Pertuzumab has been recently approved by the FDA for the treatment of breast cancer. This drug joins a small group of targeted therapies which focus on the HER2 receptor, yet unlike the existing drugs, Pertuzumab is not only HER2 targeted, but also prevents dimerization with HER3 and HER4.

We now know that breast cancer is not one disease, but rather is a group of many different diseases. In fact, even when tumors are classed together based on their appearance, they may still be differentiated due a different genetic expression. For example, HER2-positive breast cancer is one form of breast cancer, named as such due to the overexpression of a gene called human epidermal growth factor receptor 2 (HER2) in tumor cells, and which is characterized by aggressive growth and a poor prognosis. Other cancer forms may also overexpress HER3 and HER4 receptors. Although HER2-positive tumors tend to be less responsive to hormone treatment, treatments that specifically target HER2 are quite effective and mostly include Trastuzumab (Herceptin®), Lapatinib (Tykerb®) and recently pertuzumab (PERJETA®).

Trastuzumab, which specifically targets HER2, attacks the cancer cells and decreases the risk of recurrence. Trastuzumab is often used with chemotherapy, but may also be used alone or in combination with hormone-blocking medications, such as Tamoxifen. Lapatinib, like Trastuzumab, is a HER2-specific drug and may be effective for HER2-positive breast cancer that doesn’t respond to trastuzumab. Lapatinib is also being studied in combination with Trastuzumab.

On June 8, 2012, the U.S. Food and Drug Administration approved Pertuzumab injection (PERJETA®, Genentech, Inc.) for use in combination with Trastuzumab and Docetaxel for the treatment of patients with HER2-positive metastatic breast cancer who have not received prior anti-HER2 therapy or chemotherapy for metastatic disease. Pertuzumab is a recombinant humanized monoclonal antibody that targets the extracellular dimerization domain (Subdomain II) of HER2, and thereby blocks ligand-dependent heterodimerization of HER2 with other HER family members, including EGFR, HER3 and HER4.

In our next blog posts, Graeser Associates International will be exploring the challenges that are facing the healthcare teams, having to face much of the uncertainty upon providing biosimilars to patients. We will also be providing powerpoint presentations, written reports, and short audio and video presentations through our Slideshare channel (www.slideshare.net/biosimilars). We will also be selling more detailed reports and longer audio and video presentations – please see our biosimilars product page for a list of products (www.biosimilar.me).

Adv. Ariel Averbuch, RPh, is an advisor on IP, healthcare and business strategies at Graeser Associates International (GAI), an international health care intellectual property firm, and acts as Chairman at the Pharmaceutical Society of Israel (PSI). Adv. Averbuch has been a pharmacist for over 10 years and is also a lawyer and a patent attorney, having extensive experience in the pharmaceutical field. Follow Ariel Averbuch on LinkedIn and Twitter: @ArielAverbuch. Follow our biosimilar communications on Twitter: @biosimilarsGAI. Email us at biosimilars@gai-ip.com.

Leading or lagging? When it comes to the adaptation of interchangeability aspects of biosimilars you are either ahead or behind. Where does Israel stand?


These are times of uncertainty, when new biological drugs penetrate the market, yet regulatory authorities have a hard time making clear cut decisions. One highly debatable subject is the matter of interchangeability of innovative biologics and biosimilar drugs. The problem arises since the biosimilar is not identical to the reference product, and as such, switching between the two might cause serious side effects and immunogenic responses for the patient.


Until recently, the Israeli Ministry of Health (MOH) did not issue clear guidelines with respect to the interchangeability of biologics and biosimilars. Accordingly, the Pharmaceutical Society of Israel (PSI), being the largest pharmacists’ organization in Israel, was concerned with the possible liability of the dispensing pharmacist in case of a possible adverse reaction due to a switch between an innovative biological drug and a biosimilar.


On April 30, 2012 the PSI raised its concerns with the MOH, stating that without clear guidelines the biosimilars are regarded as generics, which does not seem to be the proper definition for these follow-on biologics. On 21 June 2012, the MOH issued a brief notice stating that although there is room for interpretation of the law when it comes to generics, unless otherwise stated, interchangeability of biosimilars is allowed.


It didn’t take long for the MOH to change its mind, and on 2 August 2012, the MOH issued a second notice overturning the previous guidelines, and now stating that although possessing an active ingredient bearing an identical name, the biosimilars are in fact not identical to the reference product. As such, the MOH determined that the pharmacist is not allowed to switch between a biosimilar and the reference product and vice versa, without explicit directions from the physician. The MOH also added that a special committee will be appointed to determine the possible interchangeability options for specific biosimilars on a case by case basis.


In our next blog posts, Graeser Associates International will be exploring the challenges that are facing the healthcare teams, having to face much of the uncertainty upon providing biosimilars to patients. We will also be providing powerpoint presentations, written reports, and short audio and video presentations through our Slideshare channel (www.slideshare.net/biosimilars). We will also be selling more detailed reports and longer audio and video presentations – please see our biosimilars product page for a list of products (www.biosimilar.me).


Adv. Ariel Averbuch, RPh, is an advisor on IP, healthcare and business strategies at Graeser Associates International (GAI), an international health care intellectual property firm, and acts as Chairman at the Pharmaceutical Society of Israel (PSI). Adv. Averbuch has been a pharmacist for over 10 years and is also a lawyer and a patent attorney, having extensive experience in the pharmaceutical field. Follow Ariel Averbuch on LinkedIn and Twitter: @ArielAverbuch. Follow our biosimilar communications on Twitter: @biosimilarsGAI. Email us at biosimilars@gai-ip.com.

What you don’t know can hurt you in the world of patents and biosimilars


With apologies to the Beatles, the “orange submarine” of the title refers to submarine patents and the Orange Book for generic drugs. Of course, biosimilars lack such an Orange Book – would be biosimilar sellers have to go through a lengthy and cumbersome patent process with the originator for a biological drug instead. But the principle remains the same; patents act as a gatekeeper for determining whether a biosimilar can be manufactured and sold in the US.


Submarine patents add a degree of extreme uncertainty and risk for biosimilar manufacturers. The term “submarine” refers to the fact that these patents remain secret until they issue as a granted patent, after which they have 17 years of life from their issue date. By their very nature, submarine patents cannot be planned for, as they appear without warning and effectively block biosimilars of a particular biological drug from being manufactured.


Up until 1995, all patents were effectively submarines, as they were secret until they issued and they had 17 years of life from their issue date. After 1995, the life of such applications (and their granted patents) was 20 years from the date of filing of the application – not 17 years from the date of issuance of the patent. This change meant that no new applications filed after that date could truly be submarines.


Of course, older patent applications – filed before that date and still pending – could be considered submarine patents once they actually issue. For a period of time, such submarine patents would regularly appear, disrupting various industries and otherwise suddenly injecting a previously unknown risk factor for companies. As time went on, these submarine patents dwindled in number – until everyone thought that they were gone.


Think again – an important submarine patent covering the biosimilar drug Enbrel issued as late as November 2011 – meaning that it will be in force, unless abandoned or invalidated, until November 2028! No one predicted that such a patent could still exist, and certainly no one was prepared for this particular patent. Thus, submarine patents could still theoretically appear, disrupting plans for a particular biosimilar and generally injecting an unquantifiable risk to the business of biosimilars in the US.

The emerging field of Biosimilars requires some adaptation from the relevant healthcare practitioners, as these complex molecules seem to defy the known facts related to simple chemical entities. Find out why


“It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change,” said Charles Darwin, and indeed nowhere else is there a better example of slow adaptation like the one we are witnessing these days with the penetration of generic biological drugs, or biosimilars, into the medical world. The struggle of the regulatory authorities to define the requirements for approval, and the lagging adaptation of medical staffs around the world to recognize and comprehend the fact that we are now facing a brand new class of drugs, makes biosimilars very intriguing.


Biological drugs, also referred to as biologics, are proteins which are designed to either mimic or antagonize endogenous processes, a fact which makes them highly efficient in treating many medical conditions. The structure of a protein is by far more complex than that of a relatively simple chemical molecule. Proteins, being constructed of amino acids, have four levels of structure complexity which include not only the sequence of the acids and the length of the chain, but also secondary, tertiary and quaternary folding structures. Comparing a simple drug like Aspirin (21 atoms) to an average IgG Antibody (~25,000 atoms), is like comparing the structure and mechanism of a bicycle to the complexity of a jet plane. It is thus understood why, unlike chemical molecules which may be synthesized in a lab by performing chemical reactions, biological drugs are produced using live cells.


Because of this ability to produce exact copies of chemical molecules, in the pharmaceutical world we are accustomed to seeing generic drugs flooding the market once the patent for an innovative molecule expires. However, in the biological arena, producing an identical biological copy when the patent for the original expires is almost impossible since the manufacturing conditions have to be identical to yield an exact copy of the protein (as previously mentioned, it is not enough to have the correct sequence of amino acids, as the folding structures and post-translational modifications are also crucial). That is why follow-on biologics are referred to as “Biosimilars”, taking into consideration that although similar, they are not identical. It is essential to understand that the days of interchangeability of medications, and simple comparative studies are probably over, and unlike chemical generics, the safety and efficacy of each new biosimilar will most likely need to be determined on an individual level.


In our next blog posts, Graeser Associates International will be exploring the challenges which await the healthcare practitioners with regard to biosimilars. We will also be providing powerpoint presentations, written reports, and short audio and video presentations through our Slideshare channel (www.slideshare.net/biosimilars). We will also be selling more detailed reports and longer audio and video presentations – please see our biosimilars product page for a list of products (www.biosimilars.me).


Adv. Ariel Averbuch, RPh, is an advisor on IP, healthcare and business strategies at Graeser Associates International (GAI), an international health care intellectual property firm, and acts as Chairman at the Pharmaceutical Society of Israel (PSI). Adv. Averbuch has been a pharmacist for over 10 years and is also a lawyer and a patent attorney (Israel), having extensive experience in the pharmaceutical field. Follow Ariel Averbuch on LinkedIn and Twitter: @ArielAverbuch. Follow our biosimilar communications on Twitter: @biosimilarsGAI. Email us at biosimilars@gai-ip.com.

Not many things can profoundly affect and perhaps even alter a profession, let alone the pharmacist’s profession. However, biosimilars might do just that.


The pharmacist, being an integrated member of the health care team, is focused on providing consultation and promoting safe and effective medication use. Specifically, the hospital pharmacist has a crucial role in providing accurate information about drugs to both the patient and other members of the medical team. From detailed mechanisms of action to rare side-effects, the pharmacist has to keep up with the constantly updating, abundant information the pharmaceutical field has to offer.


However, being familiarized with the activity of relatively simple chemical entities is entirely different from profoundly understanding the complex world of biological drugs, and that is where the biosimilars kick in. Biosimilars, or follow-on biologics, are the closest thing to generic versions of biological drugs. But unlike the simple chemical molecules which may by synthesized in a lab in many different ways, biological drugs are manufactured using live cells, and thus, even slight modifications in the process conditions may yield a considerably different biological drug. From a regulatory point of view, biosimilars are approved in reference to the originator biological drug and are required to undergo a process of approval in order to ensure that they are sufficiently similar to the reference product in order to be safe and effective.


Accordingly, the pharmacist is now required to refrain from taking issues like interchangeability for granted, as switching one biological drug for another, even if having the same “generic” name, may cause the patient to react differently. In fact, some regulatory authorities around the world, including the US, Canada, Europe and Israel have expressed their concerns about the interchangeability of biologics by pharmacists. The pharmacist is also required to get familiarized with side effects and possible complications of biological treatments, such as systemic immunogenic responses, which are less common with simple chemical molecules.


In our next blog posts, Graeser Associates International will be exploring the challenges that are facing the hospital pharmacists, who will be at the front line of much of the uncertainty for providing biosimilars to patients. We will also be providing powerpoint presentations, written reports, and short audio and video presentations through our Slideshare channel (www.slideshare.net/biosimilars). We will also be selling more detailed reports and longer audio and video presentations – please see our biosimilars product page for a list of products (www.biosimilars.me).


Adv. Ariel Averbuch, RPh, is an advisor on IP, healthcare and business strategies at Graeser Associates International (GAI), an international health care intellectual property firm, and acts as Chairman at the Pharmaceutical Society of Israel (PSI). Adv. Averbuch has been a pharmacist for over 10 years and is also a lawyer and a patent attorney (Israel), having extensive experience in the pharmaceutical field. Follow Ariel Averbuch on LinkedIn and Twitter: @ArielAverbuch. Follow our biosimilar communications on Twitter: @biosimilarsGAI. Email us at biosimilars@gai-ip.com.

Good news for Rheumatoid Arthritis (RA) patients, as Actemra® (TOCILIZUMAB) shows superior results in reducing disease activity in patients when compared to Humira® (ADALIMUMAB)

Rheumatoid Arthritis patients are often treated with biological drugs such as Actemra®or Humira®, usually combined with methotrexate. However, due to methotrexate intolerance, significant side effects or ineffectiveness, it is quite common to see patients receiving biological monotherapy, i.e., a single biological drug as the only therapy for their symptoms.

From a recent study (Gabay et al., “TOCILIZUMAB (TCZ) MONOTHERAPY IS SUPERIOR TO ADALIMUMAB (ADA) MONOTHERAPY IN REDUCING DISEASE ACTIVITY IN PATIENTS WITH RHEUMATOID ARTHRITIS (RA): 24-WEEK DATA FROM THE PHASE 4 ADACTA TRIAL” Ann Rheum Dis 2012;71(Suppl3):152) it is evident that patients receiving the Actemra® drug as monotherapy have had significant improvement in the reduction of the symptoms of the disease when compared to patients receiving Humira® after a 24 week period of treatment. From the 8th week and onwards, patients treated with Actemra® have demonstrated improvement in swollen and tender joint counts, ESR (Erythrocyte sedimentation rate, a common measure of inflammation) and patient global assessment, and statistical significance was also achieved in favor of Actemra® for the general disease remission and lower activity.

The results of this research were presented at the EULAR (The European League Against Rheumatism) conference in Berlin in June 2012, and are considered a breakthrough which will enable physicians to better treat monotherapy patients suffering from polypharmacy side-effects and accordingly provide better care for this complex disease.

In our next blog posts, Graeser Associates International will be providing you with the latest updates on biological drugs and biosimilars. We will also be providing powerpoint presentations, written reports, and short audio and video presentations through our Slideshare channel (www.slideshare.net/biosimilars). We will also be selling more detailed reports and longer audio and video presentations – please see our biosimilars product page for a list of products (www.biosimilars.me).

Adv. Ariel Averbuch, RPh, is an advisor on IP, healthcare and business strategies at Graeser Associates International (GAI), an international health care intellectual property firm, and acts as Chairman at the Pharmaceutical Society of Israel (PSI). Adv. Averbuch has been a pharmacist for over 10 years and is also a lawyer and a patent attorney (Israel), having extensive experience in the pharmaceutical field. Follow Ariel Averbuch on LinkedIn and Twitter: @ArielAverbuch. Follow our biosimilar communications on Twitter: @biosimilarsGAI. Email us at biosimilars@gai-ip.com.

Biosimilars, or follow-on biologics, are generic versions of biological drugs, which are proteins. Biosimilars are approved in reference to the originator biological drug, or reference product. They are required to undergo a process of regulatory approval in order to ensure that they are sufficiently similar to the reference product in order to be safe and effective. Currently, biosimilars are sold throughout Europe; the process of reviewing and approving such follow-on biologics has recently started in the US under the BCPIA (Biologics Price Competition and Innovation Act of 2009).

 

The main answer to the question of why biosimilars are important now relates to cost. Typically, biosimilars sell for 70% of the cost of the originator drug. Given the expense of many biological drugs (some of which cost $100,000 per year per patient), cost savings of 30% can be very attractive for those paying for such biological drugs – whether private insurance companies, the government or private individuals. Furthermore, the need for biological drugs is expected to increase with an aging population; some biological drugs, such as Humira® (Adalimumab) by Abbott, specifically target diseases, such as rheumatoid arthritis, that are more prevalent in older populations. Thus, the overall amount spent on biological drugs is expected to continue to rise.

 

However, biosimilars represent many unique challenges in comparison to generic small molecule drugs. For example, because biological drugs are manufactured by living cells, different manufacturing processes may in fact lead to different proteins being produced; even if the amino acid sequence of the protein is identical to the originator biological, the biosimilar protein may have different post-translational modifications, which may in turn lead to different effects in the patient. Immune related side effects are of particular concern. The approval process for biosimilars is different from that of generic small molecules with regard to trade secrets, patents and other aspects of intellectual property. Finally, many originators, such as Abbott, are even challenging the validity of biosimilars in the US.

 

In our next blog posts, Graeser Associates International will be exploring these different challenges and uncertainties of biosimilars in the US, both with regard to intellectual property but also with regard to hospital pharmacists, who will be at the front line of much of the uncertainty for providing biosimilars to patients. We will also be providing powerpoint presentations, written reports, and short audio and video presentations through our Slideshare channel (http://www.slideshare.net/Biosimilars). We will also be selling more detailed reports and longer audio and video presentations – please see our biosimilars product page for a list of products (http://www.biosimilar.me/ ).

 

D’vorah Graeser, PhD is the founder and chief executive officer of Graeser Associates International (GAI), an international health care intellectual property firm. Dr. Graeser has been a U.S. patent agent for over 15 years and has extensive experience in the biomedical field– including patent analysis and prosecution for small molecule generic and biosimilar drug companies. Follow Dr. Graeser on Twitter:@DGraeser. Follow our biosimilars communications on Twitter:@biosimilarsGAI. Email us at biosimilars@gai-ip.com.

Dr. D’vorah Graeser sat down with Lawrence Warry, Patent Examiner – Cluster Computers at the European Patent Office to discuss the function of the EPO, recent regulatory changes and patent application trends. Editorial note – the first part of this interview appeared in the July 2012 edition of our newsletter, while the second part – marked as “Part II” below – did not.



1. Can you describe the European Patent Office’s primary functions as a regional office, and main advantages?


An international PCT (Patent Cooperation Treaty) application filed with the WIPO (World Interllectual Property Organisation) must be converted into national or regional patent applications, and then are subject to national/regional grant procedures.


The EPO is the regional examination office governing the Eurozone. When an application has received an IPER (International Preliminary Examination Report) from the chapter 2 phase of the PCT prosecution procedure, it may enter the second phase and be filed the with the EPC member states zone. It will then be examined with the intention of being granted as a Eurozone patent.


Unlike many regional offices, the EPO’s advantage is that it offers protection covering multiple states (those states designated in the request) in one single request. In addition, the EPO, as a single regional regulation body for all member states, harmonizes law and patent legislation. This helps form a more integrated patent community of member states. The EPOprovides the gateway for companies from around the world who file international PCT patents with the WIPO (Israel being a significant participant) to gain license protection of their products in the one or many member states of the EPC.


2. The EPO has stated it’s striving for ‘high quality’; how is it doing so?


The EPO has made significant steps in recent years to put quality high on the agenda of organizational improvement. The management directive to “raise the bar” kicked off a number of procedural changes including the requirement that each examination department staff a quality assurance expert. His or her responsibiliities include providing a localised, to the field quality control on the search and examination products produced by search and examination staff. Quality improvements came with the revision of the EPC to EPC2000 (which entered into force in 2007). On the other side of the procedure is the resource and, to that extent, quality has improved with the growth of the documentation repositories available for searching.


In 2005 the EPO restructured and set up various departments which are at the heart of its Quality Management System.


The EPO now has a top level Quality Board chaired by a vice president (VP2) in charge of quality policy (“quality roadmap”) and implementing quality improvements. Quality objectives are set by the President. We have a Quality Audit department (DQA) which checks a sample of searches and grants, providing an independent compliance figure for the offices’ output. Principal Directorate Quality Management is in charge of a system of quality monitoring by examiner and administrative staff peers. This is called OQC and provides direct feedback to operational units on compliance and causes of non-compliance so that the processes can be improved.

We also collect feedback from user satisfaction surveys and complaints to improve processes.


The end result is that we have been more receptive to feedback and have better monitored examination and administrative units for quality. The culmination will come in 2013, when the EPO will apply for certification of this system under ISO 9001, the quality management standard.


3. For patent agents and attorneys familiar with the procedures of the EPC, Lawrence Warry went into great detail recent changes to filing requirements and rules. For example, the contents of Rule 45 governing search went through significant change. Analysis of this and other changes to the Code can be found below. Examiner Warry explained the motivation behind these changes.


Changes made to EPC codes and regulations were made to improve the quality of prosecution and also to improve the quality of information provided to the applicant. For example, changes to rules related to searching now require an explanation for any unsearched subject-matter. Unlike in the past, now the examiner must provide a reasoned statement explaining why they cannot make a meaningful search for specific subject-matter of the claims.


4. In the case of computer inventions, what is a technical problem to be solved and what is a technical effect? What is the trend for granting computer inventions and how has it changed in the past 15 years?Portions of Examiner Warry’s answer appear here, while the rest can be found below.

CIIs (computer implemented inventions) require the EPO search examiner to either declare subject-matter that cannot be searched or to narrow down as much as possible what subject-matter can be evaluated for an inventive step. The trend shows a very low percentage of grants compared to filings and an even lower percentage over time from 1995 to 2007.

PART II – Additional Material

Rule Change Analysis


Former EPC1973 Rule 45 stated:
“If the Search Division considers that the European patent application does not comply with the provisions of the Convention to such an extent that it is not possible to carry out a meaningful search into the state of the art on the basis of all or some of the claims, it shall either declare that search is not possible or shall, so far as is practicable, draw up a partial European search report. The declaration and the partial report referred to shall be considered, for the purposes of subsequent proceedings, as the European search report.”


Corresponding EPC2000 Rule 63 now states:
“(1) If the European Patent Office considers that the European patent application fails to such an extent to comply with this Convention that it is impossible to carry out a meaningful search regarding the state of the art on the basis of all or some of the subject-matter claimed, it shall invite the applicant to file, within a period of two months, a statement indicating the subject-matter to be searched.
(2) If the statement under paragraph 1 is not filed in due time, or if it is not sufficient to overcome the deficiency noted under paragraph 1, the European Patent Office shall either issue a reasoned declaration stating that the European patent application fails to such an extent to comply with this Convention that it is impossible to carry out a meaningful search regarding the state of the art on the basis of all or some of the subject-matter claimed or, as far as is practicable, draw up a partial search report. The reasoned declaration or the partial search report shall be considered, for the purposes of subsequent proceedings, as the European search report.
(3) When a partial search report has been drawn up, the Examining Division shall invite the applicant to restrict the claims to the subject-matter searched unless it finds that the objection under paragraph 1 was not justified”


The new Rule 63 implies significant changes for both the way the search examiner and the applicant work with the EPC; primarily, it has introduced an additional dialog step between the applicant and the examiner. Unlike in the past, now the examiner must provide a reasoned statement explaining why they cannot make a meaningful search for specific subject-matter of the claims. The applicant must now indicate which subject-matter can be searched as a consequence.


Some Rules did not change in content, only in reference. It is useful for applicants to be aware that Rule 71a EPC1973 became Rule 116 EPC2000 (time limit of filing submissions after the summons to Oral Proceedings) and Rule 29 EPC1973 became Rule 43 EPC2000 (Form and Content of Claims).


Rule 116 EPC 2000 (previous Rule 71a EPC 1973) literally states:
“(1) When issuing the summons, the European Patent Office shall draw attention to the points which in its opinion need to be discussed for the purposes of the decision to be taken. At the same time a final date for making written submissions in preparation for the oral proceedings shall be fixed.Rule 132 shall not apply. New facts and evidence presented after that date need not be considered, unless admitted on the grounds that the subject of the proceedings has changed.
(2) If the applicant or patent proprietor has been notified of the grounds prejudicing the grant or maintenance of the patent, he may be invited to submit, by the date specified in paragraph 1, second sentence, documents which meet the requirements of the Convention. Paragraph 1, third and fourth sentences, shall apply mutatis mutandis.”


Rule 43 EPC 2000 (Previous Rule 29 EPC 1973) literally states (you may want to strip out just relevant paragraphs of the rule. I suggest 43(1) and 43(2):
(1) The claims shall define the matter for which protection is sought in terms of the technical features of the invention. Wherever appropriate, claims shall contain:
(a) a statement indicating the designation of the subject matter of the invention and those technical features which are necessary for the definition of the claimed subject matter but which, in combination, form part of the prior art;
(b) a characterising portion, beginning with the expression “characterised in that” or “characterised by” and specifying the technical features for which, in combination with the features stated under sub paragraph (a), protection is sought.
(2) Without prejudice to Article 82, a European patent application may contain more than one independent claim in the same category (product, process, apparatus or use) only if the subject matter of the application involves one of the following:
(a) a plurality of interrelated products,
(b) different uses of a product or apparatus,
(c) alternative solutions to a particular problem, where it is inappropriate to cover these alternatives by a single claim.”


Further information on computer inventions


CIIs (computer implemented inventions), like business method inventions, have always been controvertially received in the patent community to the extent that it was necesary for the EPO search examiner to either declare subject-matter that cannot be searched or to narrow down as much as possible what subject-matter can be evaluated for an inventive step.


The following chart shows the trend in the number of grants compared to number of filings of applications in the field G0F9/40 : arrangements for programming, which are representative of the general trend in the software field (including G06f17/30: information retrieval). The trend shows a very low percentage of grants compared to filings and an even lower percentage over time from 1995 to 2007.

Software patent trends at the EPO

On one hand, it can be reassuring for the applicant that the quality is upheld and the chance of opposition can be considered minimal. On the other hand, such a trend can be concerning and may lead the applicant to hesitate to file patent applicantions wth such subject-matter.


A number of current problems may be unnecessary contributers to this trend (such as machine translation errors betweeen languages, misalignments in prosecution between laws of different regions, varied trends in case law). As time goes on, these problems are continuously being addressed which should improve the situation.


Whilst Article 52(3) EPC clearly states that programs for computers “as such” are not patentable, there has been on going strife to clearly define what subject-matter falls under “as such.” The current line is a balance between restrictive and liberal in terms of interpreting what is regarded as technical, and the tool used to determine technicality is the current case law (T-decisions established by the board of appeal). For example, see the following decisions:
T1173/97 (IBM), T641/00 (COMVIK), T0931/95 (Pension Benefit), T769/92 (SOHEI), T0208/84 (VICOM). The following chart shows the trend from strict to liberal over the years for significant case law relevant to the definition of what is technical in computer implemented inventions:
Trends in software patent examination


Based on EPO Board of Appeals case law, technical contribution pertains to a further technical effect that goes beyond the normal physical interaction between the program and the computer. Having technical character is an implicit requisite of an “invention” within the meaning of Article 52(1) EPC.


Any feature assessed as non-technical cannot be taken into account for the assessment of an inventive step, unless the non-technical feature interacts with the technical subject-matter to solve a technical problem. Assessing whether or not a feature contributes to the technical character of a claim is a challenging task for the EPO examiner. Such an assessment requires some understanding of how skilled a person is in the art.


Thus an expert in business or finance cannot be regarded as a person skilled in the art, while a computer hardware or memory management expert may be regarded as a skilled person. This means that the mere implementation of a business method on a computer or computer network without further technical matter would likely not be perceived as having sufficient technical subject-matter that would lead to an inventive step, whereas improving a process to solve a technical problem, aided by a computer, is technical subject-matter worthy of evaluating an inventive step.

Here is a lesson that Microsoft is learning the hard way: excessive company efficiency = short term profits, long term failure. Creativity costs money and appears to be inefficient (and is definitely less efficient in the short term), but it is the only route for long term profitability and company survival. In an article in Forbes, the author compares the impending failure at Microsoft to other company failures and even failures of civilization.



Continuing Innovation is the Answer
Creativity and innovation are messy, hard to budget and frequently difficult to measure in terms of desired outcomes, such as increased sales, increased profitability or increased market penetration to new or existing markets. For these reasons, R&D is often the first budget to be slashed when a company is in trouble – or even when it isn’t. However, R&D spending alone doesn’t explain how some companies are able to innovate while others stagnate. Instead, it is explained by the “mindset” of the company – whether creativity and innovation to find better solutions for customers is desirable, or whether focusing on previously successful strategies is more important.



Short Term Success vs Long Term Sustainability
For a long time, Microsoft was objectively more successful than Apple – in terms of market share, profitability, share price, market cap and so forth. Yet now Apple shares are trading at a vastly higher level, while Apple’s market cap is higher than Microsoft’s. Microsoft still leads in terms of market share for most computer products, with the exception of MP3 music players, tablets and mobile telephony. Microsoft is still more profitable than Apple, but the gap has been closing as Apple’s profitability has increased more rapidly than Microsoft’s.



Bottom Line – Creativity for the Long Term
To maintain a company over the long term, creativity and innovation are a must, not a “nice to have”, as the story of Apple and Microsoft demonstrates. Short term-ism can only provide short term profits. What is the true goal of your company?

So, who owns your patents? And who is the “who” of that question? This post looks at the importance of assignments in determining patent ownership in the US – and what can happen if a proper assignment is not signed and filed.



US Patent Applications Must Be Filed in the Name of the Inventor
Unlike the vast majority of countries, the US requires all patent applications to be filed in the name of the inventor, even if the rights to the invention are owned by a company or other organization. It is assumed that the inventor owns the patent application until such an assignment is filed. The inventor may then transfer rights to the patent application (and hence to the invention) by signing an assignment, a document which transfers rights from the current owner (in this case the inventor) to a new owner. The inventor may be obligated to assign the rights by contract, but that cannot substitute for an assignment.



A Contract Is Not an Assignment
In Stanford Univ. v. Roche Molecular Systems, Inc., the US Supreme Court decided that even though a Stanford professor was obligated by contract to assign his rights in an invention to Stanford University, a prior assignment by the professor to Roche was still valid. This prior assignment, signed before any assignment by the professor to Stanford, prevented Roche from being sued for infringement for selling HIV detection kits. The US Supreme Court reasoned that while the contract was a promise to assign, the previously signed assignment was an actual assignment and so was valid.



Have Your Employees and Contractors Quickly Sign Assignments
The lesson to be learned is to quickly have your employees and contractors sign assignments as soon as any invention has been developed – possibly even if a US patent application has not yet been written, let alone filed. At the very least, it is important to have such assignments signed before or shortly after US patent application is filed – do not rely on contracts alone to enforce your rights.