Statement Of The Honorable Gerald J. Mossinghoff Before The Subcommittee On Courts And Intellectual Property Of The Committee On The Judiciary U.S. House Of Representatives

May 1998

Mr. Chairman and Members of the Subcommittee:

My name is Gerald J. Mossinghoff. I am pleased to submit this statement regarding the appropriate handling of requests for patent term restoration to remedy protections lost due to delays in regulatory agency review processes. I served as Assistant Secretary of Commerce and Commissioner of Patents and Trademarks during the consideration and enactment of the Drug Price Competition and Patent Term Restoration Act of 1984, commonly known as the Hatch-Waxman law. Later, I was President of the Pharmaceutical Research and Manufacturers of America. Currently, I am Senior Counsel to the law firm of Oblon, Spivak, McClelland, Maier & Neustadt, P.C. and a Visiting Professor of Intellectual Property Law at the George Washington Law School. The views expressed in this statement are my own; they do not necessarily reflect those of any institution.

The problem of lost effective patent life due to regulatory delay is a real one. While the Hatch-Waxman law addressed this question at a general level for products subject to premarket approval by the Food and Drug Administration, there are inevitably situations in which the law's restrictions lead to an inequitable result. This is especially true for so-called "pipeline" drugs, whose patent term restorations are limited to two years even though the Hatch-Waxman law also established an abbreviated application and review process for follow- on products, which was not in place when development efforts on these drugs began.

The ability to restore lost patent life is necessary not only as a matter of fairness, but also to ensure adequate incentives for research and development in the future. Companies that invest in discovering and developing new medicines, for example, need some assurance that if, for reasons beyond their control, patent life is lost that cannot be restored through the Hatch- Waxman law, some avenue will be available to rectify the situation.

At the same time, the current process for reviewing individual patent term restoration requests is in serious need of improvement. Because the enactment of legislation is the only means currently available to restore patent lives, these requests inevitably come before Congress. You must then spend the time and resources necessary to evaluate the requests, hold hearings, draft legislation, and consider it and vote on the floor. While these requests deserve such attention, there should be a better way to provide it.

Based on my experience as Commissioner of Patents and Trademarks, I believe that the Patent and Trademark Office (PTO) is ideally suited to review and decide patent term restoration requests. The PTO already has a process in place under the Hatch-Waxman law to obtain information on drug review times. This could readily be supplemented to secure and review such additional information as would be appropriate in any individual case, pursuant to factors established by Congress. I am confident that the PTO could handle these requests without any impact on its patent application review process.

In addition to reducing the burdens on Congress, placing the process within the PTO would have the advantage of regularizing the process and ensuring its fundamental fairness. In place of ad hoc decisions on proposed legislation, which depend on a variety of factors often beyond anyone's control, Congress could set forth in legislation the relevant factors to be considered. The PTO, in turn, could apply those factors to individual circumstances pursuant to an established procedure. Judicial review would be available as a safeguard against arbitrary or capricious decisions. This process of delegating authority to an agency is of course a common feature of administrative law. The Hatch-Waxman law itself embodies such a process for restoring patent terms; Congress can now supplement and improve on that process with one designed to handle individual cases of potential unfairness.

I agree totally with the current Commissioner of Patents and Trademarks, Bruce Lehman, who testified before this Subcommittee on the same point just a few months ago. On March 19, 1998, in response to a question from Representative Bryant, he stated that setting up an administrative process within the PTO to review patent term restoration requests for pipeline drugs and other products would be an "excellent idea." He said that this would provide a "more objective procedure" as an alternative to private bills. I agree.

Empowering the PTO to make a final decision on these matters, subject only to judicial review under the arbitrary and capricious standard of the Administrative Procedures Act, would make the process workable, fair, and nonpolitical. Companies that have invested many millions of dollars in research and development, only to see their intellectual property protections eroded by administrative delays, deserve to have their requests for restoration of lost patent life heard and decided on the merits. The PTO, in my opinion, is able to do that job.