|The Art of Intellectual Property|
Originally Published MX January/February 2006
Originally Published MX January/February 2006
GOVERNMENTAL AND LEGAL AFFAIRS
Intellectual property law firms can serve as valuable partners for medical device manufacturers looking to get the lay of the prior-art landscape.
When litigation surrounding medtech intellectual property (IP) rears its head, few medical device companies hesitate to enlist the services of an outside intellectual property law firm. But the relationship between a medtech manufacturer and its IP counsel can and should extend beyond the courtroom to encompass the entire life cycle of a medical device. Even in the earliest stages of development, when a company is just beginning to consider the potential market for a device or technology, an IP law firm can be an effective partner in paving a smooth road for that idea. And the more consideration given to the IP surrounding a medical device in its infancy, the less likely that product's life will end in the throes of a legal battle.
The relationship between a manufacturer and its IP firm often begins during the earliest stages of a device's development, when a company begins to investigate the prior art surrounding an area of potential interest. Due to the tremendous emphasis placed on intellectual property within the medical device industry, companies looking to map the prior-art landscape surrounding a product concept can spend virtually infinite time and resources plowing through databases and patent archives. Determining what depth of review is merited is a complex decision that is specific to each product or technology idea, and IP attorneys can help to assess the particular needs of a company's search.
"The easiest way to limit costs is to understand why a company wants to survey the landscape and to limit the search accordingly," says Kevin W. Cyr, managing partner of Kondzella & Cyr PA (Minnetonka, MN). "Generally, a prior-art search is typically done for one of three reasons: the search may be done to establish the state of the art in a particular field, the search may be done to determine whether or not a product or future product may infringe any existing patents, or the search may be done to see if a particular product may include patentable inventions."
To some extent, a medical device company can never have too much knowledge of its competitive landscape, says Cyr. However, such knowledge can be expensive. When determining where to draw the line between knowledge and cost, several factors come into play.
David Schnapf, a partner in the intellectual property practice group of Sheppard Mullin Richter & Hampton LLP (San Francisco), says two major factors guide medtech companies in determining the extent of needed prior-art searches. "How much is at stake in the product launch, and how well does a company know the market? The less certainty a company has about what's out there, and the more that is at stake, the greater the search effort that should be undertaken," Schnapf says. "Some companies know their competition very well and know what patents their competitors have. Other areas of technology may be much more difficult to assess without thorough searching."
John S. Cipolla, a partner at Calfee, Halter & Griswold LLP (Cleveland), agrees that the importance of a product to a company's overall business is crucial when planning a prior-art search. "Smaller companies that are just starting out often have only one or two products," he says. "In cases where a product is the lifeblood of a company, we recommend conducting full-blown searches."
Charles B. Lyon, also a partner at Calfee, adds, "It is extremely important to early-stage investors to have a sense of what prior art exists. A company must know if there are patents out there that might present potential right-to-use issues going downstream."
In addition to a product's importance relative to a company's stage of development, Gregory Carlin, an IP attorney with Alston & Bird LLP (Charlotte, NC), cites yet another determining factor: the density of a particular prior-art field. "Clearly pioneering inventions wherein the invention does not even fall into a relatively broad, known category of prior art might need little searching," he says. "In the medical device area, however, the prior art is often dense and innovations are more incremental due to the high cost of overcoming regulatory hurdles when bringing medical devices to market."
Due to the density of prior art in the medtech field, focusing a search around the known players in the field can help a company manage the scope of its search. "If a company wants to conduct a reasonable search without throwing money down a sinkhole, it has to identify where there is most likely going to be prior art," says Dirk D. Thomas, a partner at Robins, Kaplan, Miller & Ciresi LLP (Washington, DC). "One way to do this is to think about who a company's biggest competitors are likely to be and identify all their patents. Another way is to identify the patents filed by inventors who tend to be prolific in a particular field."
Overall, the depth of a patent search can be viewed in terms of a risk/reward analysis, says Tim Bianchi, a patent attorney with Schwegman, Lundberg, Woessner & Kluth PA (Minneapolis). "If a company is considering how to invalidate a patent that threatens its most profitable product line, it can justify higher costs to search for prior art," he says. "If a company is considering whether to file a patent on a concept that is not slated for production, sometimes a simple online search is adequate and justified."
Mark DeLuca, cochair of the intellectual property department at Cozen O'Connor (Philadelphia), agrees that companies must evaluate the level of risk they are willing to accept in their prior-art searches. "For prior-art searches associated with patentability and preparation of patent applications, the costs of such searches can be reduced if the company is willing to assume risk that the cost of preparing and filing a patent application may result in no patent being issued or a patent issuing with limited enforceability against equivalents that do not literally infringe the claims," he says.
Even if a particular product concept demands an extensive prior-art search, there are approaches that can help a medical device company keep its costs in check. The more educated a company's in-house staff is on the prior-art fieldand the clearer it is on what it hopes to achieve with its searchthe less time and resources it will waste. Whenever feasible, a company should conduct a baseline search on its own before sitting down with outside counsel to fine-tune its prior-art strategy.
"I suggest cost-conscious clients start their own prior-art search on the U.S. Patent and Trademark Office's Web site at www.uspto.gov," says Jerry Helget, an IP attorney with Briggs and Morgan PA (Minneapolis). "If there is a dead-ringer prior-art resemblance out there that would clearly make obtaining a patent impossible, the client will most likely find it online. If a client doesn't find prior art, then they could engage an IP firm's services."
Cyr agrees that preparation is key to saving money on mapping a prior-art field. "Rarely, if ever, does a company come to the table with no knowledge of what is already being done in its industry, who the players are, and what the critical patents are," he says. "Assembling this information into a package that can be provided to your attorneys will simplify their efforts and reduce your overall costs."
Similarly, J. Paul Haun of Patterson, Thuente, Skaar & Christensen PA (Minneapolis) says that companies should not overlook the skills and knowledge they already possess in-house when going into a prior-art search. "First, there may be people within the organization that already have a knowledge base in their heads due to past experiences," he says. "Second, there may be people in the organization who possess a working knowledge of intellectual property and understand who the competitors are such that they could use available tools to start assembling the competitive landscape. Through smart use of the Internet, a company can quickly assemble at least a satellite view of the competitive landscape even before they make the phone call to an attorney. This not only focuses the work of an attorney, but it also brings up the internal knowledge level so that what the attorney returns with is understandable."
The amount of search work that can be done in-house will vary greatly according to a company's size and its experience working in the relevant area. "I like to have companies do as much as they can in-house to save money," Schnapf says. "But the reality is that many companies don't have the luxury of turning a person over entirely to that purpose. We try to be as efficient as we can by using available resources, but a company can spend almost limitless money looking for prior art. Sometimes a company just has to set a budget and try to live with it."
When setting this budget, however, medtech executives should not discount the savings that thorough knowledge of the competitive landscape can deliver in the long run. "If the technology is deemed critical to the ongoing success or survival of a company, conducting comprehensive prior-art searches will ultimately be an inexpensive insurance policy when compared with the overall costs of success or failure," Haun says.
"Searching is not expensive relative to the cost of preparing, prosecuting, or litigating a patent," says John J. Gagel, a patent attorney with Fish & Richardson PC (Boston). "Indeed, if searching uncovers prior art that makes clear that the invention proposed for the application is unpatentable, the expense of preparing and prosecuting the application can be avoided entirely."
According to Barbara A. Wrigley, a partner in the intellectual property practice group of Oppenheimer, Wolff & Donnelly LLP (Minneapolis), expenditures on prior-art knowledge are especially important when drafting patent claims. "The old adage is that the patent attorney should draft the claims 'as broad as the prior art will allow,'" she says. "Therefore, you can see the importance of conducting a thorough prior-art search before deciding what is and what is not patentable. It is amazing how many companies want to save money by skipping the prior-art search. In the long run it will cost them more because, in most circumstances, claims that are amended during prosecution will not be afforded equivalents, thus narrowing the scope of possible protection."
Partnering with IP Firms
Much in the way that every prior-art search a company undertakes will be unique, so will the ways in which a company chooses to utilize the services of an outside intellectual property firm during this process. While larger firms might have the manpower and internal expertise to handle the majority of the patent landscaping themselves, some smaller firms, particularly those with less experience navigating the patent field, might entrust almost the entirety of the task to outside counsel.
Regardless of which entity will bear the brunt of the prior-art search, DeLuca says one aspect is key to the relationship: communication. "No one has a monopoly on keywords and search strategies, and the time spent discussing the search before it is done should reduce less-productive activities and provide for a more efficient search," he says.
Wrigley agrees that communication is essential. "I can't emphasize enough how important it is for the company to educate the patent attorney on the finer details of the device or technology to which the search is directed," she says.
In educating patent attorneys on these finer points, medtech companies shouldn't hesitate to pair their engineers and technical experts with their IP counsel, says John C. Serio, a patent attorney with Brown Rudnick Berlack Israels LLP (Boston). "During prior-art searching, companies can work with their patent attorneys to design around problematic patents uncovered during the search," he says. "It is extremely helpful to have a company representative who has technical or manufacturing expertise as a point of contact who is able to work with counsel."
Arthur S. Hsieh, a patent attorney with Morrison & Foerster (Palo Alto, CA), agrees that the technical minds of a medical device company can be assets in the prior-art searching process. "Company engineers and scientists, especially those with extensive experience in the medical device industry, can be valuable resources in identifying individuals, companies, and institutions active in a particular technology area," he says. "Their input can be very effective in assisting the patent attorney to conduct targeted and focused prior-art searches. However, these senior engineers and scientists tend to be the backbone of the company and are usually overloaded with various research and development tasks already. Therefore, management should provide incentives for the engineers and scientists to assist the attorney, while at the same time work with the attorney to ensure that the engineers' and scientists' time and efforts are utilized efficiently."
In addition to pointing attorneys in the right direction in their searches, in-house personnel at a medtech company can also assist in sifting through the search's results, says Mark D. Barrish, a partner at Townsend and Townsend and Crew LLP (Palo Alto, CA). "The real work begins after the results begin to arrive, and this is where coordination between a medical device manufacturer and a law firm is particularly beneficial," he says. "To derive the full benefit of the search, responsibility for filtering the results should be assigned to either the firm or one individual at the company. But regardless of who separates the wheat from the chaff, someone at the company should be available to provide a technical review of the most relevant prior-art references."
Filtering the Results
Although engineers and scientists at a medical device company can help read and interpret the technical side of patents that turn up in a prior-art search, one of the most valuable functions an outside IP firm can serve during the search process is to help put those patents into a legal context for a company.
"The main area in which law firms can help companies is in evaluating the results of a search," says Kirk A. Vander Leest, a partner at McAndrews, Held & Malloy (Chicago). "Patents are specialized legal documents. Intellectual property firms can help companies understand patent law, including what constitutes prior art and what isn't prior art. If a person doesn't have an understanding of this, an individual can spend a lot of time searching."
"To the majority of nonpatent attorneys, reading patents and patent applications, especially in the field of medical devices, feels like trying to read and understand a foreign language," says Haun of Patterson, Thuente, Skaar & Christensen. Brad Pedersen, another attorney with the firm, adds, "What the law firms possess is the ability to quickly read and understand the subject matter contained in the references that are found in relation to the potential patentability of an idea, as well as the experience and ability to gauge the likelihood of obtaining significant patent coverage for an invention."
Les Bookoff, a partner at Finnegan, Henderson, Farabow, Garrett & Dunner LLP (Washington, DC), agrees that an attorney's analysis of patents during the prior-art searching process will likely yield different results than if the filtering of patents is done internally at a medical device company. "A patent that a technical person may deem not problematic and gloss over, based on his or her interpretation of the language, may in fact be a significant issue to the company," he says.
In addition to experience in reading and dissecting patents, IP law firms often have access to prior-art searching capabilities and resources that medical device companies rummaging for patents in online databases might not.
Although the Internet has made most significant search resources readily available to everyone, Alston & Bird's Carlin points out that law firms can still reduce costs for companies when using these tools. "Due to volume of usage, law firms often have much more favorable rates on some online resources such as LexisNexis," he says. "Law firms can pass these savings through to the company. In addition, an attorney's experience with the use of search terms, as well as the classification systems used at the U.S. Patent Office, enables quicker, more-effective searching. Law firms also often have professional patent searchers on staff."
Schnapf of Sheppard Mullin Richter & Hampton notes that many IP law firms also have the resources to conduct in-person searches at the patent office. "We have access to good searchers who operate by going into the patent office and looking at patents," he says. "Often looking at the figures of a patent can be better than key word database searching. In addition, we have access to an international network of patent firms and can do local searching. This can be important if your biggest competitor is, for example, a Japanese company. Only a fraction of Japanese patents are ever filed in the United States or translated into English."
Chris Kennerly, an IP attorney with the medical device practice group of Baker Botts LLP (Dallas), also emphasizes the value of relationships with patent searchers. "Knowledge of which individual searcher to use for a particular technology is typically the single most important piece of information for obtaining a quality result," he says. Bruce Slayden, based in Baker Botts' office in Austin, TX, adds, "Over the years, we have developed strong relationships with several well-known search firms and have negotiated annual contracts with them at reduced rates. That helps limit the costs for all of our clients, even those with only one or two searches annually."
A Lasting Relationship
As with many other working relationships, a medtech company can benefit by establishing a long-term partnership with an IP firm that assists it in the quest for prior art. The more searches a company and firm conduct together, the more efficient these endeavors are likely to become.
"The more we work with a client in a particular field, the better we get to know the art and the more quickly we can identify issues and patents that might require further review," says Linda E. Alcorn-Horner, an attorney with Sterne, Kessler, Goldstein & Fox PLLC (Washington, DC). "For some of our institutional clients, we have created a library of patents that we update regularly. We group the patents in our library by category based on the categorizations used by the company. Then, when we receive a new invention disclosure from the client, we can quickly and efficiently locate the patents in our library that are most relevant and assess the patentability and freedom-to-operate issues for the client."
Jeffrey A. Lindeman, a partner at Nixon Peabody LLP (Washington, DC), agrees that stability between a medical device company and a law firm will drive efficiencies in the prior-art process. "One of the best ways to achieve effective patent searching is to have continuity between the people working at the client and at the law firm on similar matters," he says. "This is nothing more than building experience and resources, not only internally at the medical device company, but also at the IP firm. Typically after wiring two or three patent applications, there is a wealth of experience and knowledge of the prior art that aids both inventors and patent attorneys in assessing patentability, and also in knowing the competitive landscape for commercialization of a device."
Medical device manufacturers can benefit greatly by expanding their relationships with IP law firms beyond the courtroom. By enlisting the services of an IP partner in the earliest stages of a product's inception, medtech companies can avoid stepping on intellectual property mines later in a device's life. Whether it's a company's first or 50th product, forming a lasting relationship with attorneys who take the time to learn the intricacies of the manufacturer's portfolio will drive efficiencies and reduce the costs of prior-art searching over the long run.
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