Patent Marketing Approval Linkage

The FTA between Korea and USA includes provisions regarding the patent drug market approval (MA) linkage. Pursuant to the KORUS FTA, Korea has to fully implement patent drug market approval linkage from March 15, 2015. The key changes are summarized below.

1. Green List – the Korean version of Orange Book

When a company of a new drug application (NDA) has obtained a drug market approval (MA) from KFDA, the NDA holder must list patent information in the patent list (“Green List”) of KFDA. The Green List is similar to the Orange Book in the U.S., but is not the same. The deadline to list is 30 days from the receipt date of MA.

Unlike the Orange Book in the U.S., a NDA holder must list patents with the claim-by-claim basis in the Green List. Therefore, an applicant must specify every claim that covers the approved drug product and further an applicant must submit detailed explanation between each claim and the approved drug to KFDA.

2. ANDA Applicant’s Certification regarding Listed Patents

Like the HWA, an applicant of a generic drug application (ANDA) must submit a certification regarding listed patents of Green List to KFDA. The patent certification is similar to those of HWA. For example, an ANDA applicant must file a Para. IV certification if he wants to launch a generic drug before the expiry date of listed patents. In such a certification, the generic drug applicant must provide a detailed statement demonstrating that the listed patent is invalid or that the generic drug does not infringe the listed patent.

3. Notice to an NDA holder and a Patentee

Like the HWA, an ANDA applicant with Para. IV certification must notify the fact that an application for generic drug approval has been filed and the filing date of the application to the product approval holder and patent owner within 7 days of the application filing date. The obligation to notice will apply to an ANDA applicant who will launch their product before the expiry date of term of the listed patent. Otherwise, this provision does not apply to generic applicants who intend to launch their drug after the expiration of the listed patent.

4. 12-Month Stay on Generic Drug Entry

Within 45 days from the receipt date of the notice, the Patentee may file: a patent infringement action or a scope confirmation trial before the Korea Intellectual Property Tribunal (KIPT) against the generic drug. Further, the patentee/NDA holder may request KFDA to take an action stay generic drug entry for 12 months from the receipt date of the notice from an ANDA applicant. Such stay shall y apply only once to each generic applicant.

5. First Generic's 12-Month Marketing Exclusivity

The first applicant may obtain first generic marketing exclusivity for 12 months over other generics. The first applicant for this marketing exclusivity means : (a) to be the first filer of ANDA application or skinny (paper) NDA applications that are similar to 505(b)(2) applications in USA; and (b) to be successful in obtaining an IPT decision or a court decision from challenging actions against listed patents including a scope confirmation trial or invalidation action. The actions must be filed before filing a generic approval application.

6. Forfeiture of 12-Month Marketing Exclusivity

The first generic's marketing exclusivity shall be forfeited if the ANDA applicant failed to obtain MA within 12 months from the filing date; or failed to launch generic within 2 months from the date that the generic may be marketed.

7. Substantial Differences from the HWA system of USA

The patent MA linkage system in Korea may share basic principle with the HWA system of the U.S. Upon reviewing the Bill to the Drug Act and the draft of KFDA regulations, however, we can find that many details will be quite different from those of HWA. In order to grasp practical implications, it is better to compare two systems in detail after the Korean version has been fixed. The FTA of Korea and U.S. set the deadline to implement a full system of patent MA linkage in Korea: March 15, 2015. Therefore, we will certainly have final versions of law provisions and regulations within this year. We will provide you with them when they are available.

Benefits on Prior Art Search to Korean Language Documents in ICT Fields

Korea becomes one of the largest pools of patent publications in the world. In every year, KIPO receives over 350,000 domestic patent applications with specifications written in Korean. Furthermore, Korea already had the largest number of patent applications per year in the world in several technology fields.

1. Market Trend

 a. Mobile Phone

Samsung extended its lead in the overall mobile phone market as well, selling more than one in four phones worldwide in the third quarter of this year. While Apple’s market share in the worldwide mobile phone market increased slightly, the pricing of the new iPhone 5s and iPhone 5c in both mature and emerging markets failed to entice consumers as hoped. The table shows a recent market trend of smartphone sales.

 b. Embedded OS

In the smartphone operating-system market, Android continued to dominate the industry with more than 80 percent of the market's share in the third quarter of 2013. And, while Apple's iOS and BlackBerry suffered a drop in their worldwide market shares, Microsoft’s Windows Phone showed significant growth, albeit from a low base.

 c. Digital / Smart TV

Samsung retained its leadership position in the global Smart TV market amid the competitive holiday season of 2013 with a 26.4 percent share as TV vendors rapidly deploy Smart TV capabilities to garner higher average selling prices (ASPs), according to the latest Strategy Analytics research, “Smart TV Market Share Report Q4 2013″.

Samsung’s nearest competitor, LG, registered a 14.4 percent market share of Smart TV shipments. Although Sony ships fewer Flat Panel TV (FPTV) units than LG, it has been aggressive in its efforts to add Smart TV capabilities to nearly all models it currently offers, which helped Sony capture another 14.3 percent of the Smart TV market.

Samsung and LG have done well in growing their overall FPTV market shares while also refreshing their line-ups with more high value-added products like Smart TVs that have slowed ASP decline at these two companies. Not coincidentally, both companies witnessed a surge in Smart TV market share in the same period.

2. Patent Applications Trend in Recent 5 Years

 a. Mobile Phone/Embedded OS Fields

 b. Digital TV Field (excluding display panel technology) 

3. Korean Patent Documents as Prior Art Pool

 

Accordingly, it is certainly necessary to search and review patent publications in Korean for prior art searches. Nonetheless, it is really difficult to fully understand Korean texts because Korean is a language far remote from English. Usually it has been our experience that we can often find a critical prior art written in Korean that was never considered during patent examination in EPO or USPTO.

Search is not simple. Rather it requires expertise in strategy and deep understanding of technology. We have been entrusted for prior art search by large companies who have multinational patent litigations. Our experienced experts can provide high value-added search strategy and results for analyzing and compiling of patent database information. We have a lot of search and analysis experiences in smart phones, digital TV, video data processing, etc.

Statistics re Korean Patent Applications from WIPO world IP indicators 2012

In 2011, KIPO received about 180,000 patent applications. Among them, 23%, 40,890 Korean patent applications were filed by foreign applicants. Korea was ranked the 5th in the world in the number of patent applications by foreign applicants.

Patent Office	Non-Resident Filing	Total Filing	Percentage
KR	40,890	178,924	23%
Japan	55,030	342,610	16%
China	110,583	526,422	21%
Germany	12,458	85,674	14%

<Data Source: WIPO, World IP Indicators, 2012> 

In addition, 12,139 Korean patent applications – accounting for approximately 25% of the 40,000 Korean patent applications by foreign companies – were filed by American applicants.

Origin	Office
	US	EP	CN	JP	KR
US	-	34,987	28,457	23,414	12,139
CN	10,545	2,548	-	1,401	752
JP	85,184	20,568	39,231	-	15,234
KR	27,289	4,889	8,129	5,007	-

As for PCT routes, KIPO is highly trusted internationally. Further, KIPO become one of the most important offices because KPO has been appointed as the PCT International Searching Authority for about 1/3 of the U.S. PCT applications.

Year	2007	2008	2009	2010	2011
PCT applications in  USA	54,042	51,642	45,627	45,008	48,596
PCT International Search by KIPO	2,735	11,371	13,356	13,319	15,168

For example, Major US companies who appointed KIPO as their PCT International Searches in 2012 include Intel, MS, HP, Google, 3M, Hughes, Applied Materials, Caterpillar, Kimberly-Clark.

Functional Language in Claim

In general, a claim with functional language is very often objected by the Examiner in Korean patent practice. Examiners usually consider functional wordings or expressions used in claims rendering the scope or constitution of the claimed invention unclear and indefinite. Further, they seem to surely have the opinion that such functional expressions make the scope of the functional language claim to be unduly broader than the subject matter supported by the specification.

However, functional wordings or functional expressions are surely allowed under Korean patent practice when no alternative and effective expressions that can clearly and definitely describe the claimed subject matter; the meanings of the functional expressions are fully supported by the detailed description of the invention; and the functional expressions do not pose any problems in defining the scope of the claimed invention. For example, for the specifications of electronic technology field, functional wordings are usually and often allowed in claims. An examiner who is in charge of examinations for chemistry, biotechnology or pharmaceutical patent applications, has relatively high tendency to reject functional language claims.

Recently the Supreme Court held that the scope of protection for an invention is limited to the embodiments clearly specified in the detailed description and drawings when means-plus-function features are exceptionally allowed. The detailed descriptions and drawings of the invention are critical factors to be considered in narrowly interpreting functional claims for purposes of determining the scope of protection. Therefore, it is advisable to keep in mind that many examples should be described in the detailed description when the applicant files an application for a functional claim.

Denied Patent Term Extension for Novartis' Exelon® Patch in Korea

Novartis' Exelon® Patch has been used to treat mild to moderate dementia of the Alzheimer's type and mild to moderate dementia associated with Parkinson's disease. The active ingredient is rivastigmine.

Novartis obtained the first MA for Exelon® Capsule and the second MA for Exelon® Patch in Korea. Exelon® Patch uses a new formulation that allows rivastigmine to be administered in a transdermal therapeutic system (TTS).

Novartis listed two patents in the Green List (http://medipatent.kfda.go.kr) of KFDA pursuant to the linkage system of patent and market approval. The first patent is Korean Patent No. 133,686 that claims chemical compounds including rivastigmine, its pharmaceutical use. The term of the compound patent expired on December 23, 2012. The second patent is Korean Patent No. 569,051 that claims inventions of TTS formulation. The second patent will expire on January 8, 2019.

Novartis has another patent in issue that claims rivastigmine compound for transdermal administration and compositions for them. The patent in issue is Korean Patent No. 121,596 that has actually lmost the same scope of protection that of the basic compound patent of Korean Patent No. 133,686. The background between two patents is somewhat complicated because Korean Patent No. 121,596 stems from transient measure in 1987.

The Patentee and NDA holder, Novartis filed a petition for patent term extension of the basic compound patent on April 23, 2012. In Korea, the patent term extension system was first introduced on July 1, 1987. Under the 1987 Act that applied to the patent in issue, a petition for patent term extension may be filed only during the last three (3) years of the original term of the patent. Upon filing a PTE request, the term of the subject patent shall be extended automatically and shall be terminated on the expiry date retroactively in case the petition has been denied.

KIPO denied Novartis’ petition. Novartis appealed to the Seoul Administrative Court. On September 26, 2013, the court rejected Novartis’ arguments and denied PTE for Exelon Patch patent. The Patentee and NDA holder, Novartis appealed the lower court decision to the Seoul High Court again. The current PTE system has been based on 1990 amendment and the first PTE regulations of 1987 are quite different from those of the current PTE regulations. The PTE regulations of 1987 that must applied to Exelon Patch case had much more narrow scope than those of the current regulations in subject patents and gourds for PTE. Exelon Patch falls in such unfortunate cases during transient period between 1987 and 1990.