Creating a Well-RoundedIP Strategy for MedTech Start-Ups

April 27, 2018

MassMEDIC Seminar: Confronting MedTechStart-Ups’ Three Biggest Challenges

Derek Roller, Partner, and Todd Gerety, Of Counsel

• 150 lawyers; headquartered in Boston, Massachusetts

• 30 practice areas, including industry leading Intellectual Property and Litigation practices

• Clients across the country and internationally

• Highly ranked in leading industry surveys and publications

• 150 lawyers; headquartered in Boston, Massachusetts

• 30 practice areas, including industry leading Intellectual Property and Litigation practices

• Clients across the country and internationally

• Highly ranked in leading industry surveys and publications

Nutter at a Glance

1

MedTech – Across the Spectrum

Biotech/Pharma Medical Devices Diagnostics Health-IT Mobile Health

Practice supports start-up, mid-market and public clients in:

3

What is an IP Strategy?

What is an IP Strategy?

Short Term BusinessGoals

$Long TermBusinessGoals

Marketplace &

Competitors

TechnicalNeed

Timing

• A roadmap of how IP will support the business

An IP Strategy Should Identify:• Short/long term company’s technical & business goals

• Products, markets, time to market

• Types of IP assets needed to support those goals• Patents, ®, ©, and trade secrets

• Plan for obtaining IP assets• In-house development, obtain license, asset purchase, company

acquisition?

• Plan for protecting IP outside the U.S.

• Budget ($)

What is an IP Strategy?

An IP Strategy Should Identify:• Internal IP mining procedures

• Encourage engineers to be mindful of any new potential improvements to company technology

• Implement an invention disclosure documentation process

• Establish a review process to collect and evaluate any invention disclosures for IP protection

• E.g., quarterly patent/IP committee meetings• Identify high priority IP & low priority IP and action items for each

What is an IP Strategy?

An IP Strategy Should Identify:• Competitors

• Technology & market share information

• Plan for monitoring Competitor IP • Periodic searches, Google® alerts, part of design phase review

• Defensive/Offensive strategies re: Competitor patents• Design around strategies • Non-infringement/invalidity opinion• Anticipate and block competitor next-gen design strategies

• Freedom-to-operate opinions

What is an IP Strategy?

Utility Patents• Protect functional/structural aspects of your medtech innovations

Design Patents• Protect ornamental features (appearance) of your medtech

innovations

Trademarks/Service marks• Protect your brand

• Company name, product/service names, logos

Types of IP

Copyrights• Protect your tangible works of authorship

• Software, operating manuals, marketing materials, training videos

Trade Secrets• Information that derives independent economic value from not being

generally known or not readily ascertainable by others• Formulas, methods, techniques, devices, confidential business information, etc.

• Subject of reasonable effort to maintain its secrecy

Domain Names• Registered, user-friendly name identifying website/internet domain

• Top level domains - .com, .net, .info, .biz, etc.

Types of IP

Why File For Patents?

• Stimulate investment or acquisition

• Discourage third parties from bringing patent infringement law suits against you

• Increase leverage in negotiations with third parties

• Enforce against competitors

• Prevent patenting by someone else

• Generate licensing revenue

Patents

• Protect functional/structural aspects of claimed invention

• Machines, manufacture, compositions of matter, or other new and useful improvements thereof

• Must meet statutory requirements for patentability

• Territorial right to exclude others from making, offering to sell, selling, using, importing

• Not a positive right to practice claimed invention by owner

• 20 year term from filing

Utility Patents

• Protect ornamental features of a design• Ornamental features must be distinct from

functional aspects of design

• Standard of Infringement• Whether the accused design is substantially

similar to the patented design from perspective of an “ordinary observer” with knowledge of prior art

• Protections lasts for 15 years from grant

• U.S. Patent No. D582,036• “Surgical Instrument Box Hinge”

Design Patents

• Medical Devices/Systems and related methods of use• Function/Structure (utility patents)• Ornamental features (design patents)• E.g. Surgical tools, implants, surgical robots

• Software

• Methods of Surgery and Treatment• Patentable in U.S., but not all other countries (e.g., EU)• 35 U.S.C. § 287(c) – Safe harbor for medical practitioners and

related health care entities

• Methods of Diagnosis• Questionable as patent-eligible subject matter

What is patentable in MedTech?

• First-to-file patent system – no longer first-to-invent• Patent term and value of patent over time• On-sale/public disclosure bars to patenting• Territorial rights• Cost

Considerations for Patenting

Deciding what to patent• Identify patentable technology from

• product roadmaps

• employee invention disclosures

• design arounds to competitor IP

• Engage patent attorney to perform a patent landscape review to identify “white spaces”

• Prioritize identified technology for patenting (e.g., gold/silver/bronze)

Considerations for Patenting

Deciding When (or When Not) to Patent• First-to-file wins, but not necessarily a rush to patent office

• Consider filing provisional patent applications to cost-effectively balance first to file with robustness of disclosure

• Consider filing non-provisional applications on high priority technology (e.g., core, essential)

• Delay patenting (or maintaining as trade secret) lower priority technology (e.g., “cool features”)

• Defensive publications can be an option

• Continuing applications

Considerations for Patenting

Filing Outside the U.S.• Consider whether you plan to market your medtech innovation outside the U.S.

• Patent Cooperation Treaty (PCT) international patent applications – misnomer, as there is no international patent

• Allows applicant to delay filing (and associated costs) of patent applications in individual countries or regions by about 30 months from earliest filing date of U.S. patent application.

• Applicant is also provided with international search report and/or an examination report

Considerations for Patenting

• Having a patent stops others from copying my product

• We don’t copy anyone’s product, so we don’t infringe anyone’s patent

• We’ve never seen this product on the market, so it must be patentable

• Filing a patent application automatically results in a patent

Patent Myths

Patents – Case Study

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

Mon

ey R

aise

d ($

M)

Year

InvestmentGrants

First US Patent Awarded

First Meeting on IP Strategy

• Protect your brand• Source identifier of goods and services to distinguish

from others

• Consider registering at least name or logo of company and/or flagship product in U.S. and other key geographic markets

• Must exhibit proper control over their use to avoid becoming generic and/or lose status as identifier of source

Trademarks / Service Marks

®™

Quick Tips For Trademark Issues

• Think about developing a brand

• Clear your mark

• Consider filing for trademark registration even if you have not begun using the mark

• Registered trademarks ® versus common law trademarks ™

Trademarks / Service Marks

Not just for musicians and novelists• Protect original works of authorship

• Computer software, operating manuals or videos, whitepapers, marketing materials, etc.

• Right to prevent others from copying, making derivative works of copyrighted work, for example

• Ownership: Author, unless work made for hire

• Open source issues

Copyrights

©

• Generally, information that derives economic value by not being generally known or reasonably ascertained by others

• Formulas, software, general know-how, confidential business information, etc.

• Trade secret has no expiration…until its no longer a trade secret

• Must take active steps to maintain secrecy • Monitor where information is stored, secure computers, maintain

secrecy with outside vendors,

Trade Secrets

Shhh…

• Registered, user-friendly name identifying website/internet domain

• Top level domains - .com, .net, .info, .biz, etc.

• No trademark rights created when domain name is registered

• Ideally, the domain name distinctive enough for protection under trademark

• Registration of another entity’s trademark as a domain name = trademark infringement

• AKA cybersquatting

Domain Names

DOT.COM

• Employment / Consultant Agreements• IP ownership and obligation provisions

• Assign, execute documents or perform other acts to secure IP in employer• Confidentiality/Non-disclosure Provisions• Non-compete provisions (employee)

• Reasonable limitations as to geographic area and time period• Work-for-hire provision for certain copyrighted works (consultant)

• 3rd Party Confidentiality/Non-disclosure Agreements• Use of NDAs with vendors/suppliers• Avoids transfer of information between parties being deemed public

disclosures

IP-related Agreements

Considerations with License Agreements• Grant• Term• Exclusivity• Field of Use• Ownership of derivative works• Transferability• Indemnification

Do you have what you need to bring your medtech product to market?

License Agreements