UC Irvine

Patents have proven to be important to the growth and financing of the American biotechnology industry, but it remains unclear whether current patent standards are suited to the needs of this industry. Patent law has a general set of legal rules to govern the validity and infringement of patents in a wide variety of technologies. With very few exceptions, the statute does not distinguish between different technologies in setting and applying legal standards. Rather, those standards are designed to adapt flexibly to new technologies, encompassing "anything under the sun made by man."1 1 Diamond v. Chakrabarty, 447 U.S. 303, 309 (1980) (citing S.Rep.No.1979, 82d Cong., 2d Sess., 5 (1952); H.R.Rep.No.1923, 82d Cong., 2d Sess., 6 (1952)). In theory, then, we have a unified patent system that provides technology-neutral protection to all kinds of technologies. However, we have recently noticed an increasing divergence between the rules actually applied to different industries. Biotechnology provides one of the best examples. In biotechnology cases, the Federal Circuit has repeatedly held that uncertainty in predicting the structural features of biotechnological inventions renders them nonobvious, even if the prior art demonstrates a clear plan for producing the invention. At the same time, the court claims that the uncertain nature of the technology requires the imposition of stringent patent enablement and written description requirements that are not applied to patents in other disciplines. Thus, as a practical matter, it appears that although patent law is technology-neutral in theory, it is technology-specific in application. We provide evidence for this claim in Part I. While this chapter focuses on biotechnology, which presents an extreme example, our findings have implications for other industries as well, notably small-molecule chemistry. Part II explores how the application of the same legal standards can lead to such different results in diverse industries. Much of the variance in patent standards is attributable to the use of a legal construct, the "person having ordinary skill in the art" (PHOSITA), to determine obviousness and enablement. The more skill those in the art have, the less information a patentee has to disclose, but the harder it is to find an invention nonobvious. The level of skill in the art affects not only patent validity, but also patent scope. Because both claim construction and the doctrine of equivalents turn on the understanding of the PHOSITA in certain circumstances, judgments the court makes about those industries affect the scope of those patents that do issue. One reading of the biotechnology cases is that the Federal Circuit believes that biotechnology experts know very little about their art-at least, this seems the clear implication of the court's holdings and accompanying analysis. We do not challenge the idea that the standards in each industry should vary, nor the idea that that variation depends in part on the level of skill in that industry. As we have explained elsewhere, patent law should be technology-specific because the industries it affects are not homogenous.2 2 Dan L. Burk and Mark A. Lemley, Policy Levels in Patent Law. 89 Va. L. Rev. (forthcoming 2003). We think the use of the PHOSITA provides needed flexibility for patent law, permitting it to adapt to new technologies without losing its essential character. We fear, however, that the Federal Circuit has not applied that standard properly in biotechnology. The court has a static perception of the field that was set in its initial analyses of biotechnology inventions, but does not reflect the realities of the current industry. In Part III, we offer a very preliminary policy assessment of these industry-specific patent cases. We suggest that the special rules the Federal Circuit has constructed for biotech cases are rather poorly matched to the specific needs of the industry. Indeed, in some ways, the Federal Circuit cases have it exactly backwards. We offer a few suggestions as to what a consciously designed biotechnology patent policy may look like. In doing so, we hope to lay the groundwork for broader exposition of those ideas and suggestions for implementing them. © 2003 Elsevier Inc. All rights reserved.