Chapter excerpt from the ebook MedTech IP: Lessons and Strategies for Success - view all chapters here.
Nobody can ever be 100% certain about the validity of any individual patent. The reason is simple; no patent search can ever prove that someone else did not create the same invention previously.
It is therefore important to keep innovating, and to continue to patent new technology as it arises, so you have a back-up plan if any individual patent fails.
An evolving armoury of IP rights can also enable you to adapt to changing markets and even enable you to define markets.
So, building a constantly evolving portfolio of patents isn’t just a defensive measure – it can be a way to define opportunity and foster growth.
Let us see how ResMed went about this in rather spectacular fashion…
A Continuous Positive Airway Pressure (CPAP) machine provides CPAP to a patient via a face mask. This prevents collapse of the upper airway, and CPAP therapy is therefore highly effective for managing obstructive sleep apnea, among other conditions.
You may already know that ResMed, established in Australia in 1989, is the world's largest manufacturer of CPAP devices, employing over 10,000 people worldwide, operating in more than 140 countries, and with a revenue of US$4.2 billion in fiscal year 2023.
You may also know that ResMed has filed over 10,000 patent applications.
What you may not know is that in 1993, just 4 years after ResMed was established in Australia, three judges of the Australian Federal Court completely revoked ResMed's foundational patent for the invention of the CPAP machine.
How did this company, which had its foundational patent completely revoked, go on to become the world's largest manufacturer of CPAP devices? To answer this question we need to look in a little more detail at the story of the CPAP machine.
The CPAP industry is now a huge MedTech industry. According to a report from the US Securities and Exchange Commission, more than 8 million CPAP interfaces are sold annually in the US, with another 2.5 million globally. There are also an estimated 80 million people with undiagnosed sleep apnea.
How did this multi-billion dollar industry begin?
The CPAP machine was invented in Australia in 1980 by Colin Sullivan, an Australian physician and professor, who was determined to patent his invention, against the odds. Sullivan originally sought assistance from his university’s Business Liaison Office for obtaining patent protection for his invention. This request was declined, and Sullivan then used his own resources to patent a “Device for treating snoring sickness” that issued as Australian Patent AU 560,360.
Figure 1 of the original patent is shown below, and illustrates the fundamental concept of the CPAP machine. The patent states that, "the patient will have administered to the nasal passages air of slightly increased pressure sufficient to maintain the nasal passages open throughout the breathing cycle."
A collaboration between Sullivan and a colleague led to a further patented invention, namely the delay timer patent (PCT/AU88/00, 8 Sep 1987) issuing as US patent 5,199,424 on 6 April 1993. This was achieved by providing an initial low pressure, to allow the patient to go to sleep, followed by gradually increasing the pressure to the required level, over a selectable time period.
A further patented invention used a microphone to detect when snoring occurred, and used this information to increase the air pressure only when needed to prevent an apnea from developing. This was based on the realisation that most apneas are preceded by snoring. The invention provided the patient with better sleep, and lower average delivered pressure during the night, thus increasing compliance with the therapy.
In 1989 ResMed was established in Australia to develop Colin Sullivan's invention of the CPAP machine.
The key thing was that, after filing a patent application for the idea of a CPAP machine, innovation had continued, and the company now owned a number of patents relating to further developments of the CPAP machine. So when in 1993 the Australian Federal Court unfortunately revoked the original patent, all was not lost. ResMed then initiated an action alleging infringement of ResMed's surviving patents.
Fortunately, ResMed had not simply relied on the original patent, but had further patents which could be asserted against alleged infringers.
According to the publication Medtech Dive, ResMed is now the largest manufacturer of CPAP and bilevel positive airway pressure devices in the world by market share. ResMed relocated to San Diego, California in 1990, and is now a medical equipment company which provides cloud-connectable medical devices for the treatment of sleep apnea (such as CPAP devices and masks), chronic obstructive pulmonary disease (COPD), and other respiratory conditions.
The story of how Colin Sullivan's invention of the CPAP machine in 1980 led to a multi-billion dollar industry is a remarkable story of success. Clearly patents have been central to this success story, starting with Colin Sullivan's original patent mentioned above, which he financed himself. The company was successful because in the early days the company did not simply rely on the original patent, but continued innovating and patenting new developments.
