Patent rights in the international forum

October 4, 2013

Patent protection is intended to encourage innovation and development. The cost of ignoring patent laws is not only high, but it poses a threat to innovation and research within the U.S. This is particularly relevant to companies in San Diego, which hosts a large IP industry.

In 2008, the U.S. entered into international negotiations intended to produce a free trade agreement known as the Trans-Pacific Partnership Agreement. Besides the U.S., there are 11 countries involved in the partnership along both the Eastern and Western sides of the Pacific; this year, the negotiations have entered their 19th round.

Patents are necessary to encourage companies, doctors and scientists to continue working to develop cures for cancer and other diseases such as Alzheimer's or Parkinson's. When breakthroughs in research are made, the people and companies who have invested money expect to have a return on that investment. One theory behind patent protection is that if researchers were denied a profit for their work, it might discourage them from using resources to explore more complex and challenging medical problems.

Studies show that for every 5,000 to 10,000 experimental medicines considered by companies, only one can be expected to receive FDA approval. The expenses that are estimated to be associated with the development of this many medications are $1.2 billion, spent over 10 to 15 years. Given the amount of money that companies stand to lose, it becomes more understandable why business litigation plays a prominent role in intellectual property disputes: the cost of litigating is far less than what a developer stands to lose on a missed patent. When multiple countries are involved, the laws and jurisdictions of the U.S. are harder to impose, making it important for countries to honor international agreements regarding patent rights.

Source: Forbes, "Intellectual Property Rights Matter", Doug Schoen, September 24, 2013