United States: The Benefits of Patents for Nutraceuticals

One of the common misunderstandings in the natural products industry is the mistaken idea that patents can’t be obtained for natural products. The persistence of this myth can be attributed in part to history. As the pharmaceutical industry established itself, it became more focused on extraction of the active components of plant-based preparations and the synthesis of these actives. Pharmaceutical companies began to distance themselves from companies producing natural remedies—products that generally consisted of more complex mixtures of actives, often herbal extracts or even blends of raw herbs. Proving the efficacy of an isolated active compound to gain regulatory approval of a therapeutic was easier than proving efficacy of complex mixtures, due in part to the inherent difficulties in extracting and standardizing the actives.

Against this background, Congress eventually revised the patent laws in 1952, to permit patenting of "anything new under the sun made by man." While Congress intended this to be expansive, the U.S. Patent Office was more restrictive. The courts were more reasonable, agreeing that natural products might still be patentable. For example, Papaver somniferum, the common poppy, contains numerous medically important alkaloids. From the latex of the poppy, chemists can extract morphine and codeine, among other substances. Pure morphine is not found in nature, and the extraction of morphine from opium raises the morphine to the threshold level of a patentable composition, provided it meets the additional criteria of novelty (which it does not, as pure morphine has been known and in use since the 1800s). But, an extraction process may qualify as patentable subject matter, such as the novel process of extracting morphine from raw opium provided in U.S. Patent No. 6,054,584 (2000). Selective breeding and genetic engineering can also be used to change the poppy in a way that a new strain could result, which would likely be patentable. For example, U.S.Patent No. 6,067,749 (2000) describes a Papaver somniferum strain that produces high levels of thebaine, a precursor to codeine that is in high demand by the pharmaceutical industry.

What might this mean to the natural products industry? First, don’t assume that because a product is based on naturally occurring substances, it won’t qualify for patent protection. Formulations and new mixtures of natural products may be patentable where they are nonnatural (not found in nature) combinations of individual agents that have a synergistic effect/action not previously known. Second, as genetic engineering becomes more acceptable to plant breeders, many natural products will be modified in ways that result in the creation of non-natural varietals, such as grapes with higher levels of polyphenols, or olives with higher levels of beneficial fatty acids. Third, even where a natural product is sold, and the formulation is known, the processes for assaying and developing standards for product consistency and quality, and extraction and processing methods may be patentable. The question of patentability can be a complicated legal question, and the laws are always in flux. Ultimately, the question of patentability in the United States is addressed by the U.S. Patent and Trademark Office, and seeking the advice of a competent patent attorney can help you make important business decisions as to how best protect your company’s valuable proprietary assets.

Another major issue relates to misunderstandings surrounding the content, scope and enforceability of patent applications, particularly provisional patent applications and the confusingly similar sounding, but unrelated, concept of provisional rights in patent applications.

A patent is a limited grant of rights to exclude others from making, using, selling or importing the patented technology into the United States. A U.S. patent is only enforceable within the United States and its territories. A patent application confers no rights to the applicant, and a lawsuit can’t be brought for infringing a patent application. However, at a point in the application process, patent applications are published. Once published, an applicant may put potential infringers on notice of the existence of the application. By doing so, an applicant preserves the ability to obtain a limited remedy, if 1) the application becomes a valid U.S. patent, 2) the patent claims in the issued patent are substantially the same as those in the published patent application, and 3) the patent is successfully asserted against an infringer in a litigation proceeding. This is referred to as provisional rights. The rights are provisional because they don’t solidify until a patent is granted. Provisional rights, when properly asserted, provide the patentee with the ability to obtain a reasonable royalty, which can be retroactive up to the date of publication, but more commonly to the date when the applicant first put the potential infringer on notice that the patent application existed. This royalty for past infringement of the application is in addition to any remedies that exist for infringement of the patent, i.e., damages and possibly injunctive relief.

As such, companies with patent applications should be aggressive about policing the marketplace. When competitors are discovered that appear to be performing activities within the scope of your patent application, they should be notified of the existence of the application. Failure to provide notice to a potential infringer will preclude obtaining the retroactive royalty. However, threats of a lawsuit are inappropriate at this time, since no lawsuits are permitted based on infringement of applications, only issued patents, and any letter sent will certainly be seen by the court in later infringement proceedings. The concept of provisional rights is frequently confused with provisional patent applications. A provisional patent application is a type of utility patent application (as opposed to design and plant patent applications) that is never examined. A provisional application can be thought of as a placeholder that is used to obtain a filing date with the U.S. Patent and Trademark Office. It will automatically expire after one year, unless the applicant affirmatively moves the application into the examination process. This is often referred to as "converting" the provisional to a regular utility application.

In practice, the provisional application is rarely converted, but instead a utility application is filed on the year anniversary of the provisional filing, and the utility application claims the benefit of, or "claims priority to" the original filing date of the provisional application. This is significant since the filing date determines what is "prior art" for examination purposes. Patent claims need to be novel over the prior art for the invention to be patentable. There are other requirements, but this is the most significant.

Any subsequent improvement to the company’s technology should be captured in new provisional applications, filed without delay. There is no limit to the number of provisional applications that can be used to establish a priority claim, and waiting to describe the improvements in the regular utility application can affect the effective priority date. New matter in any patent application results in an application with a hybrid filing date; the original disclosure gets the benefit of the original filing date, and new matter gets the subsequent filing date. Intervening art, or subject matter described in a reference after the original filing date, but publicly available before the subsequent filing date, can cause problems with patentability. Frequently, people file provisional applications when their products or technologies are still in a preliminary form. This is acceptable, but it isn’t an excuse to file a provisional application with an inadequate disclosure.

The patent laws make no distinction in the requirements for a provisional versus a regular utility patent application. The grant of patent rights is based on the idea that the government grants limited monopoly to the patent holder, in exchange for a meaningful surrender of the idea to the public. A disclosure is legally sound when it teaches one of skill in the relevant art, how to make and use the invention. In addition, the invention needs to be described in sufficient detail, such that the skilled artisan would appreciate the invention based on his own knowledge, in view of the teachings of the patent. Lastly, the applicant does not have to describe all methods of practicing the invention, but does have to describe the best mode known at the time of filing. There is no requirement to update the best mode during subsequent prosecution. Any application, regular or provisional, that fails to meet these standards will make it unlikely the patent will issue, or may ultimately result in a court‘s invalidating the patent if it is challenged.

Companies that manufacture and/or sell natural products have the ability to obtain patents to protect their innovations. These patents may be applicable to the products themselves, if the patent claims are properly drafted. In addition, patent protection should be available for the manufacturing and testing methods, and these types of patent claims can round out a company’s patent portfolio. A company need not await the grant of a patent before it alerts competitors about the existence of its applications and, to take advantage of all possible remedies, it actually shouldn’t wait until issuance of a patent. However, applications are not patents, and they need to be carefully drafted to afford a company with the best possible case in the event subsequent litigation does ensue.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.