from the tighten-the-noose dept.
A U.S. Senator is seeking to close the patent loophole used by the pharmaceutical company Allergan:
Allergan's move to stop its patents from being reviewed by handing them off to a Native American tribe is winning support from few people outside the drug company. Now one lawmaker is seeking to ban it.
Sen. Claire McCaskill (D-Mo.) has introduced a bill (PDF) that would head off Allergan's strategy without waiting to see whether the judges at the Patent Trial and Appeals Board will even approve it. "This is one of the most brazen and absurd loopholes I've ever seen, and it should be illegal," McCaskill said last week in a statement to a pharmaceutical lobby group.
The Native American patent shelter, promoted by Allergan's outside law firm, seeks to avoid the process of "inter partes review," or IPR, for the patents protecting the blockbuster drug Restasis. The IPR process is a kind of quasi-litigation that takes place at the Patent Trial and Appeals Board for the sole purpose of determining whether a patent is valid or not. Now that the Restasis patents are owned by the St. Regis Mohawk tribe and licensed back to Allergan, the drug company's lawyers have asked for an impending IPR to be dismissed. The tribe argues that it's protected from IPRs by "sovereign immunity."
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Dr. Lowe has scary patent news. Allergan's patent on Restasis is being questioned in court.
Last December, the US Patent Office granted an inter partes review of the relevant patents, a decision that did not go down well with Allergan or its investors. That form of patent review has been around since 2011 and the America Invents Act, and its purpose is specifically for prior art objections to a granted patent.
Looks bad for Allergan, but then they got sneaky. They transferred the patent rights to St. Regis Mohawk Indian Nation. Why? The Indian Nation is a sovereign nation, and our patent laws don't apply to them.
Members of Congress want answers about a multinational drug company's deal to save its patents by handing them off to a Native American tribe.
Last month, Allergan gave the St. Regis Mohawk Tribe six patents that protect Restasis, the company's blockbuster eye drug. The goal is a sophisticated legal strategy to avoid having the US Patent Office proceed with a process called inter partes review, which is a kind of quasi-litigation in which opponents of a patent can try to have them revoked. Lawyers for Allergan are hoping that the principle of sovereign immunity, in which Native American tribes are treated as sovereign nations in certain ways, will protect their patents from government review.
The strategy may well succeed. IPR proceedings against patents held by public universities have been canceled on at least two occasions, when the Patent Trial and Appeals Board held that the universities benefit from sovereign immunity because they are state actors. The St. Regis Mohawk tribe will be paid an annual royalty of $15 million as long as the patents are valid.
The move is a legal maneuver to avoid challenges to their patent.
Previously: Allergan Pulls a Fast One