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Patent Reform Could Scare Off Investors from Small Biotech

By Riley Guerin | Feb. 4, 2012
News

Law Office Management

Feb. 4, 2012

Patent Reform Could Scare Off Investors from Small Biotech

The America Invents Act's switch from a first-to-invent to a first-to-file patent claim system favor biotech companies with deep pockets.

The America Invents Act's switch from a first-to-invent to a first-to-file patent claim system favor biotech companies with deep pockets but sets back struggling startups because it forces the latter to put their resources behind patent filings earlier in the R&D process, reports the Daily Journal.

This also means biotech startups with limited funds will have to defend the validity of their patents and bear those legal costs sooner than in the previous first-to-invent system. Venture capitalists could, as a result, end up investing less seed capital in biotech startups than they used to.

Already, investment in startups and novel drug prospects is waning as venture capitalist are wary of medicines and medical devices that require hundreds of millions of dollars to develop and bring though clinical testing and a lengthy US Food and Drug Administration approval process.

#239060

Riley Guerin

Daily Journal Staff Writer
rguerin@journaltech.com

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