Thursday, March 13, 2014

TNI Biotech Just Upgraded its Armor (GOOG, GILD, IDIX, TNIB, AAPL, VRNG)

Think patent wars are only being fought - and won - by consumer technologies like Vringo, Inc. (NASDAQ:VRNG) and Apple Inc. (NASDAQ:AAPL)? Think again. While the Vringo patent war with Google Inc. (NASDAQ:GOOG) and the Apple infringement case against Samsung may have been the world's highest-profile patent litigation conflicts (and most covered by the media), patent infringement claims and subsequent court cases have become just as common within the biotech world. Just ask Idenix Pharmaceuticals Inc. (NASDAQ:IDIX) and Gilead Sciences, Inc. (NASDAQ:GILD)... two biotech names that are currently duking it out over patents that look nearly identical. Indeed, a coin toss may be just as fair of a way to decide who's right and who's wrong between Idenix and Gilead.

The point is, there's no such thing as overkill when it comes to patent protection anymore. More patents, and more specific patents, are necessary, even if it feels gratuitous. That's why TNI Biotech Inc. (OTCMKTS:TNIB) shareholders can take a little more comfort with their position today (even if they didn't know they had anything to worry about). Per Wednesday's news release, TNI Biotech now has patent protection not only on the mechanism that makes methionine met-enkephalin (or MENK) an effective immunotherapy by activating lymphocytes to attack cancer cells and other infectious diseases like HIV, but as of yesterday, also has patent protection on an method that produces a sustained immune response from its MENK therapy.

The patent approval mentioned yesterday specifically refers to the United States' patent office's approval, though the patent on the same TNI Biotech know-how regarding the sustained response has already been approved in most other major markets across the globe.

For those just taking a quick glance at the new TNIB patent and what it aims to protect, it may seem a bit pointless; if MENK is patented, wouldn't the way the drug paces the body's immune response (by default) be patented as well? Or if not explicitly covered by the patent, wouldn't TNI Biotech basically/effectively have patent protection since one would have to own the patent on MENK in order to control how long its effect lasts? Ten years ago, one would think so. But, patent law has gotten incredibly twisted in recent years.

For perspective, the big hullabaloo last year between Samsung and Apple last year confirmed that Apple had a rightful patent on the rounded corners of its handheld devices, and also had patent protection on the shape of the icons placed on its devices' screens. Ten years ago, those ideas would have fallen under the label of "design", and likely wouldn't have stood up in a patent case. Google also recently lost a case to Vringo, as Vringo was the first to patent the idea of an intelligent, "learning" web-search algorithm that improved - made more relevant - the search results displayed based on which links user did or did not click on when that search was performed. Most would assume an always-improving search engine would be an obvious idea for all search engine companies to employ. The court didn't see it the same, however, rewarding Vringo a percentage of Google's improved revenue once it allegedly began using the Vringo premise.

It's not just happening in the world of technology either. As mentioned above, Gilead Sciences and Idenix Pharmaceuticals are now battling in a courtroom, as IDIX claims GILD has unlawfully violated its patent on using 2-methel nucleosides to treat hepatitis C. Gilead is defending itself, in a sense, with a countersuit against Idenix, claiming the latter company is infringing on the GILD patent covering its hepatitis C treatment based on a 2-methel, 2-flouro nucleoside. Are the two mutually exclusive?  Is there overlap, and does it matter? All good questions. One thing is for sure, though... it's tedious, and complicated, and you can never have too much patent protection. With another layer of defense, TNI Biotech is going to be better armed should the day ever come when it needs to make its case in a courtroom. It's no small matter.

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