Kyle Bass is a hedge fund owner who has also founded the Coalition for Affordable Drugs (CFAD). The Coalition filed a petition with the Patient Trial and Appeal Board (PTAB) for an inter partes review (IPR) of a patent owned by the pharmaceutical firm Biogen (NASDAQ:BIIB). That means the United States Patent and Trademark Office (USPTO) agreed that the Coalition demonstrated there was a reasonable likelihood it could prove the patent was not viable. The final decision will take about a year.
Bass’s Coalition challenged U.S. Patent No. 8,399,514, which is using 480 milligrams of dimethyl fumarate for treating multiple sclerosis. It is scheduled to expire in 2028.
The current petition is the second filed against the same patent by the Coalition for Affordable Drugs. Last year, the PTAB denied the Coalition’s petition. It says it found the current petition much more persuasive.
The patent has another challenge that’s still pending. Last year, Forward Pharma A/S (NASDAQ:FWP) filed a challenge on its own behalf. The PTAB declared the patent had interference. The PTAB wants Biogen to prove it came up with the technology first, and not Foward. That case is scheduled to be heard in January 2017.
In the European Union, the same technology was protected by EU Patent No. EP2137537. However, Forward and a few other parties filed a challenge to that patent, and the European Patent Office has revoked it. Biogen is appealing that decision.
CFAD has filed petitions challenging other pharmaceutical drug patents owned by other drug companies, including Jazz Pharmaceuticals plc, Acorda Therapeutics Inc and Celgene Corporation.
The CFAD has filed 33 IPR petitions with the U.S. Patent Office challenging drug patents. So far, the PTAB has issued decisions on 17 of those 33 petitions. Of those 17, the PTAB has denied 10 petitions and allowed 7.
Kyle Bass is the owner of Hayman Capital Management L.P, a hedge fund. He is well-known for profiting enormously from the subprime mortgage crisis in 2008. He purchased credit default swaps in many of the securities issued by investment funds, which means he made money when their price went down, similarly to shorting them. When the true weakness of those securitized mortgages was widely publicized, Bass made about half a billion dollars, while the investment banks were bought up or went out of business.