“The 2021 Index ‘illustrates that economies with the most effective IP frameworks are more likely to achieve the socio-economic benefits needed to combat COVID-19, including greater access to venture capital, increased private sector investment in research and development, and over 10 times more clinical trial activity.’”
The U.S. Chamber of Commerce Global Innovation Policy Center (GIPC) released its ninth annual International IP Index yesterday, finding that the United States, Japan and Europe remained at the top of the global intellectual property rankings, while emerging markets like the United Arab Emirates, China and Mexico continued to improve their scores. Despite the pandemic, the overall global IP environment improved, and the report underscored the critical role that strong IP economies have played in combating COVID-19.
The report, titled “Recovery Through Ingenuity,” covers the IP framework in 53 global economies across 50 unique indicators. 32 of these 53 economies had positive improvements in their scores over the 2020 report.
IP Will be Key to Global Economic Recovery
According to a GIPC press release, the 2021 Index “illustrates that economies with the most effective IP frameworks are more likely to achieve the socio-economic benefits needed to combat COVID-19, including greater access to venture capital, increased private sector investment in research and development, and over 10 times more clinical trial activity.”
The Index found that effective IP regimes “enabled the development of a pipeline of therapeutics solutions to combat COVID-19,” including vaccines that were developed with the benefit of decades of scientific research that was quickly employed for use during the pandemic. These vaccines were only able to be developed at unprecedented speed thanks to public-private partnership, said the report. “As governments pivot their focus to the distribution of the vaccine, IP will be critical to facilitating licensing and technology transfer while also expediting the manufacturing and delivery of vaccines and therapeutics,” said the report.
At the same time, the report highlighted steps taken in some countries that the GIPC said work to “undermine the framework that successfully enabled coronavirus-related innovation.” For instance:
- In Israel, Hungary, and Russia, governments issued compulsory licenses for COVID-19 therapeutics.
- Other economies, including Chile, Colombia, and Indonesia called for or enacted new laws that expand the criteria for compulsory licensing.
- At the World Trade Organization (WTO), India and South Africa issued a proposal to waive IP rights on all COVID-19 related medicines, devices, and technologies through the TRIPS Council waiver.
There has been much debate about whether these steps will actually harm innovation in the long term.
Eye on Emerging Economies
Since 2012, when the inaugural edition of the Index was published, China’s score has increased 18.34% while India’s improved 13.44%. Mexico had the second largest overall increase in score this year (3.87%), following legislative changes made as a result of the implementation of commitments in the U.S.-Mexico-Canada Agreement (USMCA). “However, Mexico forfeited more substantive gains for life sciences IP protection when critical protections were removed from the final agreement,” said the GIPC release.
China had the largest overall increase in score between 2020-2021 at 3.90% and an overall 2021 score of 54.86%. Like Mexico, China’s improved score is attributed in part to legislation implemented in response to a trade agreement with the United States. “These changes, if implemented effectively, should improve China’s domestic IP regime,” said the GIPC. “However, ongoing market access barriers, uneven enforcement, measures requiring forced technology transfer, and serious deficiencies in the rule of law continue to make the business environment in China highly challenging for rightsholders.”
U.S. IP Regime Stays Strong – But There’s Room for Improvement
The United States’ 2021 overall score was 95.31%, with a .03% change from the 2020 IP Index. The UK, Germany, France and Japan follow in the top five overall scores. Of those, Germany’s score improved the most, with a 1.19% increase.
The report found that the U.S. Patent and Trademark Office (USTPO) guidance on patent eligible subject matter led to a “statistically significant decrease in the first office rejections for Alice-related technologies” and USPTO proposed changes to the inter partes review process on patent validity challenges were also cited as a positive step.
The three areas of weakness identified for the United States were:
- Proposals for compulsory licensing as a pharmaceutical cost containment policy
- Continued uncertainty over patentability for high-tech sectors
- Lack of a targeted legal basis for addressing online piracy, along the lines of other global leaders
Like last year, in the category of “Patents, Related Rights and Limitations,” Singapore scored highest, with 97.22%, followed by Japan, South Korea, Switzerland and the United States, all of which had the same score of 94.44% for second place. “IP continues to be a massive economic driver for jobs and investment,” said the GIPC. “In the United States alone, IP supports over $6 trillion in GDP and more than 45 million jobs, according to the U.S. Department of Commerce.”
“The international IP system gave the innovative scientific community the capacity to respond to the global pandemic,” said David Hirschmann, President and CEO of GIPC in a statement. “Countries with the most effective IP ecosystems – as measured by the 2021 Index – become trusted partners in our mission to develop, manufacture, and distribute the solutions needed to defeat COVID-19 in record time. Now is the time to build greater international consensus and capacity on IP, to enable all countries and the next generation to build a sustained economic recovery through ingenuity.”