Giachino (00:05.0239 - 00:26.0500)
This is IP Protection Matters. I'm the host, Renee Giachino with the Center for Individual Freedom. Joining me now is Andrei Iancu. Andrei is the Chairman of the Council for Innovation Promotion. He also led the Patent and Trademark Office under President Trump. Andrei, thank you so much for joining us. We appreciate it.
Iancu (00:26.0500 - 00:27.0370)
Pleasure to be with you.
Giachino (00:27.0819 - 00:31.0600)
Can you tell us a little bit about the Council for Innovation Promotion?
Iancu (00:31.0889 - 01:12.0220)
Sure. So we started the Council a couple of years ago in order to promote strong intellectual property rights, and to make sure that the United States continues to have a leading intellectual property ecosystem where patents, copyrights, trademarks and other forms of intellectual property are secure, clear, reliable and provide the appropriate incentives and rewards for inventors, authors and creators in general - entrepreneurs and the like - to continue to operate at maximum capacity.
Giachino (01:12.0480 - 01:37.0610)
Well, let's get into the weeds if we can, figuratively speaking, especially when we start talking about "patent thickets." And we hear pejorative terms like that: "product hopping," "patent thickets." We hear those being thrown around by advocates of weaker patent protections. Could you help educate us? What do they mean when they're using these terms? And is there any validity to their arguments?
Iancu (01:37.0110 - 06:01.0735)
Well, let me just start there. No, there is no validity to their argument. They're using pejoratives, because they lack a substantive argument here and they resort to just terminology to try to confuse the issues.
What they're talking about is when a product has multiple patents on it, they call that, that the product has a patent thicket around it, whatever the product might be. And it's usually focused on drugs, on medicines. And, you know, the particular drug might have a dozen patents covering that drug, or multiple dozens of patents covering that drug. And therefore, the critics say that the pharmaceutical company has created a patent thicket around that drug with the implication that that is inappropriate and it's artificially raising prices of that particular drug. I emphasize that this would apply to any product. But the predominant example that they have is in the drug space.
It's not a good argument at all, or legitimate. And the reason is that each patent on any product, each individual patent, is for a particular new, distinct invention. So, if a product has two features in it, two inventions in it, it should have presumably two patents on it. If it has 100 different inventions, it will have potentially 100 different patents on it.
And some products like cell phones, for example, have thousands of inventions in them, right? And you can see on the phone, you have obviously the phone features, the communications, the camera, you know the various apps and icons you use on it. Thousands of these potential inventions with thousands of patents covering the phone.
The same is true for a drug, but actually on a smaller scale. You know, a drug could very well have many different really important inventions. So one, for example, on a drug is the main chemical or molecular formulation that is the active ingredient that directly treats the medical condition. That is an invention and that would be a patent. But on top of that, there are really important inventions surrounding the coating for a particular pill, for example. Really important that the coating is well done so that the individual can tolerate the medicine. So that needs to be, presumably if that's an invention and new and obvious, that would have a patent. The method of delivery can be innovative. And if that's true, that can be a patent. The dosage and that's really important, right? There are lots of inventions surrounding the dosage and sometimes it's really complex. And the sequence of various drugs.
So you can see how there's lots of research and development that goes into each one of these different things - lots of investments in each one of these inventions. The FDA has to approve everything that's new, takes a long time. So they are all covered by different patents. And therefore, a particular product will have multiple inventions and therefore multiple patents.
So the bottom line here is, there's nothing wrong with having what they call a patent thicket or multiple patents, as long as we have multiple inventions. And the United States needs to encourage investment in more and more innovation for a particular product, not less.
Giachino (06:01.0876 - 07:08.0279)
And so the patents thicket would apply, maybe potentially, at the initial phase of seeking that patent, applying it across the different uses or applications of that innovation. The patent evergreening that we hear talked about, where activists again allege that companies file additional patents on existing products to extend the life, hits what you talked about in terms of, we continue to innovate. And if there is no incentive, if we take away that incentive to continue to innovate, how might we improve how this pill is taken from, you know, a capsule to a liquid, or so on and so forth. It's not in that case an instance where they are trying to, as the activists say, engage in gaming this patent system. Share with us your thoughts on that - where the activists claim that it impedes access to generic medications or it keeps prices high. Fact or myth?
Iancu (07:08.0859 - 10:47.0664)
Complete myth and it's an outright falsehood. An outright falsehood.
A patent lasts for 20 years from the date of filing, unless there is a short extension due to government delays. But put that aside, that's not what they're talking about. So, a patent generally is 20 years from filing. And, it's for an invention. If I now, some time later - let's say a year later or two years later - I come up with a new invention. As you indicated a different dosage or a different delivery mechanism that improves how effective the drug is for particular patients, then you could get a new patent on that new invention and that new patent will run 20 years from its filing date. Okay. However, that has nothing to do with impeding the introduction of generics. Because when the initial 20 years expires, any generic can make that initial product. And then, when the next 20 years expires for the new invention, then the generics can make that improved product. Everything is on a 20-year scale from the date of filing of that particular patent on that particular invention.
And here's the more important practical point. The reality is if you look at all the drugs in the market, okay, the active life on average of patent protection overall, of all the patents on a particular drug is on average approximately half of the 20-year period. So 10, 11, 12 years overall is the active total life of patent protection. It's very rare that a particular drug will have protection for more than 20 years, no matter how many inventions you have. And the reason for that is that drug companies enter into settlement agreements, so to speak, globally with the generic industry to allow earlier access for various market and economic reasons.
So, the concept of evergreening is absolutely false. You cannot by law extend the life of a particular patent.
One final point on this issue, the activists are very focused on drugs, but think about all the other products in the market. Okay. And again, back to cell phones. Think about your cell phone that you use every day. Almost every year or every other year, they come up with a new model. You're barely buying your iPhone and as soon as you get home, they announce a new version. We're up to iPhone 16, I think, in the Fall. And the activists are not complaining about that.
The reality is that you want to incentivize companies to come up with improvements and new features and let them bring them to the consumers. And you don't want to stifle that continuing innovation and incremental improving innovation. All of that is good for consumers and for the same reasons, it's really good for patients.
Giachino (10:48.0215 - 11:18.0880)
So talking about stifling innovation. In recent news, there seems to be a wonky but significant proposal from the USPTO - an office that you led some years ago - that could impact drug patenting, including lowering the cost of each patent challenge. What impact would this have on innovation? And is it necessary? We're talking about a practice known as "terminal disclaimers." If you could give us a little background on that - a two-minute version?
Iancu (11:19.0609 - 13:08.0866)
Oh, my. [Laughter] I don't know if a two-minute version exists for terminal disclaimers. However, let me give it a shot.
So, in patent law, if you file what's called a continuation patent application in the same patent family that you've already filed earlier because of the 20-year term, you have to make sure that the new patent does not extend the original term. Okay. If the inventions are not sufficiently distinct from each other. And that's why I said that by law, you cannot extend the 20-year term. So a terminal disclaimer insures is that part of the law that ensures you cannot extend the 20-year term? Okay. So that's a long-standing law.
And what the patent office is trying to do right now is to kill entire patent family on a particular product if one of the patents in that family is found to be invalid. And that doesn't make sense at all. So each patent has a different scope. And sometimes in a patent family, a patent is narrower and other patents are broader. And if one patent is invalid because it's too broad - in other words, it's so broad that it covers too much, including what somebody else invented earlier - then that patent would be invalid.
Iancu (13:08.0875 - 14:53.0065)
Okay. And it gets removed by the courts or by the patent office.
But that doesn't mean that a narrower patent is also invalid. Right? If you have a very narrow specific patent that clearly covers your invention and nobody else's, then that patent should be valid and not impacted by the broader invalid patent. So now what the patent office is proposing - and by the way, I don't think it's going to go through, for many reasons, including the fact that I don't think it's allowed under the law. But in any event, what they're proposing is that even the narrower patents would get invalidated. That would devastate the patent system. And as a result, completely disincentivized innovation.
And just imagine, you invent things, you start making products based on the patents you obtained on those innovations, and then just one of your patents is found to be incorrectly issued because it was too broad. That means that all of your patents on all of your inventions surrounding this this particular product and patent family would be out the window, and you have no protection and the copycats can come in right away. It would be absolutely devastating. And so therefore, I think it's bad policy. It's not going to go through for that reason, I think. And it's also, again, against the law because each patent, each invention needs to stand on its own.
Giachino (14:53.0495 - 15:25.0309)
Yeah, that's astonishing that they could even be proposing something that would conflict with both statutory and federal authority, federal law. You know, essentially leading to probably more likely challenges to proposed rules and potentially even substantial barriers, especially for small and independent inventors. Andrei, before I let you go, can we close out with you giving us your thoughts on what you see today as the biggest threats to IP protection?
Iancu (15:25.0809 - 17:54.0860)
You know, there are lots of threats to IP protection right now in the United States. There is a lot of rhetoric that is politically motivated surrounding the price of drugs and other products that is leading to easy political cheap shots at patents, like the one we just discussed. Like the use of terminology such as patent tickets, evergreening and so on that really do nothing to help with pricing, but do a whole lot to hamper U.S. innovation.
So, you know, the United States is in a very significant global competition for innovation on the technologies of the future that does include biotechnology. And there's an example - MRNA that was used in the vaccine in the pandemic. And other... lots of DNA processing and technologies that include things like artificial intelligence, quantum computing, autonomous vehicles, 5G, 6G and beyond telecommunications, and so much more. It's a global race for these technologies and we need a lot of innovation to be generated out of the United States. And for that, you need a lot of investment in that innovation in the United States. And all this rhetoric and all these policies and proposed policies that attack the intellectual property system in the United States are harming that innovation engine in the United States instead of helping it or even be neutral. They're doing affirmative harm.
On top of this, we continue to have the threat of theft of our IP once it is issued. And that is, you know, the harm from and the threat from the outside of the United States. So we're in the midst of a double whammy here where we're being threatened by our international competitors. But at the same time, we're also threatened internally by our wrong-headed domestic policies that are working to weaken our intellectual property system. We need to fix both of those and, at the minimum, stop harming ourselves.
Giachino (17:55.0291 - 18:19.0989)
Our guest has been Andrei Iancu, Chairman of the Council for Innovation Promotion.
Thank you so much for educating us on these very important issues. We hope that others will continue to follow your work and the work of your organization and that we can do all that we can do to ensure that IP protection continues to matter. Thank you again for your time today. Andrei. We greatly appreciate it.
Iancu (18:20.0000 - 18:21.0680)
Pleasure to be with you. Thank you so much.