Corrections or additions?
This article by Barbara Fox was published in U.S. 1 Newspaper on
October 27, 1999. All rights reserved.
Patents for Pharmas
When Prabha Fernandes left Bristol-Myers Squibb
to start Small Molecule Therapeutics at Princeton Corporate Plaza,
the new company had lots of expertise but no patents. Two years later
the company has 30 employees and several patents in its portfolio.
This model of a start-up — one that rapidly fills its intellectual
property portfolio — is advocated by Sonia K. Guterman,
founder of Dyax and former MIT licensing officer. She will offer patent
strategies for both young start-ups and big pharmaceuticals at a conference
for pharmaceutical and biotech executives staged by Global Prior Art
on Monday and Tuesday, November 1 and 2, at the Marriott. Cost $895.
Call 888-347-3257.
Boston-based Global Prior Art, which does patent searching and analysis,
has assembled industry leaders to discuss techniques for assessing
the strength of a patent, building a valuable intellectual property
portfolio, maximizing the payoff from R&D, defensive patenting, and
using metrics to value intellectual property. Speakers include Lou
Capezzuto of Johnson & Johnson, Katherine Gordon, CEO of
Apollo BioPharmaceutics, Robert Dodge, vice president of IDDEXX,
Donald Daus, former senior examiner for pharmaceuticals at the
U.S. Patent Office, and Patricia J. Conway, former vice president
at Orchid Biocomputer.
The daughter of an engineer/inventor, Guterman majored in biochemistry
at Cornell, has a PhD from MIT in microbiology, and was a senior scientist
at Biotechnica International. As co-inventor of important patents
on remodeling proteins, she co-founded Protein Engineering Corporation,
now called Dyax. She is a patent agent at Bromberg and Sunstein, a
Boston-based law firm E-mail: sguterman@bromsun.com). Her topic: “Creating
a Strong Intellectual Property Portfolio: Lessons for Small Biotech
and Drug Delivery Firms, including Documentation Issues, Business
Development, and Filing Strategies.” Her advice:
Start ups should energetically file patents, whether licensedfrom a university or derived from the founder’s idea, says Guterman:”That in itself can create wealth.” A company she co-foundedput most of its early capital into pioneering patents, and now thatportfolio has been licensed to 40 companies with revenues of up to$2 million annually.Startups can tap university research. Given the oversupplyof PhDs, young high-tech companies can take advantage of ambitiousyoung scientists and engineers ensconced at what are sometimes low-payinguniversity jobs. They want to generate some extra income and haveideas but don’t have factories or lab programs. The university’s transferand licensing office will patent the ideas and license them to thetechnology companies.”You want to start up a company, you have some money — notmuch but some — a good place to look is at universities,”says Guterman. “If you have an idea of where you want to start,collect names of leading scientists and talk to them. Universitieslove start-ups. Instead of paying you up front, they may take fivepercent of the company, usually a smaller percentage than would aventure capitalist. Universities also usually want royalties on futureproducts.”Start-ups should consider applying for provisional patents.Because acquiring venture capital and filing applications is likethe chicken and egg problem, you can’t do one without the other, Gutermansuggests filing what is called a provisional patent application, appropriateeven for those who have no laboratory or new data. This kind of patenthelps level the playing field for biotech companies, which are bynature more expensive to establish than software development or Internet-basedfirms.”The beauty of the provisional patent application is that it isnot examined,” says Guterman. “It gives you a clear year tocollect data, get venture capital support, hire people, and set upa lab. A year later, when you have these ideas in place, you can filethe nonprovisional patent application.”Consider other alternatives to patent applications. Forsome technologies big companies might classify some of the discoveriesas trade secrets rather than patents. Trade secrets are acquired overtime and involve fine points of a particular process; Coca Cola’sformula is a famous one. They are kept very clearly marked, with lockedfiles and limited access.Depending on the technology these large firms could consider rewardingtheir scientists with bonuses for trade secrets or other ideas notpatented. Patents are not cheap; they cost $15,000 to $20,000 in theUnited States and $50,000 to $100,000 worldwide. Meanwhile the largecompany may have thousands of scientists wanting recognition, bonuses,and advancement — all linked to devising patents.”Trade secrets should be rewarded by management to the same extentthat patents are, just the way that sales people get bonuses. Thenthere wouldn’t be so much pressure on patent departments,” saysGuterman.Consider middle ground options. “If the scientistin a large firm is enthusiastic about an idea, but management is not,the company could file a provisional application. It is cheaper tofile, and it does not require a patent law expert to draft the claims.The inventor can go a long way to creating the final product.”The company then allows the inventor to put together the “disclosure,”words describing the invention, and to do the business plan and calculationspredicting the revenue stream and time table.”You are much more likely to get value out of that scientist,”she says. Either the idea comes through so the company can file anonprovisional application, or — if it turns out to be a flashin the pan — the employee learns a lesson.– Barbara FoxNext StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
