Facilitating Innovation to Fight Coronavirus Act: Would it help or hurt patent owners?

With numerous private entities, major national health centers, and non-governmental organizations concentrating their efforts on developing and bringing to market diagnostics, treatments and preventatives to combat COVID-19, the issue of patent protection—and potential enforcement of patents—has also come to the forefront.

Senator Ben Sasse of Nebraska introduced draft legislation seeking to balance the interests of innovation and enforcement. The legislation, titled the Facilitating Innovation to Fight Coronavirus Act, joins the growing conversation of patent protection for technology in the fight against COVID-19.

Notably, the Facilitating Innovation Act would seek to accomplish two things. First, it would delay the patent term of any patent issued for a new or existing pharmaceutical, medical device, or other process, machine, manufacture, or composition of matter, or any new and useful improvement thereof used or intended for use in the treatment of COVID-19.  By “pausing” the patent term, patent owners with a new or existing patent would be prevented from asserting a patent infringement claim against a third party developing or using a treatment related to COVID-19. The term of this moratorium would continue until the COVID-19 “national emergency...terminates.”

Second, in exchange for the moratorium of asserting infringement during this national emergency, the patent life would extend for 10 years longer than it otherwise would under the Patent Act.

The proposed legislation is silent on what, if any, remuneration or compensation would exist against any infringers, which raises the issue of an improper government taking of property against patent owners.

An additional 10 years of patent term may have or may not have appeal to innovators depending on the technology especially if the proposed legislation would give potential infringers a defense to infringement during a time when the value of these eligible patents is likely at its peak.

McDonald Hopkins will continue to provide updates as this draft legislation progresses through the Senate.

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