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Why Applicants Should Keep Patent Term Adjustment (PTA) in Mind During Prosecution
December 13, 2017

joesephboosBy Joseph P. Boos

Patent Term Adjustment (PTA) is additional time added to the term of a patent based on delays by the United States Patent and Trademark Office (USPTO) during prosecution. The PTA is determined after an application has been granted a patent. An applicant or patent prosecutor should be cognizant of PTA during prosecution because any gain of PTA due to USPTO delay is reduced by applicant delay. In the lifetime of a patent that covers a successful product or technological standard, every day can be highly valuable. This is especially true for biotechnology and pharmaceutical patents for which commercialization often occurs long after the patent application is filed but can then earn thousands or millions of dollars per day. Each day a product or technological standard remains unpatented is a missed opportunity for revenue. Therefore, an applicant should be astutely aware of the rules and try to avoid actions that constitute applicant delay whenever possible.

Adjustment of patent term for delays caused by the USPTO are codified in 35 U.S.C. §154. There are three types and they are commonly referred to based on the sub-section in 35 U.S.C. §154: “A” delays (sub-section (b)(1)(A)); “B” delays (sub-section (b)(1)(B)) and “C” delays (sub-section (b)(1)(C)).

“A” delays occur when the USPTO fails to: issue a first Office Action (OA) within 14 months of application filing; respond to an applicant’s reply within four months of the reply; respond to a decision by the Patent Trial and Appeal Board (PTAB) or by a Federal court within four months; or issue a patent within four months of the payment of the issue fee.

“B” delays occur three years from application filing up to the issuance of the patent. However, “B” delays do not accrue during the time consumed by: a Request for Continued Examination (RCE); an interference, derivation proceeding or secrecy order; review by the PTAB or by a Federal court; or applicant requested delay. Time consumed by an RCE begins on the date the RCE is filed and ends on the date that a Notice of Allowance (NOA) is mailed. If an RCE is filed after a NOA, then applicant delay will accrue.

“C” delays include delay caused by interference and derivation proceedings, PTAB appeals and secrecy orders.

Applicant delay is codified in 35 U.S.C. §154(b)(2)(C) and 37 C.F.R. §1.704, where PTA is reduced by the number of days the applicant “failed to engage in reasonable efforts to conclude prosecution of the application.” Applicant delay occurs when an applicant does not respond to any notice or OA within three months. Further, there are numerous other types of applicant delays described in 37. C.F.R. §1.704(c), including: (1) suspension of action at applicant’s request; (2) deferral of issuance of a patent; (3) abandonment or late issue fee payment; (4) failure to file a petition to withdraw the holding of abandonment or to revive an application within two months from the mailing date of a notice of abandonment; (5) conversion from a provisional to a non-provisional application; (6) submission of a preliminary amendment or other preliminary paper less than one month before the mailing of an OA or NOA; (7) submission of a reply having an omission; (8) submission of a supplemental reply or other paper, other than one expressly requested by the Examiner, after a reply has been filed; (9) submission of an amendment or other paper after a PTAB decision less than one month before issuance of an OA or NOA; (10) submission of an amendment after allowance pursuant to 37 CFR 1.312 or “other paper” (other than an RCE) after a NOA; (11) failure to file an Appeal Brief within three months from the date on which a notice of appeal to the PTAB was filed; (12) submission of an RCE after a NOA; and (13) failure to provide an application in condition for examination within eight months of filing.

An applicant, keeping the PTA rules in mind, can maximize the PTA by reducing applicant delay during prosecution. Some simple ways to reduce applicant delay include: (i) avoiding a time extension by filing a response by the shortened statutory deadline; (ii) filing a full and complete response to avoid the need for a supplemental response or amendment; (iii) filing an  Information Disclosure Statement (IDS) promptly, before receipt of a first OA, before or with a response or before a NOA; (iv) avoiding the filing of an RCE, since it stops the three-year clock for a B delay; (v) reviewing the claims and specification as early as possible in prosecution and filing amendments before a NOA is issued; (vi) using the Quick Path IDS (QPIDS) after a NOA if possible, since it may eliminate the need for an RCE; (vii) avoiding unnecessary terminal disclaimers.

Approaching an effort to gain a patent should include a healthy respect for the PTA rules. Such awareness would go a long way to reduce applicant delay during prosecution and offer significant reward after the patent issues.