Industry-Specific Patent Policy
Patent scholars have long called for industry-specific patent policy; however, these policies must support cross-functional collaboration amongst different technologies to continue to foster innovation.
BBC: Artificial intelligence-created medicine to be used on humans for the first time.
Since its inception in 1790, the US patent system has remained neutral by not taking specific industry standards into account when applying patent law. Several major pieces of legislation, such as the Patent Act of 1952 and Leahy-Smith America Invents Act (AIA) of 2011, have continued to enshrine the neutral stance of the patent system toward specific industries; however, as industries become more specialized, some scholars have questioned the U.S. Patent and Trademark Office’s (USPTO’s) reliance on such a neutral system.
For example, in their 2003 article, Dan Burk and Mark Lemley assert that even though patent law provides great leeway for courts to tailor existing law to specific industries, the Federal Circuit and Supreme Court have not embraced a role in establishing industry-specific patent policy. As a result, Burk and Lemley argue that the patent system could function better if the courts implemented more industry-specific patent policies. In particular, they point out that industries have fundamentally different needs and that technology is not uniform. By way of illustration, the semiconductor field requires billions in investment and years of construction to develop a novel semiconductor whereas the computer industry has been disrupted by two inventors working in their garage on a shoestring budget. In another example, they argue that neutral patentability standards have led to a proliferation of narrow biotechnology patents. Biotechnology suffers from fragmented ownership that hinders commercial development, and creating higher patentability thresholds in biotechnology could encourage greater innovation. Therefore, the article concludes that courts should better embrace industry-specific patent policies to help drive innovation.
Before this article, Robert Merges and Richard Nelson discussed how different technologies influence patent scope and economics in their 1990 article. Here, the authors argue that critical rulings on early patents, or pioneer patents, influenced the evolution of a technology’s field. For example, granting a very broad, pioneer patent gives one party exclusive access over the technology and may subsequently preclude other inventors from contributing to a cumulative-technology. Therefore, each technological field has already been influenced from previous prosecution and a non-neutral system inherently exists in patent law.
While these articles correctly identify that different industries have divergent needs and have separately evolved based on court decisions from keystone patents, each article examines technology in a siloed space. The past several years has seen an explosion in cross-functional collaboration amongst different technologies.
One such example of these collaborations is drug discovery and artificial intelligence (AI). AI is dramatically cutting the time and costs to develop new drugs by using large datasets to train algorithms that identify novel compounds for previously undruggable targets. In a real world example, Insilico Medicine used AI-drug discovery and design platforms to identify an anti-fibrotic small molecule inhibitor for an undruggable target to treat Idiopathic Pulmonary Fibrosis (IPF). Importantly, this process set a historic precedent that went from concept to phase I trials in only 30 months and Insilico Medicine’s costs throughout this process were about $2.6 million whereas a traditional approach would require at least $400 million in investment and a minimum of 3 to 6 years to complete. Revenue from this emerging field is already expected to reach $4 billion by 2027.
While the burgeoning field of AI-drug discovery holds great promise, it faces an uncertain future. A recent article discussing this uncertain future and the unique challenges that drug discovery and AI will have in patent law concludes that current laws must be improved to ensure patent law sufficiently incentivizes inventors and capitalizes investment. Accordingly, scholars and policy makers must consider the future implications for cross-functional collaboration amongst different technologies to ensure the patent system functions effectively.