Amgens Epogen 1) Describe Amgens patenting strategy.

Evaluate its strengths and weakness Amgen first went after product patent, the strongest type of patent. But Amgen knew that it would be very difficult to get the product patent because it did not pass the test of nonobviousness in the light prior art. Therefore they also went after process patent. Now to increase the protection, Amgen also patented the starting material that is needed to produce EPO protein i.e. host cell and its vector. Strengths of product patent: Provide best possible protection i.e. firm has the right to exclude others from making, selling, using or importing

Weakness of product patent: Hard to obtain for biotech companies because most of these products have already been discovered and isolated.

Strengths of process patent: Since first-scale doctrine does not apply to process patents, people who have bought the patented product could not resell the invention Process patents can be written quite broadly so therefore you can cover a lot of ground in one patent

Weakness of process patent: By writing broad claims you can get in trouble when it comes time to defend your patient. In addition to that, it can also be difficult for someone skill in the art to reproduce the patient claims and this can invalidate your patient After Durdens case, its difficult for biotech companies to obtain process patent

Weakness of patenting starting material: This patient did not prevent foreign manufacturing from using these starting materials and then importing the final product to USA

2) Should Amgen execute the royalty-free cross license? YES: Why? They will be able to get to market without any legal problems and start bringing in revenue. This will stabilize Amgens stock price Avoid expensive fees of courts and lawyers Genetics Institute has the product patent, which is much more powerful than Amgens process patent

Amgens Epogen Since Amgen has the only patent on starting material, Genetics Institute can still produce the product in a foreign country and then important the product. This can really hurt Amgen because Genetics Institute can gain early-mover advantage. The longer Amgen wait, the less time they have to make money before Epogen patient expiration Now even though both companies have similar products, Amgen can still gain a competitive advantage with price, promotion and distribution Genetics Institute has won its 1989 court case and therefore has momentum over Amgen. This can be seen by statement make by Genetics Institute I can shut you down; I can take you off the market.

Other Strategies: There is a possibility that Amgen can buy out Genetics Institute. This will consolidate the two firms. They can also even buy out Genetics Institutes product patient Amgen can say no to royalty-free cross license and try to grind it out in court Negotiate a short or long term contract with royalties Amgen can try to differentiate Epogen product without changing its biological activity Amgen can try to go after Genetics Institute in different jurisdiction, European Union for example. It can also try to get patient in different countries. Amgen can try to amend their patient by narrowing the broad claims and then try to re-apply for stronger patient position