Innovation Policy

United States Patent and Trademark Office

The United States Patent and Trademark Office (USPTO) is the organization within the United States government that reviews and grants patents and trademarks. The USPTO is tasked with defining patent types and what each type covers and protects. Established under the Department of Commerce on July 19, 1952[1] by 35 U.S.C. §1[2], the USPTO is intended to fulfill the mandate in Article I, Section 8, Clause 8 of the United States Constitution "to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries."[3]. Since 1790, the US has issued more than 6.5 million patents[4]. The agency's main offices reside in Alexandria, Virginia, with several satellite offices around the country.

Current Issues Facing the Patent System

Criticisms

In recent years, there has been an increase in patent reform legislation due to wide range of criticisms on current patent institutions and practices demanding stricter reform.

USPTO: In April 2016, the USPTO had an unexamined patent backlog of 549,896 and 352,573 application filings for review. The unexamined patent backlog is a record of how many UPR Patents are waiting for review by a patent examiner, and application filings are how many patents are being sent in for review. [5] The USPTO reports that in 2016 the average total pendency time, the time between filing a patent application and issuing or dismissing a patent, has been 26 months. Harvard Business Review reports that the increase in cases being referred to lower, random courts raises the cost of processing a patent application and causes the patent system to rely on juries often without requisite technical or procedural expertise. These juries are expected to decide whether high level technology or processes satisfy the requirements for protection.

Patent Litigation: Critics at Wired believe that the amount of patent litigation and patent infringement claimed has created a "disastrous environment for innovation." (Wired) Litigation and lawsuits may result in a significant decrease in product development. In 2015, Google and Apple invested more in supporting patent purchases and litigation than in R&D.(NYT-PW) Additionally, "junk patents" are a source of contention as HBR suggests they lead to pointless trials. The technology industry often suffers of overly broad patents, which also may lead to pointless litigation. Amazon has successfully patented buying things with one-click in the United States, and Apply has claimed ownership of rounded-edged, rectangular-shaped communication devices on which icons are arranged in a grid with a row of persistent icons at the bottom.

Rapidly Growing Industries: The biotechnology industry as a whole provides new ethical challenges to the patent system and introduces new competitive threats such as me-too drugs. Me-too drugs are approved after pioneering drugs to function as substitute products [6]. Limiting the scope of discoveries that can be patented in biotechnology is an ongoing issue. The DOJ's declaration that genes may not be patented in a case dealing with Myriad Genetics and the University of Utah Research Foundation resulted in sharp public criticism in 2010. [7] The Biotech industry along with others such as e-commerce or computer software face the challenge of overcoming overlapping patents that could result in many separate patent infringements. [8]

Right to Exclude: The current patent system allows companies to file for the right to exclude if they have a novel, non-obvious invention. The right to exclude creates a temporary monopoly for a certain product, creating the potential for higher prices for consumers. Daraprim, a drug produced by Turing Pharmaceuticals, was at one point in time priced at $750 per pill for commercial sale.The CEO OF Turing Pharmaceuticals, Martin Shkreli, led the charge to such an exorbitant price hike, earning himself the title of "Most Hated Man in America."