This article was originally published by the Globe and Mail Report on Business: Cannabis Pro on January 9, 2020 and updated February 1, 2020.
By Jameson Berkow
Sophisticated cannabis companies are already focused on protecting their intellectual property, says Alice Tseng.
“And the really, really sophisticated ones would have thought about it several years ago,” said the partner at Smart & Biggar LLP who is also a registered patent agent and pharmacist.
For those just starting to look at protecting their cannabis-related inventions now, Ms. Tseng has some advice that could help make up for lost time. In her own words – lightly edited for length and clarity – Ms. Tseng provides three IP-related tips she says everyone involved in the legal cannabis industry ought to keep in mind.
Tip 1 - Deal with an 18-month information 'black hole’
A key thing that not everyone knows, including investors, is that information remains confidential for 18 months after a [patent] filing.
The reason why that is relevant is because it is a huge black hole. If you’re a company or an investor and you want to acquire a company that thinks they have a great invention, you actually don’t know if that invention is patentable right now because, when you do a patent search to see what else is in the landscape, you can’t tell if someone else had the same idea within the past 18 months.
That is actually pretty important and not everyone appreciates that. [What we tell people who do not appreciate that] it is true across the board, not specific to cannabis, it is just that with cannabis it is especially important because of all the recent filings.
Tip 2 -Patents are a battlefield win, not the end of the war
That is another thing that I’m not sure everyone appreciates. When you have a patent, the patent prohibits other companies and other people from commercializing an invention that will infringe on that patent. But just because you have a patent, doesn’t necessarily mean you can commercialize your own invention. (Q: Why?) There may actually be another patent out there which precludes you from commercializing your invention, on a separate part of your invention perhaps. So the benefit of having a patent is that, what often ends up happening is different companies can cross-licence to each other.
Unless you can challenge the validity of the other person’s patent
(Q: What if they cannot cross-license or challenge?) Well, you would still have a patent for whatever it is worth in and of itself. You could take the chance and proceed anyways and just hope that other company doesn’t sue you for infringement.
This is very different from, say, pharma litigation. When you’re dealing with prescription drugs it is very different because Health Canada will not approve a drug until a patent issue has been resolved. In every other industry you can launch, you just do it at the risk of being sued for infringement.
Tip 3 - Talking to an IP professional before you create IP can save you money
Speed is critical and not just in terms of thinking about IP but in terms of working with people like [a patent lawyer].
It is having an understanding of the patent landscape and of patent law to know how to structure your research, quite frankly, [because] for something to be viable from a patenting perspective, you might need to have some sort of R&D data done first before you can file an application. So, when [patent lawyers] are involved they can say ‘this is the critical part’ or ‘you need this part first before you move on’ so people know how to prioritize.
Some people will have everything tied up and their invention is perfect before they come to a lawyer and by then it might be too late, but if you come in earlier, then the better they can help themselves and the better we can help them.
(Q: What about the challenge of actually enforcing a patent?) I actually think patent enforcement is actually even better maybe in the cannabis industry because the products are all so closely regulated, so we already know anyone who can legally produce and sell cannabis, because there is a much more limited pool of who is actually in the legal market, I don’t know that enforcement is worse in the cannabis sphere than in other industries. It might actually be better.