Risk Regulation and Innovation: The Case of Rights-Encumbered Biomedical Data Silos

Arti K. Rai*

Overlapping legal claims pervade data-based innovation. Because of its heavily regulated status, and its potential to improve human welfare, innovation based on biomedical data is a particularly notable example.

As in most other areas of innovation,¹ intellectual property rights can overlap. Patents and trade secrecy can cover the same inventive territory simply because the U.S. Patent and Trademark Office (USPTO), litigants, and courts find it excessively expensive to police the patent statute’s complex disclosure requirements.

Moreover, precisely how much disclosure should be required is a policy question. Patent cases have sometimes allowed patent applicants to claim an invention that arises after patent filing without requiring disclosure of this after-arising invention. Meanwhile, the subsequent technology or information could itself be the subject of separate intellectual property, whether trade secrecy or an improvement patent.

While the caselaw trend has moved away from very broad rights, this movement has not precluded “adjacent” intellectual property rights. In these cases, the narrower patent claims do not formally cover the follow-on innovation. However, to the extent that even patent claims of moderate scope on a key research tool cannot be “invented around,” and the claims can be enforced, the practical effect may be similar.

Depending on the precise nature of the follow-on innovation generated, adjacent rights may include subsequent patents, trade secrecy, or regulatory exclusivities administered by the Food and Drug Administration (FDA). In the case of biomedical data—the focus of this Article—the adjacent right typically involves either trade secrecy or regulatory exclusivity. Both overlapping and adjacent rights have generated controversy regarding the possibility of excessive control by the initial rights holder.

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© 2017 Arti K. Rai. Individuals and nonprofit institutions may reproduce and distribute copies of this Article in any format at or below cost, for educational purposes, so long as each copy identifies the author, provides a citation to the Notre Dame Law Review, and includes this provision in the copyright notice.

*Elvin R. Latty Professor of Law, Duke Law School; Co-Director, Duke Law Center for Innovation Policy. Thanks to Jorge Contreras, to participants in the Notre Dame Law Review symposium, and to participants in workshops at Fordham Law School and the University of Toronto Law School for helpful comments. From 2013–2015, I was a member of an Institute of Medicine (now “National Academy of Medicine”) committee that issued a report on clinical trial data sharing. See Comm. on Strategies for Responsible Sharing of Clinical Trial Data, Inst. of Med., Sharing Clinical Trial Data: Maximizing Benefits, Minimizing Risk (2015) [hereinafter Sharing Clinical Trial Data], http://nap.edu/18998. However, this Article is based on publicly available information only.

1 See, e.g., Symposium, Negotiating IP’s Boundaries in an Evolving World, 92 Notre Dame L. Rev. 1421 (2017).