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Patents in a Pandemic: Are There Incentives?

The debate over the role of patents during the COVID-19 pandemic has been growing. Ironically, in January 2020, less than a week after the Centers for Disease Control and Prevention issued its first public alert about the coronavirus, the U.S. Supreme Court declined to hear a case that one party thought was an opportunity to “provide much-needed guidance on the important question of the patent eligibility of medical diagnostic tests.” The lower court in that case, Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC, 927 F.3d 1333 (Fed. Cir. 2019), ruled that medical diagnostic test kits and methods are not patentable. The general rationale is that diagnostic tests relate to a natural occurrence, not a patentable man-made invention.

Would we have better COVID-19 diagnostic tests today if the patent incentive were not taken away? We are in the midst of a huge increase in federal funding to develop therapies and vaccines for COVID-19, including more than a billion dollars given to the National Institutes of Health, the National Science Foundation and the Food and Drug Administration. Many people believe that corporate America will take advantage by patenting their sponsored research, resulting in a slowdown of innovation, and making COVID-19 vaccines more expensive and less available. A few countries, including Canada, have already enacted emergency compulsory licensing legislation to improve access to coronavirus-related patents, and the World Health Organization wants to organize a voluntary pool of patent rights. Conversely, in an April 12, 2020, post to the IPWatchdog, former Federal Circuit Judges Paul Michel and John Battaglia warn that devaluing patent rights has historically had the opposite effect. They remind us of the situation created by rulings, such as Athena Diagnostics: “U.S. investment in R&D has dropped ... most notably … among innovative bio-pharmaceutical companies.” The incentive created by patents was the vision of George Washington and James Madison when they advocated for a U.S. patent system. Thomas Jefferson resisted, believing that ideas should be free. Nevertheless, Jefferson relented to the first Patent Act in 1790, became one of the first patent examiners and was later quoted: “Ingenuity should receive a liberal encouragement. Patentable subject matter should include anything under the sun that is made by man.”

Royal W. Craig
410-576-4109 • rcraig@gfrlaw.com

For additional information on the impact of the coronavirus, visit our COVID-19 information hub for a list of up-to-date content.