On the Appeal of Drug Patent Challenges

47 Pages Posted: 17 Apr 2023 Last revised: 9 Sep 2023

See all articles by Charles Duan

Charles Duan

American University Washington College of Law

Date Written: March 31, 2023

Abstract

Administrative patent challenge proceedings, the most prominent form of which is inter partes review, have attracted much controversy. In particular, the pharmaceutical industry and its supporters have criticized the proceedings as unfairly biased toward canceling valuable drug patents. Yet there has been little empirical study of the impact of these administrative proceedings on drug patents or pharmaceutical markets.

In this Article, I review the universe of administrative challenges on drug patents that have proceeded through appeal to the Federal Circuit. I find that a large fraction of patents challenged this way are deemed unpatentable at both the agency and appellate levels, and that administrative cancellation of drug patents correlates closely with subsequent generic drug competition and reduced drug prices. The data suggests that these effects are not due to bias against patents, but rather because of the expertise of administrative adjudicators and the remarkably low quality of the drug patents challenged. Indeed, I find that nuanced aspects of these administrative proceedings, particularly at the appellate level, in fact are biased in the opposite direction — against patent challengers. These findings suggest that inter partes review and other administrative challenge proceedings likely serve an important purpose for lowering the costs of medicines, and those proceedings could potentially be improved.

Keywords: patents, inter partes review, administrative law, pharmaceuticals

JEL Classification: O31, O34, I18, K23

Suggested Citation

Duan, Charles, On the Appeal of Drug Patent Challenges (March 31, 2023). 2 Am. U. L. Rev. 1177 (2023), Available at SSRN: https://ssrn.com/abstract=4406404 or http://dx.doi.org/10.2139/ssrn.4406404

Charles Duan (Contact Author)

American University Washington College of Law ( email )

4300 Nebraska Ave NW
Washington, DC 20016
United States

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