Before getting into the details of why patents expire, let’s first understand what is the purpose of a patent.
Patents serve mainly two purposes. That is:
1) To provide secret know-how of the invention to the public so that anyone can use that knowledge to build new technology.
2) To incentivize inventors by giving them monopoly over the invention for a limited period of time.
Now we can answer the question, why do patents expire? Or why don’t patents last forever?
Patent is a monopoly right. The patent is given to incentivize the inventors for their investment but ‘for a limited period of time’ so as to maintain a balance between the interests of inventors and public. Patent may also expire when the renewal fee is not paid in time.
There are many aspects to the main question of the article, let’s see them in detail.
Why Do Patents Expire OR Why Don’t Patents Last Forever?
Without incentives or motives, nothing moves. Innovation is hard and often expensive. It takes years of an inventor to come up with a patentable idea. So, naturally, the inventor expects some reward for his investment.
Innovation propels the world forward and helps to make it a better place. Innovation simply refers to a technical solution to a problem.
Nobody would disagree that increased innovation is the need of the hour and is always welcome.
So, it was conceived to reward people/ entities who come up with technical solutions to technical problems.
As a reward, the idea of giving monopoly rights to the inventors over their inventions was given thought. This posed a new problem: The Monopoly.
Why is monopoly a problem? Let’s understand this.
1) Patents are often referred to as negative rights. In other words, if you have been granted a patent for an invention, it doesn’t mean that you can use that invention freely.
For example, if you want to manufacture a patented drug, you will still have to take permission from various regulators and will have to fulfill many other prescribed obligations. So, you yourself can’t make the patented drug at your will.
However, you can stop others from making it. So, patents are the right to exclude others from utilizing the invention.
2) Now that we have seen that patents are negative rights. Imagine a scenario where the patent for a light bulb would never have expired. Only entities permitted by the bulb patent holder would be making the bulb. This way we wouldn’t have seen so many companies coming out with their own bulb. This would have resulted in very high prices for bulbs. and probably could have put the bulb out of reach of common people.
3) So, an eternal monopoly given in guise of the patent would have been damaging to the public cause. If a large segment of the population can’t benefit from the innovation then what’s the point of encouraging the innovation? Therefore, patents don’t last forever.
Having considered the issues that come with eternal monopoly, a middle path was chosen. This resulted in giving monopoly rights to the inventors over their inventions but for ‘a limited period of time’ also called as ‘term of a patent’.
Patents expiring by way of completing their lifespan is not the only way. Patents may also expire when the annual renewal fees are not paid in time or if the patent has been revoked or rendered invalid by the patentee or by the opposition.
What Are The Terms For Patents In Different Countries Or When Do Patents Expire?
When we discuss the question, why do patents expire? It’s natural to ask the adjacent question which is ‘when do patents expire’. Let’s see countrywise:
In USA: In USA utility patents are granted for a period of 20 years. If there are delays due to processing by USPTO, there is a provision for patent term adjustment (PTA). In PTA, the term of 20 years is extended by considering various factors.
If we talk about design patents in USA, the term for them is 15 years which is shorter than utility patents.
In India: In India, the period for which a patent would be valid has been decided to be 20 years from the date of priority or filing, whichever is earlier. So, after 20 years, the patent expires in India.
There is no concept of design patents in India. However, designs are registered separately but not as a patent. The validity of such designs in India is for a period of 10 years from the date of priority. This can be further extended for the next 5 years if the request for extension is filed anytime before the expiry of the initial term I.e. 10 years.
In Europe: Similar to other countries, the term of the patent is 20 years. There is also an arrangement of term extension in Europe similar to that of USA so as to compensate the patent owners for the various delays as prescribed. This is called ‘Supplementary Protection Certificate (“SPC”)’.
The design patent in Europe is initially valid only for 5 years from the date of filing. However, it can be renewed in periods of 5 years up to a maximum of 25 years.
When the patent rights expire, the public can use the invention in any way it wants. It is free to make, sell, use, import or market the invention. Or in other words, the patent comes into the public domain in true sense only after it expires. This way, the expiry of a patent plays an important role in balancing the interests of the inventors and the public.
Similar terms to the term ‘patent expiry’ are ‘patent ceased to exist’, ‘patent cessation’, ‘patent lapsed’, ‘patent revoked’, and ‘patent invalidated’. Any of the events mentioned previously are enough to render the patent ineffective or the patent stops being in force or in other words, we can say that the patent has expired. Legally these terms may have different meanings in different countries but end result of all of them is that “a patent stops being in force’
Now let’s move on to the next query that you may be having.
What Happens When Patents Expire?
1. So the patent has expired. The patentee or the patent holder no longer holds the monopoly right. Anyone can use the patent as if it was their own. Anyone can make, sell, import, use or market the expired invention without the permission of the patent owner.
For example, anyone can make the light bulb, telephone, steam engine, etc. As respective patents have expired.
2. Further you should know that you can’t renew your patent once it expires. However, the patent can be restored in the prescribed time frame if the patent lapses due to non-payment of the renewal fee.
3. As the patent expires, the owner of the patent incurs losses or is unable to enjoy the benefits anymore. No royalties are received and no licensing agreements are in force any longer.
4. There is no way you can continue to hold ownership of the patent once it expires.
5. There is a provision of patent term adjustment (PTA) in USA and Supplementary Protection Certificate (“SPC”) in Europe. Using these provisions the normal term of a patent can be extended if permitted. However, after the completion of the extended term, patents eventually expire.
How You Can Find Out That The Patent Has Expired Or Where Can You Find Expired Patent?
Now as an interested person or a competitor to the patent holder, you may be wanting to know about the status of a patent. It may be important to know for you whether the patent has completed its term or it has lapsed due to non-payment of renewal or maintenance fees.
For Indian patents, you can search at INPASS. While searching on INPASS, look for Patent E-register tab. You check out Legal status of patents, documents, maintenance fees, and working of patents in E-Register as shown in figures below.
In addition to government databases, there are third parties that provide details of the patents, google patents for example.
There may be situations when the patent holder may not want to maintain the patent any longer for various reasons, for example, he may not see any profit in it. However, that patent may be of interest to you. In such case, you can find the lapsed patent and contact the patent holder. Further, you can pay off the fee for restoration and buy the rights of the re-stored patent.
What Steps Can You As An Inventor Take When your Patent expires?
1) You can still protect the trade secrets if any. Although you are required to furnish all the details about the invention in the patent specification there may be some processes and other details that are necessary to use the invention optimally. So, you should look for protecting such information.
2) You may want to slow down or scale down your production of the product as the expiry of the patent approaches. That is because after the patent expires, you will have competitors in the market flooding the market with the same product as yours. So, in that regard, you should make an economic assessment.
3) As the expiry date approaches, you should increase your focus on building your brand in case you have not done so earlier. Because while your patent is in force, you are the only one selling the product.
Leveraging this fact, it’s time to build the brand loyalty of the people towards your brand. This would be beneficial to take on the competitors once the patent expires.
4) You may come up with better technology and get it patented leveraging your experience in the field. But this option is open to anyone investing in Research & Development.
Now let’s look at frequently asked questions that would enhance your understanding of the article and the patent knowledge overall.
FAQ
What does invalidation of a patent mean?
No prior art search is perfect. Therefore, naturally, there is a possibility that the patent examiner may miss an important prior art.
However, when the patent goes into infringement or into opposition proceedings, there may emerge a prior art that either anticipates the patent claims (I.e. claims are not novel or new) or proves the claims to be non-obvious (I.e. claims don’t involve an inventive step or claims can be derived from one or more documents by a legally defined person.)
The legally defined person may have different definitions in different countries. For example, in India it is a ‘person skilled in the art’, and on the other hand in USA it is the ‘person having ordinary skill in art’
When the patent claims are anticipated or proved to be non-obvious, they are said to be invalidated. Such invalidated patent claim(s) doesn’t remain in force. The invalidated patent can be revoked either by the patent office or by the court as per the provisions of the law of that country.
What is a lapsed patent?
Once the patent is granted to the patentee, there is generally a maintenance fee that the patentee has to pay annually. This fee is also called as renewal fee.
When the patentee I.e. the patent holder fails to pay the renewal or maintenance fee, the patent lapses. However, there is still a chance to restore the patent by paying a certain fee but this can happen in a prescribed time period, 18 months in India for example. After the expiration of such prescribed time period, lapsed patent ceases to exist i.e. expires.
What does an active status of patent mean?
Active status means that the granted patent is still in force.
What is evergreening of patents?
Who doesn’t want to keep enjoying monopoly? If there is any way that can extend the term of a patent, there will be a temptation in the inventor’s or patent holder’s mind to go for it. Patent evergreening is one such way.
Patent evergreening simply refers to a tactic in which the monopoly right is extended by obtaining multiple patents for various aspects of the same product. Mostly, this includes improvements to the product.
Evergreening of patents is practiced mainly by Pharmaceutical companies to maximize their profit.
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