BIO Submits Brief of Amicus Curiae in Wi-Fi One, LLC v. Broadcom Corporation (U.S. Court of Appeals for the Federal Circuit)

The Biotechnology Innovation Organization (“BIO”) is the principal trade association representing the biotechnology industry. BIO has more than 1,100 members, which span the for-profit and non-profit sectors and range from small startup companies and biotechnology centers to research universities and Fortune 500 companies. Approximately 90 percent of BIO’s corporate members are small or mid-size businesses with annual revenues of under $25 million.

Because modern biotechnological products commonly involve lengthy, resource-intensive development periods, BIO’s members depend on a strong, stable, uniform system of patent rights and protections. According to a recent study, the average cost to discover, develop and pursue regulatory approval for a new drug (including projects that do not succeed) is $2.558 billion. These costs are greatest in the last stages of the drug’s development. Without effective patent rights, these investments are difficult or impossible. Many of BIO’s members devote years and millions of dollars to innovations protected by a single patent, leaving members especially vulnerable to the misapplication of patentability doctrines. In biopharma technology, compared to many other fields, vague patent claims and overbroad patent thickets are rare; patents are generally sought to protect exclusivity, not to extract industrywide royalties; and evaluating prior art combinations for obviousness purposes is an unusually sophisticated inquiry.

Patents have faced daunting odds in America Invents Act proceedings. According to the most recent available statistics, 63 percent of petitions to institute review in these proceedings are granted. Of patents that reach a final written decision after institution, over 80 percent have had at least some claims cancelled. Of those decisions from which appeals are taken and heard, over 90 percent are affirmed. AIA petitions have therefore been consistently popular with petitioners, with 5,656 filed in their first four years of existence. Biopharmaceutical patents are becoming an increasingly common target of petitions. The share of AIA petitions challenging biopharmaceutical patent claims has risen from 6 percent in 2014, to 9 percent in 2015, to 13 percent in 2016. Such petitions targeting biopharma patents are increasingly brought, not by fellow biopharma concerns who wish to compete, but by third parties such as hedge funds making market wagers by challenging a patent in an AIA petition while shorting the patent owner’s (or licensee’s) stock.

The majority opinion in the now-vacated panel decision in the present case would have left in place and extended a broad ban on judicial review of the PTO’s exercise of its authority to institute review of issued patent claims in AIA proceedings. This Court’s doctrine regarding preclusion of judicial review of such questions has led to continuing confusion among BIO’s members (as well as other members of the public) regarding which matters this Court can review on appeal from a final decision by the Board. Given the importance of patents to BIO’s members and biopharmaceutical innovation, and the increasingly grave significance of AIA challenges to their patents, BIO’s members have a strong interest in ensuring appropriate judicial review is available to ensure that the PTO’s Patent Trial and Appeal Board acts consistently and predictably within its statutory and regulatory authority.

Amicus has no direct stake in the result of this appeal. No counsel for a party authored this brief in whole or in part, and no such counsel or party, nor any person other than amicus curiae or its counsel, made a monetary contribution intended to fund preparation or submission of this brief. This brief is solely the work of amicus and its counsel, and reflects amicus’s organizational view, but not necessarily the view of any of its individual members. The Court’s January 4, 2017 Order granting rehearing en banc (Dkt. 67) authorized and invited the filing of this brief.

Amicus takes no position on any other matters not expressly addressed herein.

BIO Submits Brief of Amicus Curiae in Wi-Fi One, LLC v. Broadcom Corporation (U.S. Court of Appeals for the Federal Circuit)