Latest Trends in U.S. Intellectual Property: Patent Term Extensions and Litigation Risk Mitigation Under Policy Changes
On October 30th, the seminar “Latest Trends in U.S. Intellectual Property: Patent Term Extensions and Litigation Risk Mitigation Under Policy Changes” co-hosted by Zhide Law Firm and Beijing Zhizhong Deben Intellectual Property Agency Co., Ltd. concluded successfully at Zhide’s Beijing office. The event was moderated by Guan Wei, Partner of Beijing Zhizhong Deben Intellectual Property Agency Co., Ltd. Focusing on key topics such as changes in U.S. intellectual property enforcement under the new administration, proactive strategies for addressing U.S. patent litigation through Early Case Assessment (ECA), patent term adjustments, patent term extensions, and data protection mechanisms, the seminar featured distinguished speakers including Jeffrey Shneidman, Louis Fogel, and Peng Lin, partners from the renowned U.S. law firm Fish & Richardson. It attracted active participation from representatives of enterprises already operating overseas or planning to expand internationally, intellectual property directors, and legal professionals.
01 Changes in U.S. Intellectual Property and Enforcement Under the New Administration — Jeffrey Shneidman, Partner at Fish & Richardson
Kicking off the seminar, Partner Jeffrey Shneidman delivered a presentation titled “Changes in U.S. Intellectual Property and Enforcement Under the New Administration.” With dual expertise in electrical engineering and law, Jeffrey splits his time between Fish & Richardson’s Boston and Shenzhen offices, providing extensive support to Chinese enterprises on their overseas intellectual property needs. He has accumulated rich experience in intellectual property layout for leading companies such as Huawei. He pointed out that under the new U.S. administration, the intellectual property field is undergoing a transformation from “gradual adjustments” to “rapid reforms,” with significant shifts in enforcement logic across the USPTO, PTAB, ITC, and federal district courts — changes that will have far-reaching impacts on Chinese enterprises’ overseas patent strategies and dispute resolution approaches.
(1) PTAB Emerges as the Core Arena for Policy Reforms
Jeffrey emphasized that the PTAB has witnessed the most dramatic changes in this round of policy adjustments. Officials appointed by the new administration generally adopt a “pro-patent” stance, marking a stark contrast to the strict restrictions on business method patents imposed by previous officials with financial services backgrounds. Currently, the U.S. government is actively encouraging patent types that were previously difficult to obtain authorization for, creating a more favorable patent protection environment for enterprises. A key change lies in the application of 35 USC 101 — under the judicial exception principles established in the Mayo and Alice cases, software patents and diagnostic method patents were often rejected for being “abstract ideas.” However, the newly proposed “Patent Eligibility Restoration Act” seeks to overturn this series of precedents, easing restrictions on patent applications in these fields.
Taking the artificial intelligence (AI) sector as an example, the USPTO previously required AI-related patents to improve the AI system itself rather than merely protecting AI applications in specific fields. However, the new USPTO Director recently clarified in a machine learning patent examination that such “domain application-type” AI inventions will be eligible for authorization. Jeffrey advised enterprises to seize this policy window to strategically build patent portfolios and draft broader claims, particularly in previously restricted areas such as diagnostic methods and new drug research and development.
(2) Major Adjustments to Patent Challenge Mechanisms
Addressing the issue of patent validity challenges, a top concern for enterprises, Jeffrey detailed recent rule changes at the PTAB. On one hand, the “settled expectations” principle has been strengthened, making it significantly more difficult to challenge patents that have been granted for 7-15 years and further protecting the legitimate rights of patent owners. On the other hand, restrictions on parallel litigation have become stricter — if a patent’s validity is already in dispute in federal district court, the PTAB will typically refuse to initiate duplicate administrative challenges to avoid resource waste.
More notably, the PTAB plans to implement new rules within the next 5-6 months: parties initiating Inter Partes Review (IPR) must commit not to raise obviousness or anticipation challenges in any other forum. This rule will force enterprises to make an “all-in” choice when challenging patents, as IPR proceedings only allow written prior art as evidence, excluding physical evidence or invalidity defenses based on “public sale of the product more than one year before patent filing.” Additionally, the PTAB’s case institution decision-making process has changed — instead of detailed institution opinions issued by a panel of three Administrative Patent Judges, the Director now makes a concise “grant/deny” decision, increasing procedural uncertainty.
(3) AI Application and Future Trends at the USPTO
Jeffrey also introduced innovations in AI application within the USPTO’s examination process. Currently, enterprises can opt to participate in the “AI-Powered Prior Art Search Pilot Program,” where AI generates a list of the most relevant prior art. Enterprises can adjust their patent applications based on this list without being required to respond formally. This initiative marks the USPTO’s gradual shift toward a new model of “machines examining machine-generated patents,” with broader application of AI in patent drafting, searching, and examination expected in the future.
Summarizing strategies for enterprises, Jeffrey stated: “We are in a ‘golden age’ for U.S. patent owners.” Enterprises should leverage policy dividends to focus on layout in previously restricted areas. Meanwhile, as PTAB challenges become more difficult, patent litigation cases in federal district courts are expected to increase significantly in the next one to two years, along with potential higher litigation activity from Non-Practicing Entities (NPEs). Enterprises need to prepare in advance. Additionally, when initiating patent challenges, enterprises may consider alternatives such as ex parte reexamination or resolving disputes directly through federal district courts.
02 Early Case Assessment (ECA): Proactive Strategies for Addressing U.S. Patent Litigation — Louis Fogel, Partner at Fish & Richardson
Next, Louis Fogel, Partner at Fish & Richardson, delivered a presentation titled “Early Case Assessment (ECA): Proactive Strategies for Addressing U.S. Patent Litigation.” Drawing on 25 years of experience in life sciences patent litigation, Louis analyzed the core value, optimal timing, and key tasks of ECA from a litigator’s perspective. With a Ph.D. in chemistry and serving as Managing Partner of Fish & Richardson’s Chicago office, Louis specializes in pharmaceutical patent litigation and has a profound understanding of litigation processes under the Hatch-Waxman Act.
(1) Core Value of ECA: Securing Success Through Preparation
Louis opened by stating: “The core value of Early Case Assessment lies in increasing the probability of winning litigation.” U.S. patent litigation is extremely costly, with a full trial potentially exceeding millions of dollars. Thorough advance preparation enables enterprises to address disputes in the most cost-effective manner. He cited AbbVie’s Humira as an example — once the world’s best-selling drug with annual sales of $25 billion, Humira’s success was underpinned by a robust protection network of over 150 patents. Through continuous ECA to optimize its patent portfolio, AbbVie successfully defended against challenges from numerous generic drug manufacturers and maintained market dominance for an extended period.
Louis also objectively pointed out potential risks of ECA: first, upfront investment costs; second, if initiated too early, product changes resulting from regulatory review may render the assessment ineffective; third, materials generated during ECA may be discoverable by the opposing party in subsequent litigation, requiring strict confidentiality and privilege protection.
(2) Optimal Timing for ECA: Precision Alignment with Regulatory Cycles
For Hatch-Waxman litigation in the life sciences sector, Louis detailed the optimal timing for ECA. Under the Hatch-Waxman Act, innovative drug companies enjoy a 5-year New Chemical Entity (NCE) exclusivity period after FDA approval. In the 4th year of exclusivity (i.e., NCE-1 date), generic drug companies can submit an Abbreviated New Drug Application (ANDA) and trigger patent litigation within 45 days of submission. Therefore, innovative drug companies should initiate ECA approximately 18 months before the NCE-1 date. At this stage, the product form is generally stable, allowing sufficient time to address gaps in the patent portfolio and prepare litigation materials.
For non-life sciences sectors, Louis recommended that enterprises initiate ECA immediately upon learning of potential infringement or receiving a cease-and-desist letter to avoid being caught off guard due to inadequate preparation. He emphasized: “There is no ‘wrong time’ for ECA, but there is an ‘optimal time.’ Initiating too early may waste resources, while initiating too late sacrifices defensive opportunities.”
(3) Key Tasks of ECA: Building a Comprehensive Defense System
Louis broke down the core tasks of ECA into four modules, providing enterprises with a clear action framework:
- Patent Portfolio Review and Gap Identification: Conduct a comprehensive inventory of relevant patents to assess right stability. Focus on verifying the inclusion of “specific compound structure claims” — these are far more difficult to invalidate than broad genus claims. Simultaneously, confirm coverage of formulation patents, manufacturing method patents, and indication patents to form multi-layered protection. Address identified gaps through continuation applications or other means.
- Regulatory Compliance and Orange Book Listing Management: In the U.S., only patents listed in the Orange Book (Approved Drug Products with Therapeutic Equivalence Evaluations) can be enforced in Hatch-Waxman litigation, and only for specific types such as compounds, formulations, therapeutic methods, and polymorphs. Enterprises must ensure timely and accurate listing of core patents to avoid losing enforcement rights due to omissions. They should also verify compliance with Patent Term Extension (PTE) applications.
- Validity and Infringement Risk Assessment: Conduct advance prior art searches to anticipate potential invalidity defenses against patents. Analyze technical features of competing products to assess infringement risks. Confirm the completeness of patent ownership chains and timely payment of maintenance fees to avoid procedural defects affecting enforcement. Additionally, monitor potential competitors’ R&D activities through platforms such as clinicaltrials.gov to proactively layout defensive patents.
- Team Building and Evidence Preservation: Secure technical experts and legal teams early. Leverage expert resources to optimize technical interpretation, and protect communications through “attorney-client privilege” to prevent discovery by the opposing party. Establish robust litigation preservation systems requiring relevant personnel to retain case-related documents and avoid adverse inferences due to spoliation of evidence.
Louis also highlighted unique rules of U.S. litigation that enterprises should note: first, discovery is extremely broad, covering not only written documents but also electronic data and witness testimony, with strict compliance with protective orders for confidential information exchange; second, venue selection is critical — 90% of Hatch-Waxman cases are concentrated in New Jersey and Delaware, where judges have high expertise and efficient case handling, while non-life sciences patent litigation often favors the Eastern District of Texas; third, expert witnesses play a pivotal role — the outcome of technical cases often depends on experts’ interpretation of patent claims and demonstration of technical facts. Enterprises should secure high-quality expert resources early and prevent competitors from retaining the same experts.
03 Pharmaceutical Market Exclusivity: A Brief Discussion on Patent Term Adjustment (PTA), Patent Term Extension (PTE), and Data Protection Mechanisms — Peng Lin, Partner at Fish & Richardson
In the second half of the seminar, Dr. Peng Lin delivered an insightful presentation titled “Pharmaceutical Market Exclusivity: A Brief Discussion on Patent Term Adjustment (PTA), Patent Term Extension (PTE), and Data Protection Mechanisms.” As the first Chinese equity partner at Fish & Richardson, Dr. Lin holds a bachelor’s degree from Tsinghua University, a Ph.D. in human statistical genetics from the U.S., and a J.D. from Harvard Law School. Currently serving as President of the Chinese Antibody Society, he possesses profound expertise in pharmaceutical patent layout and term management. Founded over 140 years ago, Fish & Richardson has represented landmark patents such as the Wright brothers’ airplane patent and Bell Labs’ telephone patent. From 2012 to 2025, the firm handled more PTAB cases than any other U.S. law firm and consistently ranks top in patent litigation.
(1) Pharmaceutical Data Protection: Analysis of Different Types of Market Exclusivity
Dr. Lin first outlined four core types of U.S. pharmaceutical data protection, helping enterprises clearly distinguish the application scenarios and scope of rights for each mechanism:
- New Chemical Entity (NCE) Data Protection: Grants 5 years of exclusivity for first-approved small-molecule drugs. During this period, generic drug companies cannot use the original drug’s clinical data in ANDA applications but may conduct their own clinical trials and submit independent data. Notably, NCE protection covers all indications — even if a generic drug targets an unapproved indication of the original drug, it cannot use the original clinical data.
- New Indication/Formulation Data Protection: Provides 3 years of exclusivity for new indications, dosages, or administration routes of already approved drugs. Unlike NCE protection, this applies only to clinical data for specific indications — generic drugs targeting other indications can use the original data without restrictions.
- Orphan Drug Data Protection: Offers 7 years of exclusivity for drugs treating rare diseases (defined in the U.S. as diseases affecting fewer than 200,000 people). This is the strongest form of protection — even if a generic drug company conducts complete independent clinical trials, the FDA will not approve its 上市 during the exclusivity period unless it can demonstrate significantly superior efficacy to the original drug. However, orphan drug protection is limited to the approved rare disease indication; use for other common diseases (“off-label use”) is not restricted.
- Biosimilar Data Protection: Grants 12 years of exclusivity for biologic drugs. During this period, the FDA will not approve any biosimilar applications using the original biologic’s clinical data. While generic drug companies may conduct their own clinical trials, the high cost and risks associated with biologic clinical trials make this path practically unfeasible for most enterprises.
Dr. Lin illustrated with an example: if an original biologic is approved on January 1, 2025, its data protection period will last until January 1, 2037. To launch early, generic drug companies must either wait for the protection period to expire or conduct full independent clinical trials — a rarely chosen option in practice.
(2) Patent Term Adjustment (PTA): Addressing Examination Delays and Recovering Term Losses
PTA provides patent term compensation for delays in USPTO examination. Dr. Lin noted that Chinese enterprises often miss out on compensation opportunities due to lack of familiarity with relevant rules. With proper handling, enterprises can typically obtain 3 months to 1 year of term extension, and in favorable cases, even 2-3 years.
PTA Calculation Logic: PTA = Examination Delays (A Delay + B Delay + C Delay) – Applicant Delay.
- A Delay: USPTO fails to issue the first Office Action within 14 months of filing, or fails to respond to the applicant’s Office Action response within 4 months.
- B Delay: Period exceeding 3 years from filing to patent grant. However, if the applicant submits a Request for Continued Examination (RCE), the B Delay clock pauses until a Notice of Allowance is received.
- C Delay: Delays resulting from the PTAB or appellate court reversing the examiner’s position (relatively rare but potentially yielding significant compensation).
- Applicant Delay: Delays caused by the applicant’s failure to respond to Office Actions within 3 months or submit required documents in a timely manner.
Practical Tips for Maximizing PTA:
- Initiate National Phase Early: When entering the U.S. national phase via PCT, proactively submit an “express request” along with the inventor’s declaration and filing fees to avoid term loss from the default 30-month start.
- Precisely Control Response Timing: Respond to Office Actions as close to the 3-month deadline as possible without incurring applicant delay, forcing USPTO processing to exceed statutory time limits and accumulate A and B delays.
- Strategically Use RCEs: After receiving a Notice of Allowance, submit an RCE to supplement Information Disclosure Statements (IDS). When submitting IDS related to foreign Office Actions, file supporting documents within 30 days to avoid applicant delay.
- Avoid Unnecessary Disclaimers: Overcome examination objections by adjusting claim scope rather than submitting disclaimers, which may impact term compensation.
(3) Patent Term Extension (PTE): Compensating for Clinical Delays and Extending Exclusivity
PTE provides patent term compensation for products requiring long-term clinical trials such as pharmaceuticals and medical devices. Its core purpose is to offset lost market exclusivity due to clinical trials and regulatory review after patent grant.
PTE Calculation Rules: PTE Term = (1/2 of Clinical Trial Period) + Regulatory Review Period (from NDA submission to FDA approval). Key Notes:
- The calculation starts from IND (Investigational New Drug) submission and ends at FDA approval.
- Only clinical trial and review time occurring after patent grant is counted; pre-grant time is excluded.
- PTE is capped at 5 years, and the total patent term after compensation cannot exceed 14 years from FDA approval.
- A product can receive only one PTE, and one patent can correspond to only one PTE.
PTE Eligibility and Scope:
- Eligibility: The patent must cover the approved product (including the product itself, salts, esters, and other derivatives), and the product must be receiving its first FDA approval.
- Scope: PTE protection is limited to the approved product and its salts/esters; unapproved indications or other derivatives are not covered. For example, if a patent protects DMF (dimethyl fumarate) and DMF is approved for marketing, PTE only covers DMF and its salts/esters, not its metabolite MMF (mycophenolate mofetil).
Key Considerations for PTA-PTE Coordination:
- Calculation Order: PTA must be calculated first, followed by PTE; the order cannot be reversed.
- Term Stacking: Combining PTA and PTE can significantly extend the effective patent term. For example, a patent with an original 20-year term could achieve a 24-year effective term with 1 year of PTA and 3 years of PTE.
Dr. Lin emphasized that the key to successful PTE applications is obtaining patent grant as early as possible — if the patent is granted after clinical trials begin, pre-grant clinical trial time cannot be included in compensation, resulting in substantial term loss for enterprises. Additionally, enterprises should consider patent layout during clinical trial design to ensure precise alignment between clinical trial products and patent protection scope, laying a solid foundation for subsequent PTE applications.
04 Summary
Through in-depth insights from three industry experts, this seminar comprehensively presented the latest trends and practical strategies in the U.S. intellectual property landscape. Covering policy reform dividends under the new administration, proactive defense through Early Case Assessment, pharmaceutical patent term management, and compliance key points for data protection, the content was structured hierarchically and packed with actionable insights, providing clear guidance for Chinese enterprises’ overseas intellectual property layout.
