[Congressional Record Volume 141, Number 11 (Thursday, January 19, 1995)]
[Extensions of Remarks]
[Page E129]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   INTRODUCTION OF THE BIOTECH PROCESS PATENT PROTECTION ACT OF 1995

                                 ______


                        HON. CARLOS J. MOORHEAD

                             of california

                    in the house of representatives

                       Thursday, January 19, 1995

  Mr. MOORHEAD. Mr. Speaker, today, the gentleman from Virginia, [Mr. 
Boucher] and I are introducing the Biotech Process Patent Protection 
Act of 1995. This is the 4th consecutive Congress that we have 
introduced this legislation together.
  From an economic point of view, the U.S. Biotech industry has gone 
from zero revenues and zero jobs 15 years ago to $6 billion and 70,000 
jobs today. The White House Council on Competitiveness projects a $30 
to $50 billion market for biotech products by the year 2000, and many 
in the industry believe this estimate to be conservative.
  Companies that depend heavily on research and development are 
especially vulnerable to foreign competitors who copy and sell their 
products without permission. The reason that high technology companies 
are so vulnerable is that for them the cost of innovation, rather than 
the cost of production, is the key cost incurred in bringing a product 
to market.
  In addition to the ability to obtain and enforce a patent, small 
companies in particular must be concerned about obtaining a patent in a 
timely fashion. In 1992 the pendency of a biotech patent application as 
27 months with the backlog in applications increasing from 17,000 in 
1990 to almost 20,000 in 1992. The Patent Office has taken steps to 
improve the situation by reorganizing its bio-technology examination 
group and increasing the number of new examiners. The PTO has also 
implemented special pay rates for their biotechnology examiners. As a 
result, biotech patent application pendency has been reduced from 27 
months to 21 months and the backlog in applications have been reduced 
from 20,000 in 1992 to 17,000 in 1994.
  Although this is slow progress it is a substantial improvement. 
However, we must continue to reduce these delays because this industry 
is so dependent on patents in order to raise capital for reinvestment 
in manufacturing plants and in new product development, and even more 
so for an industry targeted by Japan for major and concerted 
competition.
  The House Judiciary Committee took the first step in 1988 when the 
Congress enacted two bills which I introduced relating to process 
patents and reform of the International Trade Commission. However, our 
work will not be complete until we enact this legislation. This bill 
modifies the test for obtaining a process patent. It overrules In Re 
Durden (1985), a case frequently criticized that has been cited by the 
Patent Office as grounds for denial of biotech patents, as well as 
chemical and other process patent cases.

  Because so many of the biotech inventions are protected by patents, 
the future of that industry depends greatly on what Congress does to 
protect U.S. patents from unfair foreign competition. America's foreign 
competitors, most of whom have invested comparatively little in 
biotechnology research, have targeted the biotech industry for major 
and concerted action. According to the Biotechnology Association, in 
Japan the Ministry of International Trade and Industry [MITI] and the 
Japanese biotechnology industry have joined forces and established a 
central plan to turn Japanese biotechnology into a 127 billion yen per 
year industry by the year 2000. If we fail to enact this legislation, 
the Congress may contribute to fulfillment of that projection.
  In conclusion, Mr. Speaker, this is important legislation. The 
biotech industry is an immensely important industry started in the 
United States with many labs housed in California. In the decade ahead, 
biotechnology research will improve the lives and health of virtually 
every American family. It will put people to work and it will save 
people's lives. I intend to schedule action early this session.

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