• Sausage-making: America Invents Act, Sec. 37

    Last month, the NY Times’ Andrew Pollack tried valiantly to shine the light on some legislative sausage-making.  Congress was considering (and ultimately passed) legislation to fix a simple but hugely expensive patent filing error by law firm Wilmer Hale.  The patent belongs to The Medicines Company, for the drug bivalirudin (Angiomax).  Wilmer Hale filed the paperwork a day late, and it cost them a whopping $232 million – $18 million up front from the firm’s malpractice insurers and up to $214 million over time if the mistake allows generic entry in the US before June 15, 2015.  (Details on the Wilmer Hale settlement here).

    But Wilmer Hale dodged a bullet (American Lawyer coverage), and may avoid paying anything from their own pocket, due to helpful special interest legislation in Congress. Section 37 of the recently passed America Invents Act overlooks the late filing by Wilmer Hale and restores the patent, despite mounting attacks from unhappy members of Congress and the generic company APP Pharmaceuticals.  Ed Silverman at Pharmalot has a nice summary with links.

    Observations:

    • $232 million for a one-day mistake in filing must be a record settlement by a major US law firm.
    • How is it “innovative” to reward a patent filing error with a couple more years of patent life?
    • By delaying generic entry, Section 37 saved Wilmer Hale $218 million, with those funds coming from Medicare, Medicaid and private payers.
    • Wilmer Hale/The Medicines Company avoided a potential loss at the Court of Appeals because they had better lobbyists in Congress.
    • Lobbyist return on investment:  The Medicines Company paid the Ken Cunningham Group only $180,000 in 2010 and $40,000 in 2011 to get the provision inserted.  1000:1 ROI.
    • For my law students:  never, ever miss a filing deadline.  Better yet, file a day early.
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    • In the US, the purpose of government is to serve the corporations so this should not be surprising. The fact that it will cost the government (taxpayers) more is just another way our government serves corporations. In the good old days, this was called fascism.
      Fascism is the authoritarian rule by a privileged class and a full-scale assault on the lower class. Wages, any social net, labor laws and unions are quickly under attack.
      Unfortunately, this doesn’t end well. As people wake up and realize their plight, they tend to be upset. The tea party and occupy wall street protests are the start.