Is US Patent Policy Strong Enough to Withstand the Winds of Change: A Study of the Need to Change United States Patent Policy (original) (raw)
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SSRN Electronic Journal, 2013
Economists are unable to provide a clear answer to how effective the patent system is in encouraging innovation. At best, they point to certain sectors, such as pharmaceutical and biotechnology, which benefit from a robust patent scheme. Conversely, sectors such as software and, ironically at the same time, biotechnology may be harmed by an overly broad patent scheme. The question emerges: Why do the various stakeholders in all industrial sectors, Congress, the Patent and Trademark Office ("PTO"), and the courts (in particular, the Federal Circuit) continue to center the development of patent law around the "innovation presumption" despite the lack of theoretical and empirical evidence to answer the fundamental question: Do patents actually create more incentive to innovate, more actual innovation, and hence more economic growth? Preparing for this Symposium on the Federal Circuit, innovation, and disruptive technologies has allowed me to reflect further on why it is necessary to challenge the innovation presumption and explore alternative paradigms, such as the use of innovation "policy levers" for this problematic narrative.
Patents and New Product Development in the Pharmaceutical and Biotechnology Industries
This paper examines the rationale for intellectual property protection in the development of new pharmaceutical products. Prior survey studies of R&D executives have found that patents play a more critical role in appropriating the benefits of innovation in pharmaceuticals compared to other high tech industries. This paper considers why this is so based on an analysis of the economic characteristics of R&D costs and returns in the pharmaceutical and biotechnology industries. The final section examines recent policy developments and issues surrounding patent lifetime and generic competition in this industry. The pharmaceutical and biotechnology industries, which are among the most research intensive industries, have been the focus of several benefit cost and social return on R&D studies. Elsewhere in this symposium, Frank Lichtenberg has reported on his finding concerning the impact of new drugs on increased longevity, worker productivity, and savings in other types of medical expenditures. 4 He finds significant aggregate net benefits to society from new drug introductions. His analysis is consistent with more microeconomic analyses targeted to specific medical conditions such as cardiovascular disease, depression, and infectious disease. These studies have also found high incremental social benefits from new drug innovation. 5 Another general finding of the academic literature is that public policy actions can have a significant influence on the rate of innovation in particular industries. Among the key industrial policies influencing the innovative process in pharmaceuticals are the public support of biomedical research, patents, FDA regulatory policy, and government reimbursement controls. 6 The focus of this paper is on the role and impact of patents and intellectual property protection in the discovery and development of new pharmaceutical and biotechnical products. The importance of patents to pharmaceutical innovation has been reported in several cross-industry studies by economists. In particular, Richard Levin, et al, and Wes Cohen, et al, have undertaken surveys of U.S. R&D managers in a large cross-section of 4
The R&D-patent relationship: An industry perspective
2010
Abstract: This paper aims at contributing to the literature on the relationship between research efforts and patent counts. It is claimed that the" propensity-to-patent" should be split into an" appropriability propensity" and a" strategic propensity". The empirical contribution is based on a unique panel dataset composed of 18 industries in 19 countries over 19 years, and relies on five alternative patent indicators. The results confirm that the distinction between the two types of propensity matter. The sharp increase in patenting observed in ...
An academic landscape of patent & innovation research for policy reform
2010 IEEE International Conference on Management of Innovation & Technology, 2010
The global intellectual property system is currently being revolutionized by changes in innovation and the quantitative expansion in patenting. There is an expectation of applying the results of academic patents studies to the reformation of the intellectual property system. On the other hand, the rapid quantitative expansion in academic knowledge is posing difficulties for the application of conventional techniques to extract required knowledge or apply a suitable synthesis. This article has the purpose of effective implementation of large volumes of knowledge for policy formation and examines the methodology for specifying academic growth fronts, important research domains or comprehension of the academic landscape. We specify that research fronts have a profound association with issues surrounding reform of the system.
A patent only protects an innovator from others producing the same product, but it does not protect him from others producing better products under new patents. Therefore, one may divide up the source of competition facing an innovator into within-patent competition, which results from production of the same product, and betweenpatent competition, which results from production of products on other patents. Previous theoretical and empirical micro -based analyses have emphasized the effects of intellectual property regulations on within -patent competition by showing how protecting innovative returns from imitators raises R&D incentives. However, between-patent competition affects innovative returns, particularly through creative destruction in the many high-tech industries that seem central to overall economic progress. This suggests that a fuller understanding of IP-regulations take into account its effects on between-patent competition. We find that the total effects of intellectual property regulations depend heavily on whether these unexplored effects are present. We attempt to estimate the relative magnitudes of the two sources of competition in limiting innovative returns in the U.S. pharmaceuticals market. In this market within -patent competition from so-called generic producers has been analyzed relatively more compared to competition between-patents through so called therapeutic competition. We estimate that between-patent competition, most of which occurs while a drug is under patent, costs the innovator at least as much as within-patent competition, which cannot occur until a drug is off patent. The reduction in the present discounted value of the innovator's return from between-patent competition appears to be at least as large as the reduction from competition within -patents, and may be much larger.
Challenges to the Patent System
SSRN Electronic Journal, 2011
; In the pharmaceutical industries drug attrition is a mounting problem: I. Kola & J. Landis, "Can the pharmaceutical industry reduce attrition rates?" (2004) 3 Nature 711 [Kola & Landis]. 3 F. Lévêsque & Y Ménière, "Patents and Innovation: Friends or Foes?" (December 2006) Centre d"économie industrielle Ecole Nationale Superieure des Mines de Paris at 3 [Lévêsque & Ménière] (the title belies the multi-faceted study on various aspects of the patent system); R.
The Patent System at a Crossroads
University of Southern California Center for Law & Social Science (CLASS) Research Paper Series, 2018
Judicial decisions, agency actions and legislative enactments have promoted a creeping reversion toward the weak patent regime that prevailed for several decades preceding the establishment of the Court of Appeals for the Federal Circuit. The pending Supreme Court case, Oil States Energy Services v. Greene’s Energy Group, provides an opportunity to reflect upon the choice between a “property rights�? vision of the patent system in which resource allocation is principally directed by market signals and an administrative vision of the patent system in which resource allocation is perpetually subject to adjustment by courts and regulators. A growing body of empirical research raises doubts concerning the social costs that have been attributed to a robustly enforced patent system and, by implication, poses a challenge to policy actions that have targeted property-like attributes of that system.