Posts Tagged: "pharmaceutical patent law"

On Thursday, December 15th, a subsidiary of Kenilworth, NJ-based pharmaceutical developer Merck & Co. (NYSE:MRK) was awarded $2.54 in royalty damages in a case involving one of the most popular available treatments for combating the hepatitis C virus (HCV). A federal jury decided that Gilead Sciences Inc. (NASDAQ:GILD), an American biotech firm headquartered in Foster City, CA, owed these royalties as a result of its infringement of patents for HCV treatments held by Merck’s Cambridge, MA-based subsidiary Idenix Pharmaceuticals. According to coverage of the verdict by Bloomberg, this $2.54 billion royalties award is the largest verdict for patent infringement in the history of the United States. The case was decided by jury in the U.S. District Court for the District of Delaware (D. Del.).

The pending report of the UN Secretary General’s High Level Panel on Access to Medicines not only attacks the patent system as predicted, but proposes giving the organization oversight of drug development. If you think United Nation functionaries would be more effective than entrepreneurs, you’ll be delighted. If you live in the real world where bureaucracy is the enemy of innovation, you don’t know whether to laugh or cry.

Pharmaceuticals is the industry sector where a strong patent system, promising substantial returns to successful innovation, is of paramount importance. Regrettably, the weakening of pharmaceutical patent rights through legislative means and antitrust lawsuits is symptomatic of a broader and more general policy attack that antitrust enforcers have directed against patents in recent years. Antitrust enforcers and legislators clearly need a few remedial lessons in the economics of innovation before their myopic meddling cripples the (up-to-now) highly successful American pharmaceutical sector and other key U.S. industries, which have stood as a testament to the value of strong patent rights.

The number of these potentially anticompetitive deals has fallen significantly following the Supreme Court’s landmark antitrust decision in FTC v. Actavis in 2013. The total number of such deals filed with the FTC has dropped to 21 in FY 2014 from 29 in FY 2013, and 40 in FY 2012 prior to the Actavis ruling. The FTC staff report for FY 2014 represents the first annual snapshot of such deals following the Actavis decision.

Claiming to be the ”Pharmacy to the Developing World”, India argues that their lax intellectual property rights regime is critical to their ability to provide low-cost, quality generic drugs. They are wrong on two counts. First, India needs to honor IP rights, because without effective intellectual property rights, new pharmaceuticals will not be developed and the “Pharmacy to the Developing World” won’t have anything to provide to the developing world, or to anyone. Second, given the quality crisis in the Indian pharmaceutical industry, they shouldn’t be the pharmacy to anyone.

At first blush Dr. David Taylor’s claim that “continuing progress in the pharmaceutical and other health sciences will eliminate disease related mortality and disability in people aged under 75 by 2050” seems a bit unbelievable… The core of the analysis focuses on the extent to which intellectual property rights serve to foster innovation and improve global public health, both today and tomorrow. Taylor et al. recognize that without intellectual property rights private investment in expensive, risky and uncertain biopharmaceutical research and development projects would not take place. Acknowledging that the debate is more nuanced that a choice between firm profits or patient access, the authors argue that alternatives to the existing IPR regime would be unlikely to deliver the therapeutic advances that we enjoy under the current system.