Practical Pieces & Perspectives

COVID-19 is scourging the world. Numerous companies from all over the world are working on drugs and vaccines,[1] and patents are currently being filed on COVID-19 vaccines.[2]  Thus far, the global search has been characterized by cooperation between companies.[3]  But some governments are engaged in a race to be the first with the vaccine.[4] Others have discussed the use of patents by private owners to create patent holdups, using the patent’s exclusionary rights to control use of the vaccine against the public interest.[5]  This article provides a background on the patent system, the secrecy order procedure, and the effects of a secrecy order, and argues that the United States may create a patent holdup situation on a COVID-19 vaccine by issuing a secrecy order.  For example, under the Invention Secrecy Act and pursuant to national security, the U.S. government may prevent disclosure of vaccines and other health technology, potentially exacerbating a nationalistic competition to find a COVID-19 vaccine.

Manufacturing a vaccine is expensive.  Each step requires a highly sterile and temperature-controlled environment, and the vaccine must be maintained within a narrow temperature range during storage and delivery (called the “cold chain.”)[6] Manufacturers need applications for both product and establishment licenses.[7]  Each batch of vaccines must be individually tested and licensed.[8]  Unsurprisingly, vaccine IP is complex, including multiple technologies and patents per product: DNA sequences, amino acid sequences, vectors, formation, methods of use, and administration devices.[9]

The government currently relies on contracts with industry vaccine manufacturers to manufacture vaccines. Many vaccines are licensed in the U.S. by domestic firms and foreign suppliers.  Some vaccine manufacturers, like Wyeth, are more active than others.[10]  Notably, the government once maintained a vaccine plant dedicated exclusively to manufacturing vaccines for possible biological weapons.[11]

In the U.S., an inventor files a patent application, which is examined by the United States Patent and Trademark Office (USPTO).[12]  The application is confidential for 18 months following its earliest filing date, and then published.[13] If the USPTO deems the application satisfactory, it issues a Notice of Allowance and will issue the patent upon payment of a fee.[14]  This issuance gives the applicant the right to prevent others from “making, using, selling, offering to sell, or import” the invention as claimed in the patent.[15]

In foreign patent prosecution, after an application is filed in one country, the applicant may file a second application on that invention in another country. The applicant must obtain a foreign filing license from the USPTO to file in a foreign country prior to six months after filing in the U.S.[16]  In another method, the applicant may file a local application at a Patent Office, and then file a PCT application in a Receiving Office.[17]  By 16 months after the local filing date, the applicant will receive an International Search Report detailing the invention’s patentability against prior art.[18]  18 months after the local filing date, the application is published internationally.[19]  The applicant may then select which countries the applicant wants a patent in, and may “nationalize” the application and continue examination in each of those countries.[20]  At the end of the PCT process, the applicant may have multiple patent applications on the same invention in different countries, each of which may lead to a separate patent on the same invention.[21]

Whether filing domestically or internationally, the patent application is normally published after 18 months.[22]  But under the secrecy order system, the government may prevent publication on some inventions.

If the government has a property interest in the patent application and if the head of any interested defense government agency believes that publishing that application could be detrimental to national security, that head may notify the Commissioner of that belief.[23]  The Commissioner would be obligated to order that the invention be kept secret for at least a year.[24]

If the government does not have a property interest in the patent application, then if the Commissioner believes the publication may be detrimental to national security, the Commissioner will make the application available for inspection to the Atomic Energy Commission, the Secretary of Defense, and the chief officer of a department or agency designated by the President as a defense agency.[25]  If any of these parties believe that publishing the application would be detrimental to national security, that party notifies the Commissioner, and then the Commissioner orders that the application be classified.[26]  These parties must properly show that examination might jeopardize national security, and then the Commissioner maintains the application under seal.[27]  An order in effect, or issued, during a “national emergency declared by the President” shall remain in effect for the duration of the emergency and six months after.[28]  In either case, the party just needs to determine that divulgence might harm national security.  In one case, a generalized fear of information getting “into the wrong hands” was sufficient.[29]

The majority of secrecy orders are imposed upon work funded directly by the government.[30]  But every year, at least a few secrecy orders are imposed on private citizens – otherwise known as “John Doe” secrecy orders.[31] Notably, the secrecy order system does not differentiate between applications filed by U.S. citizens and applications filed by foreigners.[32]

Under § 5.3, when the secrecy order is issued, the patent prosecution process delineated above comes to a halt.[33] In a national application, if the application receives a final rejection, the fee must be paid to avoid abandonment, but no hearing or progress is made until the secrecy order is removed.[34] Further, if the patent application is found to be allowable, the Patent Office will place the application in suspension until the secrecy order is renewed, and then will allow when the secrecy order is lifted.[35]  Under § 5.3(d), international applications subject to a secrecy order are not transmitted to international authorities for examination.[36]  They are processed until copies would be transmitted to the authorities, but no further.[37]  The USPTO will also not grant a foreign filing license to the applicant if the application is subject to a secrecy order, subject to the approval of the head of the departments who caused the secrecy order.[38] Under the NATO Agreement for the Mutual Safeguarding of Secrecy of Inventions Relating to Defence and for Which Applications for Patents Have Been Made (“NATO Secrecy Agreement”), parties to NATO agreed to automatically impose secrecy orders on patent applications filed in their offices if a parent application was put under a secrecy order by another NATO country.[39]

Secrecy orders bar disclosure of inventions. Under 35 U.S.C. § 186, anyone who knows of the order and is not authorized to disclose will be convicted, fined or imprisoned if the person willfully discloses the invention.[40]  The penalties under § 187 do not apply to U.S. officers or agents acting within their scope of authority.[41]  Furthermore, an application subject to a secrecy order does not serve as prior art against subsequent applications under § 102(a)(2), because it is not deemed “published.”[42]

§ 183 gives an applicant a cause of action to seek “just compensation” for damage caused by the order of secrecy and/or for the use of the invention by the Government that results from the applicant’s disclosure.[43] But this cause of action is limited. The Federal Circuit held that the Government is only liable for wrongful use of a patented invention during the period of the invention secrecy order.[44] The Court of Federal Claims on remand from the Federal Circuit further construed use under § 183 as wrongful only when it results from the Government’s disclosure of the application.[45] The government, accordingly, is not liable for use of a patented invention that does not result from its disclosure of the application.  Uses in secret do not seem to give liability.

At the discretion of the Commissioner and at least one Defense Agency Head, any patent application may be classified and hidden from public use.  It is impossible to authoritatively say what types of technologies have been hidden because the applications are secret.  Currently, declassified patents have focused on high military significance, such as laser-tracking systems and weapons.[46]  And a declassified document from 1971 does provide a list of subject matters that “should be made available in accordance with 35 U.S.C. § 181,”[47] which includes materials and measures which protect the individual against biological weapons.[48]  There is no guarantee that this list is current or comprehensive, and without further information, it is conceivable, though uncertain, that a subject matter may include vaccinations and other biotechnology.[49]

It is well documented that a secrecy order negatively affects the ability of an inventor to commercialize their invention.[50]  If the inventor cannot discuss their invention, they cannot sell the invention or their patented products.[51]  Furthermore, a government may “use’ the invention without disclosing the patent application. That government could use a secrecy order to maintain a lead in an innovation arms race.  For example, in the current COVID-19 vaccine arms race, the U.S. is battling China and Europe to get the first cure or vaccine,[52], or the first patent on a cure of vaccine.[53]  China began militarizing its efforts.[54] And the U.S. had invited a German company, CureVac, to complete its research on American soil.[55]

This article argues that there is a possible motivation and venue to use secrecy orders to gain a lead on COVID-19 vaccine production. First, the U.S. government could instruct the Commissioner of Patents (“Commissioner”) that disclosing an application on a coronavirus vaccine is a national security threat.  Global and public health have been considered elements of national security since at least 2016 – the Director of National Intelligence did include pandemics and other health hazards in the U.S. intelligence community’s worldwide threat assessment in 2016.[56]  The U.S. government could argue that gaining a vaccine by a secret method will extend the time when the government can immunize its citizens at the expense of foreign nationals, thus favoring its own citizens and taking advantage of the economic and geostrategic fallout of COVID-19.[57]

Second, given the secrecy and the breadth of the subject matter eligible for a secrecy order, the government could instruct the Commissioner that a COVID-19 vaccine is eligible for a secrecy order.[58]  If the U.S. instructs the Commissioner, then the Commissioner, upon receiving a COVID-19 patent application, would notify the defense heads and the Secretary of Defense of the application.[59]  Any one of the defense heads or the Secretary of Defense may instruct that the patent application’s disclosure would be detrimental to national security.[60]  The Commissioner would then issue the secrecy order.[61]

The vaccine patent application would then be a secret.  The applicant could not legally disclose the contents to anybody upon pain of a fine or imprisonment.[62] But, as long as the government does not disclose the application, the government may use the invention, here the vaccine, themselves.[63]  First, the government could manufacture the vaccine and distribute it through government channels.  People have advocated for government manufacture of vaccines before, but this process has not yet come to fruition.[64] The government could also use its extensive purchasing power[65] to negotiate production contracts with vaccine manufactures, providing the production information without disclosing the existence of the patent.  For instance, in 2019, the U.S. Department of Health and Human Services recently contracted with Sanofi Pasteur to produce recombinant influenza vaccines in the U.S. to the tune of $226 million.[66]  The vaccine manufacturer may conceivably be the inventor in the first place. In this situation, the manufacturer would still be compelled to keep the information secret, but could otherwise manufacture the vaccine with authorization.[67]  Finally, the government could directly instruct manufacturers to manufacture this vaccine, without disclosing the patent application involved.  This could be done through the newly invoked Defense Production Act.[68]  In all of these cases, the government’s secrecy order would prevent the information underlying the vaccine from reaching other countries, delaying use of the vaccine in those countries, imposing redundant costs of vaccine research on those countries, and giving the U.S. leverage over those other countries.

This section proposes a “public health” exception to the Invention Secrecy Act. A provision should be added to 35 U.S.C. § 181, stating that: “[a]n invention which relates to public health must be disclosed, regardless of the defense head determination of secrecy.” A narrower formulation of the provision could read as: “an invention which relates to vaccinations must be disclosed, regardless of any determination of secrecy.”

This public health exception would keep the secrecy order system intact for any other subject matter, so that the system can address the subject matter that poses recognized national security concerns.  But it would forestall any chance of keeping vaccine inventions secret.  Then, patent applications may be filed, and information on the vaccines may be disclosed worldwide, helping coordinate biological researchers’ efforts. Ultimately, this amendment would ensure that no one country keeps a vaccine formulation secret and earns undue leverage over other countries.

The U.S.’s secrecy order system could be used to suppress information on a COVID-19 vaccine through a public-health exception to the secrecy order, which would prevent imposing a secrecy order on the vaccine. By suppressing others’ disclosure of this invention, the U.S. could exacerbate already existing nationalistic dynamics within the global search for a COVID-19 vaccine.