Freedom to Operate Search | Patent Infringement & Product Clearance Search

Freedom to Operate Search (FTO Search) includes Patent Infringement Analysis or Product Clearance Search.

Patent Due Diligence

Consider a situation where some professors in the computer department of a particular college has come up with the idea of ‘An artificial intelligence based tool for assisting non-technical people over security’. They invented the tool and further willing to patent the same. But before proceeding on with the patent application, they need to know about the following things: 

1. Whether the invention by them is indeed patentable?
2. Whether the invention results in infringement of patent rights of others?
3. Whether the invention can be exploited commercially?

Such a due diligence is considered necessary by various persons, business entities, organizations etc. before they go ahead with patenting their invention. This due diligence helps in minimizing risks, reducing litigation cost after filing of patent application, exploring business opportunities etc. This due diligence conducted prior to applying for a patent is known as Freedom to Operate (FTO) Analysis. For example, in September 2003, three pharmaceutical companies, Cambridge Antibody Technology, Micromet AG and Enzon Pharmaceuticals conducted an FTO analysis and thereafter, entered into a cross-licensing agreement which enabled them to conduct research and develop a defined number of therapeutic and diagnostic antibody-based products.

FTO Process

Freedom to operate refers to the ability of a patent holder to commercially exploit the patent without infringing the rights of other patent holders. It is the ambit or the window in which the patent holder can legally operate. Consider, for example, in aforementioned situation of patenting ‘AI tool for assisting non-technical people over security’, the inventors have following patent claims:

1. The intelligence of chatbot that is capable of differentiating between security commands and normal commands
2. The method of integrating anti-virus program with chatbots
3. The functionality of the chatbot to scan URL and to operate over cloud

In this situation, there is a possibility that the second claim might have already been patented by some other company XYZ. Such a possibility may result in limiting the ‘freedom to operate’ of the inventors to the first and the third claim because patenting the second claim will result in infringement of right of the company XYZ. Therefore, the ‘freedom to operate’ of inventors will be limited to first and third claims.

FREEDOM TO OPERATE ANALYSIS (FTO ANALYSIS)

It is possible that Patent Office may reject the patent application in the example mentioned in above section as there is a possibility that the second claim is infringing rights of the company XYZ. This will result in extra-cost in filing the patent application again. And if the patent is granted, it will result in unwanted litigation costs.

Therefore, it is necessary to conduct an FTO analysis before filing of the patent application so as to know whether the patent infringe rights of the others. FTO Analysis is also known as infringement analysis. It is done to determine if any unexpired (in?force) patents would be infringed by launching a product on the market or by otherwise practicing the invention in question.

By the FTO patent search, a party is “cleared” to make, use, sell or import a product incorporating the invention. It involves a study of all the claims of all the relevant patents which are still in force to determine their scope of protection so as to avoid doing anything which will be considered to be an infringement of an unexpired patent.

FTO ANALYSIS STEPS

There is no hard and fast rule as to how an FTO analysis needs to be conducted. Nevertheless, the following steps maybe followed broadly in an FTO Analysis:

1. Study the invention and the claims related to it carefully.
2. Search various patent databases such as national patent databases, Patentscope (in case of international applications) etc in order to find out patent literature which might have claims similar to the claims in the invention. This includes applications of published as well as granted patents.
3. Analyze the relevant Patent Literature against the invention in order to determine ‘Freedom to Operate’.

4. Search and analyze the Non-Patent Literature (NPLs) as well as in order to understand the background and scope of invention.

5. Search and analyze the expired patents applications. If there are indeed granted patents on claims similar to the claims in the invention, also look for possible licenses, joint venture agreements and other commercial aspects of that particular patent.

6. Prepare an opinion having the complete FTO analysis along with the possible strategies for future which the inventors, companies etc might follow.

ADVANTAGES OF FTO ANALYSIS

1. An FTO analysis helps in protecting technology. If there are no obstacles in FTO analysis on freedom to operate, the business entity or the inventor may proceed for patenting the invention in order to protect it.

2. An FTO analysis helps in clearing obstacles if there are any for the particular invention. If freedom to operate is limited as per FTO analysis, the company or business entity may decide for purchasing the patent, licensing in, cross licensing, inventing around or for patent pooling.

3. The results of an FTO analysis may allow you to make better use of technologies in the public domain and inform your choice of research tools or vector constructs. The analysis also may alert you to scientific discoveries and inventions related to your work.
4. FTO opinions do not eliminate risks related to third-party intellectual property. Instead, they allow for the development of sound risk-management strategies (which may be of a legal/licensing nature, involve business approaches, or be research based). Implementing the strategy requires clear pathways of communication and dialogue between science managers, product development, licensing personnel, and senior management.

Biotech Drug Patent Expirations

Generic pharmaceutical players in the market is after U.S. Food and Drug Administration to develop regulatory guidelines for launching the biosimilar products in the market. However, the task of copying the known active substance to treat diseases is a very long procedure. Beneflix is used to treat haemophilic patients. The active substance in Beneflix is factor IX. The patent for the active substance factor IX expired in the year 2009. Currently, FDA doesn’t have a proper regulatory mechanism for approving generic versions of most biotechnology related drugs. Details of most known biotech drug patent expirations are listed below for reference purposes.

There are many hurdles for manufacturing biotech products whose patent is no longer in force. Therefore, market exclusivity for biotech therapies treating different ailments is going to be difficult. Conducting clinical trials for manufacturing biotech products is a costly affair as they have to pass the test of being the true copy of the patented biotech drug. The overall process is time consuming for the generic pharmaceutical company. Not many generic pharmaceutical companies will enter the biotech field of manufacturing biosimilars as there are many challenges to overcome and at the same time keep the cost low.

Generally, in pharmaceutical patent battle we always hear and read about big pharmaceutical company suing the small generic pharmaceutical company for infringing upon their patent. However, this situation is not always true. In the current scenario, we see big pharmaceutical company suing another big pharmaceutical company. Noteworthy case is the fight over the approval of Omnitrope by two big pharmaceutical companies Novartis, which owns Sandoz, and Pfizer, whose own version of somatropin (Genotropin) now faces competition.

How can companies take advantage of biotech drug patent expirations?

Biotech pharma companies can follow a proactive approach to file and secure patents in the field of biotechnology and pharmaceutical industry as patented inventions can be licensed to generate revenues. Patent can also be enforced to prevent infringement by initiating lawsuits and generating additional revenue streams by way of settlements and damages.

Biotech pharmaceutical & generic pharma companies can also keep a keen eye on technology and patent landscape by monitoring the patents that are filed and granted in this field. A thorough patent search and analysis of existing patents in relevant technology field can assist companies in determining if a patent already exists that discloses the technology of interest. Subsequently, researchers and inventors can fine tune their research accordingly.

How can companies take advantage of FTO of biotech drug patent expirations?

If you are planning to launch a generic version of the medicine get freedom to operate by an experienced patent attorney to avoid future infringement proceedings.

Patent Research Services

Patent Portfolio Management

With an upsurge of competition, the significance of patent portfolio management increased. Efficient patent portfolio management helps businesses identify opportunities while mitigating risk factors, and maintaining an edge over the competitors. Constant and pre-emptive reviewing and management also help it conform with the commercial goals of the company.

Patent Litigation Management

Litigation for patent is tedious, expensive, indeterminate but inevitable in some cases. Because of the erratic nature of patent litigation, you need a meticulous strategy to assert your intellectual property right, and this requires a comprehensive knowledge of the statutory framework, as well as the workings of the entire patent legal system. Our team of experienced patent attorneys are trained to handle the patent litigation procedure from start to finish.

CONCLUSION

A Freedom to Operate (FTO) Analysis is a risk management tool for the business purposes. Whenever a particular entity invents a new product, it should have an FTO analysis before filing a patent in order to minimize the risk, to understand ambit of freedom to operate and to reduce the litigation costs in patent prosecution. FTO analysis further helps to develop various business strategies so that the IP asset like patent can be properly managed by the entity or company.

REFERENCES

1. Indian Patent Office, Patent Application No: 201941002943, An Artificial Intelligence Based Tool for Assisting Non-technical People over Security, Field of Invention: Computer Science, Filed on: 24th January 2019, Publication No: 05/2019. 

2. World Intellectual Property Organization, IP and Business: Launching a New Product- Freedom to Operate, WIPO Magazine, Issue 5/2005 available at https://www.wipo.int/wipo_magazine/en/2005/05/article_0006.html (last accessed 5th May 2019).

3. Krattiger A, RT Mahoney, L Nelsen, JA Thomson, AB Bennett, K Satyanarayana, GD Graff, C Fernandez, and SP Kowalski. 2007. 14: Freedom to Operate and Risk Management. In Executive Guide to Intellectual Property Management in Health and Agricultural Innovation: A Handbook of Best Practices (Krattiger A, RT Mahoney, L Nelsen et al.); Available online at www.iphandbook.org (last accessed 5th May 2019).

4. European IPR Helpdesk, Case Study – Paving the way to success by building up an IP strategy for an academic start-up, May 2016, available at https://www.iprhelpdesk.eu/sites/default/files/newsdocuments/Case-Study-Paving-the-way-to-success.pdf (last accessed 5th May 2019).

Law Office of Patent Attorney Rahul Dev offers high value software patent drafting and patent due diligence services to clients by using proprietary and efficiently proven process along with a fixed fee costs, for performing comprehensive patent investigations and providing clients with strong patent reports for decision making.

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Advocate Rahul Dev is a Patent Attorney & International Business Lawyer practicing Technology, Intellectual Property & Corporate Laws. He is reachable at rd (at) patentbusinesslawyer (dot) com & @rdpatentlawyer on Twitter.

Quoted in and contributed to 50+ national & international publications (Bloomberg, FirstPost, SwissInfo, Outlook Money, Yahoo News, Times of India, Economic Times, Business Standard, Quartz, Global Legal Post, International Bar Association, LawAsia, BioSpectrum Asia, Digital News Asia, e27, Leaders Speak, Entrepreneur India, VCCircle, AutoTech).

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