A Patent ‘Reform’ Ruinous to Our Nation’s Health | Commentary

Posted July 10, 2015 at 11:03am

Congress giveth and Congress taketh away.

Take the “Innovation Act of 2015.” Please.

Whatever my House colleagues thought they were giving to medical innovators by repealing Obamacare’s medical device tax, as they did recently, they may soon take back if they enact that catastrophic law.

The misnamed legislation paraded around Capitol Hill as “patent reform,” in the same week moved out of the Judiciary Committee, headed for the House floor.

Under the proposal, whoever devises a major, life-saving medical breakthrough will find its patent difficult to defend if it is stolen by a large corporation.

How could such zero-sum thinking happen?

The charitable explanation is that too many of my colleagues took the mega-corporations’ bait that the act will reduce the high cost of frivolous litigation. A more convicting explanation is that, like so much other legislation — including Obamacare itself, its mind-dulling, eye-glazing verbiage went unread.

This is being sold as a legislative means to curb costly lawsuits, but it actually heaps the largest costs on small inventors by pitting their meager counsel against the big company’s well-financed legal teams. It obstructs investors who see a return on taking to market the products of inventive creators untethered to large corporations.

The point hit home powerfully when my colleagues and I debated a proposal to repeal the medical device tax.

The proposal happily passed, but it was a necessary act of cleaning up after a previous Congress passed Obama’s monstrous Affordable Care Act. Embedded in the act — which then-Speaker Nancy Pelosi memorably said had to be passed before we could know what was in it — was a funding mechanism that heaped heavy taxes on medical innovations.

On the face of it, an awful idea. But here we were debating this no-brainer when it came to me to tell a personal story, painful as it was to relate.

“Two and a half years ago,” I began, “I was notified that my daughter, who was at that time 9 years old, had leukemia. It was a horror for my family, a horror story, just like it is for families across America. We came out of that. We went through it. It was a tough, tough road for a year. Last week, she had her last cancer treatment and, last week, she was declared cancer free.”

At that point the speaker pro tempore advised me I had run out of time. A gracious colleague yielded another minute, in which time I spoke of the 90 percent of leukemia kids who are now cured, as opposed to the 90 percent who died 40 years ago, thanks to devices like the one that saved Annika.

“The people who devised that medical device,” I continued, “saved my daughter’s life, and now we want to make them the most heavily taxed people in our country. That is ridiculous. We want to encourage people to build these types of devices that will save our children and help those people who are suffering.”

I wound up my remarks and shortly after, the House voted overwhelmingly to repeal the medical device tax. The measure now moves to the Senate, which we may expect will show the same wisdom.

That was the giveth. Now for the taketh.

As I said, in the same week the so-called Innovation Act was sent by the Judiciary Committee to the full House.

This bill, HR 9, which was stopped in the Senate last year, would effectively gut our patent system, neutering the ability of small inventors to protect their property rights. It would essentially abrogate the only right mentioned in the body of the Constitution prior to the first 10 amendments.

The point of a patent is to protect an inventor’s secrets from rapacious competitors. The founders knew this, and because of it America’s innovative capacity has been the envy of the world, the perpetual threshold to the modern age.

But this bill opens the legal discovery process to opponents while giving away secrets prematurely to international competitors. We may say, if it passes, goodbye to America’s tradition of innovation.

Congressional consistency, never easy to come by, would assure that punitive taxes imposed on our innovators ransacks our economy just as badly as gutting their intellectual property rights. We need neither assault from our own government.

I’m opposing HR 9 as I opposed the medical device tax so that we may continue our history of progress. More personally, I am doing it for Annika and for all our Annikas.

Rep. Dana Rohrabacher is a Republican from California.