Rep. Scott Peters Leads Bipartisan Fight for American Innovators

WASHINGTON, D.C. – Congressman Scott Peters (CA-52) led a letter, with support from a bipartisan group of 78 other colleagues, to House leadership asking for changes to the Inter Partes Review (IPR) portion of H.R. 9, the so-called “Innovation Act,” before the bill comes to the floor for a vote. Peters has been out front and persistent in the fight to make substantial changes to the currently-flawed legislation before it is considered by the whole House of Representatives.

“What is clear is that the so-called ‘Innovation Act’ is the wrong approach and will undermine the entire patent system,” said Rep. Scott Peters (CA-52). “The bill is overly broad, resulting in a system where any actions taken against a patent troll could also be taken against a real inventor with a legitimate patent.”

Peters continued, “Instead of throwing the baby out with the bathwater, we should craft patent reform legislation that actually fixes the problem of abusive litigation and out of control patent trolls, gives inventors a clear and reasonable route of recourse when they are wronged, and brings our patent system into the 21st century.

“We must be working to find the right balance between immediate access to lower-cost medicines and incentivizing innovative research and development here in the United States. The ‘Innovation Act’ would undermine that balance and threaten our country’s competitive advantage,” Peters concluded.

Signatories of the bipartisan letter include the following Members:

Rep. Scott Peters (CA-52), Rep. Ryan Costello (PA-06), Rep. Alma Adams (NC-12), Rep. Pete Aguilar (CA-31), Rep. Lou Barletta (PA-11), Rep. Karen Bass (CA-37), Rep. Dan Benishek (MI-01), Rep. Ami Bera (CA-07), Rep. Rod Blum (IA-01), Rep. Brendan Boyle (PA-13), Rep. Susan Brooks (IN-05), Rep. Julia Brownley (CA-26), Rep. Vern Buchanan (FL-16), Rep. Larry Bucshon (IN-08), Rep. Ken Calvert (CA-42), Rep. Michael Capuano (MA-07), Rep. John Carney (DE-AL), Rep. Andre Carson (IN-07), Rep. Buddy Carter (GA-01), Rep. Katherine Clark (MA-05), Rep. Chris Collins (NY-27), Rep. Gerry Connolly (VA-11), Rep. Joe Courtney (CT-02), Rep. Susan Davis (CA-53), Rep. John Delaney (MD-06), Rep. Charlie Dent (PA-15), Rep. Robert Dold (IL-10), Rep. Sean Duffy (WI-07), Rep. Tom Emmer (MN-06), Rep. Elizabeth Esty (CT-05), Rep. Stephen Fincher (TN-08), Rep. Mike Fitzpatrick (PA-08), Rep. Chuck Fleischmann (TN-03), Rep. Ruben Gallego (AZ-07), Rep. Gwen Graham (FL-02), Rep. Andy Harris (MD-01), Rep. Alcee Hastings (FL-20), Rep. Denny Heck (WA-10), Rep. Jim Himes (CT-04), Rep. Mike Honda (CA-17), Rep. Richard Hudson (NC-08), Rep. William Keating (MA-09), Rep. Robin Kelly (IL-02), Rep. Ann Kuster (NH-02), Rep. Doug LaMalfa (CA-01), Rep. Leonard Lance (NJ-07), Rep. Ted Lieu (CA-33), Rep. Dave Loebsack (IA-02), Rep. Stephen Lynch (MA-08), Rep. Tom Macarthur (NJ-03), Rep. Mark Meadows (NC-11), Rep. Greg Meeks (FL-05), Rep. Seth Moulton (MA-06), Rep. Kristi Noem (SD-AL), Rep. Donald Norcross (NJ-01), Rep. Bill Pascrell (NJ-09), Rep. Donald Payne (NJ-10), Rep. Joe Pitts (PA-16), Rep. Mike Quigley (IL-05), Rep. David Roe (TN-01), Rep. Raul Ruiz (CA-36), Rep. Linda Sanchez (CA-38), Rep. Kurt Schrader (OR-05), Rep. Krysten Sinema (AZ-09), Rep. Albiro Sires (NJ-08), Rep. Chris Smith (NJ-04), Rep. Jackie Speier (CA-14), Rep. Eric Swalwell (CA-15), Rep. Mark Takai (HI-01), Rep. Glenn Thompson (PA-05), Rep. Norma Torres (CA-35), Rep. David Valadao (CA-21), Rep. Juan Vargas (CA-51), Rep. Marc Veasey (TX-33), Rep. Bonnie Watson Coleman (NJ-12), Rep. Frederica Wilson (FL-24), Rep. David Young (IA-03), Rep. Todd Young (IN-09), Rep. Ryan Zinke (MT-AL)

The text of the letter can be seen HERE or below:

[BEGIN TEXT]

Dear Speaker Boehner, Majority Leader McCarthy, Minority Leader Pelosi, and Minority Whip Hoyer:

The House Judiciary Committee recently approved H.R. 9, the Innovation Act, and we understand that the bill’s sponsors would like to have the legislation considered on the House floor in the coming weeks.  We support the original objective of the legislation, and we commend Chairman Goodlatte for attempting to combat so-called patent trolls in our system.  At the same time, however, any patent litigation legislation must represent the views of the full spectrum of different industries and sectors reliant on a well-functioning U.S. patent system.  Accordingly, before H.R. 9 is brought to the floor, we believe that, in addition to the current changes to the inter partes review (IPR) system contained in the bill and several other changes that have been requested by the life sciences community, language should also be included to preserve the integrity of the Drug Price Competition and Patent Term Restoration Act (commonly known as Hatch-Waxman), and the Biologics Price Competition and Innovation Act (BPCIA).  Congress established Hatch-Waxman and BPCIA to strike a balance between access to lower cost versions of medicines and preserving incentives for continued innovation.  This unique patent litigation system has been working for decades.  However, the patent challenge system created under the America Invents Act, specifically the IPR system, threatens to undermine these specialized patent resolution frameworks in a way that was not intended when Congress created it. 

Patents are critically important for developing FDA-approved biopharmaceutical products.   Unlike companies in other sectors, biopharmaceutical companies are not able to immediately capitalize on the value of their patents.  Instead, they must spend almost a decade and, on average, $2.6 billion, before they can receive approval from the FDA to bring new medicines to market.  In recognition of these unique circumstances, Congress established separate patent dispute resolution frameworks for approved drugs and biologics.  Hatch-Waxman and BPCIA are designed, among other things, to create an incentive for generic and biosimilar competition, while balancing the need to preserve incentives for innovation.

Hatch-Waxman has had a profound impact on the prescription drug market since its inception 30 years ago.  Today, 88 percent of prescriptions filled in the U.S. are for generics – up from just 19 percent before the law’s enactment – and the use of generics generated nearly $1.5 trillion in savings to the U.S. health care system from 2004-2013.  At the same time, investment in research and development (R&D) is at an all-time high and there were a record number of new medicines approved by the FDA in 2014, allowing patients to live longer healthier lives.  The IPR process, as implemented by the Patent and Trademark Office (PTO), must not be allowed to upset this delicate balance.

Fortunately, Congress has a chance to address this concern, by including language in H.R. 9 to make clear that the IPR process does not apply to biopharmaceutical patents that are subject to challenge under Hatch-Waxman and BPCIA.  Doing so would build on language in the underlying bill, which already exempts Hatch-Waxman and BPCIA challenges from changes the bill makes to certain patent litigation proceedings.  Including this language would protect the delicate balance Congress struck in Hatch-Waxman and BPCIA while in no way harming the intent behind the IPR process.  We should address this issue, which is crucial to maintaining the substantial R&D investments needed to develop new treatments and cures for U.S. patients, before the bill comes to the House floor.    

We look forward to working with you and with Chairman Goodlatte to address this issue before H.R. 9 is considered.

[END TEXT]

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