Pharmaceutical News 2.0

Pharmaceuticals is an industry exposed to many unique risks. The capital intensive research and development (R&D), the uncertainty of Food and Drug Administration (FDA) approval, and a constant shroud of legislative risks may seem like a lot to deal with, but one of the fastest growing threats for pharmaceuticals are patent trolls.

The Pharmaceutical Process
FDA approval is already a long process, and even properly-approved drugs have left companies open for litigation. To take just one example from 2008/2009, there is an ongoing legal argument about whether federally approved warning labels pre-empt state law. The main problem was that if the Supreme Court ruled that warning labels didn’t pre-empt state law, or if Congress changed the rules to give state law equal importance, then drug companies could find themselves facing more lawsuits. In addition, the drug companies would have to go through FDA approval followed by state by state compliance checks - all of this adding to the already considerable costs of doing business.

Patent trolls, by either attacking existing patents or hoarding vague patents, hurt pharmaceutical companies more acutely by reducing returns on investment at a time when both the companies’ costs and risks are rising. Drug companies need large cash reserves/war chests at all times to pay for capital-intensive research, FDA approval and settling lawsuits. To maintain this war chest they need strong and, more importantly, stable profits from their products.

Risk and Return
These companies pay out the huge R&D costs in return for huge possible rewards on patented drugs. The rewards are more or less proportional to the risks, as many drugs never make it to market, meaning they never pay back their R&D costs. Drug companies want their patents, essentially their intellectual property rights, protected for as long as possible. They want an exclusive monopoly over their product in order pay back the costs of development along with a profit equal to the risks taken on by the company. Excess profits will either go to the shareholders or cover the costs of the many failed drugs that never make it out of developmental stages.

Trolls Provide Short-Term Benefit
Whether it is generic aspirin or generic Viagra, the patient receives an immediate benefit from patent trolls in the form of a lower price for medicines. This short-term benefit is no doubt much appreciated. The government also tends to think short-term - a cynic would say in four-year cycles - and generally in line with patients. They want cheap pills for voters and are more than willing to see corporate profits take a hit to meet that end. Governments have shown their support for patent trolls by creating legislative loopholes and eroding patent rights.

By attacking long-term patents, trolls are able to open up specific formulas for generic mass production and bring cheap generic drugs to market quicker. In the short-term, it’s hard to argue that cheap medicine doesn’t benefit the general population. In the long-term, however, the actions of patent trolls may actually hurt everyone.

Read more about pharmaceutical patent trolls.

Pharmaceutical Patents pharmaceutical patent

by Stephen Albainy-Jenei
June 30, 2009

The American Conference Institute’s Maximizing Pharmaceutical Patent Lifecycles, the 10th Anniversary Edition will be held at the Helmsley Park Lane Hotel, New York, New York, on Wednesday, October 7, 2009 to Thursday, October 8, 2009.

Overview

This 10th American Conference Institute event on Maximizing Pharmaceutical Patent Life Cycles will bring you the thoughtful and targeted commentary and in-depth analysis that you have come to expect from this industry leading conference. This year’s conference will help you prepare for the sweeping changes currently underway by providing you with:

* Focused panels on the pending Follow-On Biologics and Patent Reform legislation that will allow you to assess how both legislative proposals will impact pharmaceutical patent life cycle management
* Access to key officials from the FTC’s Bureau of Competition’s Health Care Division and the EC’s DG Competition’s Pharmaceuticals Task Force who will provide you with direct insights into the logic of these agencies on some of the most pressing antitrust matters currently affecting the industry
* An in-depth review of new FDA determinations regarding exclusivity, forfeitures, patent listing and delistings and strategies for incorporating these guidelines into your initial life cycle management plan
* Analyses of key cases that have affected patent life cycle strategies and tips for using these rulings to your advantage

Read more about this conference on pharmaceutical patent lifecycles.

Pharmaceutical Patents pharmaceutical patent

Thursday, November 15, 2001
by Frank R. Lichtenberg

When the threat of anthrax became a widespread concern, the Canadian government said it had serious doubts that Bayer, the owner of the patent for the anti-anthrax drug Cipro, could meet Canadian needs. Canada ignored the patent and ordered generic copies. In the United States, Sen. Charles Schumer expressed the same concerns and proposed that the U.S. government do the same. After Bayer said it could meet the needs of both nations, and after other drugs that are effective against anthrax were identified, Canada reversed its decision, and the issue was dropped in the United States for the time being.

But the proposal to override patents is certain to come up again as other drugs are needed, and as the population ages and demands drug treatment for an increasing range of illnesses and ailments. While overriding a patent might lead to a temporary increase in the supply of a drug, a great deal of evidence suggests that this policy would lead, in the long run, to a lower supply of innovative drugs, and poorer public health.

Research and development investment in general, and pharmaceutical R&D in particular, has made enormous contributions to the economic well-being and health of Americans. To have the incentive to undertake research and development, a firm must be able to get sufficient returns to make the investment worthwhile. The patent system is one of the most important ways in which the government can provide this incentive. Weakening patent protection (e.g., by government violation of patents) may have a chilling effect on private R&D investment, and therefore reduce the health and wealth of future generations.

Value of Medical Research.

A host of academic studies speak to both the value of medical research and the important role of economic incentives. For example, a major project sponsored by the Mary Woodard Lasker Charitable Trust addressed the question, “What is the true economic value of our national investment in medical research?” and found, “It provide[d] a surprisingly dramatic answer: the returns are exceptional.” The pharmaceutical industry performs about one-third of U.S. biomedical research. Some of my own academic research has estimated the benefits to consumers from the introduction of new drugs at the patient level, disease level and national level. These benefits include longer life, better quality of life, and reductions in total medical expenditure.

Read the rest of this article on pharmaceutical patent protection.

Pharmaceutical Patents pharmaceutical patent