Latest / Making Medicine / FDA Vouchers, Orphan Cures & IP with Joshua Kresh

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FDA Vouchers, Orphan Cures & IP with Joshua Kresh · Making Medicine

• 0:00
  Speaker 1: At Making Medicine. We're reporting on the headlines, not making
• 0:03
  Speaker 1: medical recommendations. For personal health questions, always consult a doctor.
• 0:08
  Speaker 1: Nothing in this episode constitutes investment, financial, or legal advice,
• 0:12
  Speaker 1: and please consult your own advisors before making decisions. Hello everyone,
• 0:23
  Speaker 1: and welcome back to the Making Medicine Podcast or Science
• 0:27
  Speaker 1: Policy and Innovation Meet. As always, I'm your host John Stanford.
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  Speaker 1: This week we're talking through the latest headlines, looking at
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  Speaker 1: the latest FDA approvals, and celebrating National Intellectual Property Month
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  Speaker 1: or National IP Month with special guest Joshua Cresh. With that,
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  Speaker 1: let's get into the show, and now for some headlines
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  Speaker 1: from the last week across the biotech industry. Most notably,
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  Speaker 1: we had our third announcement out of the White House
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  Speaker 1: with EMD.
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  Speaker 2: Serno. But it was another element of that conversation that
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  Speaker 2: we're going to get into, and that's the announcement of
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  Speaker 2: the first priority review vouchers out of the FDA that
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  Speaker 2: have occurred since the Trump administration took office. They're wide ranging,
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  Speaker 2: covering all sorts of priorities for the administration. So in
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  Speaker 2: addition to EMD. Sorono's similar announcement to Pfizer and astrosenica,
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  Speaker 2: we thought we'd dive a little deeper. As discussed in
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  Speaker 2: an earlier episode, the Commissioner's PrV program was announced back
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  Speaker 2: in June to significantly shrink the review time for new
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  Speaker 2: drug applications NDAs and Biologics License Applications or blas. FDAs
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  Speaker 2: shared that they'd like review times to go from roughly
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  Speaker 2: a year to only one to two months and laid
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  Speaker 2: out a number of program criteria that aligned with the
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  Speaker 2: most important US priorities. Those included addressing a US public
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  Speaker 2: health crisis, delivering more innovative cures for the American people,
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  Speaker 2: addressing a large unmet medical need, on shoring drug development
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  Speaker 2: and manufacturing, and increasing affordability. So just from those five
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  Speaker 2: criteria alone, you can see this is a wide ranging
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  Speaker 2: and frankly very subjective process, and so these first ten
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  Speaker 2: announcements certainly give us a little look at what people
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  Speaker 2: are looking at. So for each of the following each
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  Speaker 2: review decision was tasked with nominating a product that met
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  Speaker 2: program criteria, and here they are the first PrV recipients
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  Speaker 2: per Govius for infertility for mrk tep lizamab for type
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  Speaker 2: one diabetes from Sonofi sitis nukline from nicotine vaping Addiction
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  Speaker 2: from Achieved Life Science DBOTO for deafness from Regeneron from
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  Speaker 2: don't THEE Pharmaceuticals for blindness Sinnedgermann their BKBJ variety RMC
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  Speaker 2: six two thirty six from Revolution which is focused on
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  Speaker 2: pancreatic cancer for porphyria from disc Medicine by Tooperin, Ketamine
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  Speaker 2: focused on domestic manufacturing and augment in XR for domestic
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  Speaker 2: manufacturing from USA antibiotics and the ketamine will come from Flow.
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  Speaker 2: I want to focus on the last two for a
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  Speaker 2: moment because both of them reflect very commonly well known drugs,
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  Speaker 2: but a priority for domestic manufacturing, augment in something very
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  Speaker 2: familiar to folks who take antibiotics, and ketamine which is
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  Speaker 2: used in general anesthesia of focus on bringing both of
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  Speaker 2: them back to the US. We also saw a wide
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  Speaker 2: ranging list of drugs being approved in places where we
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  Speaker 2: are looking for innovation, for example pancreatic cancer, where for
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  Speaker 2: so many it does not bring about the hope that
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  Speaker 2: many other cancers have seen in recent years. The FDA
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  Speaker 2: announced that another batch of recipients are expected in just
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  Speaker 2: a few months. Another headline that cut our eye this
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  Speaker 2: week is growing conversation around one of the real achievements
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  Speaker 2: in the One Big Beautiful Bill of the inclusion of
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  Speaker 2: the Orphan Cures Act, which does away with a maddening
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  Speaker 2: disincentive to find secondary indications for rare drugs. Study after
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  Speaker 2: study after study shows, both from the investor perspective as
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  Speaker 2: well as the entrepreneur and the patient perspective, that what
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  Speaker 2: works in one area of science stands a good chance
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  Speaker 2: of working in another. There are a litany of drugs
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  Speaker 2: whose secondary indications brought hopes to patients who had nothing
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  Speaker 2: to do with the first indication, but following the passage
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  Speaker 2: of the IRA, there was a big disincentive to pursuing
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  Speaker 2: that secondary indication. Right after the IRA, it was al
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  Speaker 2: Nylum who announced that they'd stop a Phase three trial
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  Speaker 2: pretty far along simply because exploring a secondary indication made
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  Speaker 2: no economic sense. That noise has bubbled up, and Incubates
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  Speaker 2: been one of the voices calling for this fix, and
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  Speaker 2: sure enough, the Orphan's Cures Act is now law. But
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  Speaker 2: now we're beginning to hear a little bit of pushback.
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  Speaker 2: There's conversation that because some of the drugs that would
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  Speaker 2: have been slated for negotiation might now be exempt are
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  Speaker 2: driving up the cost of the Orphan Cures Act over time.
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  Speaker 2: A recent CBO score that was issued earlier this week
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  Speaker 2: at the behest of a handful of Democrats, pointed that
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  Speaker 2: the cost could be roughly double from four billion to
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  Speaker 2: approximately eight billion because of the inclusion and impact on
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  Speaker 2: price negotiations of a handful of drugs in twenty twenty eight.
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  Speaker 2: That's led some policymakers to run with the headline and
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  Speaker 2: introduce a bill effectively repealing the Orphan Cures Act. While
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  Speaker 2: this will continue to play out, it's important to remember
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  Speaker 2: that the Orphan Cures Act is not about now. It's
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  Speaker 2: about the future. And what's forgotten in the conversation from
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  Speaker 2: those pushing changes to the Orphan Cures Act, which is
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  Speaker 2: now law, is the fact that we have given certainty
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  Speaker 2: to investors in early stage entrepreneurs that pursuing secondary indications
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  Speaker 2: and letting science lead the way is the best course now.
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  Speaker 2: Politically speaking, it makes a lot of sense that in
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  Speaker 2: these partisan environments, Democrats will be looking for any reason
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  Speaker 2: to voke holes in what was included in a Republican
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  Speaker 2: only bill. But it's important to remember that the Orphan
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  Speaker 2: Cures Act and the Rare disease advocacy that went into
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  Speaker 2: it led to bipartisan support to this issue. At the
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  Speaker 2: end of the day, the short term budget horizon that
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  Speaker 2: the CBO looked at simply can't include the long term
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  Speaker 2: benefits of having more medicines with more capabilities and proven science.
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  Speaker 2: That's why this became law in the first place. So
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  Speaker 2: there'll be more headlines about the impact of the Orphan
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  Speaker 2: Cures Act on a handful of already manufactured drugs, but
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  Speaker 2: here at Incubate and the Making Medicine Podcast were focused
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  Speaker 2: on the positive impacts that are going to lead to
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  Speaker 2: new drugs and new treatments for patients. For more on
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  Speaker 2: tracking the beneficial progress, check out incubates Life Science Tracker
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  Speaker 2: and Rare Disease Tracker that is already capturing changed investor
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  Speaker 2: sentiment and a return to dollars for those looking for
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  Speaker 2: secondary indications for rare disease drugs. Each month, Incubate looks
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  Speaker 2: back on the Making Medicine Podcast at the good news
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  Speaker 2: that's come out of the FDA. This is the approvals corner.
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  Speaker 2: This September we saw five new approvals key trude as
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  Speaker 2: Q from Merk was approved to treat adult in pediatric
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  Speaker 2: solid tumor indications. Prezinity from Stealth Biotherapeutics was approved to
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  Speaker 2: improve muscle strength in patients with Bart syndrome. Lily had
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  Speaker 2: an approval for in Lure to treat certain breast cancers
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  Speaker 2: with disease progression following at least one line of endocrine therapy.
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  Speaker 2: Kroinetics Pharmaceuticals saw approval for Pulsonify, which treats acromegaly and
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  Speaker 2: adults who in an inadequate response or for whom surgery
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  Speaker 2: is not an option, and finally, Novardes's Repsido was approved
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  Speaker 2: to treat chronic spontaneous uticaria in adults who remain symptomatic
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  Speaker 2: despite H one antihistamine treatment. What I think is particularly
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  Speaker 2: compelling about a couple of these is they were advanced
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  Speaker 2: frends for folks who other treatments were not an option
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  Speaker 2: or not working as well as they could be. And
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  Speaker 2: so it's not always about finding a new drug for
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  Speaker 2: a disease state that doesn't have a therapy, but sometimes
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  Speaker 2: it's making sure that for folks existing therapies aren't working,
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  Speaker 2: new options are at the table, and that's what we
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  Speaker 2: got this month. As mentioned, October is National IP Month
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  Speaker 2: in the United States, where we celebrate the role intellectual
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  Speaker 2: property plays not just in our economy but in our
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  Speaker 2: everyday lives. Whether it's a movie you love, a book
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  Speaker 2: you read, a new device computer phone, or most importantly,
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  Speaker 2: the medicines we take. None of them would be possible
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  Speaker 2: without intellectual property. There are a lot of things to
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  Speaker 2: give the founding fathers credit for, and one of them
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  Speaker 2: is including intellectual property enshrined in the Constitution. So we're
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  Speaker 2: glad to have Joshua Kresh on in a moment to
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  Speaker 2: talk IP at a time when we're questioning some of
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  Speaker 2: those very foundations but also seeing unparalleled innovation thanks to progress,
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  Speaker 2: all thanks to IP. In celebration for National IP Month,
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  Speaker 2: We're lucky to have one of ip's luminaries, Joshua kresh
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  Speaker 2: on the show. He's the Research Professor and Executive director
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  Speaker 2: of IPPI, the IP Policy Institute with the University of
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  Speaker 2: Acre School of Law. He's previously been an associate with
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  Speaker 2: DLA Piper in DC, where he practiced. Patent litigation is
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  Speaker 2: a law degree with honors from George Washington University Law
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  Speaker 2: School has a number of other degrees and honors. I
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  Speaker 2: won't go into but frankly is one of the most
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  Speaker 2: important voices in IP and doing incredible work at IPPI,
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  Speaker 2: which Joshua, maybe that's the best place to start off first,
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  Speaker 2: Welcome to the show. Thank you, John tell us A
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  Speaker 2: little bit about the work of IPPI is what are
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  Speaker 2: you doing that's helping move IP protection forward in this country?
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  Speaker 3: Sure? So, IPPI is an IP institute any US law
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  Speaker 3: school to focuses in IP and innovation. So we basically
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  Speaker 3: study how the IP system is working in the real world,
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  Speaker 3: which differentiates us from a lot of other academics because
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  Speaker 3: we do theory, what we really care about practice and
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  Speaker 3: seeing what's really happening and does the theory follow with practice,
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  Speaker 3: which it doesn't always, And then we try to translate
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  Speaker 3: that into easier to understand tidbits that can be used
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  Speaker 3: by industry and by policy makers, so if they make changes,
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  Speaker 3: they can make it based on reality versus based on
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  Speaker 3: what kind of you know, gut feelings, which sometimes influence
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  Speaker 3: things more than they should, particularly in this space.
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  Speaker 2: Well, I'm sure we're going to get into some of
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  Speaker 2: the gut feelings of folks in the Trump administration or
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  Speaker 2: in Congress, but you know, here we are on for
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  Speaker 2: many of our listeners, they'll be very familiar with IP,
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  Speaker 2: but it always helps to restate it. Why of all
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  Speaker 2: the industries you look across at Ippi, why is biotech
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  Speaker 2: so important? Why is it so intrinsic that we talk
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  Speaker 2: about IP as it relates to biotech and developing new medicines.
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  Speaker 3: So developing in medicine is time consimming, takes ten to
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  Speaker 3: fifteen years often to get approval, and very very expensive.
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  Speaker 3: You can argue with the numbers, but somewhere between you know,
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  Speaker 3: one in three billion dollars, and then it's relatively easy
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  Speaker 3: to copy, particularly for small molecules. Biologics are a little
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  Speaker 3: more complicated. But still, you know, I can spend three billion,
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  Speaker 3: you could spend a few million or maybe fifteen million
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  Speaker 3: to copy me and release something relatively cheaply. So if
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  Speaker 3: I can't protect that, then I have no incentive to
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  Speaker 3: spend that money and to take the time and resources
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  Speaker 3: to do it. So without IP, you really wouldn't have
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  Speaker 3: a biotech industry at all, or at least it would
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  Speaker 3: be much much, much smaller.
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  Speaker 2: And how do you feel about the current environment for
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  Speaker 2: IP at large? When you're you know, either sitting at
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  Speaker 2: the desk or laying awake at night, What are you
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  Speaker 2: thinking about some of the changes we're talking about, or
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  Speaker 2: how is the health of IP more broadly in twenty
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  Speaker 2: twenty five.
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  Speaker 3: I think the best word for it is complicated. We've
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  Speaker 3: had a decade plus where we've weakened IP rights in
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  Speaker 3: some pretty significant ways, and we're certainly seeing the impact
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  Speaker 3: of that. We're starting to switch that both at the
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  Speaker 3: PTO and potentially with legislation, but we're not entirely and
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  Speaker 3: there's also some potentially negative legislation. So things are moving
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  Speaker 3: multiple directions. And you know, as I like to say,
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  Speaker 3: we're pulling a lot of levers without necessarily thinking about
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  Speaker 3: what's going to happen when you pull that lever, and
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  Speaker 3: it doesn't always get to the results we want. So
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  Speaker 3: I think there is a need to kind step back
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  Speaker 3: and say, Okay, what's working, what we've done in the
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  Speaker 3: last decade, what's not working. I think there's a lot
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  Speaker 3: that's not working, and how do we actually fix those
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  Speaker 3: problems where they are rather than trying to make changes
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  Speaker 3: without necessarily knowing what we're doing. I'm happy to go
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  Speaker 3: into some of the specifics on that as well.
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  Speaker 2: Yeah, let's pull on that thread a little bit, maybe
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  Speaker 2: starting with what's not working from your view in the
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  Speaker 2: IP system and are there legislative solutions out there that
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  Speaker 2: have caught your eye?
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  Speaker 3: Yeah, so, I think the three big issues that you
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  Speaker 3: can bluing to, and one has changed significantly in some reason.
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  Speaker 3: The last just couple of weeks is pattern eligibility, which
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  Speaker 3: is the first tier question. You know, is this the
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  Speaker 3: type of invention that you can actually protect which was
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  Speaker 3: supposed to be pretty broad, pretty easy to get through.
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  Speaker 3: And then you look at the other parts of the
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  Speaker 3: statute to figure out, Okay, it's the type of invention,
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  Speaker 3: but is it actually an invention? Doesn't is it new?
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  Speaker 3: Is it non obvious? Is it enabled the written tription
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  Speaker 3: there which it really is to do the media of
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  Speaker 3: the work. A bit over a decade ago, the Supreme
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  Speaker 3: Court made a number of cases which expanded how you
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  Speaker 3: can use eligibility or narrowed eligibility, particularly in diagnostics from
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  Speaker 3: the life science side. And if you have a new molecule,
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  Speaker 3: you're still safe, but if you have the diagnostic it's
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  Speaker 3: really tricky. And if you have software part of your
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  Speaker 3: invention is also really tricky. I think that that was
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  Speaker 3: a mistake. It's not based in the statue, not based
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  Speaker 3: on the legilative history, and there is pending legislation PAIRER,
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  Speaker 3: which would fix that. The other big legislation to restore injunctions.
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  Speaker 3: A pattern is not a right to make or use
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  Speaker 3: or sell anything. It's a right to stop someone else
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  Speaker 3: from making or using or selling your invention. This is
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  Speaker 3: important because it does, you know, help with licensing. You're
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  Speaker 3: not going to get someone to licensing deal with you
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  Speaker 3: if they can just copy you without any consequences, particularly
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  Speaker 3: in the biotech space. Often start off for small companies
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  Speaker 3: will take the invention through the first stages and then
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  Speaker 3: they'll work with a bigger company to actually bring something
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  Speaker 3: to market that works because the IP rights actually have
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  Speaker 3: some weight. If the big company could just steal your
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  Speaker 3: work and do it on their own, they're not going
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  Speaker 3: to make it. People. They're not going to spend a
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  Speaker 3: billion to buy a startup, and if anyone else gonna
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  Speaker 3: steal from them, then they're not going to spend the
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  Speaker 3: money anyway, because the second they release something, they'll be
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  Speaker 3: a cheap competitor out there and they're never going to
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  Speaker 3: make a return on investment. About fifteen years ago, the
• 14:15
  Speaker 3: Spreme Court had a case where in the concurrence they
• 14:19
  Speaker 3: dramatically narrowed the ability to get an injunction. Courts have
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  Speaker 3: interpreted that as being the law, and there's questions about
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  Speaker 3: whether that really should be the law, but it's sort
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  Speaker 3: of it is now. So there's a piece of legislation
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  Speaker 3: which could fix that and bring back injunctions as being
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  Speaker 3: the standard if your pattern is valid and infringed.
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  Speaker 2: And is that is that the Restore Act?
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  Speaker 3: That's Restore okay. The third biggest issue is p TAB,
• 14:44
  Speaker 3: which is not really a big issue in the life
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  Speaker 3: science space at all. There are concerns from some about
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  Speaker 3: the use of it to bring to make generics cheaper
• 14:52
  Speaker 3: and bring it them faster, but the evidence really doesn't buy,
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  Speaker 3: you know, support that. It's pretty narrow use in life sciences,
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  Speaker 3: there are some, but it's vastly use more in tech.
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  Speaker 3: There's a piece of legislation which is designed to fix
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  Speaker 3: it and bring it back to what Congress intended because
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  Speaker 3: there's been a bit too much variability administration to administration
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  Speaker 3: in terms of how it's been interpreted. So some administrations
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  Speaker 3: it's very easy to get cases in front of the tab,
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  Speaker 3: so it's a bit harder right now. It's actually quite hard,
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  Speaker 3: and the P tab has been narrowing quite a bit.
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  Speaker 3: So if you don't like the P tab, you're pretty
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  Speaker 3: happy with what the PTO has done in the last
• 15:24
  Speaker 3: few weeks. But the downside is the next administration couldn't
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  Speaker 3: flip it over entirely. So the benefit of having some
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  Speaker 3: legislation there is that we would set a bit more
• 15:33
  Speaker 3: of a guideline to what the PTO can do and
• 15:35
  Speaker 3: have less variability to ear which really matters small for
• 15:38
  Speaker 3: companies when we think of if I'm going to invest
• 15:40
  Speaker 3: and build this, what is the chance that it's going
• 15:42
  Speaker 3: to be challenged and is it actually worth something tomorrow?
• 15:45
  Speaker 3: And you care abo it's worse than today, But if
• 15:46
  Speaker 3: it's not, you have five years from no hour, ten
• 15:47
  Speaker 3: years from no when your RUG releases the system has changed,
• 15:50
  Speaker 3: and you don't know what the likelihood of the patent
• 15:52
  Speaker 3: being worth something, then then it's very hard to make
• 15:54
  Speaker 3: those long term investments.
• 15:58
  Speaker 2: You've said a lot that first of all, I think
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  Speaker 2: in cats relating those three different issues as you see
• 16:02
  Speaker 2: as problems right now makes a lot of sense. So
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  Speaker 2: thank you. One for distilling that down for us US
• 16:09
  Speaker 2: lay folks without the JDS and the practice and intellectual property.
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  Speaker 2: You said a few things that caught my ear, but
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  Speaker 2: one of them was the large company. You know, a
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  Speaker 2: lot of times when I'm talking about IP on Capitol Hill,
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  Speaker 2: people think of it as a protection for the large manufacturer.
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  Speaker 2: But I think you raise an interesting point of the
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  Speaker 2: small biotechs need it too, because otherwise the large manufacturers
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  Speaker 2: could just create the innovation that they've had, and we
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  Speaker 2: see so much, we see two thirds of the innovation
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  Speaker 2: in the system coming out of small biotechs. We talk
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  Speaker 2: a lot on this show that it's an ecosystem, it's
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  Speaker 2: not large versus small, And that's kind of what I'm
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  Speaker 2: hearing is that IPS not just good for the big
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  Speaker 2: companies who have products on the market. From your view,
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  Speaker 2: IP is also critically important for the small biotechs and
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  Speaker 2: the emerging technologies.
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  Speaker 3: Absolutely, IP is what lets deals happen, or certainly what
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  Speaker 3: helps deals happen, which is vital for this industry. And
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  Speaker 3: if you look at it, going back all the way
• 17:09
  Speaker 3: back to universities, which start for some of these prior
• 17:13
  Speaker 3: to the baydel At, universities could get protection, but it
• 17:16
  Speaker 3: couldn't license, which meant university protections inventions stayed on the
• 17:20
  Speaker 3: shelf because no one wanted touch it because they couldn't
• 17:22
  Speaker 3: protect it and couldn't make the deals that changed, universities
• 17:27
  Speaker 3: could license, and we've basically created the entire biotech ecosystem
• 17:30
  Speaker 3: in the US based on that. Now you can say
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  Speaker 3: this university is versus small companies, but it's much the
• 17:34
  Speaker 3: same thing that if you can't protect it, then I
• 17:37
  Speaker 3: don't want to talk to you because I'm afraid of
• 17:39
  Speaker 3: what you'll do here. And there are trade secrets, but
• 17:42
  Speaker 3: that doesn't really work in this space for a number
• 17:43
  Speaker 3: of reasons which we can get into, mostly because if
• 17:46
  Speaker 3: you're going to prove something works, you have to kind
• 17:48
  Speaker 3: of show that it works and people people aren' going
• 17:50
  Speaker 3: to trust you. It's like take my drug. I'm not
• 17:52
  Speaker 3: going to tell you how it works. I'm not going
• 17:53
  Speaker 3: to tell you any data, but it works. That doesn't
• 17:55
  Speaker 3: really work in this space, where it might work in others.
• 17:58
  Speaker 2: We have to bring the receipts as as the kids say, so,
• 18:02
  Speaker 2: I think that's that makes a lot of sense. I
• 18:04
  Speaker 2: don't want to bury the lead here because IP has
• 18:07
  Speaker 2: been front and center the last couple of weeks, a
• 18:09
  Speaker 2: couple of months, thanks in large part to our Commerce
• 18:13
  Speaker 2: Secretary Howard Lutnik, he has made some very outside the
• 18:19
  Speaker 2: norm views about from my perspective on patents, and we've
• 18:28
  Speaker 2: seen and sort of an intrusion into the marketplace by
• 18:31
  Speaker 2: the Trump administration that we typically haven't seen before. Have
• 18:35
  Speaker 2: you been following Lutnik's various proposals as it relates to
• 18:38
  Speaker 2: IP and and what do you make of them to
• 18:41
  Speaker 2: the extent you've there are details even out there.
• 18:44
  Speaker 3: Yeah, so I've been following them. I will say they're
• 18:47
  Speaker 3: quite concerning, but there aren't The deals are quite scarce.
• 18:51
  Speaker 3: So certainly something we're watching, and certainly something I've written
• 18:54
  Speaker 3: a little bit about and talked to some staffers about.
• 18:57
  Speaker 3: But it's hard to come at too much with knowing
• 19:00
  Speaker 3: what they're actually going to do. So I think the
• 19:01
  Speaker 3: two proposals you're probably getting at or one to take
• 19:04
  Speaker 3: half of the percent or fifty percent of the royalties
• 19:07
  Speaker 3: for university patents, that one will probably kill most university licensing.
• 19:15
  Speaker 3: And if you talk to AUTUMN, which is the Association
• 19:17
  Speaker 3: of University Technology Managers, the vast majority of university patents
• 19:20
  Speaker 3: have one potential licensee who they can make a deal with.
• 19:24
  Speaker 3: It costs a lot of risk. It's early stage. You know,
• 19:26
  Speaker 3: you don't know if if it's going to go anywhere.
• 19:29
  Speaker 3: If you double the costs most university would like we do.
• 19:33
  Speaker 3: If you had half the revenue, then you're going to
• 19:37
  Speaker 3: have fewer companies who want to take it, and a
• 19:38
  Speaker 3: lot of things to stay on the shelf. The other
• 19:40
  Speaker 3: options to say, well, universites can pay for this, and
• 19:42
  Speaker 3: the answers they can't. Most universities tech transfer offices lose money.
• 19:46
  Speaker 3: They're not there to make money for university. Some some
• 19:48
  Speaker 3: do make money. Some make a lot of money on occasion,
• 19:51
  Speaker 3: but usually is on an occasion. So if they lose
• 19:56
  Speaker 3: half their revenues, how many universities who already have small
• 19:59
  Speaker 3: office which are costing them something are going to either
• 20:02
  Speaker 3: have to let people go or shut the offices entirely.
• 20:05
  Speaker 3: They have to have something as part of batals, so
• 20:07
  Speaker 3: they can't entirely share it off. They can certainly cut
• 20:09
  Speaker 3: back on it, so that I think would not really
• 20:12
  Speaker 3: drive revenues for the government and would likely dramatically hurt
• 20:16
  Speaker 3: the entire system. The other proposal is to take a
• 20:20
  Speaker 3: one to five percent tax or fee or something on
• 20:23
  Speaker 3: the value of patents. I think the idea behind that
• 20:26
  Speaker 3: is that secondary letting things patents are valuable, which I
• 20:29
  Speaker 3: think they are, and it feels the government is giving
• 20:31
  Speaker 3: them to companies and that they should get a cut.
• 20:34
  Speaker 3: And I have a couple of responses to that. First,
• 20:37
  Speaker 3: you know, anything the company does with the pattern, whether
• 20:39
  Speaker 3: they're licensing or selling a product that covers the patent
• 20:43
  Speaker 3: or making deals, that's taxable revenue. So we already get
• 20:47
  Speaker 3: a good cut of it. We create lots of jobs,
• 20:49
  Speaker 3: we pay people a's are taxed, so I'm not seeing
• 20:53
  Speaker 3: that on that side. Now, there were issues a number
• 20:56
  Speaker 3: of years ago where companies could move IP rights to
• 20:58
  Speaker 3: other countries and try to avoid some the tax on that,
• 21:01
  Speaker 3: And if that's the problem, I think there's ways to
• 21:02
  Speaker 3: fix that without this. The other problem is valuing patents
• 21:06
  Speaker 3: is actually really hard. As a former patent literitor, I
• 21:09
  Speaker 3: can say it's common in cases and they are not
• 21:11
  Speaker 3: trying to figu out the value of the patent over'all.
• 21:12
  Speaker 3: I'm trying to figure out for one infringer, we could
• 21:15
  Speaker 3: spend one hundred thousand dollars in damages reports. Most patents
• 21:18
  Speaker 3: are not worth one hundred thousand dollars, so anything that
• 21:21
  Speaker 3: actually valued with you know, any kind of reasonable way
• 21:23
  Speaker 3: would probably cost more for most patents than you'd actually
• 21:26
  Speaker 3: get as the one to five percent. So I don't
• 21:28
  Speaker 3: see how you could do this besides the fact that
• 21:30
  Speaker 3: there's no legal way to do it, and we can
• 21:31
  Speaker 3: get into the BTSPE structures and why this can't be
• 21:33
  Speaker 3: part of that. It doesn't seem like makes sense from
• 21:36
  Speaker 3: a practical standpoint. Now you could counter and say, you know,
• 21:40
  Speaker 3: for if there's a single patent on a single drug,
• 21:42
  Speaker 3: then you can figure out the sales, but again you're
• 21:44
  Speaker 3: getting taxes on the sales there, so I'm not I
• 21:47
  Speaker 3: don't see what's missing.
• 21:48
  Speaker 2: There are two good points, the first one being a
• 21:52
  Speaker 2: slice of this already is going back to the government
• 21:54
  Speaker 2: in forms of taxes, and too. Valuation of patents is
• 21:59
  Speaker 2: probably a lot harder than we think. We will keep
• 22:02
  Speaker 2: an eye out for, like you said, not a lot
• 22:04
  Speaker 2: of details. We've seen the Secretary kind of throw these
• 22:08
  Speaker 2: ideas out there without a lot of guardrails or additional
• 22:13
  Speaker 2: items that help us evaluate whether or not they're good proposals.
• 22:17
  Speaker 2: But I think you've laid out a clear argument about
• 22:19
  Speaker 2: some flaws with them, but I want to close in.
• 22:23
  Speaker 2: You know, we're saying it's a celebration of National IP Month,
• 22:26
  Speaker 2: and America continues to innovate and in many places out
• 22:31
  Speaker 2: innovate the rest of the world. So what is working
• 22:35
  Speaker 2: in IP and what are some of the exciting sort
• 22:38
  Speaker 2: of fruits of that labor that cross your desk? You know,
• 22:41
  Speaker 2: what keeps you excited and hopeful that we can continue
• 22:44
  Speaker 2: to bring innovations that change people's lives.
• 22:48
  Speaker 3: Sure, So, you know, I've talked a lot about the
• 22:49
  Speaker 3: problems with the system, and I do think there are
• 22:51
  Speaker 3: problems that things will be better if we fix it,
• 22:54
  Speaker 3: But overall say, the system actually is working pretty well
• 22:57
  Speaker 3: on most reviews, one of the most innovative, the most
• 23:00
  Speaker 3: innovative countries. Still, I think, you know, could we do better?
• 23:03
  Speaker 3: And do we have concerns about competing with China and
• 23:05
  Speaker 3: others as our system weakens and their strengthen. Sure, but
• 23:09
  Speaker 3: the biotech industry is a great example of which working well.
• 23:12
  Speaker 3: In the US. We produce more new medicines than any
• 23:16
  Speaker 3: other country. We approve more new medicines than any other country.
• 23:19
  Speaker 3: The vast majority of new medicines come from US. So
• 23:23
  Speaker 3: something is certainly working, doesn't mean it's perfect, doesn't mean
• 23:26
  Speaker 3: we can't do better. We certainly can, but I think
• 23:29
  Speaker 3: that those are things that you can take to heart.
• 23:31
  Speaker 3: And even on tech, what we're doing with standard central patterns,
• 23:36
  Speaker 3: with chip designs, we're doing pretty well in most of
• 23:39
  Speaker 3: those areas, again because their competition that there wasn't ten
• 23:42
  Speaker 3: years ago. Yes, do we have to be cautious, yes,
• 23:47
  Speaker 3: Can we do better, yes, But I think we're still leading,
• 23:49
  Speaker 3: and we should make sure to keep things going in
• 23:51
  Speaker 3: the right direction and to fix the problems we've made,
• 23:54
  Speaker 3: rather than pushing things backwards and slowing things down, which
• 23:58
  Speaker 3: we certainly can't afford to slow down at this point.
• 24:01
  Speaker 2: Well, I think, well, I think that's a great place
• 24:03
  Speaker 2: to leave it. We can't afford to slow down. There
• 24:05
  Speaker 2: certainly are adversaries looking to out innovate US, but like
• 24:10
  Speaker 2: you said, I think our IP system is so foundational
• 24:13
  Speaker 2: it's worth celebrating, worth tweaking their improvements. And also there
• 24:18
  Speaker 2: are some concerning proposals out there. So I'm so grateful
• 24:20
  Speaker 2: that you took time away from IPPI to join us.
• 24:24
  Speaker 2: So Joshua thank you, and a very happy National IP
• 24:27
  Speaker 2: Month to you.
• 24:28
  Speaker 3: Thank you, John.
• 24:30
  Speaker 2: That's all for this week's episode of the Making Medicine Podcast.
• 24:33
  Speaker 2: A special thanks to Joshua for joining to celebrate National
• 24:36
  Speaker 2: IP Month with us. Do you have a thought or
• 24:39
  Speaker 2: question about today's topics, Drop a comment and we'll feature
• 24:42
  Speaker 2: it in next week's episode. Don't forget to subscribe on
• 24:45
  Speaker 2: YouTube and follow us on LinkedIn, X and Instagram using
• 24:49
  Speaker 2: the links in the description. Thanks for listening, and as always,
• 24:53
  Speaker 2: keep innovating.