Wednesday, 30 October 2013

The patent system

Patent is a  exclusive property right.  in intangible creations of the human mind it is a reward. They
exist only as provided in the laws of sovereign states, and can be enforced only to the
extent that application has been made and a patent granted covering the territory of an
individual state. Patent rights are limited in duration, with the global standard being 20
years from the date of application. The new product, article of manufacture or process
described in the patent application must be something that has never been previously
disclosed anywhere in the world and something that would not be obvious to a person
ordinarily skilled in the field involved. Determinations of whether these requirements
have been met are made by comparing the claims of the patent applicant against the body
of published literature in the field, including previously issued patents. This process is
called examination, and it assures that no one is able to claim patent rights on anything
that already is existence.
Patents work differently indifferent industries. In the electronic industry patents are often
shared among competitors through pooling or cross licensing. This sharing is necessary
because a given product often contains many patented technologies. However, in the
pharmaceutical, chemical and biotechnology industries the patent normally equals the
product, and protects the extensive investment in research and clinical testing required
before placing it on the market. Patent protection for chemical and pharmaceutical
products is especially important compared with other industries because the actual
manufacturing process is often easy to replicate and can be copied with a fraction of the
investment of that required for the research and clinical testing.
The extensive cost required to produce a new pharmaceutical product has meant that
private sector investment in pharmaceutical innovation has been disproportionately
directed to products meeting the needs of patients in developed countries, particularly in
the United States, which combines strong patent protection with a market free of price
Until the TRIPS Agreement in 1994 many developing countries provided no patent
protection for pharmaceutical products. And, while countries that have joined the WTO
have obligated themselves to provide such protection, least developed countries are not
required to meet this obligation until 2016. The continuing lack of patent protection for
pharmaceutical products makes it very difficult to establish research-based industries in
most developing countries. Most medical research in these countries takes place in the
public sector. The lack of any means of patenting these inventions and the related lack of
experience in licensing them to the private sector, suppresses the development of
commercial enterprises focused on alleviating the disease burdens common to developing
The controversy over availability of patented therapies for the treatment of HIV disease
has resulted renewed interest in the compulsory licensing of pharmaceutical products.
After two years of discussion, the WTO Council recently affirmed that the TRIPS
Agreement permits such compulsory licenses in health emergencies, even in cases where

the compulsory license is for an imported product. However, to date, no compulsory
licenses actually have been issued, even though the threat of compulsory licensing has
been used as a means of seeking lower prices.
One danger in compulsory licensing is that it will discourage further the commercial R &
D necessary to new drugs to fight global epidemics. Another danger is that compulsory
licensing can be used to seek price levels below what a given national market is capable
of supporting, further concentrating the burden of financing pharmaceutical innovation
on developed country consumers and discouraging development of drugs targeted at the
disease burdens of countries using compulsory licenses.
There are promising developments in countries such as India and Brazil that are
beginning to use patents to develop commercial pharmaceutical industries that produce
products directed at local diseases and available at price that patients in those countries
can afford. Foundations and nonprofit organizations such as the Bill and Melinda Gates
Foundation and OneWorld Health, Inc. are supporting such efforts. These efforts show
that developing countries have the capacity to build research-intensive pharmaceutical
industries capable of operating profitably in the conditions of the local market. However,
for such local industries to take root and grow, effective patent protection must be made
available, the commercialization of publicly funded research must be encouraged, and
compulsory licensing must be kept to a minimum. Wealthy countries can assist this
process by subsidizing local markets for the purchase of drugs through the Global Fund,
and by direct programs of assistance such as that recently proposed by President Bush.
Consumers in all countries can share the burden of drug development equitably by paying
for medicine at a price level consistent with their means, rather than attempting to shift
the costs of drug development to others.

What is a Patent?
A patent is a property right granted by a sovereign state to the inventor of a novel, nonobvious
and useful invention. Because the invention must be novel (meaning that it has
not been previously disclosed anywhere in the world) and because it cannot be obvious to
one ordinarily skilled in the art, the grant of the property right cannot interfere with the
public’s access to what already exists.
The owner of a patent has the right to exclude others from making, using, offering for
sale, or selling his or her invention for a period of 20 years from the filing of the patent
application. An invention is any new or useful process, machine, article of manufacture,
or composition of matter. An improvement on any of these items also can be an
invention. Patent rights are territorial in nature and exist only in the national jurisdictions
in which the patentee has applied for and received recognition of his property rights.
Whether a claimed invention meets the tests of novelty and non-obviousness is
determined by comparing it to the body of previously disclosed information in the same
field. This information is usually called “prior art.” The most commonly used prior art
consists of published patents that have already been issued or published by the world’s
patent offices.
While all countries require that the tests of novelty and non-obviousness be met before
patent rights can be enforced against in fringers, many countries do not determine whether
these tests have been met though a substantive examination as in the United States, Japan,
the U.K. and Germany. In counties, such as France, claims to patent rights are registered
with the state but not actually tested for their validity until or unless they are asserted in a
judicial proceeding. At that time the responsible judicial authorities engage in the fact finding
process necessary to determine whether the tests of patent ability have been met.
The benefit of granting an inventor the exclusive property right of a patent for the limited
period of 20 years is that he or she is given a powerful incentive to create. The inventor is
assured that investors will be given the incentive to commit the financial resources
necessary to support the inventor’s research and to develop it to the point where it can be
manufactured and made available to the market.