Leveraging the Patent Priority Date: A Life Sciences Focus
The ACC last month hosted the San Francisco Bay Area Life Sciences CLE Conference, giving TransPerfect Legal Solutions (TLS) team members the opportunity to learn and connect with colleagues. One of the panels, moderated by Alex Trimble, Partner at Mintz Levin, Cohn, Ferris, Glovsky, and Popeo, focused on prioritizing patent filings. Panelists included Briana Barron, Arcus Biosciences Vice President of Intellectual Property, Alok Goel, Cepheid Senior IP Counsel, and Wesley Jackson, Valitor CEO. Eric Elting, TLS Regional Director, attended the panel discussion and came away with some valuable insights.
Patent Filing Strategy
We all understand that patents help protect market share and attract investors who will further fund expansion by excluding competitors from making, selling, or using your technology. In that sense, a patent protects revenue stream; one good patent can be the basis of sustainability and growth for young and mature companies alike. It can also create company value in the absence of a revenue stream (shares of AOL rose by more than 40% when they signed a deal selling more than 800 of their patents worth $1.1B). Patents protect innovations and product-focused technology.
As seeking patent protection is a business and legal strategy, some of the most interesting information to come out of the panel was advice on the blocking and tackling of patent filing. When is the best time to file, and where? These decisions may make an impact on your organization in the long term.
Patent Priority
A priority claim determines the priority date of a patent application. The priority date effectively determines what references can and cannot be asserted as prior art against a patent application during its examination. The earliest patent filing may comprise a provisional patent application, a non-provisional patent application, or a foreign application. Ultimately, the priority date draws a line in the sand for prior art that cannot be crossed.
The term may also refer to the earliest filing date of a particular feature of an invention. Therefore, it is possible to have multiple priority dates if new features were added in related applications. This is also how the patent office determines whether another patent filing or publicly available document qualifies as prior art against the patent application.
The right of priority belongs to the applicant or the successor in title. It also allows the claimant to file a subsequent application in another country for the same invention, design, or trademark effective as of the date of filing the first application. The period of priority is often referred to as the priority year for patents and utility models, and typically lasts six months for industrial designs and trademarks, and 12 months for patents and utility models.
When to File: Earlier vs. Later Filing
Patents are business tools. Traditionally, many companies wait until the filing deadline is near before submitting, but there are strategic advantages to filing early. In the life sciences area, it is important that scientists understand the value of IP and how even a small improvement can have a large impact. Early filing can protect ideas prior to a conference presentation to preserve foreign rights. Others internally may want to position the company for collaboration or outside investment that needs protection, the marketing team may be trying to promote the company via publications, or, simply, the partner of your joint venture is releasing a public statement. Many of these aspects are often pursued by early-stage companies. After presentation or publication, US rights are still available by filing within a one-year grace period (35 USC 102(b)(1)).
On the other hand, because patents expire, waiting to file will preserve the patent term for as long as possible. Similarly, delaying publication delays disclosure to competitors. Later filings allow research and development to advance further and strengthen the initial patent filing. Larger, more mature, companies are often better placed to prioritize these factors, especially if they have strong controls around maintaining trade secrets.
Whether your organization chooses to file early or late may be as much a matter of position in the marketplace as business strategy.
Considerations for Filing Abroad
In addition to the potentially considerable cost of foreign filing, other factors need to be considered: market cap potential, as well as a defensive strategy based on where your competition is or where their manufacturing will be done. Are you moving into a market to further stimulate interest from investors or for tax and corporate considerations? Your play may be to keep the novelty value even if another entity applied the patent to a similar or same invention during the priority date and the filing date abroad. All these factors are weighed against administration and financial costs.
Conclusion
Developing intellectual property is only the first step toward monetizing it. Protecting IP with domestic and/or foreign patent protection is an important part of the process. As the panelists at the Bay Area Life Sciences CLE Conference showed, when and where you file goes a long way toward maximizing these important business investments, especially in the life sciences.