WASHINGTON -- The Supreme Court yesterday made it easier to challenge patents, bolstering arguments by some in business that they are too readily granted and can stymie new drugs and other innovations.
In an 8-1 decision, the court said MedImmune Inc. may pursue a court case in a patent dispute over its childhood respiratory drug, Synagis.
MedImmune, of Gaithersburg, Md., challenged a patent agreement with Genentech Inc. Genentech argued the case should be dismissed because MedImmune had agreed to make royalty payments, though under protest.
The decision "opens the courthouse door and lets people come in and possibly allows them to challenge, but it also leaves many questions unanswered," said Washington attorney George C. Best. The outcome, he said, turns on how lower courts interpret MedImmune's deal with Genentech.
The Bush administration supported MedImmune, saying that invalid patents can hurt efficient licensing, hinder competition, and undermine incentives for innovation.
Corporations that are major patent holders backed Genentech, saying that creating a unilateral right for a licensee like MedImmune to challenge a licensed patent will destabilize thousands of existing patent settlements and license agreements.
While the ruling focused on legal procedure, during arguments in a patent case in November several justices expressed skepticism about the current standard for granting patents and seemed to signal a willingness to make them harder to obtain. That case focuses on whether an invention is obvious and therefore ineligible for a patent.
Twenty years ago, the government issued 77,000 patents a year; for the 12 months ended Sept. 30, it was 183,000. The volume of applications has exploded in the past two decades: 131,000 in 1986 and 443,000 last year.