Patent Palooza: One Patent Battle in Hep C, And Another Patent Brawl Brewing On Capitol Hill

Patent risk is one of the biggest risks in biotech, but patent risk isn't limited to the just patent expiration. Other patent risks can also cause revenue to slip or a company's shares to drop. For example, patent infringement cases can force drugmakers to pay royalties to competitors that they weren't paying previously. Last week, a jury decision in a patent infringement case could put Gilead Sciences (NASDAQ:GILD) on the hook for hundreds of millions of dollars in royalties owed to Merck & Co (NYSE:MRK) and Ionis Pharmaceuticals (NASDAQ:IONS).

Patent threats can also come from unexpected places, too. For instance, this week members of Congress asked the National Institutes of Health to revoke Medivation's (NASDAQ:MDVN) patent exclusivity on Xtandi, a popular prostate cancer drug that was developed partially using taxpayer money.

These instances of patent risk may not end up taking a big toll on these companies, but investors still need to understand the implications associated with them. In this episode of the Motley Fool's Industry Focus: Healthcare, Kristine Harjes and Todd Campbell explain these patent risks and what they may mean for investors.