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Executive Summary

SEN. MATHIAS' PATENT BILL's PROVISION TO BAR UNPUBLISHED RESEARCH from use as a basis for challenging a patent "would accomodate modern research practices," Monsanto attorney John Maurer asserted April 3 at a hearing before Mathias' Patents, Trademarks & Copyrights Subcmte. Maurer spoke in support of the bill, S. 1535, on behalf of the Ad Hoc Cmte. to Improve the Patent Laws. The group includes Merck, Roche, Lilly, P&G, and American Hoechst. Present patent law has the effect of penalizing organizations which take a team approach to the solution of problems," Maurer noted. He explained that that the "unpublished information developed by one individual for the organization can be used against the invention of another individual in the organization" to challenge the patentability when the "second individual is aware of the research of the first." Maurer maintained that the proposed amendment "would remedy this situation and accomodate modern research practices, by providing that unpublished prior information known to the patent applicant shall not defeat the patentability of a subsequent invention." The amendment, he said, would encourage the free exchange of ideas between researchers in a team approach. Another amendment to the patent laws included in the Mathias bill is designed to prevent the infringement of process patents abroad for the manufacture of products for the U.S. market, Maurer pointed out. The bill would remove "loopholes in present law which encourage product manufacture or assembly of a patented invention outside of the U.S.," Maurer said. He noted that the proposed amendment to the patent law "provides that unauthorized importation into the U.S. of a product made abroad by a process patented in the U.S. will infringe the U.S. patent." The bill states that "whoever without authority imports into or sells or uses within the U.S. a product made in another country by a process patented in the U.S. shall be liable as an infringer." In his testimony to the subcmte. Maurer asserted that the Tariff Act, while it recognizes the principle of process patent protection, "is of limited value." He noted that it requires an administrative determination of "substantial" competitive injury to an industry as well as proof of patent infringement and adjudication of patent validity. In addition, Maurer noted, a patentee "cannot obtain damages for past infringement." He added that S. 1535 "would broaden the procedural and substantive remedies available to patentees in the courts and thus would favor production within the U.S. of products intended for the U.S. market." However, GPIA Patent Counsel Alfred Engelberg, of the NYC law firm of Amster, Rothstein & Engelberg, maintained that the Tariff Act provisions "strike the appropriate balance by protecting patent owners from foreign infringement only if they are actually engaged in the domestic exploitation of a process patient." In support of his testimony, Engelberg cited Merck's pending proceeding with the ITC involving the alleged infringement abroad of an indomethacin process patent ("The Pink Sheet" Feb. 27, T&G-6). He asserted that Merck purchased a U.S. process patent issued to a Japanese chemical company as Merck's product patent for Indocin ran out, and the firm now seeks "to prevent importation of indomethacin based on that newly acquired patent." Engelberg said that currently "the case can be defended on the ground that there is no injury to Merck and a substantial benefit to the public." Under the proposed legislation, he asserted, "no such defense is available." The Mathias patent bill is still in the subcmte. Reportedly, a revised draft of the bill should be ready for circulation among cmte. members following Congress' Easter recess.

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