Tag: Patent

Someone Gets It

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Only a few years ago, it would have been unthinkable for someone at a major political publication, even a liberal one like The Nation, to suggest that IP protections need to be relaxed for the good of society, and now we are seeing this.

IP law is literally for the public interest, in the US at least, as is explicitly stated in Article 1, Section 8 of the US Constitution, “To promote the progress of science and useful arts.”

IP is not property, it is a way to benefit society, not a way to allow rent-seeking to dominate our society:

The explosion of inequality over the past four decades is appropriately a major focus of the political agenda for progressives. Unfortunately, policy prescriptions usually turn to various taxes directed at the wealthy and very wealthy. While making our tax structure more progressive is important, most of the increase in inequality comes from greater inequality in before-tax income, not from reductions in taxes paid by the rich. And, if we’re serious about reversing that trend, it is easier, as a practical matter, to keep people from getting ridiculously rich in the first place than to tax the money after they have it.

While the Reagan, George W. Bush, and Trump tax cuts all gave more money to the rich, policy changes in other areas, especially intellectual property have done far more to redistribute income upward. In the past four decades, a wide array of changes—under both Democratic and Republican presidents—made patent and copyright protection both longer and stronger.

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The effect of these changes was to transfer money from the bulk of the population to the relatively small group of people in a position to benefit from them, either because of their skills in software, biotechnology, and other areas, or because of their ownership of stock in companies that benefit from these rules.

The upward redistribution of wealth arising from intellectual property (IP) is typically disguised in public debates as being the result of “technology.” But blaming technology attributes it to an impersonal force. When we point out that it is due to intellectual property, we make it clear that inequality is a policy choice.

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By my calculations, the amount of money transferred from the rest of us to those in a position to benefit from IP comes to more than $1 trillion annually. This transfer comes in the form of higher prices for prescription drugs, medical equipment, software, and many other products. This amount is almost half the size of all before-tax corporate profits, and roughly one-third larger than the current military budget. In other words, it is real money.

Intellectual property does serve an important economic purpose in providing an incentive for innovation and creative work. But we can make patent and copyright monopolies shorter and weaker while still supporting innovation and creativity, instead of going the route of longer and stronger, as we have actually done over the past four decades.

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Most of the public money goes to finance basic research, but sometimes the government supports the actual development process, as was the case with Moderna’s coronavirus vaccine. The government paid Moderna $483 million for its research and Phase 1 and 2 trials. It then coughed up another $472 million to cover the cost of Phase 3 trials. Incredibly, the Trump administration still allowed Moderna to have patent monopolies on its vaccine, even though the government had covered the development costs and taken the investment risk. If the vaccine had proven to be ineffective, the government would have borne the cost, while Moderna still would have been paid.

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We need to keep this example in mind as the Biden administration develops its foreign policy agenda, especially its relationship with China. Biden has already complained about China’s stealing “our” intellectual property. This sets the stage for potential conflicts that are not at all in the interest of the vast majority of the American people.

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While there may be cases where the failure to honor intellectual property can cost some middle-income jobs (for example, if China uses technology to which Boeing has patent rights), the impact is likely to be comparatively small. Arguing that we should protect Boeing’s IP on this basis would be like arguing that we should not tax Jeff Bezos because reducing his income could lead him to lay off some well-paid servants. The benefits that the relatively affluent and very wealthy get from IP protections are vastly greater than the higher wages that some workers may get as a result of working for Boeing or another company with large IP claims.

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The rules on intellectual property are a major part of the story of upward redistribution of the past four decades. Contrary to what is typically claimed, they have likely been a major obstacle to technological progress, especially in the areas of health and climate technologies. It would be tragic if the protection of IP was a major cause of a cold war with China. It would be even more tragic if progressives were leading the charge.

The author, Dean Baker, has been saying this for years, and now he is getting a real hearing on this in the court of public opinion.  Huzzah.

What a Surprise

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Countries that May Manufacture or Buy Sputnik V

In a world* where Covid-19 ravages the world, and no one can see a way out beyond giving taxpayer funded research to rent-seeking pharmaceutical companies, one nuclear armed nation’s vaccing manages to turn in good numbers without looting by private actors.

By, “One nuclear armed nation,” I do not mean the United States.  The idea of creation and distribution of medications without government subsidies is completely beyond the pale in this country.

I am referring to Russia, where the Sputnik vaccine is not showing effectiveness in excess of 90%, at a lower cost and without the handling issues of the mRNA vaccines being rolled out in the United States.

There is a precedent, the widespread popularity of the AK-47, which occurred because anyone could make it without IP concerns:

President Vladimir Putin’s announcement in August that Russia had cleared the world’s first Covid-19 vaccine for use before it even completed safety trials sparked skepticism worldwide. Now he may reap diplomatic dividends as Russia basks in arguably its biggest scientific breakthrough since the Soviet era.

Countries are lining up for supplies of Sputnik V after peer-reviewed results published in The Lancet medical journal this week showed the Russian vaccine protects against the deadly virus about as well as U.S. and European shots, and far more effectively than Chinese rivals.

At least 20 countries have approved the inoculation for use, including European Union member-state Hungary, while key markets such as Brazil and India are close to authorizing it. Now Russia is setting its sights on the prized EU market as the bloc struggles with its vaccination program amid supply shortages.

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Its decision to name Sputnik V after the world’s first satellite whose 1957 launch gave the Soviet Union a stunning triumph against the U.S. to start the space race only underlined the scale of the significance Moscow attached to the achievement. Results from the late-stage trials of 20,000 participants reviewed in The Lancet showed that the vaccine has a 91.6% success rate.

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Sputnik V uses a platform based on the adenovirus, which causes the common cold, and has been studied in vaccine development for decades, though its effectiveness is yet to be proven. AstroZeneca’s is similar, while drugs developed by Moderna and Pfizer and BioNTech rely on a new technology, which uses genetic instructions in a nucleic acid molecule called mRNA to program a person’s cells to make the viral protein itself, triggering an immune response.

Unlike the Pfizer/BioNTech vaccine, Sputnik V can be stored in a fridge rather than a freezer, making it easier to transport and distribute in poorer and hotter countries. At around $20 for a two-shot vaccination, it’s also cheaper than most Western alternatives. While more expensive than AstraZeneca, the Russian inoculation has shown higher efficacy than the U.K. vaccine.

The take-away here is not that Russia is some sort of biotech super-power, it clearly is not.

The take-away here is, or at least should be, that the US model, taxpayer financed research leading to private profits through additional government subsidies (patents) is not necessarily the best model to develop medical treatments.

*To quote Don LaFontaine.

Bill Gates is now a Mass Murderer

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Oxford promised to make their vaccine open source, and then Bill Gates strong-armed them into selling exclusive rights to AstraZeneca, because Bill Gates is philosophically opposed to the free exchange of information.

There will be tens of thousands of people will die of Covid-19, particularly in poor countries, because open source gives him butt-hurt.

Next time you see Bill Gates, ask him why he decided to kill thousands.

More chilling is that the Bill and Melinda Gates foundation is dedicated to promulgating his twisted view of public health on the rest of the world:

In a business driven by profit, vaccines have a problem. They’re not very profitable — at least not without government subsidies. Pharma companies favor expensive medicines that must be taken repeatedly and generate revenue for years or decades. Vaccines are often given only once or twice. In many parts of the world, established vaccines cost a few dollars per dose or less.

Last year only four companies were making vaccines for the U.S. market, down from more than 20 in the 1970s. As recently as Feb. 11, Dr. Anthony Fauci, the government’s top infectious disease expert, complained that no major drug company had committed to “step up” to make a coronavirus vaccine, calling the situation “very difficult and frustrating.”

Oxford University surprised and pleased advocates of overhauling the vaccine business in April by promising to donate the rights to its promising coronavirus vaccine to any drugmaker.

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A few weeks later, Oxford—urged on by the Bill & Melinda Gates Foundation—reversed course. It signed an exclusive vaccine deal with AstraZeneca that gave the pharmaceutical giant sole rights and no guarantee of low prices—with the less-publicized potential for Oxford to eventually make millions from the deal and win plenty of prestige.

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Even as governments shower money on an industry that has not made vaccines a priority in the past, critics say, failure to alter the basic model means drug industry executives and their shareholders will get rich with no assurance that future vaccines will be inexpensively available to all.

“If there were ever an opportunity” to change the economics of vaccine development, “this would have been it,” said Ameet Sarpatwari, an epidemiologist and lawyer at Harvard Medical School who studies drug-pricing regulation. Instead, “it is business as usual, where the manufacturers are getting exclusive rights and we are hoping on the basis of public sentiment that they will price their products responsibly.”

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Oxford backed off from its open-license pledge after the Gates Foundation urged it to find a big-company partner to get its vaccine to market.

“We went to Oxford and said, Hey, you’re doing brilliant work,” Bill Gates told reporters on June 3, a transcript shows. “But … you really need to team up.” The comments were first reported by Bloomberg.

AstraZeneca, one of the U.K.’s two major pharma companies, may have demanded an exclusive license in return for doing a deal, said Ken Shadlen, a professor at the London School of Economics and an authority on pharma patents—a theory supported by comments from CEO Soriot.

“I think IP [intellectual property, or exclusive patents] is a fundamental part of our industry and if you don’t protect IP, then essentially there is no incentive for anybody to innovate,” Soriot told the newspaper The Telegraphin May.

Some see the Gates Foundation, a heavy funder of Gavi, CEPI and many other vaccine projects, as supporting traditional patent rights for pharma companies.

“[Bill] Gates has staked out this outsized role in the vaccine world,” Love said. “He has an ideological belief that the intellectual property system is a wonderful mechanism that is necessary for innovation and prosperity.”

In just the next year, it is clear Bill Gates will ultimately be responsible for more deaths than Osama bin Laden was on 9/11.

Inmates Running the Asylum

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In what might the most extreme example of Stockholm Syndrome ever, USPTO chief Andrei Iancu has declared that patents are in no way slowing the emergence of new Covid-19 treatments.

Less than a week later, major pharma manufacturers were sued for ……… wait for it ……… patent infringement:

A week or so ago, the head of the US Patent and Trademark Office, Andrei Iancu, who has been an extreme patent maximalist over the years, insisted that there was simply no evidence that patents hold back COVID treatments. This is a debate we’ve been having over the past few months. We’ve seen some aggressive actions by patent holders, and the usual crew of patent system supporters claiming, without evidence that no one would create a vaccine without much longer patent terms.

Iancu was questioned about how patents might hold back life-saving innovation and he brushed it off like this was a crazy question:

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Iancu also shot down the idea that patents might be used to limit access to a vaccine:

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But just to highlight how ridiculous Iancu’s statements were, just days later, Pfizer, Regeneron, and BioNTech — all working on COVID treatments (including the antibody cocktail that President Trump took from Regeneron) — were all sued for patent infringement for their COVID treatments.

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And then to make an even stronger point, pharma company Moderna — which had been facing a ton of questions about how its patents might delay COVID-19 treatment — has announced that it will voluntarily agree not to enforce the patents during the pandemic.

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The key point: even if Iancu pretends otherwise, people actually in the space know that patents can and will get in the way of life-saving innovation, rather than acting as an important incentive.

It’s long past the time we recognized how damaging patents are for innovation in many different industries, including pharma, and having a Patent Office boss who simply denies reality is fundamentally unhelpful and anti-innovation.

As I have noted many times, IP law is at its core public interest law.

As it says in the US Constitution, copyright and patent are created to, “To promote the progress of science and useful arts,” not to reward maniacal rent-seeking, which is what it has become.

GNOME Foundation: 1 — Patent Troll: 0

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Patent Troll Rothschild Patent Imaging decided to sue the GNOME Foundation claiming that their patents have been violated.

The GNOME Foundation decided to fight back, and lawyered up, large with pro bono counsels, filed a counter-suit, and kicked the troll’s slimy ass.

While the specifics have not been revealed, we do know that the Patent Troll agreed never to sue again, and that GNOME paid them nothing:

Updated The GNOME Foundation has settled a US lawsuit brought against it by Rothschild Patent Imaging, complete with an undertaking by the patent assertion entity that it will not sue GNOME for IP infringment again.

In a so-called “walk away” settlement, Rothschild Patent Imaging (RPI) and the open-source body are discontinuing their legal battle that began in October last year. RPI sued for alleged IP infringement of one of its patents by the GNOME photo-organising tool Shotwell, marking the first time a free software project had been targeted in that way.

In a statement at the time, the GNOME Foundation said RPI “offered to let us settle for a high five-figure amount, for which they would drop the case”, something it said would be “wrong” to do. The open-sourcers thus countersued RPI, aided by lawyers from New York law firm Shearman Sterling who agreed to work on the case for free.

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Not only did GNOME score a settlement with RPI that halted the lawsuit altogether, it also received an undertaking to prevent it being sued again for patent infringement by RPI (with the caveat that the software in question is open source). That settlement covers a bundle of around 100 patents, we are told.

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[GNOME Executive Director Neil] McGovern also told Brock that the open-source community “managed to raise over $150,000 from over 4,000 individual donors” to fight the case, adding: “One of the strengths of the community is how passionately we care about what we do, and how we rally around each other when there’s trouble.”

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Updated to add

In an article comment on this story, McGovern said: “For those asking about payment, I can confirm we paid RPI and Leigh Rothschild a grand total of $0.00 for the settlement.”

The Perverse Incentives of Big Pharma

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It turns out that, in addition to remdesivir, Gilead has a drug with is less toxic, probably more effective, and easier to make, but they are refusing to test it because it has less life on its patent.

Once again, we see how rent-seeking through patents is the problem, and not the solution for developing new drugs.

Here is the money quote on all of this to my mind, “The attractive profile of GS-441524 from both manufacturing and clinical perspectives raises this question: Why hasn’t Gilead opted to advance this compound to the clinic? We would be remiss for not mentioning patents, and thus profits. The first patent on GS-441524 was issued in 2009, while the first patent for remdesivir was issued in 2017.”

Gilead has a long history of sacrificing the public health to the altar of profits, so this should be no surprise.

As for the potential of GS-441524, there is significant evidence that it is at least as good, if notbetter than, remdesivir:

In the midst of a pandemic like Covid-19, for which there are no FDA-approved drug treatments, hope is important. That’s one reason why remdesivir, an antiviral drug that Gilead Sciences originally made to fight Ebola, has been propelled into the spotlight with the hope that it can stop, or at least curtail, the ravages of SARS-CoV-2, the virus that causes Covid-19.

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As chemists, we are troubled by the challenges to mass producing remdesivir. We aren’t alone. On the day that results from the two trials emerged, Gilead CEO Daniel O’Day praised the chemists behind the drug, saying he is “proud of the team because this is a complicated chemical process. It takes many, many steps.”

But does it really have to be that complicated? O’Day’s admission is interesting given that Gilead has another compound in its pipeline that is easier to make, has been shown to be effective against coronavirus in animal models, and is potentially as effective as remdesivir, if not more so.

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Some background: Remdesivir works by interfering with the cellular machinery that allows viruses to replicate inside a human host. It is a pro-drug, meaning it must be metabolized and undergo a sequence of five bioactivation steps before it becomes GS-441524 triphosphate, the active compound that impedes viral replication.

Remdesivir isn’t Gilead’s only antiviral nucleoside analogue. The company has also developed GS-441524, another pro-drug that, as its name suggests, the body also converts into GS-441524 triphosphate, but in just in three steps. GS-441524 is easier to synthesize than remdesivir, requiring three steps instead of the seven needed for remdesivir.

Researchers initially thought that remdesivir would be activated more quickly than GS-441524 in human cells infected with the SARS and MERS coronaviruses. Yet data from primary human airway epithelial cells — one of the most clinically relevant cell-based models of the human lung — showed no statistically significant difference in potency between the two compounds. These data align with previous reports on the similar effectiveness of remdesivir and GS-441524 in coronavirus-infected cat cells. When GS-441524 was used to treat cats with feline infectious peritonitis, a progressive and usually fatal disease caused by a coronavirus, it displayed remarkable safety and therapeutic efficacy, with 96% of cats recovering after treatment.

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Data in cats and primates have pointed to GS-441524’s safety. In the study using GS-441524 to treat feline coronavirus, the researchers noted its “impressive” safety profile when administered at high doses, and reported that no systemic signs of toxicity were observed over 12 to 30 weeks of treatment. In primates, GS-441524 was found to be present at high concentrations in the blood (1,000-times higher than remdesivir) with no apparent adverse effects.

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When viewed through a different lens, the initial results from the NIAID-sponsored trial are more encouraging than they would seem. The active agent, GS-441524 triphosphate, clearly exerts antiviral activity against SARS-CoV-2 in humans, as supported by the accelerated recovery rates in advanced Covid-19 patients enrolled in the trial. Our analysis of preclinical and clinical trial data strongly suggests that early and direct administration of GS-441524 should be considered as a synthetically simpler and potentially more effective alternative to remdesivir, especially as GS-441524’s remarkable safety would enable higher dosing.

An Elegant Solution

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Dean Baker, an economist who not only predicted the housing meltdown, but put his money where his mouth was, and sold his home and moved into rental housing in the early 2000s, has a solution to the “problem” of the Chinese “stealing” US vaccine research.

He suggest that all research be released as free and public information, which would mean that there is nothing to “steal”.

What’s more if all this information were publicly exchanged, we would have a vaccine that much sooner (assuming that a vaccine is possible, but that is another blog post).

The only people who would lose, would be the big pharma guys who want to charge thousands of dollars a dose.

To them, I say, “Go Cheney yourself.”

In the last couple of weeks both the New York Times and National Public Radio have warned that China could steal a vaccine against the coronavirus, or at least steal work in the U.S. done towards developing a vaccine. Both outlets obviously thought their audiences should view this as a serious concern.

As I wrote previously, it is not clear why those of us who don’t either own large amounts of stock in drug companies, or give a damn about Donald Trump’s ego, should be upset about the prospect of China “stealing” a vaccine. Concretely, if China gained knowledge from labs in the United States that allowed it to develop and produce a vaccine more quickly, this would mean that hundreds of millions of people might be protected against a deadly disease more quickly than would otherwise be the case. If China made this vaccine available to people in the developing world, then the numbers could be in the billions.

Sounds pretty scary, right?

It is amazing that neither the reporters writing these stories nor their editors apparently gave much thought to the implications of China “stealing” a vaccine. Or perhaps, even worse, maybe they did. Anyhow, I suspect that most of the audiences of these outlets would not consider it a terrible thing if people in China or other countries could get vaccinated more quickly against the coronavirus.

But the issue of this potential theft is just the beginning of the story. If China can in principle develop a vaccine more quickly if it has access to data from labs in the United States then it must also be the case that researchers in the United States could develop a vaccine more quickly if they had data from labs in China and elsewhere. This raises the question of why we are not researching a vaccine collectively, with researchers all over the world posting their findings as quickly as practical so that teams of researchers everywhere can benefit from them?

There is a bad answer and somewhat less bad answer to this question. The bad answer is that the goal of the researchers is to get a government-granted patent monopoly so that they can charge lots of money for a vaccine and get very rich. The less bad answer is that we rely on grants of patent monopolies to finance research. If companies didn’t have the hope of getting a patent monopoly, they would have no way to recoup the costs they are incurring paying researchers and undertaking the trials necessary to establish the safety and effectiveness of a vaccine.

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However, in a context where the whole world is struggling to deal with a pandemic that is killing hundreds of thousands of people, it might be reasonable to just do the research and worry about the cost-sharing later. It would make sense for governments to fund their own research to the extent practical and require that everything be fully public as soon as possible.

If we went this route, our leading news outlets could put aside their fears that China would steal the vaccine. If they take advantage of U.S. research and rush ahead and develop an effective vaccine before our own researchers, then the whole world will benefit from having a vaccine sooner than would otherwise be the case.

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We have a huge amount of potential gain from going the route of open research and very little to lose. And our leading news outlets would be able to stop worrying about China stealing our vaccine.

Now, is the absolutely worst time to allow big pharma to loot the rest of us though thoroughly undeserved patent rights.

Rule 1 of Monsanto, Monsanto is Evil

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Rule 2 of Monsanto is SEE RULE 1.

After creating a plague of Roundup resistant weeds, Monsanto decided to double down on Dicamba, which had the effect of KNOWINGLY poisoning neighboring farmers’ crops, if they did not pay for Monsanto’s own genetically modified crops:

The US agriculture giant Monsanto and the German chemical giant BASF were aware for years that their plan to introduce a new agricultural seed and chemical system would probably lead to damage on many US farms, internal documents seen by the Guardian show.

Risks were downplayed even while they planned how to profit off farmers who would buy Monsanto’s new seeds just to avoid damage, according to documents unearthed during a recent successful $265m lawsuit brought against both firms by a Missouri farmer.

The documents, some of which date back more than a decade, also reveal how Monsanto opposed some third-party product testing in order to curtail the generation of data that might have worried regulators.

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The new crop system developed by Monsanto and BASF was designed to address the fact that millions of acres of US farmland have become overrun with weeds resistant to Monsanto’s glyphosate-based weedkillers, best known as Roundup. The collaboration between the two companies was built around a different herbicide called dicamba.

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The companies said they would make new dicamba formulations that would stay where they were sprayed and would not volatilize as older versions of dicamba were believed to do. With good training, special nozzles, buffer zones and other “stewardship” practices, the companies assured regulators and farmers that the new system would bring “really good farmer-friendly formulations to the marketplace”.

But in private meetings dating back to 2009, records show agricultural experts warned that the plan to develop a dicamba-tolerant system could have catastrophic consequences. The experts told Monsanto that farmers were likely to spray old volatile versions of dicamba on the new dicamba-tolerant crops and even new versions were still likely to be volatile enough to move away from the special cotton and soybean fields on to crops growing on other farms.

Why did Monsanto do something so evil, beyond the fact that they are one step away from having a white Persian cat?

Because we allow companies to patent crops, and prevent farmers from replanting crops, and so we create an incentive to sabotage people into buying their (very) pricey seed.

This sh%$ is criminogenic, and for the life of me I do not understand how this does not constitute a criminal conspiracy under the RICO statutes.

Today in IP Insanity

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In Italy, hospitals could not operate ventilators to treat severely ill coronvirus patients, because a crucial, and very expensive, valve was not available from the manufacturer.

A group of local tech types took a valve, and figured out how to 3D print the valve for a fraction of the cost.

They were promptly threatened with a lawsuit by the manufacturer.

We need to massively reduce the scope of IP:

Update: One of the people who helped 3D-print the valve in Brescia says that they didn’t receive a legal threat from the original manufacturer, Intersurgical, according to a new report in The Verge. Another person who helped make things happen, Massimo Temporelli, who earlier said they received legal threats for alleged patent infringement, is quoted as saying: “The group we asked for the files refused and said it was illegal”. Intersurgical also denies threatening to sue. It states that it could not supply details for the valve because of “medical manufacturing regulations”. Another news item says the official list price was not as high as the original Italian report suggested, but without giving a revised figure. Whatever the details, the episode underlines why the 3D files of these kind of devices should be made available routinely to hospitals. That would allow them print in cases of urgent need, regardless of any claimed patents, so that this kind of situation doesn’t arise at all, and lives are not put at risk. Original story follows:

Techdirt has just written about the extraordinary legal action taken against a company producing Covid-19 tests. Sadly, it’s not the only example of some individuals putting profits before people. Here’s a story from Italy, which is currently seeing more new coronavirus cases and deaths than anywhere else in the world. Last Thursday, a hospital in Brescia, in the north of Italy, needed supplies of special valves in order to use breathing equipment to help keep Covid-19 patients alive in intensive care (original in Italian). The manufacturer was unable to provide them because of the demand for this particular valve. The Metro site explains what happened next:

With the help of the editor of a local newspaper Giornale di Brescia and tech expert Massimo Temporelli, doctors launched a search for a 3D printer — a devise that produces three dimensional objects from computer designs.

Word soon reached Fracassi, a pharmaceutical company boss in possession of the coveted machine. He immediately brought his device to the hospital and, in just a few hours, redesigned and then produced the missing piece.

Actually, it wasn’t quite as simple as that suggests. Business Insider Italia explains that even though the original manufacturer was unable to supply the part, it refused to share the relevant 3D file with Fracassi to help him print the valve. It even went so far as to threaten him for patent infringement if he tried to do so on his own. Since lives were at stake, he went ahead anyway, creating the 3D file from scratch. According to the Metro article, he produced an initial batch of ten, and then 100 more, all for free. Fracassi admits that his 3D-printed versions might not be very durable or re-usable. But when it’s possible to make replacements so cheaply — each 3D-printed part costs just one euro, or roughly a dollar — that isn’t a problem. At least it wouldn’t be, except for that threat of legal action, which is also why Fracassi doesn’t dare share his 3D file with other hospitals, despite their desperate need for these valves.

This sort of IP related bullsh%$ does not, as the Constitution demands, “Promote the progress of science and useful arts.”

It is an anchor dragging down our society.

No Jury in the World Will Convict Them

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Yes, this is an actual lawsuit, and the fact that the judge has not thrown this out, and imposed sanctions on the plaintiffs is a miscarriage of justice.

From a more pragmatic perspective, trying to convince a jury to find in favor of the cable companies’ mot egregious rip-offs is just not going to happen. Ever.

Broadcom is suing Netflix for being so successful that people have cut their cable subscriptions and ditched the set-top boxes that make the chip designer a huge profit.

In a lawsuit [PDF] filed late last week in California, the San Jose-based Broadcom – which designs and sells chipsets used in millions of set-top boxes – argued that “Netflix has caused, and continues to cause, substantial and irreparable harm to the Broadcom Entities [that] sell semiconductor chips used in the set top boxes that enable traditional cable television services.

“Upon information and belief, as a direct result of the on-demand streaming services provided by Netflix, the market for traditional cable services that require set top boxes has declined, and continues to decline, thereby substantially reducing Broadcom’s set top box business.”

It’s a ridiculous claim: that because one business changes the market that you can then sue it for the impact of the changes. But there is, of course, an underlying legal case and that is that Broadcom claims Netflix is infringing its patents.

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It’s hard to have sympathy for a company claiming about a loss of business from cable set-tops: the clunky outdated boxes are notoriously overpriced. Cable companies insist that they have to be “rented” by consumers and charge dozens of times their real value. The average American pays $231 a year for their box, resulting in $20bn a year in almost pure profit for the cable industry.

Seriously, if this goes to trial, I expect the jury to beat the Broadcom’s lawyers to death with sticks.

What Is an Emergency without Looting?

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Given that he is a former pharmaceutical executive, this is not a surprise:

Members of Congress and advocacy groups are voicing outrage after Health and Human Services Secretary Alex Azar—a former pharmaceutical executive—repeatedly refused during House testimony Wednesday to guarantee that any coronavirus vaccine or treatment developed with taxpayer money will be affordable for all in the U.S., not just the rich.

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During testimony before the House Energy and Commerce Committee Wednesday, Azar was pressed multiple times to vow that vaccines and treatments for the coronavirus will be priced fairly and made affordable for all U.S. households.

“We would want to ensure that we’d work to make it affordable,” Azar told Rep. Jan Schakowsky (D-Ill.), “but we can’t control that price because we need the private sector to invest.”

You don’t need the private sector to invest.

The research will be government funded, and you have tools, such as a threat to invoke Biden-Dole march in rights on most of their patent portfolio, to coerce basic human decency out of these firms.

Clearly, the Solution is Stronger and Longer Patents

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It looks like Gilead Sciences delayed the introduction of safer HIV medications because they want to extend the monopoly rents on older drugs.

What’s the destruction of some patients’ bone marrow and kidneys against more profits? Priorities man:

In 2005, Gilead Sciences notified federal regulators that it was suspending development of a potentially safer, more potent HIV-fighting drug than the one on the market. The company did not restart its Food and Drug Administration application until 2010. Now the five-year delay of a promising drug is at the core of accusations by advocates that Gilead improperly exploited the patent system at the expense of patient health.

 An HIV-prevention group called PrEP4All Collaboration filed a petition Wednesday with the U.S. Patent and Trademark Office contending Gilead knew its new, improved drug — approved in 2015 and now part of Gilead’s combination therapies Genvoya and Descovy — was safer. But it alleged Gilead postponed development so it could continue to gain monopoly profits from its older combination HIV drugs, including Viread and Truvada, for a longer period,before those drugs went off patent and faced generic competition.

 Gilead used the delaying tactic even though the older drugs posed more risks to bone and kidney health, PrEP4All alleged.

This is some seriously evil sh%$:

The group is asking the Patent and Trademark Office to reject Gilead’s request for three extra years of patent life on the newer drug, called tenofovir alafenamide, or TAF. Odds of success are steep because the patent office will review such third-party petitions only in “extraordinary’’ circumstances, according to its rules.

“Gilead has not only intentionally delayed clinical development of a drug to artificially manipulate its eligibility for a patent-term extension, but it has done so despite the apparent harm to patients,’’ said Christopher Morten, who is supervising attorney at New York University’s Technology Policy and Law Clinic, who filed the petition on behalf of PrEP4All.

Indeed.

One of the main drivers of inequality in our society is sh%$ like this.

It is a tax on the rest of us that goes into the pockets of companies that would never even consider the public good in their decisions.

I’m not sure that we can thow these guys in jail, but we can fix the system that they exploit to do this.

Abolish the Patent Court

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Since its founding in 1982, the U.S. Court of Appeals for the Federal Circuit, aka “The Patent Court” has been a morass of sloppy patent maximalist jurisprudence.

This is why the Supreme Court has been routinely overturning their rulings over the past few years.

Whenever the Supreme Court agrees to review a case from the patent court, there is some sort of reversal in the works, and likely a significant amount of shade thrown at back at the court.

Now SCOTUS will review one of the worst opinions of the Patent Court, Google v. Oracle, where it was determined that programming interfaces (APIs) were subject to copyright, which has the effect of making program interoperability unlawful:

Some big news out of the Supreme Court this morning, as it has agreed to hear the appeal in the never-ending Oracle v. Google lawsuit regarding whether or not copyright applies to APIs (the case is now captioned as Google v. Oracle, since it was Google asking the Supreme Court to hear the appeal). We’ve been covering the case and all its permutations for many years now, and it’s notable that the Supreme Court is going to consider both of the questions that Google petitioned over. Specifically:

  1. Whether copyright protection extends to a software interface. 
  2. Whether, as the jury found, petitioner’s use of a software interface in the context of creating a new computer program constitutes fair use. 

………

To me, as I always point out in this case, the key element will be getting the Supreme Court to recognize that an API is not software. Oracle and its supporters keep trying to insist that an API and executable code are one and the same, and I worry that the Supreme Court will not fully understand the differences, though I am sure that there will be compelling amici briefs trying to explain this point to them. 

It’s clear that SCOTUS is looking to slap down the patent court again.

If you are not sure what a API is, it is a set of specifications that describe how programs talk with each other.

For example, if you wanted the square route of a number, you might do it by sqrt(#) or  [#]squareroute.

They both mean exactly the same thing, but one will work with a program, and the other won’t.

Essentially, Oracle is claiming copyright of program compatibility, and the patent court swallowed it hook line and sinker.

A Week Ago, I Could Not Find the Evil in This

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I literally wrote, “I Cannot Find the Evil Here,” regarding the Trump Administration’s move against Gilead for violating the CDC’s patent on “Truvada for PrEP,” which used the drug as a prophylactic treatment for HIV.

Well, it turns out that the nature of the CDC patent is such that their attempted enforcement of their claims would allow big Pharma to “Evergreen” (maintain their drug monopoly) basically forever.

It turns out that the patent is not on the drug, but on the fact that taking one pill a day will prevent HIV infection.

This is wrong on a number of levels.

First, the PrEP treatment was not an invention, it was a discovery, which should not be patentable, and second, if upheld, this will provide drug makers with the ability to acquire IP based exclusivity forever:

The Trump administration appeared this month to finally act on a campaign promise to lower drug prices by taking the maker of an HIV drug to court for violating a government patent.

But as with all things Trump, what you see on the surface is not all that’s actually going on.

First, this is only about one drug, a crucial drug to prevent HIV, that was developed with taxpayer money. Its high price has been targeted by well-organized activists for the HIV/AIDS community because it costs more than 300 times as much in the United States as in Africa.

Second, and more importantly, the federal complaint may well help drug companies extend their patents and years of sales at inflated monopoly prices.

“Evergreening” patents and sales exclusivity by the pharmaceutical industry is one of key factors in the high price of prescription drugs in the United States. It keeps cheaper generics medicines off the market.

The specific patent that the U.S. government wants to protect, and get paid for, is one of the controversial group of patents for a process. It covers the prescribed regimen that says the patient must take one pill daily—but not the pill itself.

………

Critics think the government patent is weak. But they also worry that a court decision may validate patents for the regimen, which could create a government-supported precedent allowing drug companies to maintain monopoly prices for decades and possibly forever.

………

Prevention is a secondary use of Truvada. Patents for secondary uses, or for processes—telling patients what pill to take and when—have given drug companies essentially eternal monopolies on sales of those medicines.

“If the government protects this kind of patent, it could ultimately serve drug makers and enable them to keep recycling old patents,” said Love. His non-profit organization has been in the front of efforts to push Congress to force the Bush, Obama and now the Trump administrations to stop giving profitable, semi-permanent patent protection to makers of drugs developed through taxpayer-funded research.

………

The U.S. Government has rarely fought a major pharmaceutical corporation for royalties, though groups such as KEI and Public Citizen have been pushing for aggressive action related to drugs largely funded by American taxpayers.

………

Gilead charges American patients with AIDS about $20,000 per year for the drug Truvada. The same/version of the drug sells in Africa for $60 per year. Truvada for PrEP is the term for applying the drug to prevent AIDS infection. PrEP is an acronym for pre-exposure prophylaxis. This preventive usage is crucial for public health strategies to eradicate HIV and AIDS by 2030, a target announced by Donald Trump this year.

………

Yale University’s Global Health Justice Program leadership, during Congressional hearings in May on PrEP access and costs, slammed Gilead for its refusal to share the proceeds from its sales of Truvada with the government or to significantly lower the price for patients in the United States.

In a letter to the House Oversight Committee, Yale’s health justice team also raised questions about the government’s patent of the secondary use and the treatment process. “We have serious concerns about the value that method of treatment patents like the CDC’s patents for PrEP (and still more other “secondary” patents),” the team wrote.

“Indeed, they are regularly used by the pharmaceutical industry to artificially extend patent protection on expensive brand name drug products, delay generic competition, and keep prices high,” the Yale letter continued.
………

KEI’s Love said the government has been slow to act. “HHS could have exercised march-in rights three years ago on this drug paid for by U.S. taxpayers,” Love said. The government could have applied for a patent that guaranteed the royalty payments to America, not profits to Gilead. “But getting a patent for the procedure is another way of “evergreening” a patent – it makes the United States a patent troll.”

FYI, “March-In Rights” are a provision of Bayh-Dole, the 1980 law that privatized the proceeds of most federally funded research.

The “March-In Rights” allow the federal government to license patents to other entities if the patent holder fails to meet the, “Health and safety needs of consumers.”

Despite the egregious actions of big pharma, “March-In” has never been applied.

I would prefer for the Bayh-Dole to be completely repealed, but the case for “March-In” is incontrovertible.

I Cannot Find the Evil Here

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Gilead Sciences has been sued by the US government for violating HHS patents with its HIV preventative drugs. (Truvada and Descovy)

Considering the fact that their drugs costs $1800.00/month in the US, and $8.00 in Australia, going after the price gougers at Gilead is an unalloyed good, but it’s the Trump administration, so I’m trying to figure out how they got here.

There has to be some sort of corruption or evil behind this.

A rift between the Centers for Disease Control and pharmaceutical giant Gilead Sciences ruptured further Wednesday when the Trump administration sued Gilead in U.S. District Court, asserting that Gilead made billions of dollars on HIV prevention therapy while repeatedly ignoring government patents.

 The patent infringement case against a major drug company, coming at a time of increasing political anger over drug prices, signals a shift in a relationship that typically has been collaborative. The San Francisco-based company has worked for years with the Centers for Disease Control and Prevention to fight HIV, including providing free drugs for government experiments, as well as efforts to expand treatment of hepatitis C.

 But the lawsuit filed on behalf of the Department of Health and Human Services this week describes how, beginning in 2015, Gilead repeatedly refused to recognize CDC patents for an HIV prevention called Truvada for PrEP.

“Gilead has repeatedly refused to obtain a license from CDC to use the patented regimens,’’ the government said in its lawsuit, filed by the Justice Department in federal court in Delaware. “Meanwhile, Gilead has profited from research funded by hundreds of millions of taxpayer dollars. Indeed, Gilead has reaped billions from PrEP . . . but has not paid any royalties to CDC.’’

If I were directing CDC of HHS policy, I would not be asking for royalties, I’d be demanding price controls as a condition for the license.

It would save a lot more money than any royalty scheme.

I am Calling Bullsh%$ On This

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The US Navy has filed a patent for a room temperature superconductor and a high-energy electromagnetic field generator, and the patents claim that these technologies are “operable”, meaning that they have working models.

There are a number of requirements for patent, most notably that it be non-obvious and novel, which the claims characteristics fulfill.

There is also a requirement that a patent be public, so that once it expires, a “Skilled person in the art,” can implement their invention.

There is an exception to the public requirement though, the government can classify a patent for national security reason.

For example, the first patent for a laser was classified, and the creator of the patent was refused access to it, because of his political activities in his youth.

If there were actually working models of these two inventions right now, the Navy would have classified the patents.

They don’t, but they want to clear the deck if someone does come up with working models, so those folks cannot restrict the government’s use of whatever is developed:

Last month, The War Zone reported on a series of strange patent applications the U.S. Navy has filed over the last few years and questioned what their connections may be with the ongoing saga of Navy personnel reporting incidents involving unidentified objects in or near U.S. airspace.

We have several active Freedom of Information Act requests with the Department of Navy to pursue more information related to the research that led to these patents. As those are being processed, we’ve continued to dig through the U.S. Patent and Trademark Office’s (USPTO) Public Patent Application Information Retrieval database to get as much context for these patents as possible.

In doing so, we came across documents that seem to suggest, at least by the Navy’s own claims, that two highly peculiar Navy patents, the room temperature superconductor (RTSC) and the high-energy electromagnetic field generator (HEEMFG), may in fact already be in operation in some manner. The inventor of the Navy’s most bizarre patent, the straight-out-of-science fiction-sounding hybrid aerospace/underwater craft, describes that craft as leveraging the same room temperature superconductor technology and high energy electromagnetic fields to enable its unbelievable speed and maneuverability. If those two technologies are already operable as the Navy claims, could this mean the hybrid craft may also already operable or close to operable? Or is this just more evidence that the whole exotic ‘UFO’ patent endeavor on the Navy’s behalf is some sort of ruse or even gross mismanagement of resources?

At the heart of these questions is the term “operable.” In most patent applications, applicants must assert proof of a patent’s or invention’s “enablement,” or the extent to which a patent is described in such a way that any person who is familiar with similar technologies or techniques would be able to understand it, and theoretically reproduce it.

However, in these patent documents, the inventor Salvatore Pais, Naval Air Warfare Center Aircraft Division’s (NAWCAD) patent attorney Mark O. Glut, and the U.S. Naval Aviation Enterprise’s Chief Technology Officer Dr. James Sheehy, all assert that these inventions are not only enabled, but operable. To help me understand what that term may mean in these contexts, I reached out to Peter Mlynek, a patent attorney.

Mlynek informed me that the terms “operable” or “operability” are not common in patent applications, but that there is little doubt that the use of the term is meant to assert to the USPTO that these inventions actually work:

If they had working models for this sort of technology, this would a classified submittal, because it would be a a leap forward in the technology.

Later in the article, there is correspondence between senior Navy personnel and the patent examiner advocating for what are a profoundly weird claims, which implies that the Navy, or the Pentagon, has a reason for aggressively supporting the claims.

And all of these documents were publicly available, because????

My guess is that either the Navy finds this credible enough that they want to preempt other patent holders, or this is an attempt to send scientists and engineers from other nations (Russia and China) down a dead end.

This Is a Point That I Have Been Making for a While

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When discussing issues of patent, copyright,a d trademark, it is important to note that, “Intellectual Property Isn’t Property.”

It never has been.

If I steal your car, you no longer have the use of that car.

If I excerpt your essay, you still have that essay.

You cannot take IP in the same way that one could a spoon:

Frank Luntz’s rebranding of the estate tax as the “death tax” was an impressive bit of marketing genius, but perhaps the greatest branding coup in modern American politics was the introduction of the term “intellectual property” into the policymaking lexicon. Intellectual property guarantees the owner exclusive rights to the use of an idea, but the uglier-sounding term “intellectual monopoly” is actually more accurate.

It may be too late to cast intellectual property out of our parlance in favor of intellectual monopoly, but it’s worth addressing the underlying philosophical claim to ideas as property. There is a strong consequentialist case for intellectual property in theory, but IP does not satisfy the Lockean definition of property and therefore shouldn’t grant the holder property rights under a natural-rights framework.

………

To examine where property rights come from, let’s turn to John Locke’s Second Treatise of Government. To avoid a lengthy discussion about the merits of Locke’s arguments, let’s take the existence of property rights as he discusses them as a given: If I own myself and I put a part of myself, through my labor, into an unclaimed physical object, I should have exclusive claim to it in the same way I should have exclusive claim to my body and labor.

Why doesn’t this logic work for ideas? Most obviously and importantly, because physical property is scarce and rivalrous. If I take a piece of wood from the wilderness and whittle it into a spoon, anyone who uses that specific spoon is depriving me of my ability to use it.

This is at the nub of the problem Locke is trying to solve. Because physical objects are scarce and rivalrous in use, rights to use and control are necessarily exclusive: If one person gets to use and control the spoon, nobody else does. Locke is wondering how such exclusive rights got going if (as Locke believed) the physical world was given to people in common by their creator. He solves the riddle by asserting the right of self-ownership. Since our bodies and minds start out under our exclusive control, mixing our labor with external objects can bring them out of the common pool and into the realm of private property.

Ideas, on the other hand, are non-rivalrous, meaning their use by one party doesn’t prevent another from using them. If I come up with a new design for a wooden spoon and someone else uses the same idea (whether they learned it from me or developed it independently), my ability to use that design isn’t impeded.

What is impeded is my ability to monetize my design while denying others the ability to do the same. And in cases where the cost of innovation is high but the cost of imitation low, that impediment could end up mattering a great deal for society. Encouraging innovation by helping creators to monetize their creations is at the heart of the consequentialist case for IP. These considerations are, however, outside the scope of a Lockean case for intellectual property.

………

Furthermore, while you have a right to the products of your mind just as you have a right to the products of your body, there’s an important distinction that must be made between an idea in your head and one that’s known to others. If I come up with an original idea for a widget, song, book, or joke, I could tweet it, tell it to a few close friends, or take it to the grave. This is a natural extension of someone’s right to their own mind.

But once an idea is out in the open, it’s analogous to someone selling or giving away physical property they appropriated from nature. As long as something is transferred voluntarily, the original owner can’t make a claim to this property once it changes hands (or in this case, minds). To maintain otherwise would violate the right to free exchange, a natural extension of the right to property.

Meanwhile, physical property could theoretically remain private forever, while even the staunchest supporters of IP rights believe ideas should enter the public domain at some point. Suppose Alice goes through the traditional process of Lockean appropriation to produce a spoon. That could be hers through the end of her life, but if she gives it to Bob it becomes his. He can then give it to Charlie, and so on. At no point in this chain does the spoon go back into the commons for someone else to appropriate. To believe that intellectual property is, in fact, property, one must also accept the possibility of this infinite chain of private ownership.

The solution to this conundrum is to understand that IP is public interest law, as it states in the Constitution, it exists, “To promote the progress of science and useful arts.”

It is there to serve the public interest, by making the public pay for its benefits.

In other words, it’s socialism.

Patent Troll, Patent Troll, Patent Troll, Patent Troll, ‎Nathan Myhrvold‎

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Good news everyone, calling someone a “Patent Troll” is a constitutionally protected opinion, and as such, patent trolls, like Nathan Myhrvold‎, (He’s not a party to this case) cannot sue you for calling them a patent troll:

Free speech in the patent world saw a big win on Friday, when the New Hampshire Supreme Court held that calling someone a “patent troll” doesn’t constitute defamation. The court’s opinion [PDF] is good news for critics of abusive patent litigation, and anyone who values robust public debate around patent policy. The opinion represents a loss for Automated Transactions, LLC (ATL), a patent assertion entity that sued [PDF] more than a dozen people and trade groups claiming it was defamed.

EFF worked together with the ACLU of New Hampshire to file an amicus brief [PDF] in this case, explaining that the lower court judge got this case right when he ruled against ATL. That decision gave wide latitude for public debate about important policy issues—even when the debate veers into harsh language. We’re glad the New Hampshire Supreme Court agreed.

Last week’s ruling court notes that “patent troll” is a phrase used to describe “a class of patent owners who do not provide end products or services themselves, but who do demand royalties as a price for authorizing the work of others.” However, the justices note that “patent troll” has no clear settled definition. For instance, some observers of the patent world would exclude particular entities, like individual inventors or universities, from the moniker “patent troll.”

Because of this, when ATL’s many critics call it a “patent troll,” they are expressing their subjective opinions. Differences of opinion about many things—including patent lawsuits—cannot and should not be settled with a defamation lawsuit.

Personally, I would call ATL a bunch of pig felching patent trolling rat bastards, which I think is protected too.

Sometimes, The Ratf%$#s Lose

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In this case, the rodent breeders in question are Qualcomm, who has been requiring companies to both buy their (protected by patent) chips, AND to pay licensing fees on those same patents.

I do not understand how patent exhaustion would not prevent this.

It appears that federal judge Lucy Koh has a similar view, and found Qualcomm is guilty of serious anti-trust violations, and issued an injunction preventing them from getting two bites at the Apple:*

Qualcomm abused its monopoly on critical chip patents for decades, a US federal judge in California said on Wednesday in a decision with radical implications for the cellphone market.

In a 233-page opinion [PDF] Judge Lucy Koh came down heavily on the chip designer, saying it had violated antitrust laws and “strangled competition” by insisting that companies license its patents at unreasonable prices before being allowed to purchase its chips. Qualcomm chips are an essential component in modern mobile phones.

Koh also issued a permanent injunction that orders Qualcomm to sell its chips to companies without requiring them to license its patents. She also ordered that the company be monitored by federal regulators for seven years.

………

Qualcomm has said it will appeal the decision and seek an immediate stay on the injunction. “We strongly disagree with the judge’s conclusions, her interpretation of the facts and her application of the law,” the company said in a statement. The impact of the decision on Qualcomm’s bottom line was reflected in an instant 12 per cent drop in its share price.

………

“Qualcomm’s licensing practices have strangled competition in the CDMA and premium LTE modem chip markets for years, and harmed rivals, OEMs and end consumers in the process,” Judge Koh wrote. “Qualcomm’s licensing practices are an unreasonable restraint of trade.”

Explaining her decision to grant a permanent injunction, she argued “it makes little sense for the court, having found that Qualcomm’s patent licenses are the product of anti-competitive conduct, to leave those licenses in place.” The Snapdragon system-on-chip designer was charging “unreasonably high royalty rates,” Koh said.

………

At the core of the case is that fact that Qualcomm possesses a number of “standard essential” patents on chips that are critical for mobile phones to function. It then used that position to force companies to license its patents – demanding many times a fair market rate – before being allowed to buy its chips.

Experts highlighted the fact that Qualcomm would also only license its patents at the device level, as opposed at the component or chip level – which forced companies to pay it more and gave it greater control of the market.

Here’s hoping that this holds up on appeal.

*Pun intended.