA, which took effect in March 2013, focuses on improving efficiency and increasing transparency in the patent system, as well as harmonizing the American patent system with international practice. Major areas of change include eliminating the requirement for "best mode" disclosure, expanding the definition and scope of prior art, changing from a first-to-invent to a first-to-file standard for determining patent eligibility, and adding post-grant review, among others (Lu, Uthaman, and Kowalski 2012).

R&D managers must recognize the added risks presented by this new patent system and adapt and develop new protocols to mitigate these risks and exploit new opportunities. To make the implications of the AIA changes clear, this paper builds on two processes familiar to R&D managers: the patent life cycle (PLC) and the Stage-Gate model for new product development (Cooper, Edgett, and Kleinschmidt 2002). The PLC perspective demonstrates the need for proactive, strategic planners who recognize that patents, like chess, involve not only opening moves but also endgames. The Stage-Gate discussion reviews AIA's changes through the lens of technology development. This article is not intended to serve as a legal digest; rather, we offer a holistic view of the changes to provide innovators and R&D managers with a common framework around which to structure the strategic conversation about entering the marketplace and help alleviate the concern voiced by Fisher and Oberholzer-Gee (2013), that intellectual property-related decisions might be delegated entirely to specialists.

AIA's Reforms Across the Patent Life Cycle

Prior to ALA, the PLC occurred in five distinct stages (Figure 1): concept, value analysis, filing, prosecution, and maintenance. This PLC starts with the concept phase, during which patentable elements, even entire technology platforms or processes, are identified. Next, during value analysis, related patents are reviewed and patentability is determined. Once a favorable consensus is reached regarding value and patentability, the filing phase begins, during which a patent application is prepared and filed. Successful advocacy with the patent office results in an award during the prosecution phase. Maintenance includes activities such as payment of fees, discontinuation of fees on nonproductive patents, and identification of new revenue and product opportunities, as well as new patentable product features or process steps (IMA 2012). For R&D managers, maintenance is synonymous with portfolio management.

Under AIA, the PLC for successful patents is virtually unchanged, with the exception of one added phase--post-grant review. In addition to adding that sixth phase between prosecution and maintenance, AIA introduces important changes to each of the existing phases (Figure 2). In the figure, clouds highlight the important changes introduced by AIA as well as the relevant phases impacted most by them.

Best Mode. Before AIA, patent applications had to disclose crucial details about the most valuable, commercial form of the invention--that is, the "best mode" of exploitation--or risk invalidation. The intention was to ensure that competitors could compete fairly with a patent owner following expiration of the patent by prohibiting the withholding of key aspects of the innovation. After AIA, the requirement, while technically still present, is effectively missing, since a patent can no longer be invalidated or ruled unenforceable simply because of an insufficient or inadequate explanation of its best potential application (Auvil 2011).

To help clarify the implications of the practical elimination of best mode, consider the case of a process to obtain an herbal formulation to lower blood glucose and insulin levels. Imagine that a patent claims that a hot-water extract of seven different herbs (specified exactly by weight) when dried and administered orally will effectively treat non-insulin-dependent diabetes mellitus. …

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