Week in Review

IN THE NEWS

• The U.S. Patent and Trademark Office issued guidance to help stakeholders and agency examiners decide whether to award patents in the case of artificial intelligence-assisted innovations. Although AI-assisted inventions are not unpatentable across the board, the guidance will require a human to have provided a “significant contribution” to award a patent. The agency justified the rule by stating that “the patent system was developed to incentivize and protect human ingenuity,” not machines.
• The U.S. Small Business Administration finalized a rule to adjust the size standard for small business’s eligibility for federal assistance. The adjustment reflects the impact of inflation on the agency’s monetary-based size standards. The final rule defines a small business as a business with a net worth of up to $20 million and a net income of up to $6.5 million, marking a 34.6 percent increase from the previous size standard. The inflation adjustment increases the size standard for maximum tangible net worth to $20 million and the standard for net income to $6.5 million. Because the new threshold is higher, the agency stated that it will allow more small businesses to access its programs and financial assistance.
• The U.S. Food and Drug Administration (FDA) approved Takeda Pharmaceutical’s therapy, Eohilia, for treating eosinophilic esophagitis—a chronic condition characterized by inflammation of the esophagus. Although there are injectable drugs currently available for treating eosinophilic esophagitis, Eohilia will become the first oral treatment for the disease. Despite FDA’s initial rejection in 2021, Takeda resubmitted its application after analyzing previous clinical studies and submitting new data. The company expects that Eohilia will be available by the end of February 2024.
• President Joseph R. Biden signed into law the Moving American’s Privacy Protection Act, which requires the U.S. Department of the Treasury and U.S. Customs and Border Protection to remove any personally identifiable information from cargo manifests—a list of all contents carried on a vessel—before they are made public. This legislation safeguards the personal information of Americans, including military personnel stationed abroad, who may face the risk of identity theft and fraud due to current disclosure practices concerning cargo manifests. U.S. Representative Bill Pascrell (D-NJ) welcomed the Act as a vital measure to safeguard personal information and prevent the misuse of manifest data.
• The U.S. Department of Veterans Affairs (VA) issued a proposed rule to expand death and disability benefits for veterans exposed to Agent Orange, a toxic herbicide used by the U.S. during the Vietnam War. The rule would extend a “presumption of exposure” to veterans who served where the U.S. Department of Defense stored, tested, and used herbicides outside of Vietnam, including waters off its coast. The expansion would help exposed veterans receive benefits for cancers and diseases that are caused by certain herbicides such as Agent Orange, including bladder cancer, hypothyroidism, and Parkinson’s Disease. VA Secretary Denis McDonough stated, “Our goal is to provide every Veteran—of every era—with the VA health care and benefits they deserve, and this is another step in the right direction.”
• The U.S. Department of Agriculture adjusted the guidelines state agencies use when determining the income eligibility of applicants to the Special Supplemental Nutrition Program for Women, Infants, and Children. This program provides federal grants to states in their efforts to safeguard the health of low-income women, infants, and young children who are at nutritional risk, frequently through direct food assistance. The new guidelines provide updated threshold requirements for annual income based on household size that applicants to the program must satisfy.
• The U.S. Environmental Protection Agency proposed changes to the emissions and hazardous air pollutant standards for lime manufacturing plants, which process the mineral for various purposes, such as construction and chemical processing. The agency had previously proposed emissions standards for certain hazardous air pollutants from lime manufacturing plants. The new rule will revise the proposed limits for some of the pollutants, including mercury and hydrogen chlorine, based on additional information the agency has gathered since the proposal of the original rule. For example, the agency will establish a health-based emission limit for hydrogen chloride based on input from a Small Business Review Panel.

WHAT WE’RE READING THIS WEEK

• In a recent paper, Cary Coglianese, professor at the University of Pennsylvania Carey Law School and director of the Penn Program on Regulation, and Nabil Shaikh, a law student at the University of Pennsylvania, compared approaches to regulating government uses of AI. Coglianese and Shaikh argued that regulators should emphasize testing, validation, and monitoring of public sector AI tools—also known as a management-based approach. Coglianese and Shaikh analyzed several binding and voluntary regulatory frameworks across multiple countries that follow this approach, including through AI impact assessments and auditing.
• In a recent Brookings Institution article, senior fellow Blair Levin argued that without additional funding for the Affordable Connectivity Program (ACP), the digital divide in the United States will widen. The ACP currently offers $30 per month in broadband subsidies to about 23 million households and is expected to run out of funds in May 2024. Failure by federal legislatures to continue to fund the ACP can have detrimental effects on communities, including increases in crime and illiteracy, Levin suggested. In turn, Levin recommended a broader understanding of the program’s societal and economic impacts, which may convince lawmakers to fund its extension.
• In a forthcoming article in the Berkeley Journal of Entertainment and Sports Law, Meredith Rose, Senior Policy Counsel at Public Knowledge, advocated greater transparency in the music streaming industry in order to increase artist payouts. Rose explained that streaming platforms do not pay artists directly, but pay part of its sales to record labels, who then take a cut before paying artists under the terms of their contract, subject to non-disclosure agreements (NDAs). Rose proposed that the Federal Trade Commission conduct an information-gathering study on these NDAs to help lawmakers better understand the impact of NDAs on artists so that they can legislate accordingly.

EDITOR’S CHOICE

• In an essay in The Regulatory Review, Andrew Ittleman, a partner at Fuerst Ittleman David & Joseph, proposed steps FDA should take r to improve the regenerative medicine industry following the enactment of the 21st Century Cures Act in 2016. Ittleman noted that the regenerative medicine industry has made significant strides, with 52 designated products and one approval in 2021. Ittleman concluded that FDA could establish a partnership program for the exempt and lower-risk parts of the regenerative medicine industry, with accreditation bodies setting standards, mandatory quality control, and sanctions for violations.