Draft Intellectual Property Policy of the Republic of South Africa – Introduction and Goals

On August 25, 2017, the Draft Intellectual Property Policy (Draft IP Policy) of the Republic of South Africa was published for public comments by November 17, 2017.  This Draft IP Policy follows from the IP Consultative Framework that was approved by the South African cabinet on July 6, 2016.  In this multi-part series, we will address the need for the policy, the goals, strategies to meet the goals, and the phases of implementation.  In this first post, we will focus on an introduction and the goals of the Draft IP Policy.   

South Africa’s National Development Plan (NDP) calls for a greater emphasis on innovation, improved productivity, an intensive pursuit of a knowledge economy, and the better exploitation of comparative and competitive advantages.  Intellectual Property (IP) is an important policy instrument in promoting innovation, technology transfer, research and development (R&D), creative expression, consumer protection, industrial development, and more broadly, economic growth.   Knowledge, innovation and technology are increasingly becoming the drivers of progress, growth and wealth.  Thus, there is a need to for South Africa to transition towards a knowledge economy and IP will play an imperative role in this transition.  

There has been significant progress made in the development of IP within South Arica, which has in in part, ensured that it has a legislative framework that protects IP.  However, there is a need for a comprehensive IP  Policy  that  will  promote  a  holistic,  balanced,  and  coordinated  approach  to  IP  that is mindful of the many obligations mandated under the South African Constitution.  The policy will aim to promote and contribute to South Africa’s socioeconomic betterment by encouraging innovation, promoting local manufacture, preserving and leveraging the country’s resources and heritage, and empowering domestic industries and individuals who seek to take advantage of the IP system.  

One factor of particular importance, in which South Africa aims to address with the Draft IP Policy, is the intersection of IP and public health.  A key issue has been the role of IP in delivering public health, making it not only an IP issue, but also a human rights issue.  Specifically, a substantial issue with optimizing the role of IP in public health is that South Africa does not conduct substantive search and examination prior to the grant of patents.  The South African patent laws and implementing regulations are such that the Registrar of Patents, housed within the Companies and Intellectual Property Commission (CIPC), only conducts examination in relation to the formalities of the application.  South Africa employs a so called “depository system.”  Under the depository system, the subject of a patent application is only examined against the substantive criteria of novelty, inventive step, and industrial applicability if the patent is challenged in litigation.  This challenge could be in relation to infringement or revocation. 

The depository system for patents was instituted in South Africa due to resource constraints, whereby the cost of substantive examination is placed on parties that are directly interested in the patent.  The State is then able to direct scarce technical skills toward infrastructure and other key developmental areas.  However, there are substantial drawbacks for both producers and users of IP.  For producers of IP, the lack of examination may call into question the integrity of their patents, since the grant of a patent does not guarantee that the subject of the patent meets patentability criteria in the country, or that it does not contain subject matter excluded by law.  Another study conducted at a leading South African university, recently found that a significant number of patents granted in South Africa would not be granted under an examining system.  For users of IP, subject matter that should be in the public domain may be unfairly monopolized by exclusive rights.  An underlying policy rationale of patents is to serve as an incentive to stimulate innovation.  Granting an exclusive right, in the absence of genuine innovation, goes against the bargain that the patent holder is supposed to strike with society, namely, disclosure in return for monopoly protection.  This may result in a disadvantage to society and overall negative consequences for both access and innovation. 

The Draft IP policy cites a recent comparative study conducted by scholars from Columbia and Harvard Universities.  The study revealed that South Africa grants a far higher percentage of patents from all applications filed in the country than virtually any other comparable country.  On average, 93% of patents applied for in South Africa were granted, as compared to 61% in the United States of America, 53% in Mexico, 51% in the European Union (51%), and only 29% in Japan.  World Intellectual Property Organization (WIPO) statistics demonstrate that within comparable developing countries, the figures from India and Brazil show even lower rates of granting: in 2015, India granted 19% of all patent applications, while Brazil granted a14%. 

Beyond compliance with international obligations, South Africa aims to play its part in shaping the global order at various forums where IP is discussed such as in World Intellectual Property Organization WIPO, the World Trade Organization (WTO), the World Health Organization (WHO), the Group of Twenty (G20), political formations such as the Brazil, Russia, India, China and South Africa form (BRICS) and in African regional organizations.  This requires a coordinated South African approach to IP that is informed by South Africa’s development imperatives.  International cooperation must aim to make IP a tool to achieve sustainable development within the country. 

In general, the South African Constitution provides a balanced approach to property rights by affording protection against arbitrary deprivation of property, while also taking into account the public interest.  Public interest includes the nation’s commitment to bring about reforms that promote equitable access to services and products involving IP, such as public health.  The Draft IP policy will be an instrument of addressing the aforementioned issues.  

The goals of the Draft IP Policy are:

·        To consider the development dynamics of South Africa and improve how IP supports small institutions and vulnerable individuals in society, including in the domain of public health;

·        To nurture and promote a culture of innovation, by enabling creators and inventors to reach their full potential and contribute towards improving the competitiveness of South Africa’s industries;

·        To promote South African arts and culture; and

·        To solidify South Africa’s various international obligations, such as the Convention on  Biological Diversity (CBD) and the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization (Nagoya Protocol on ABS), in the service of South Africa’s genetic resources and traditional knowledge associated with genetic resources.

The Draft IP policy includes strategies for meeting the outlined aims and key reforms.  The implementation of the comprehensive IP Policy will be implemented in a phased approach with this document, in Phase 1, focusing on IP and public health, coordination in international forums, and the implementation of commitments undertaken in international agreements.  This will be followed by a second phase that will focus on several remaining core concerns around IP.

Please continue to watch the BRIC Wall Blog for the remainder of the series on the Draft Intellectual Property Policy of the Republic of South Africa. 

This post was written by Lisa Mueller and Kate Merath of Michael Best and David Cochrane of Spoor & Fisher

New guidelines in Brazil give more power to ANVISA in the examination of pharmaceutical patent applications

On March 13, 2017, the board of directors of Agencia Nacional De Vigilancia Sanitari’s (ANVISA) announced that they had reached a new agreement with the Brazilian Patent Office, namely, the Instituto Nacional da Propriedade Industrial (INPI), concerning the prior approval provision under Article 229-C of the Brazilian Patent Statute (For more information about the 229-C article, please see our posts here, here, and here).  On April 12, 2017, after an event with several authorities and President Michel Temer, ANVISA and INPI published a written version of the new joint guidelines #1/2017 (translation enclosed here:  INTERAGENCY ORDINANCE). These guidelines describe the new workflow between ANVISA and INPI involving the examination of pharmaceutical patent applications.

Article 4 of the guidelines establishes that ANVISA will analyze whether a patent application is contrary to public health.  According to Article 4, a patent application claiming a product or process is considered to be contrary to public health when the product or process presents a “health risk”.  The article further states that the “health risk” will be characterized when the pharmaceutical product comprises, or the pharmaceutical process results in a substance that has been prohibited in the country”.    

If a product or process is found to pose a “health risk” (as defined in the Annex I of the Ministry of Health’s Ordinance #344 of 1998), ANVISA will deny prior approval and will send the application back to INPI for further handling. At this point, INPI will publish the definitive dismissal of the application. In other words, the application is denied.

The guidelines contain a new approach in the examination of patent applications claiming pharmaceutical products and processes of interest under the Brazilian government’s drug policies and pharmaceutical assistance of the National Healthcare System (SUS). Under Article 5, ANVISA will examine these applications of interest and prepare a “technical” opinion as to whether the claims meet the patentability requirements under Brazilian law.  This opinion will be sent to INPI for use as a third-party observation under Article 31 of the Patent Statute of 1996.  Once INPI receives ANVISA’s opinion, it is “free” to decide whether or not to agree with it.  In the event INPI disagrees with ANVISA’s opinion and grants the patent application, it will send ANVISA a list containing all granted patents and will continue to make this list available to ANVISA (Article 7 of the guidelines).  

The guidelines do not contain any information as to what ANVISA can or should do with the list of granted patents received from INPI.  Actions that ANVISA could take include filing a post-grant opposition or seeking invalidity of the patent before Federal Courts. 

Article 9 of the guidelines creates an Interagency Group between the two agencies. The purpose of this group is to seek to “harmonize” the understanding between the ANVISA and INPI regarding the application of patent law in “polemic” topics such as Markush claiming, selection inventions, the patentability of new uses, salts, polymorphs and antibodies, as well as other issues relevant to the pharmaceutical industry.  One concern is that such “harmonization” could result in an unlawful administrative ban of claims that are currently being allowed INPI. As such, Article 9 gives ANVISA power to influence the INPI in a multitude of ways. 

Additionally, it is important to note that the new guidelines come after several decisions were obtained against ANVISA by various pharmaceutical companies (See our post here) holding that that the agency lacked the statutory authorization to examine patentability requirements under Brazilian law.  After these early decisions were rendered (which held that ANVISA’s prior approval review was restricted solely to the analysis of potential public health issues and not patentability requirements), ANVISA amended its guidelines to include a provision stating that “the granting of patents that do not fulfil the patentability requirements violates public health”. This change was interpreted by the courts as an attempt by the agency to escape the unfavorable case law and avoid the new guidelines.  

As a whole, the guidelines read like an attempt by ANVISA to revive its ability to participate in the examination of pharmaceutical patent applications.  Interestingly, many the associations representing generic companies in Brazil such as ABIFINA and Pro Generics are celebrating the guidelines as a victory for the local industry. 

Continue to watch the BRIC Wall Blog for continuing updates on these new guidelines in Brazil.

This post was written by Lisa Mueller and Roberto Rodrigues Pinho from Licks Attorneys.




The Copaxone Story in the U.S. and India

By: Lisa L. Mueller

Teva Pharmaceutical Industries Ltd. (Teva) markets Copaxone® (a 20 milligram daily injection) for the treatment of multiple sclerosis. The active ingredient is copolymer-1, or glatiramer acetate, which is a polypeptide product consisting of four different amino acids (alanine, glutamic acid, lysine and tyrosine). Copolymer-1 is a mixture of individual polymer molecules with different constituent ratios and thus different molecular weights. Annual sales of Copaxone® are approximately US$4.3 billon worldwide and account for more than half of Teva’s profit. Copaxone® is very expensive with many patients paying over US$40,000 per year for the drug.

In 2003, Natco Pharma Limited (Natco) began research to develop a generic version of Copaxone® in order to make a cost effective version of the drug available to patients in India. As a result of its efforts, Natco developed a novel process for producing copolymer-1 and filed patent applications covering its process. Presently, Natco’s copolymer-1 product is sold in India under the mark “GLATIMER”.

During the past seven years, there has been significant patent infringement litigation in both the U.S. and India between Teva and Natco involving Teva’s patents covering Copaxone®. Most recently, on February 28, 2014, the High Court of Delhi (High Court) dismissed Teva’s lawsuit seeking an injunction to prevent Natco from exporting its generic version of Copaxone®. In view of the legal actions involving the patents covering this product we at the BRIC Wall Blog thought it would be interesting to trace the evolution of this litigation to see where Teva might go from here.

U.S. and Indian Patents

In the U.S., at least 10 patents cover Copaxone®, specifically, U.S. Patent Numbers 5,800,808 (the “‘808 patent”), 5,981,589, 6,048,898 (the “‘898 patent”), 6,054,430 (the “‘430 patent”), 6,342,476, 6,362,161, 6,620,847, 6,939,539, 7,199,098 and 8,367,605. These patents issued between 1998 and 2013. The expiration date of the ‘808 patent is September 1, 2015, while the remaining nine patents expire on May 24, 2014. U.S. Patent Numbers 5,981,589 6,054,430, 6,342,476, 6,362,161 6,620,847, 6,939,539 and 7,199,098 were listed in the Orange Book for Copaxone® (collectively, the “Orange Book patents”).  All the patents are owned by Yeda Research and Development Co., Ltd. (Yeda) and exclusively licensed by Teva.

In India, Yeda filed application no. 93/DEL/2003 on May 2, 2003 for the product glatiramer acetate. A pre-grant opposition was filed by Natco raising issues of inventive step and an objection under Section 3(d) of the Indian Patents Act, 1970 (“the Act”). The application was rejected on March 3, 2009 as (1) obvious and lacking inventive step over the prior art; (2) not constituting an invention within the meaning of Section 2[1(j)] of the Act; and (3) not constituting patentable subject matter within the meaning of Section 3(d) of the Act. Yeda has appealed this decision. Nonetheless, Yeda obtained Indian Patent Number 190759 (the “‘759 patent”) claiming a process for manufacturing a co-polymer-1 fraction. Claims 1-3 of the ‘759 patent are reproduced here:

1. A method of manufacturing copolymer-1 fraction (a mixture of polypeptides composed of alanine, glutamic acid, lysine, and tyrosine in a molar ratio of approximately 6:2:5:1) used in pharmaceuticals, comprising reacting protected copolymer-1 with hydrobromic acid by known methods to form trifluoroacetyl copolymer-1, treating in a manner such as herein described said trifluoroacetyl copolymer-1 with aqueous piperidine solution to form copolymer-1, and purifying in a manner such as herein described said copolymer-1, to result in copolymer-1 having a molecular weight of 5 to 9 kilodaltons.

2. The method as claimed in claim 1, wherein said protected copolymer-1 is reacted with hydrobromic acid for 10-50 hours at a temperature of 20-28°C.

3. The method as claimed in claim 1, wherein said protected copolymer-1 is reacted with hydrobromic acid for 17 hours at a temperature of 26°C.

Mylan’s Agreement with Natco

On June 7, 2008, Mylan Pharmaceuticals Inc. (Mylan) signed a license and supply agreement with Natco for generic copolymer-1 pre-filled syringes. The agreement granted Mylan exclusive distribution rights in the U.S. and all major markets in Europe, Australia, New Zealand, Japan and Canada and included an option to expand into additional territories.

As a result of its agreement with Mylan, Natco developed two different generic copolymer-1 products using two different manufacturing processes. A first copolymer-1 product is made using a first manufacturing process and is sold only within India. A second copolymer-1 product is made using a second manufacturing process that is exported to Mylan.

U.S. Litigation

On December 27, 2007, Sandoz Inc. (Sandoz) filed the first abbreviated new drug application (ANDA) with the U.S. Food and Drug Administration (FDA) seeking approval to manufacture and sell its proposed copolymer-1 product before the expiration of the Orange Book patents. On June 29, 2009, Mylan filed its own ANDA.  In view of the ANDA submissions, Teva and Yeda separately sued Sandoz (in August 2008) and Mylan and Natco (in October 2009) in the U.S. District Court, Southern District of New York (U.S. District Court) for infringement of the Orange Book patents as well as U.S. Patent Numbers 5,800,808 (‘808 patent) and 6,048,898 (‘898 patent). Included among the patent claims asserted were claims 1-3 of the ‘430 and ‘898 patents, which are reproduced below.

Claims 1-3 of the ‘430 patent

1. Copolymer-1 having over 75% of its molar fraction within the molecular weight range from about 2 kDa to about 20 kDa, prepared by a process comprising the steps of:

reacting protected copolymer-1 with hydrobromic acid to form trifluoroacetyl copolymer-1 having over 75% of its molar fraction within the molecular weight range from about 2 kDa to about 20 kDa, wherein said reaction takes place for a time and at a temperature predetermined by test reaction, and

treating said trifluoroacetyl copolymer-1 having over 75% of its molar fraction within the molecular weight range from about 2 kDa to about 20 kDa with aqueous piperidine solution to form copolymer-1 having over 75% of its molar fraction within the molecular weight range from about 2kDa to about 20kDa.

2. The copolymer-1 of claim 1, wherein said protected copolymer-1 is reacted with hydrobromic acid for about 10-50 hours at a temperature of about 20-28°C.

3. The copolymer-1 of claim 1, wherein said protected copolymer-1 is reacted with hydrobromic acid for about 17 hours at a temperature of about 26°C.

Claims 1-3 of the ‘898 patent

1. A method of manufacturing copolymer-1 of a predetermined molecular weight profile, comprising the steps of:

selecting a predetermined molecular weight profile,

reacting protected copolymer-1 with hydrobromic acid to form trifluoroacetyl copolymer-1 having the predetermined molecular weight profile, wherein said reaction takes place for a time and at a temperature predetermined by test reaction, and

treating said trifluoroacetyl copolymer-1 having the predetermined molecular weight profile with aqueous piperidine solution to form copolymer-1 having the predetermined molecular weight profile.

2. The method of claim 1, wherein said protected copolymer-1 reacted with hydrobromic acid for about 10-50 hours at a temperature of about 20-28°C.

3. The method of claim 2, wherein said protected copolymer-1 is reacted with hydrobromic acid for about 17 hours at a temperature of about 26°C.

The lawsuits were consolidated and on June 29, 2012, the Judge found all nine patents valid, enforceable and infringed. Specifically, the Judge found Mylan had infringed seven of the patents and Sandoz infringed four patents. On July 26, 2013, the Federal Circuit ruled that four of the patents were valid but found five invalid for indefiniteness. Specifically, the Federal Circuit ruled that the claims of the five patents were indefinite because a person skilled in the art could not discern the boundaries of the claims. The patents declared invalid were U.S. Patent Numbers 5,800,808, 5,981,589, 6,048,898, 6,620,847 and 6,939,539. The patents held valid were U.S. Patent Numbers 6,054,430, 6,342,476, 6,362,161 and 7,199,098. The invalidation of the ‘808 patent was significant because of all the Orange Book patents, it had the longest expiration date (September 1, 2015).

On November 13, 2013, the U.S. Supreme Court denied Teva’s request to stay the Federal Circuit’s decision during appeal. As a result of the Supreme Court’s denial, Sandoz and Mylan can launch their respective generic versions of Copaxone® in May 2014 (rather than in September 2015).

Litigation in India

2007 Lawsuit

In 2007, Teva and Yeda filed a lawsuit against Natco in the High Court asking for a permanent injunction restraining infringement of the ‘759 patent as well as for a permanent injunction restraining Natco and its agents from directly or indirectly managing, selling or offering for sale, exporting, marketing, commercializing or registering copolymer-1 under the mark “GLATIMER” or any other mark. Teva and Yeda also asked for an order restraining Natco and its agents from exporting the infringing drugs, formulations or bulk drugs outside India. Additionally, Teva and Yeda sought an accounting of Natco’s profits and a decree for damages in the sum of approximately US$41,000.

Natco responded by arguing that its “GLATIMER” product did not infringe the ‘759 patent. Specifically, Natco argued that the process used to produce its “GLATIMER” product was completely different than the process recited in the claims of the ‘759 patent. In addition, Natco filed a counterclaim for revocation of the ‘759 patent. Natco argued that the patent was invalid for several reasons, including lack of novelty and inventive step and because the patent did not meet the criteria of patentability under the Act. The issues were framed in this litigation in May 2012 and a trial is currently in process.

2012 Litigation

On November 3, 2012, Teva ,Yeda and Teva API Limited (Teva India) filed a second lawsuit against Natco in the High Court seeking a permanent injunction to restrain Natco and its agents from directly or indirectly manufacturing, selling, offering for sale, exporting or registering the product that had been held by the U.S. District Court from infringing the ‘759 patent. Similar to the first lawsuit, Teva, Yeda and Teva India (collectively referred to as “Teva”) sought an accounting of Natco’s profits and a decree for damages. Teva argued in the complaint that the U.S. District Court decision lead to the conclusion that Natco was infringing the ‘759 patent based on the manufacture of copolymer-1 by Natco for export and sale to the U.S. Teva argued that “Natco’s act of manufacturing the glatiramer acetate product for sale in the U.S. and elsewhere amounted to a clear infringement of the ‘759 patent and was, therefore, liable to be restrained by permanent injunction”.

Teva argued that the High Court enjoyed jurisdiction to entertain the lawsuit because Natco was involved in a “large number of activities” that occurred in Delhi and targeted customers, consumers, suppliers and hosts of other people for various aspects of their business in Delhi. Examples given included the selling and offering for sale of products though distributors and agents in Delhi, the supply of its products to various hospitals and chemists throughout India as well as a distribution network in almost every city in India.

Natco argued that the process claimed in the ‘759 patent was not being practiced in Delhi as its manufacturing facilities were based in Hyderabad. Moreover, Natco agued that nowhere in its pleadings had Teva provided any evidence that there had been an infringement of the ‘759 patent in Delhi.

On February 28, 2014, the High Court found that it lacked jurisdiction and dismissed the lawsuit. The High Court reviewed the two processes used by Natco to manufacture copolymer-1 and noted that the present suit involved the process used by Natco for manufacturing copolymer-1 in India on behalf of Mylan for sale outside of India (the “Mylan process”) and not the process used by Natco for manufacturing copolymer-1 in India for sale within India.

The High Court stated that the averments in a complaint alleging infringement or apprehended infringement of a process patent have to be precise. Specifically, the High Court stated:

“…the averments in the plaint in the instant case have to be examined to ascertain if there is any specific plea that there is a violation of the process patent within the jurisdiction of this Court. The Court finds that there is no such specific averment. There is no averment that the process patent i.e. Indian patent No. 190759, or for that matter the ‘Mylan process’ is being practiced/infringed by Natco within the jurisdiction of this Court. This has also to be seen in the context of the fact that there is no denial by the Plaintiffs that there is no manufacture of the GA-second product (the Mylan process) in Delhi. There is also no denial by the Plaintiffs that Natco has at present its manufacturing facilities only in Hyderabad.

Since the suit concerns a process patent, the pleadings as regards the product being sold in Delhi or elsewhere, or the possibility of it being launched in Delhi or elsewhere cannot justify the jurisdiction of this Court. To recapitulate, in para 40 of the plaint it is averred that ‘The US Court decision leads to an incontrovertible conclusion of infringement of rights of Plaintiffs No. 1 and 2 in IN ‘759 based on the manufacture of glatiramer acetate by Defendant No. 2 for export and sale in the United States.’  In para 41 it is stated that Natco’s act of manufacturing the glatiramer acetate product ‘for sale in US and elsewhere amounts to infringement of the process patent. The averment is not that such manufacturing of the product for export to the US and elsewhere is happening or is apprehended to happen within Delhi. In the circumstances, the invocation of Section 48(b) of the Patents Act 1970 by the Plaintiffs to urge that the product obtained as a result of infringement of process is sold or apprehended to be sold in Delhi appears to be misconceived. The fact that Natco may have an office in Delhi or a distributor in Delhi is not relevant given the fact that the subject matter of the suit is a process patent, and the action brought forth is for alleged infringement of that process for the purposes of export to the US and elsewhere.” (emphasis added).

Where does Teva go from here?

As part of its campaign against generic versions of Copaxone®, Teva published data in January 2014 in PLOS ONE comparing Copaxone® with Natco’s “GLATIMER” product. The data in the article demonstrates significant differences in the biological and immunological effects between the branded drug and Natco’s generic version. However, the research was carried out in mice and not in humans. Despite this, Teva’s President of Global Research and Development and Chief Scientific Officer Dr. Michael Hayden remarked that, “The data from this paper shows the possible significant ramifications of changes in physiochemical properties between Copaxone® and a purported generic GA. This study suggests a distinct potential difference in the impact of a purported generic GA on the immune system of patients, with possible implications on efficacy and safety in RRMS patients. Teva believes the only way to truly understand the impact of these differences is by conducting a full battery of clinical studies.”

Additionally, Teva has developed a new three-times-a-week 40 mg/1 mL dosing regimen. In May 2013, Teva filed a supplemental New Drug Application with the FDA for this new regimen. Additionally, Teva filed for patent protection on the new regimen. So far, two U.S. patents have issued covering this regimen (U.S. Patent Numbers 8,232,250 and 8,399,413). These patents will expire in 2030.  Moreover, a Patent Cooperation Treaty application was filed covering this dosing regimen which was published as WO 2011/022063. The national phase was entered in a number of countries, including Australia, Canada, China, European Union, India, Japan, Korea, Mexico, New Zealand and Taiwan. It will be interesting to watch to see whether Natco develops its own version of this dosing regimen.

This post was written by Lisa Mueller and Nidhi Anand ‎of Chadha & Chadha.

Pay Your Annuities in Brazil!

In Brazil, yearly annuities are due on any pending patent application or issued patent.  Occasionally, mistakes occur and payment of a yearly annuity is not made.  Pursuant to Article 86 of the Industrial Property Law (Law), the lack of such payment results in the abandonment of an application or patent.  However, Article 87 of the Law gives an Applicant or Patentee the opportunity to have the application or patent restored if payment is made within 3 months of publication of a notification of the abandonment.  Specifically, Article 87 states:

 “Article 87 – The patent application or the patent may be restored, if the applicant or patentee requests it, within 3 (three) months counted from the notification or abandonment of the application or extinction of the patent.”

In practice, because of the chronic backlog within the National Institute of Industrial Property (INPI), several years (and hence payment of several years worth of annuities) typically pass before publication of a notice of abandonment.  When published, the notice states that the application or patent has become abandoned due to the failure of the Applicant or Patentee to make several years worth of annuity payments.  The notice recites the years that the Applicant or Patentee has failed to pay annuities.

According to the INPI, many Applicants and Patentees have stopped paying annuities until receipt of the publication of the notification of abandonment.  In view of this perceived abuse, INPI has changed its interpretation of Article 87, stating that an application or patent cannot be restored (namely, revived or reinstated) if an Applicant or Patentee has failed to make multiple annuity payments.  In light of this new interpretation, INPI has held several patent applications and patents abandoned without possibility of restoration.

Clearly, Article 87 provides a right to restore an application or patent as long as an Applicant or Patentee requests restoration and makes the appropriate payment within 3 months of the publication of the notification of abandonment.  Hopefully an aggrieved Applicant or Patentee will challenge INPI’s interpretation before the Courts.  In the meantime, Applicants and Patentees should carefully ensure the timely annuity payment.  Please watch the BRIC Wall for future updates on annuity payments in Brazil.

This post was written by Lisa Mueller and Gustavo de Freitas Morais of Danneman Siemsen.