Philippines: How to Ensure Patents are Granted and Pitfalls to Avoid

In summary

This article examines some selected issues in obtaining invention patents in the Philippines, and offers some guidance to practitioners and inventors in navigating avoidable hazards that could delay or result in the rejection of a patent application.

Discussion points

• Inventions eligible for patent protection, and eligibility issues
• Significant amendments to the implementing rules on inventions
• Issues affecting appeals
• Invalidation and inter partes reviews

Referenced in this article

• The Intellectual Property Code of the Philippines (Republic Act No. 8293)
• Revised Implementing Rules and Regulations for Patents, Utility Models, and Industrial Designs (Intellectual Property Office of the Philippines Memorandum Circular No. 2022-016)
• Food and Drug Administration Act 2009 (Republic Act No. 9711)
• Universally Accessible Cheaper and Quality Medicines Act 2008 (Republic Act No. 9502)
• Intellectual Property Office of the Philippines ‘Manual for Patent Examination Procedure’
• Intellectual Property Office of the Philippines ‘Examination Guidelines for Information and Communications Technology Patent Applications 2022’
• Intellectual Property Office of the Philippines ‘Guidelines for Examination of Patent Applications in the Field of Biotechnology’
• Examination of Pharmaceutical Applications Involving Known Substances (QUAMA Guide)
• Patent Prosecution Highway
• Intellectual Property Office of the Philippines 2022 ‘Clarity Guidelines for Patent Applications’

The Philippines is a member of several international treaties involving patents, such as the Patent Cooperation Treaty (PCT), the Paris Convention for the Protection of Industrial Property and the TRIPS Agreement, which fixed the rights and obligations among its member countries, and established an international law of substantive minimum standards for national IP laws, as well as common procedural requirements to administer and maintain intellectual property rights for the purpose of worldwide harmonisation.

The Philippines also has bilateral agreements with the US Patent and Trademark Office, the European Patent Office (EPO), the Japan Patent Office, the Korean Intellectual Property Office and member states of the Association of Southeast Asian Nations (ASEAN): the Global Patent Prosecution Highway (PPH), a work-sharing programme where applicants can request for the accelerated examination of their patent applications. Having a PPH, however, does not guarantee that the national IP office conducting the later examination will automatically allow and grant the application, since territorial patents apply. However, applications under the PPH are given priority, are free of charge and the usage of work products facilitates examination.

About 90 per cent of patent applications filed in the Philippines, as shown in the chart below,^[1] come from foreign applicants, and 90 per cent of applications are done through the PCT, hence the need to be more familiar with the Philippine IP system for inventions.

Inventions eligible for patent protection

Section 21 of the Intellectual Property Code of the Philippines (the IP Code) defines a patentable invention as ‘any technical solution of a problem in any field of human activity which is new, involves an inventive step, and is industrially applicable’. The statutory classes of patentable inventions are:^[2]

• a product, such as a machine, a device, an article of manufacture, a composition of matter or a microorganism;
• a process, such as a method of use, a method of manufacturing, a non-biological process or a microbiological process;
• computer-related inventions; and
• an improvement of any of the foregoing.

The exceptions^[3] are:

• discoveries, scientific theories and mathematical methods, and in the case of drugs and medicines, the mere discovery of a new form or new property of a known substance that does not result in the enhancement of the known efficacy of that substance, or the mere discovery of any new property or new use for a known substance, or the mere use of a known process unless such known process results in a new product that employs at least one new reactant;
• schemes, rules and methods of performing mental acts, playing games or doing business and programs for computers;
• methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practised on the human or animal body;
• plant varieties or animal breeds or essentially biological processes for the production of plants and animals, except micro-organisms and non-biological and microbiological processes;
• aesthetic creations; and
• anything which is contrary to public order or morality.

Computer-related inventions

For computer-related inventions (CII) and those in information and communications technology (ICT), the examination guidelines^[4] require that these inventions must have technical character to carry out the solution and achieve a technical effect.^[5] These guidelines are similar to the EPO examination guidelines involving computer programs.

Second medical use

In assessing patent eligibility and inventive step, the doctrine of inherency is used to explain the meaning of ‘mere discovery’. The patentability of a second or subsequent medical use of existing pharmaceutical products is allowed in the Philippines, and the QUAMA^[6] provides that method of treatment claims may be amended to first medical use claims if a substance is known but its pharmacological properties are not disclosed in the prior art. Second medical uses are to be drafted in a Swiss-type claim format (eg, use of a substance X in the manufacture of a medicament for the treatment of disease Y).

2022 Revised Implementing Rules and Regulations

The amendments to the Implementing Rules and Regulations for Patents (Revised IRR 2022) took effect on 20 September 2022. Some of the key changes are:

• The first publication fee, claims fee in excess of 5 claims must now be paid in full upon filing, and failure to do so could result in the application being deemed a failed application that shall not be published and may have to be filed anew. In case of excess payment, it will be treated as donation to the Intellectual Property Office of the Philippines (IPOPHL).
• The mandatory appointment of a resident agent and representative for non-resident applicants, and the failure to submit within one month from notice shall deem the application to be withdrawn.
• The voluntary withdrawal of applications shall be under oath, and if done after the first publication, shall be published for opposition. If opposition is granted, the applicant can appeal to the Office of the Director General (ODG) of the IPOPHL. If the opposition is denied, the withdrawal is granted and the application is forfeited.

Appealing office decisions

The appeal process from an examiner’s rejection of the patent application or claims involves at least four stages with decisions rendered at each stage, namely:

• appeal the decision of the examiner to the Director of the Bureau of Patents (BOP); and
• appeal the decision of the BOP Director to the ODG of the IPOPHL.

The decision or order of the Director reversing the refusal of the examiner shall be immediately final and executory. However, if the decision of the Director affirms the refusal of the examiner, the applicant can:

• appeal to the ODG;
• appeal the decision of the ODG to the Court of Appeals (CA); and
• appeal the CA decision to the Supreme Court (SC).

Failure to comply with the formality requirements

The BOP is quite strict when it comes to deadlines and other procedural requirements, although occasionally it does relax its rules.

English is required

ParexGroup SA filed two national entry applications claiming priority over its French applications filed on 3 November 2016, but only the abstract and the text of the drawings had English translations. The examiner issued a notice of invalid national entry, since the patent applications were not filed in the English language as required by the Philippines Rules on PCT applications (PRo-PCT). ParexGroup appealed the denial claiming:

• substantial compliance of the PRo-PCT;
• that the description and claims were already available on the World Intellectual Property Organization (WIPO) website;
• that it should be given the chance to correct deficiencies in its patent applications; and
• that it had subsequently submitted copies of the description and claims in English.

The BOP Director denied the appeal. Dissatisfied, ParexGroup appealed^[7] to the ODG, which likewise denied the appeal. The ODG stated that the 30-month period given to those seeking the national phase of the PCT is a very reasonable period to comply with the PRo-PCT, and more so since it allowed an extension for another month that ParexGroup did not use, and finally because the submission of the English translation was done only after notification by the examiner. The ODG further stated that it is the applicant’s duty to look after its own interest, and just like in lawsuits, reglementary periods and time limits must be strictly followed as they are considered as ‘indispensable interdictions against needless delays and for orderly discharge of patent examinations’.

Reinstating lapsed patents

The BOP Director denied Incyte’s petition for the reinstatement of its patent 1-2010-502616 (‘616) that lapsed for failure to file the 10th year annual fees, stating that the IP Code does not provide for reinstatement. Incyte appealed to the ODG^[8], arguing that it was erroneous for the Director to construe the lack of a specific provision in the IP Code as a prohibition. The ODG granted the appeal, holding that the circumstances of the case merited liberality, as Incyte had been diligently paying its previous annuities and the failure to pay the 10th and 11th year annuities was due to an error committed by an employee of its US agent who failed to communicate Incyte’s instructions to pay – and because Incyte exercised due diligence upon knowing of the error, immediately arranging for the payment of the 10th and up to the 12th annuity dues with surcharges. Further, at the time the annual fees were due, the Philippines was under a state of public health emergency due to covid-19.

No Philippine agent, no application

The Revised IRR 2022 imposed even stricter rules for obtaining filing dates, meeting deadlines and complying with procedures. There may be days when patent agents are not their usual alert selves and forget to remind their foreign clients to issue their power of attorney or appointment of a resident agent. The Revised IRR 2022 makes the submission of the appointment of a resident agent or representative for non-resident applicants mandatory and gives one month from notice to comply, otherwise, the application is deemed to be withdrawn.^[9]

Late filing is a no-no

On 12 July 2018, the ODG dismissed the appeal of Takeda^[10] and held that it can only claim the filing date of the parent application within four months from date of receipt of the restriction. This case stemmed from a divisional application filed by Takeda on 1 June 2004, claiming priority over its parent Application No. 53455 filed on 18 June 1996. The examiner denied the claim for priority, stating that the claims of Application No. 53455 were subjected to the restriction requirements issued on 2 July 2002, that the applicant had four months to file the divisional and such period had lapsed. Takeda argued that it had filed a voluntary divisional application, which the BOP rejected. The ODG, in dismissing the appeal, ruled that ‘patents should be strictly construed and given only to those inventions that have significantly contributed to existing arts’.

Failure to meet substantive requirements

To be patentable, an invention must meet three requirements: novelty, inventive step, and industrial applicability, and must not fall within the exclusions.

Non-patentable: anything that is contrary to public order or morality

Application No. 1/2017/500733 for ‘Cannabis Extracts and Methods of Preparing and Using the Same’ with priority claims from US applications, which entered the Philippines on 20 April 2017, was issued a substantive examination report with mailing date of 5 February 2021 rejecting all amended Claims 1-28 for being drawn to a subject matter contrary to public order or morality. The claimed cannabinoid formulation, the method of its production from cannabis extract and its medical use constitute matters that are contrary to public order or morality,^[11] because the cultivation and use of cannabis in the Philippines is illegal under the Comprehensive Dangerous Drugs Act 2002 (Republic Act No. 9165).

Non-patentable: abstract ideas, theories or fundamental concepts

In the national phase application 1/2019/501851^[12] the examiner objected to Claims 1-10 as constituting mere abstract and non-technical model training methods and data similarity determining methods, which lack the support of an apparatus or device, and appear not to be tangibly embodied in a manner as to be executable through interaction between method and apparatus – and therefore not patentable under Rule 202 of the Revised IRR 2022. Applicants are encouraged to present arguments against every ground of refusal and to support these arguments. For the purpose of expediting adjudication, the claims were examined with the assumption that technical elements are involved when carrying out the claimed method as stated in the description and in so doing, the examiner found the claim for convention priority allowable, meeting the requirements of novelty, inventive step and industrial applicability.

Oppositions and re-examination matters

The Philippines has no opposition procedure against patent applications, except for voluntary withdrawal of the application as earlier discussed. However, the IPOPHL invites the public to submit their observations, under oath, within six months, either through electronic mail or separate notification on the IPOPHL website, following the publication of the patent application.^[13] The affiant must indicate their personal details. All observations are forwarded to the applicant, who may respond to the observations. Copies of any observations filed, comments on them by the applicant and minutes of conferences form part of the file wrapper in the subject application. The observation and comments, as well as the discussion in the conferences, shall be taken into consideration when examining the patent application. Upon request, the IPOPHL will notify the third party of the status or final disposition of the application.

Invalidation or petition for cancellation

The IP Code provides that any interested party may, upon payment of the required fee, petition to cancel the patent or any claim or parts of the claim, on any of the following grounds:^[14]

• what is claimed as the invention is not patentable;
• the patent does not disclose the invention in a manner sufficiently clear and complete for it to be carried out by any person skilled in the art;
• the patent is contrary to public order or morality; or
• the patent includes matters outside the scope of the disclosure contained in the application as filed.

For documents executed outside the Philippines, such as the power of attorney and affidavits, the authentication or apostille of these documents must have been done before the filing of the case.^[15] A single pleading for petition involving more than one registration is allowed, provided that it involves the same parties and each patent sought for cancellation constitutes one distinct case. The petitioner has to pay the applicable fees corresponding to each and every patent sought to be cancelled. For this purpose, the petitioner may also submit a single power of attorney or proof of authority of the signatory, including the verification and certification of non-forum shopping.^[16]

A petition for cancellation may be raised as a defence or a counterclaim in an action for patent infringement, and the same formalities on authentication or apostille as regards non-resident defendants and respondents apply.

If the petition meets the filing requirements, a notice to answer shall be issued to the respondent, which is given 30 days to respond (and can be extended by 45 days). The same requirements on formalities apply. If the answer is filed on time or the defects are cured, the case is referred to alternative dispute resolution for mandatory mediation.^[17] The IPOPHL has a memorandum of understanding with the WIPO that for cases primarily involving one or more parties domiciled outside the Philippines, the parties can request for WIPO mediation, and the IPOPHL fees shall apply.^[18] If the parties are able to forge an agreement within or outside the mediation period, and submit the same to the IPOPHL, the case is dismissed based on the agreement, which is equivalent to a judgment on the merits. If not, the prosecution of the case continues, the parties are required to submit their position papers, and the Adjudication Officer issues the decision within 20 calendar days from the date the case is submitted for decision, with a 20-day extension allowed.^[19]

Case example

Invalidity of patent as defence

Bristol Myers Squibb sued Innogen^[20] for infringing its patent ‘228 by selling to the public certain low doses of Entecavir compositions covered by ‘228, under the brand name Entegard. Innogen, for its part, filed a petition for cancellation of ‘228 for lack of novelty and inventive step, claiming that US Patent 5,206,544 (filed by practically the same owner ER Squibb) was the first medical use as it already disclosed the active ingredient entecavir for treating Hepatitis B in humans, and because dosage forms were already within the knowledge of pharmacists (the persons skilled in the art). Innogen’s cancellation case was dismissed, as the Biologics License Application (BLA) Director held that ‘228 is valid and stated that US Patent No. 5,206,544 does mention the substance entecavir and the illness Hepatitis B, but it cannot be prior art to ‘228 because no simple mathematical ratio and proportion of the amount of entecavir vis-à-vis the weight of the patient applying the alleged prior art is involved. Therefore, ‘228 pertains to an invention wherein a reduced dose of the active ingredient entecavir produces effective results without the undesirable side effects that can result from high dose required in US Patent No. 5,206,244.

According to the BLA Director:

How to prepare a pharmaceutical with reduced dose of entecavir cannot be obvious to a pharmacist or any person skilled in this kind of field. At the most, the latter will only tweak the amount of entecavir depending on the body weight of the user as disclosed in U.S. Patent 5,206,244. Without the subject invention, pharmacists will not know that a smaller amount of entecavir, prepared as stated in the subject patent, will produce effective results.

It must also be noted that US Patent 5,206,244 was already considered by the examiner during the substantive examination of ‘228.

Footnotes