Researchers at the University of California Hastings College of the Law found that three-quarters of the drugs associated with new patents in the records of the Food and Drug Administration were not new drugs coming on the market, but existing drugs. Pharmaceutical companies extended their exclusivity over blockbuster drugs 80 percent of the time, attaching new patents on dosage and other aspects that had nothing to do with the original invention.
Here’s how it works: Pharmaceutical companies start moving doctors to the tweaked formulation before the initial patent runs out, so that by the time it expires nobody is prescribing the original drug. That gives them an extra 20 years of exclusivity in which they can charge patients and their insurance companies exorbitant fees. Society has nothing to gain.
In a brief to the court, the Initiative for Medicines, Access and Knowledge — a nonprofit group arguing for broader access to affordable medicines — argued that the patent office’s panel “is an important and necessary tool in the fight to lower drug prices because it allows the timely removal of unmerited patents, which promotes competition.”
Tahir Amin, a co-executive director of the initiative, added that “there are a lot of patent trolls trying to extort rents from low-quality patents.”
The Supreme Court has in recent years shown itself sympathetic to the argument that patent protections have become too restrictive. On half a dozen occasions since 2013, it has overturned decisions by Federal District Courts granting patent rights over what were ultimately fairly intuitive processes.
Notably, the Supreme Court’s 2014 decision in Alice Corporation v.CLS Bank International held that where a patent claim is based on an abstract idea, which is not patentable, using generic computer implementation does not transform that idea into a patentable invention.
Corporate interests are not aligned in this case, though. Pharmaceutical companies despise the patent office’s new powers. Information-technology corporations, which incorporate thousands of ideas into one gadget and see themselves as victims of patent trolls, are strong supporters of this relatively cheap and expedient avenue to challenge patents once they have been written.
The Goliaths of technology are, of course, out for themselves alone. Yet in this case they are aligned with the economy’s interest. For too long, innovation has been narrowed to fit patent holders’ argument for sacrosanct property rights. For these rights to hold, however, at the very least we need a system to undo those that prove to be invalid.
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