Congress must protect vital drug patents from Wall Street attacks

N/A by N/A is licensed under N/A N/A
Hedge-fund investors are coming to raid your medicine cabinet.

Cutting-edge treatments for diseases affecting millions of Americans are threatened by Wall Street’s latest moneymaking scheme. The ploy: hedge funds bet against a drug company’s stock price, launch attacks against the firm’s patents on its best-selling medicines and then reap windfall profits when investors panic and the stock price plummets.

Unless Congress protects pharmaceutical-research firms from these assaults, funding for drug discovery will dry up and many new treatments won’t ever make it into the hands of patients.

Hedge-fund manager Kyle Bass pioneered the strategy, which relies on a new legal procedure known as “inter partes review,” or IPR. Earlier this year, Bass — who previously made $590 million betting that homeowners wouldn’t be able to make their mortgage payments during the financial crisis — filed a review against Acorda Therapeutics’ patent on a drug that helps multiple-sclerosis patients walk. The challenge caused Acorda’s share price to crash by 10 percent.

Wall Street began exploiting the system after Congress created the Patent Trial and Appeal Board, a new arm of the Patent Office tasked with taking a second look at patents that some consider too vague. Since its formation in 2013, the board has proven so hungry to annihilate patents that it’s been called a patent “death squad.”

Bass quickly saw how the board was wiping out patents and jumped at the chance to make money from a self-fulfilling prophecy: challenge the patent and short the company’s stock to profit on the market’s reaction.
Article Photo Credit: N/A by N/A is licensed under N/A N/A
Sign Up for Our Email Newsletter

RECENT NEWS

Why the FTC is Investigating Pharmacy Benefit Managers

Why the FTC is Investigating Pharmacy Benefit Managers

In money matters, U.S. regulators are investigating claims by PBMs who say they save you money on prescriptions....  Read more

Uh-oh, he’s back: Fauci is once again spouting bad COVID advice

Uh-oh, he’s back: Fauci is once again spouting bad COVID advice

Let’s face it: public-health messaging and open, honest debate haven’t been the Good Doctor’s strong suits. ...  Read more

Peter Pitts speaks to CNN about baby formula shortage
  • CNN
  • 05/13/2022 12:00 AM

Peter Pitts speaks to CNN about baby formula shortage

Former FDA Associate Commissioner Peter Pitts speaks with CNN on the shortage of baby formula on May 13, 2022....  Read more

DRUGWONKS BLOG