In September 2017, Allergan, the maker of Restasis, adopted an unprecedented strategy: it paid the St. Regis Mohawk Tribe millions of dollars to rent its tribal sovereign immunity in a blatant effort to shield the patents on Restasis from review. The maneuver has deservedly attracted attention in the media (see The New Yorker and Fortune) and, now, the House Judiciary Committee.
Allergan tried to escape review of its patents under the America Invents Act’s inter partes review (IPR) procedures, which apply equally to all patent holders. The goal of the IPR process is simple: to make sure that patents were properly granted in the first place.
See the AAM white paper on renting tribal immunity.
For more background on Allergan’s ploy, see the House testimony given by William M. Jay of Goodwin Procter LLP.
The ramifications of Allergan’s novel use of sovereign immunity go beyond the pharmaceutical industry, potentially sabotaging IPR in every field of innovation.
On November 9, at the House Judiciary Committee — Subcommittee on Courts, Intellectual Property and the Internet, Chairman Rep. Darrell Issa (R-CA) said:
“[The] IP system only works if it strikes the right balance. We know that we want to, and this committee is committed to reward true innovators for their creative works, but the IP system must be protected from several types of wrongful behavior…”
In his testimony at that hearing, William Jay, Partner of Goodwin Procter LLP said:
“…the Allergan strategy of renting sovereign immunity would set up a different set of rules for patent owners with enough money, and enough gall, to enter into a transaction like this one.”
AAM believes true innovation deserves to be protected by patents. The IPR system is necessary to protect patients from attempts by some brand-name drug companies to patent non-innovative features of their drugs and therefore maintain monopoly drug prices for years longer than Congress intended. Allergan’s ploy jeopardizes the patent system overall and should not be tolerated.
See more on this issue at https://www.stoprxpatentabuse.com/.