President Trump has a reputation for unorthodox approaches. His administration’s foray into patent enforcement is no exception.  

In November, the Trump Administration launched a lawsuit against pharmaceutical giant Gilead for violating the government’s patent that covers the composition behind Truvada, an HIV “miracle” drug that has proved over 96% successful in preventing the onset of AIDs. 

There is nothing unusual about the case in the legal sense. The patent complaint generally offers up the same issues that any patent infringement case would. It was filed in a federal district court. All the stakes are the same.

It is a straightforward patent case except for one thing: the U.S. Government almost never asserts their patents. 

Of course, that was before. This is now.

Unusual Behavior

The Department of Health and Human Services, like many government departments, is heavily involved in research and development. All of these organizations employ inventors, engineers, and scientists who invent things. They normally file patent applications for these inventions, and as a result, the government owns numerous patents. The same applies to other governmental bodies as well. Universities, for example, have the same types of rights. 

Private companies use these government patents all the time, generally with a licensing fee. The unusual part about the Gilead case is that the negotiations for licensing this technology went sour. The government took the step, a very significant step, of enforcing their I.P. rights through a patent litigation lawsuit.

Any party who owns a patent has the discretion as to whether and when to file a lawsuit if someone is infringing upon their patents. None of this is out of the ordinary. What is unusual is that the government has decided to sue a private company. This isn’t illegal, nor does it violate some unwritten code. The government just usually prefers not to assert its patents. 

A Perfect Storm 

The Trump administration has been vocal about its focus on prescription drug issues and prices, and they’ve also decided to focus on the HIV epidemic as well. This case came along and it was like the perfect storm. 

Related: The Politics of Intellectual Property

Gilead had initially marketed Truvada as a treatment for HIV infection. Still, government-sponsored research soon revealed that the drug was extremely effective at thwarting the onset of AIDs in HIV-infected patients. Gilead sold the drug as an AIDs prevention drug but refused to pay a licensing fee for using the government’s prior patented technology. 

The government then took Gilead to court for patent infringement. 

The Aftermath

The fallout from the lawsuit could be far-reaching. For Gilead, millions in lost revenue is at stake. The company recently announced it had created a new, improved version of Truvada. Truvada is reaching the end of its protection cycle and will soon face generic competition.

The latest version of the drug could result in nearly twenty more years of protected status for the company and greatly enhance their profits. However, the government is claiming that the new drug also infringes on its patent. 

For people living with HIV, it could be a matter of life or death. The drug costs patients $20,000 per year or $50-$60 per day. This cost causes some patients to reduce their dosage and increase their risk and simply puts Truvada out of reach for many. If the government wins its suit, the drug could become far less costly and far more accessible to the vulnerable community in need of it most. 

It is unlikely that the government is looking for a cash payout from the lawsuit. Another $20,000 in royalties means nothing to a budget the size of the U.S. government. Instead, they may be hoping to force Gilead to reduce the prices of Truvada and the newer spinoff version of the drug. 

There’s a massive amount of public pressure now on Gilead to do the right thing. And the lawsuit is generating a lot more attention than might typically be generated by a case like this.

And that is where it gets even more interesting from a socio-political perspective. The communities most affected by the AIDs crisis and who will most benefit if the government wins its fight against Gilead, are, let’s face it, unlikely also to be Trump supporters. His administration isn’t getting much credit for this fight. 

In addition to the impact on HIV sufferers and Gilead, this lawsuit could have a huge impact on the entire pharmaceutical industry. There’s a new sheriff in town. Pharmaceutical companies may not have as much leverage in patent negotiations as they are used to having. There may also be concern that the government is going to make a habit of this type of lawsuit. Anytime a ground-breaking therapy comes out, it could require companies to do more diligence regarding the rights held by the government. Or it might require a rethinking of the existing philosophy that we don’t need to worry when the government owns the patent, because it won’t sue us. 

That’s all changed.

Related: If Insulin is Patented, How Did Colorado Cap the Price?  

With the government acting more like a private company would, concerns won’t be limited to the pharmaceutical industry. Government research and development is all over the place. So, it could literally be any other industry. Other industry giants are probably looking at this case and considering how wary of the U.S. government patents they should be now. 

The U.S. Government just became a powerful new player on the IP front.