For biotechs, guarding concepts is critical

April 30, 2006|By TRICIA BISHOP | TRICIA BISHOP,SUN REPORTER

If Alba Therapeutics Corp. didn't have product protection from the 200 patents it has either applied for or been issued, the Baltimore biotech might have been $30 million poorer.

That's the amount the fledgling company has brought in from venture capital investors over the past year. "If you don't have a strong intellectual property position, you usually don't even get to the table," said Christopher E. Jeffers, vice president of intellectual property at Alba.

"These guys are looking for 10 [times], 15 [times] return on their investment," Jeffers said. "The only way they're going to be able to get that kind of return" is if a potential product has the edge of being able to exclude others from duplicating it.

Over the last 30 years, the growing biotechnology industry has become a big proponent of strong patent protection, often filing applications as soon as there's a glimmer of a product idea. It can take a dozen years and hundreds of millions of dollars to develop a drug candidate, and the industry says it can't afford to battle competitors with like concepts.

"If you're making that sort of investment, and taking that degree of risk, you need to have a patent on that product. ... It's fundamental," said Alba's president, chief executive and co-founder, Blake M. Paterson, standing in an empty laboratory in his new offices at the University of Maryland, Baltimore BioPark.

While many in the biotech industry agree that the system for granting patents should be made more efficient, they would prefer that little else change. The system now favors patent holders over potential competitors. Challenging a patent in court requires a steep burden of proof. Punitive damages can be tripled if a court finds "willful infringement." And infringers are usually ordered to cease operation without weighing other potential remedies.

Patents are "much more in the mainstream now and very much under attack from all different directions," said Nancy J. Linck, a deputy general counsel for the Biotechnology Industry Organization in Washington.

She attended a U.S. Supreme Court hearing last month that looked at the injunction issue.

"The patent right is the right to exclude. If you don't get an injunction, in effect you've lost your patent right," Linck said.

Jeffers said his company is the only one working on a treatment for celiac disease, an autoimmune disorder characterized by an inability to digest gluten-containing grains, which can cause damage to the small intestine. Alba is hoping to one day produce a pill that could block the negative reaction gluten causes. "If we do our job correctly in the [intellectual property] space, we should be able to exclude everyone from the market," he said. "We probably have at least a 10-year jump on the rest of the competition."

Managing intellectual property is Jeffers' main responsibility at Alba. He was the first employee hired. "What I think the biotech industry is scared of, and I'm scared of as well, is we're going to swing the pendulum too far in terms of eroding patent rights," Jeffers said. "I don't think the Supreme Court would do this. It's more likely Congress would do this."

tricia.bishop@baltsun.com

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