Posts Tagged: "incentivizing innovation"

LITAN: ”Cross industry variation in the use of patents shouldn’t mean that we should just junk the patent system. As I said, the alternatives to go to a system of trade secrets which has very, I think, suboptimal social implications relative to patents. Indeed I think when people object to patents they don’t think about well what else would firms rely on for protecting their hard-earned IP. Indeed, even companies that are heavily involved in the open source world are using patents as a ‘currency’ through which they can achieve collaboration with other firms. That’s why you see big firms like Microsoft and IBM cross license. They do it not only to insulate themselves from infringements against them but because patents are the tickets through which can collaborate with other parties to innovate, make better products and so on.”

In a recent article in the New England Journal of Medicine, Amy Kapczynski argues that the Supreme Court of India’s strict interpretation of the country’s new patent law provides a model to be followed by other countries. Kapczynski applauds this “Patent Law 2.0” and argues that it will enhance access to medicines and may improve pharmaceutical innovation. Unfortunately she is wrong on both counts. Section 3(d) of the Indian Patent Act forbids the patenting of new forms of known drugs unless the new form significantly enhances efficacy and yields therapeutic benefits. Accordingly, much of the incremental innovation that is done on existing treatments will no longer be patentable under the so-called Patent Law 2.0. These are not issues considered by Kapczynski. Astonishingly, she interprets the impact of this law as follows, “Provisions like Section 3(d) can help reverse this effect [prioritizing incremental innovation over breakthrough drug discovery] and encourage companies to undertake the riskier and more expensive research that is required to generate breakthrough drugs.” Her analysis is strikingly naïve. It is laughable to think that weaker intellectual property rights (IPR) protection will incentivize innovative pharmaceutical firms to expend more resources and take on greater risk.

These first-level-thinkers just assume that information would be disseminated at the same rate without a patent system, which is so ridiculous it is hard to take anyone seriously who actually professes to believe such nonsense. Can anyone really believe that? This is why it seems overwhelmingly clear to me that there is an anti-patent agenda in many newsrooms across the country. No intelligent person who has reviewed history and has any knowledge about how business works would think that businesses would randomly disclose proprietary information in the volume that occurs today absent a patent system that incentivizes such disclosure.

Intellectual property law is premised on incentivizing innovative and creative activities by providing limited property rights for the fruits of such activities in order to increase the storehouse of creative and innovative knowledge for the betterment of society. Excessive overlapping protection undermines the careful balance individually developed under each body of intellectual property law. Expansion of the subject matter protected under either patent, copyright, or trademark law should only occur if it does not undermine the careful balances struck under each of the other bodies of intellectual property law. Being mindful of the balance between protection and public interest can prevent unintended over-protection of intellectual property that would work to skew the balance in favor of rights to creators and innovators at the expense of the public.