POSTED BY Rebecca M. Ferrante
In light of the controversy surrounding the less than elegant release of the federal government’s healthcare website in October 2013, there is much current discussion on the topics of both healthcare and technology. Where these topics intersect resides a host of issues concerning software durability, patient privacy, and big data. For those software companies engaged in the development and implementation of related electronic health and health record systems (EHRs), “Non-Practicing Entities” (NPEs) or “Patent Assertion Entities” (PAEs), otherwise known as patent trolls, pose an additional challenge. However, according to the U.S. Government Accountability Office (GAO), the risk of patent infringement suits is much more likely to be levied by another company rather than by an NPE.
The U.S. Government Accountability Office (GAO) released a report this summer reviewing factors that affect patent infringement which presented an analysis of 500 lawsuits between 2007 and 2011. The GAO found that while patent infringement lawsuits increased by 129% during the period, suits were 95% more often brought by other producing companies as opposed to NPEs. That being said, the GAO’s report did announce that lawsuits involving infringement of software related patents represented 89% of the increase. As electronic health record systems are one of the fastest growing yet highly fragmented industries, representing $8.2 billion of the $40 billion in healthcare IT spending forecasted this year, these companies are simply more exposed.
The GAO’s report becomes less applicable in instances where the question is whether a business is actually a producing company or not. Patent trolls by definition hold patents and enforce related intellectual property rights, but do not practice invention. In late 2012, MMR Global, Inc. announced that it had obtained its fifth patent pertaining to EHRs, contacted and offered licenses on their patents to more than 1,000 hospitals and group practices, and signed license agreements valued at more than $30 million. MMR claims that the patents are part of its core products.
