Climbing the Alliance IP Landscape

Section I.M.? Patent Filing Costs? ?Intellectual property (IP) is the key asset accessed by a commercialization partner in a biopharma alliance.? Yes, there’s expertise, and lead time in development often sweetens the deal.? But an originator’s IP is the foundation upon which the success of an alliance rests.

?????????????? For this reason, commercialization partners, especially top pharma companies, have strong motivation to influence, or outright control, IP prosecution once an alliance is in place.? However, project originators have long resisted relinquishing such control – both as to foundational IP and any product-specific inventions which might arise over the term of collaboration.

?????????????? The 2001 Discovery Partners alliance with Pfizer is an example of pharma’s preferred stance with respect to patent filing – control over the conduct and costs of project IP.? Here’s the contract language:

In this timeframe, however, an alternative negotiation outcome was for an originator to retain control over patent filing while sharing the costs.? This was the case in the 2000 Vertex kinase discovery alliance with Novartis with respect to the amount and timing of patent costs:

Less than a decade later, biopharma originators typically maintained control of patent filings, including costs, at least with respect to product-specific alliances.? Why the reversal?? In large part, upfront and development cost compensation had grown to an extent that the cost of patent filing and prosecution was far less of a burden to the originator.? For example, here’s a snapshot of Synta’s 2008 preclinical alliance with Roche for calcium ion channel inhibitors:

In this instance, Roche’s patent filing control and expense with respect to Synta’s IP was limited to a back-up right, as shown here:

Once delivery technologies were combined with pharma compounds, however, control and costs of patent filings reverted back to pharma, as was the case in the 2013 BIND alliance for Accurin nanoparticle encapsulation of Pfizer’s compounds.? Here Pfizer controls and pays for filing of Patent Specific Patents as shown below:

More recently, commercialization partner control over and cost of filing of product-specific patents has expanded to cover joint and originator IP.? For instance in co-development deals following opt-in, as in the 2018 Tide Pool Co-development deal between Theravance and Janssen discussed earlier, the patent filing contract language is as follows:

Nowadays control over and the cost of patent filing is an open negotiation item, especially in alliances between peer biopharma companies.? Here’s a snapshot of the 2018 Co-Co collaboration between Pieris and SeaGen for discovery and development of bispecific antibodies:

In this instance, Compound Specific Patents and Joint Patents are controlled and paid for by the commercialization partner (SeaGen), except when co-developed, in which case control remains unchanged but costs are shared equally.? Here’s the contract language:

As biopharma alliances have become more collaborative, the allocation of patent filing and prosecution rights, along with control over patent defense and third party patents, has gained negotiating prominence commensurate with the importance of IP generally.? BD&L responsibilities in this regard now start with deal negotiation and tend to climb higher over time in the hierarchy of issues that reside within alliance management.

?You can see the introduction to this ongoing series of articles about best practices in biopharma licensing, or go directly to links to previously posted articles of the series here.