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Article

Title: Can a Strong Patent Position Be Illegal?

Author: Hymel, Lin J.; Williams, Kathleen Madden Article Type: Product Analysis
Source: Genetic Engineering News, v25 n7 p44(2) Publication Date: Apr 1, 2005
URL of Publication: http://www.genengnews.com

A discussion is provided of the possibility that a strong patent position held by a biotechnology or pharmaceutical firm might be illegal due to the ways in which such companies may have designed licensing and marketing policies. Hypothetical scenarios are described in which the issue of possible illegal tying could arise for products or services offered by a biotechnology or pharmaceutical company. For instance, a company might sell an analytical instrument that is patented and might require buyers of the instrument to use the patent holder's own reagents or kits with the instrument. The patent holding company might also mandate that buyers license a method that can be done with the instrument. In another possible situation, a company could license patented technology only when bundled with a license to another technology, or only with the requirement to purchase a specific product. Several federal court decisions describe the circumstances of illegality. In general, they adhere to law that holds ownership of a patent as a presumption of conveyed market power. Although some decisions have taken another turn, a recent decision by the U.S. Court of Appeals for the Federal Circuit in Independent Ink, Inc v. Illinois Tool Works reaffirmed the U.S. Supreme Court doctrine that ownership of a patent covering a tying product, i.e., the desired product used to force sales of another product, creates what is called a rebuttable presumption of market power over that product.

Products:
Biotechnology Patents
Pharmaceuticals

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