Guest article

Preparing for impending USPTO rule changes

By James Ewing and Michel Morency

- Last updated on GMT

Related tags: Patent

The US Patent and Trademark Office (USPTO) may soon implement
procedural changes that are likely to create added pressure on IP
budgets and internal resources beginning in 2007. Is your company

Nutraceuticals is a dynamic commercial sector that is attracting increasing competition. Strategic planning and maintenance of a company's intellectual property is critical in order for it to sustain its commercial presence in the nutraceuticals marketplace.

In a climate of heightened accountability for in-house counsel and corporate management to demonstrate value derived from their company's resources, it is surprising that corporate planning does not always include annual assessment or careful budgeting related to intellectual property assets.

USPTO has long grappled with an increasing backlog of patent applications pending examination. It has proposed several changes intended to yield more efficient and high quality evaluation of technology for patent grant. Remodeling of the patent system may include significant changes to the current information disclosure and claims and continuation practices, some of which may be implemented early this year.

For innovative small to mid-sized companies, which are plentiful in the nutraceuticals area, the costs related to meet the new pending requirements could quickly escalate to several hundred thousand dollars in annual costs per year.

While the new proposed procedures do not necessarily represent creative means of increasing efficiencies within the patent prosecution process, the practical impact appears to be a shifting of tasks traditionally conducted the USPTO to the applicant (or their representative). In turn, there are expected to be increased costs for prosecution and development of patent portfolios.

It is therefore important for nutraceutical companies to be aware of these upcoming requirements and be proactive about assessing the impact of the forthcoming changes on their portfolios and IP budgets, as applicants will almost certainly be faced with increased legal service fees for meeting new requirements.

To minimize the impact of upcoming changes and attendant burdens, companies will need to implement practical approaches to ensure cost-efficient management of their intellectual property.

It may be time to consider conducting that overdue IP audit and/or review the annual plan for new patent filings with legal counsel to determine what, if any, changes in overall strategy might be considered in light of the proposed new rules.

In addition, it may be timely to assess patents for the status of information disclosure and to file information disclosure statements where they may be outstanding. A few simple steps now may ensure your company faces the New Year with confidence and are prepared to weather the impending USPTO rule changes.

James F Ewing is a senior counsel with Foley & Lardner LLP and a member of the firm's Biotechnology & Pharmaceutical Practice Group and the Life Sciences and Food Industry Teams. He can be reached at 617 342 4088 or by e-mail at wsrjvat@sbyrl.pbz​.

Michel Morency is a partner with Foley & Lardner LLP and a member of the firm's Biotechnology & Pharmaceutical and Private Equity & Venture Capital Practice Groups, as well as the Life Sciences, Emerging Technologies, Food and Nanotechnology Industry Teams. He can be reached at 617 342 4080 or by e-mail at zzberapl@sbyrl.pbz​.

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