January 2012

January 24, 2012, by Mandour & Associates, APC

Los Angeles – Schiff Nutrition International, Inc. announced that it along with Aker BioMarine Antarctic USA, Inc., and Aker BioMarine ASA (collectively, Aker) have filed a motion to stay the patent infringement lawsuit filed by Neptune Technologies & Bioressources (Neptune).

The patent infringement complaint, filed in a Delaware federal court, alleges that Schiff MegaRed infringes U.S. patent 8,030,348, which was issued to Neptune in October 2011. No rulings or injunctions have been placed against Schiff and Aker at this point, and the mere fact that Neptune has filed claims against them has not in any way affected Schiff’s ability to sell and promote its krill oil.

A motion to stay is a request to temporarily stop a case or halt proceedings. Courts can subsequently lift the stay and resume proceedings, however a stay is sometimes used as a strategy to postpone proceedings indefinitely.

The motion to stay for this case follows Schiff and Aker’s request for the United States Patent and Trademark Office (USPTO) to re-examine the Neptune ’348 patent. In its request to the USPTO, Aker cited several prior art references that were not included in Neptune’s patent application. By granting the re-examination request, the USPTO has issued an initial rejection of all twenty one claims of the ’348 patent. According to statistics provided by the USPTO, re-examination requests take on average three years for a decision, and of the re-examination certificates issued, claims were modified or cancelled in eighty nine percent of the cases.

In July 2011, Schiff and Aker entered into an indemnity supply agreement in which Aker agreed to supply Schiff with its Marine Stewardship Council certified krill oil. The agreement also protects Aker from any losses incurred as a result the patent infringement lawsuit. Under the same supply agreement, Schiff and Aker have agreed to collaborate on future innovations for the nutrition industry.

Schiff Nutrition International, Inc. is a global leader of vitamins, nutritional supplements, and meal replacement bars. Its portfolio consists of well-known brands such as Schiff Move Free, Schiff MegaRed, Schiff Mega-D3, and Tiger’s Milk nutrition bars. In business since 1937, Schiff’s corporate headquarters, manufacturing and distribution facilities, are located in Salt Lake City.

January 16, 2012, by Mandour & Associates, APC

Los Angeles – With its record number of U.S. patents granted in 2011, for the nineteenth consecutive year IBM held the top patent holder spot in the world. However, IBM now has stiff competition in the rankings from Asian companies who are building their own patent portfolios.

As the world’s leading information technology services provider, last year IBM added 6,180 new patents to its portfolio of 34,000 active patents. Since 1911, the New York based company has been granted 70,000 patents by the United States Patent and Trademark Office (USPTO). Its first patent, granted over a century ago, was for technology related to a perforating machine. Since then the company has developed patents for DRAM cells which became the standard for computer memory. IBM is also known for its patented non-computer inventions, such as a laser technique that went on to become the foundation for LASIK eye surgeries.

Microsoft was the only other American company to place in the top 10, dropping to sixth place in the rankings. There were eight Asian companies in the top 10, with South Korea-based Samsung gaining 4,894 new patents in 2011 and Canon with 2,821 new patents. In total, the USPTO issued a record 224,505 new patents in 2011, a two percent increase from the previous year.

In the coming years, IBM may fall out of its comfort zone as the Asian technology giants take the lead. Information for Industry, Inc. (IFI), a patent data research company, said that Samsung’s eight percent patent growth outpaced that of IBM’s increase of five percent. More importantly, Samsung has overshadowed IBM for the past two years in its number of patent applications. The number of pending patent applications is a good indicator of future patent grants.

A patent attorney for IBM said that IBM has been successful at using its patents to manipulate trends in the technology world. For instance, if it wishes to promote certain standards, it may advise other companies that it won’t bring legal action to anyone innovating in that area even if its patents are infringed in the process. As a result, IBM has managed to avoid costly and time-consuming litigation, allowing it to invest about $6 billion in research and development each year. The company reportedly makes approximately $1 billion annually in royalty fees from licensing agreements.

January 9, 2012, by Mandour & Associates, APC

Los Angeles – Zyprexa (olanzapine) recently lost its patent protection, to be joined by Geodon (ziprasidone) and Seroquel IR (quetiapine) in March 2012. This past October, the U.S. Food and Drug Administration (FDA) approved the first set of generic olanzapine tablets. Patients in the United States can purchase them at most pharmacies. Experts estimate generic versions of all three drugs will enter the market at a 20-50% lower cost.

Prices will not drop immediately because the manufacturers of generic drugs are usually awarded six months of exclusive distribution rights. However, long-term, the availability of generics will translate into substantial savings for Medicaid agencies and for patients who pay out-of-pocket. Patients not covered by insurance may be able to purchase and benefit from these drugs for the first time. Medicaid Part D plan insurers could also realize savings. Since reimbursement rates are adjusted retroactively, insurers could pocketed a price difference when prices drop during the first year.

Prescription antipsychotic drugs rank highly on the list of most expensive medication. They constitute approximately one-third of most Medicaid pharmacy budgets. In 2010, special brand antipsychotics accounted for $5.3 billion of overall bipolar drug sales. Seroquel, Abilify, and Zyprexa lead the market as top revenue-generating drugs.

The pharmaceutical companies that developed these antipsychotic medications may see a large decline in their market share as generics become available. The markets covered will include the U.S., Japan, the UK, Italy, France, Spain, and Germany. In the United States, the market could drop to $3.1 billion, down from $5.8 billion. Globally, the market for bipolar disorder drugs could drop to $4 billion in 2020, down from $6.5 billion in 2010.

Patients that switch to generics may also notice a difference in the way they are being treated. The availability of a large mix of generic products could allow doctors to specifically tailor a treatment plan for a patient by prescribing a larger variety of drugs in more specific doses. Antipsychotics are used to treat disorders such as bipolar depression, schizophrenia and mania, but they have a wide range of efficacy and produce different side effects such as weight gain, diabetes, cardiac disease and sedation. Many doctors prefer to prescribe a mix of medication, such as a sedative combined with a drug with a low weight-gain effect and a drug with a low diabetes link. As generics enter the market, pharmacists will have to keep up with changes in drug combinations. The doctor, pharmacist and patient will need to monitor for side effects and the efficacy of treatment.

January 5, 2012, by Mandour & Associates, APC

Los Angeles – Imagine a laptop or cell phone that could run for weeks without recharging. This month, Apple filed for two patents relating to “a portable and cost-effective fuel cell system for a portable computing device.”

The first patent application is entitled “Fuel Cell System to Power a Portable Computing Device.” According to the application, the patent encompasses a fuel cell system that uses a cell stack to produce electrical power. A controller runs the operation of the entire system, which can also include an interface to a portable computing device.
The second application, entitled “Fuel Cell System Coupled to a Portable Computing Device,” encompasses a fuel cell system that can provide power to and receive power from a rechargeable battery in a portable computing device.” The patent aims to eliminate the necessity for a large, heavy battery within the fuel cell system, significantly reducing the cost, size and weight of the fuel cell.

Fuel cells convert oxygen and hydrogen into electricity, creating water as a byproduct. They can hold more energy than a battery, are smaller, and do not utilize fossil fuels. The technology is currently used in certain types of vehicles such as cars, boats, submarines and NASA satellites. The only fuel cells developed to charge electronics require a separate fuel cartridge and are used to recharge a portable device. In contrast, the Apple patents describe fuel cells integrated into the electronics. The technology has the potential to be applied to many types of electronic devices.
Apple’s patent filings propose a fuel source of sodium borohydride powder mixed with water. The sodium borohydride will produce the hydrogen. The hydrogen can mix with oxygen through a membrane to produce electricity and water vapor. In developing these patents, Apple aimed to find solutions to reduce reliance on fossil fuels, offshore drilling, and foreign oil. If approved, these broad patents could allow the company to develop this specific technology without direct competition.

Apple owns approximately one-thousand patents. One study suggests it owns vastly fewer patents than other electronics companies. In contrast, Samsung has at least twelve-thousand patents. Nokia holds about eleven-thousand patents, followed by Alcatel-Lucent, which holds about ten-thousand patents. Thus, Apple’s recent high-profile patent infringement lawsuits against its competitors give it a misleading reputation for owning a large portfolio of intellectual property.