maximizing the use and business value of patents · • alcon –eyecare ... in 2014, we teamed up...

Maximizing the Use and Business Value of Patents

Getting from Patents to Innovation

Corey Salsberg

Head International IP Policy

Medellín, Colombia, April 16, 2015

Maximizing Business Use and Value of Patents | Corey Salsberg | March 16, 2015 |

Who We Are: Novartis at a Glance

Novartis is a global healthcare company

whose mission is to discover, develop and

successfully market innovative products to

prevent and cure diseases, to ease suffering,

and to enhance the quality of life for patients.

2

Headquarters: Basel, Switzerland

123,000+ full-time associates from

150+ countries

Operations in over 140 countries

(sales in 180 countries)

3 Main Global Operating Divisions

• Pharmaceuticals – Innovative Rx

• Alcon – Eyecare

• Sandoz – Generics + Biosimilars

Our core medicines reach more than1 billion people annually.

Consistent with our focus on patients, we reach hundreds of millions more through our special access programs.

Our ability to continue to address patient needs depends on innovation.

At heart, we are an “innovation company.”

Maximizing Business Use and Value of Patents | Corey Salsberg | March 16, 2015 |

Novartis: Innovation and Patient Health

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“[B]efore Gleevec, only 30% of patients

with CML [chronic myelogenous

leukemia] survived for even five years

after being diagnosed. With Gleevec,

that number rose to at least 89%.”

— Pray, L. (2008) Gleevec: the breakthrough in cancer

treatment. Nature Education 1(1):37

In 2014, we teamed up with Google

to develop “smart lens” technology.

In 2006, Sandoz launched the first-

ever biosimilar in the EU

Omnitrope® (somatropin), and in

March 2015 secured FDA approval

for the first biosimilar in US history,

Zarxio™ (filgrastim).

More than 200 R&D projects are

underway, with 20 compounds in

development, and 5 FDA

breakthrough therapy

designations (2 in 2014)

What do these have to do with patents?

Maximizing Business Use and Value of Patents | Corey Salsberg | March 16, 2015 |4

“The very first official thing I did,

in my administration—and it was

on the very first day of it too—

was to start a patent office; for I

knew that a country without a

patent office and good patent

laws was just a crab, and

couldn’t travel any way but

sideways or backwards.”

A Connecticut Yankee in King

Arthur’s Court (1889)

Time travel Scrap books Camelot


The Beauty of the Patent Systemin the Words of the US Founding Fathers

“The utility of th[is] clause will

scarcely be questioned . . . . The

right to useful inventions . . .

belong[s] to the inventors. The

public good fully coincides . . .

with the claims of the

individuals.”

— James Madison,

Federalist No. 43, 1788

A. The Adventures of Tom Sawyer

B. The Adventures of Huckleberry Finn

C. Life on the Mississippi

D. A Connecticut Yankee in King Arthur’s Court


Which Was Mark Twain’s Most Profitable Book?

Twain’s patented self-pasting scrapbook (1873) sold over 25,000 copies,

earning more money in his lifetime than any other of his other books.

This “was well enough

for a book that did not

contain a single word

that critics could

praise or condemn.”

Not all inventions are innovations.

Innovation requires more than patents!


Do Patents = Business Success?A Means, Not an End

Invent =

Create something new

Innovate =

Put an invention to practical use

US Patent No. 6,293,874 US Patent No. 5,830,035 UK Patent GB2272154

1. Provide a limited term of market exclusivity through which to recoup investment and establish customer loyalty.

Getting From Patents to InnovationWhat Can Patents Do for Entrepreneurs?


Case Study: In the 1980s, Brazil’s Achē

isolated a compound from an Amazonian plant

that showed promise as an effective pain

reliever — but it was not developed until after

1996, when Brazil began to recognize

pharmaceutical patents under TRIPs. The drug

became Achéflan ®, the first patented medicine

ever developed by a Brazilian firm.

Achéflan ® was an instant hit

with professional football playersAll trademarks are property of their respective holders.



Average life span of all-sized companies in Japan and Europe is only 12.5 years

Average life of a multinational (Fortune 500) is around 45 years

Of the top 500 U.S. firms in 1980, only 202 had survived by the year 2000.

460 BC - 1850s AD

• Mark Twain’s sister died of a fever when he was 4.

• 3 years later his brother died from the same.

• At age 8, a measles epidemic led Twain to expose himself to infection by sharing a bed with his infected friend.

• Cholera killed at least 24 people in his small town.

• In 1847 his father died of pneumonia.

1880s - Present

2. Enable risk-taking through R&D

• Risk leads to innovation . . .

- More than 90% of all successful innovations start off as failures

• Innovation leads to business success and transforms and saves lives

- In our industry, risky and expensive R&D fueled by patents has transformed medicine

• Why else take risks?

3. Enable entrepreneurs to innovate in directions where other forms of IP (e.g. trade secrets, TMs, know-how) do not work.

Secrecy does not work well for many fields today (or for society)!



• 33,000 examples of real innovations from 1851 and 1876 World’s Fairs

• Countries w/o patent laws were innovative, but only where secrecy

worked (food processing, scientific instruments)

• Countries with patent systems innovated much more broadly (e.g.

machinery, where secrecy does not work).

• As scientific instruments grew dependent on machinery, countries w/o

patent laws stopped making them, moved further into food processing.

Lessons from History: The 19th Century World’s FairsMoser, P., “How do Patent Laws Influence Innovation?” National Bureau of Economic Research

4. Attract investment to convert inventions into innovations (enable product development)

Beam Brush – Toothbrush with built-in-sensor and link to mobile app.

• Records duration of teeth brushing

• Connects to smartphone

• Tracks dental habits

• Sends notice when kids have brushed

• Use toothbrush as game controller

After filing patent applications beginning in 2011, inventor was able to secure requisite venture capital to fund development, making the product a reality.



Sources: Reuters, “Small businesses likely to benefit from patent law overhaul,” Sept. 25, 2012;

https://www.beamtoothbrush.com/. All trademarks are property of their respective holders.

https://www.beamtoothbrush.com/

5. Provide licensing income for those who do not/cannot practice inventions directly

• Finances career inventors or companies (enables anyone to become a career inventor)



Over 70% of the “great

inventors” of the 19th

century had only a

primary school

education (half had no

formal schooling at all).

In 1894, American

Bell Telephone Co.

licensed 73 patents

from outside

inventors,

developing only 12

inventions in-house

Thomas Edison

licensed or assigned

most of his patented

inventions to third

parties in order to

fund his full-time

R&D efforts

Charles Goodyear

invented and patented

the process for

vulcanized rubber

(1844), but never

manufactured or sold

rubber products

Sources: A. Mossoff, “The History of Patent Licensing and Secondary Markets in Patents,” George Mason U. School of Law, Dec. 2013;

H. Nothhaft & D. Kline, “Was Thomas Edison a Patent Troll?”, IP Watchdog June 1, 2010

Image from Scientific American (Aug. 12, 1854), p. 383.

6. Increase value of overall enterprise (for eventual investment or purchase)



All trademarks are property of their respective holders.

1880s: Herman Hollerith obtained series of patents on tabulating machine

technology which became the standard for tabulating and computing data input.

1911: Financier Charles Flint took notice and bought the company for $2.3m.

Merged with 3 other companies, and formed Computing Tabulating Recording (CTR) Company.

1924: Business spread to Europe, South America, Asia and Australia. The

company was renamed.

®

7. Knowledge dissemination (compare with trade secrets)

8. Enabling improvements or new products through cross-licensing, JVs, collaborations.

9. Defining scope and allocation of rights in JVs and partnerships.

Getting From Patents to InnovationWhat Else Can Patents Do for Entrepreneurs?


Adopt a state of “IP mindfulness” (which IPR and when?)

Take care when publishing inventions

Use NDAs when approaching others

File IP applications ASAP

Manage IP ownership

Stay close to the business

Use IP Counsel incl.

WIPO-WEF IAP

Increasing the Odds of Business Success:Seven Steps to “IP Nirvana”


maximizing the use and business value of patents · • alcon –eyecare ... in 2014, we teamed up...

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