Drugs are an interesting case as they have these factors going for it:
1) Expensive to bring IP to market. Lots of testing and clinical trials for drugs. For SW it is pretty cheap now.
2) Easy and cheap to copy. Generic versions can be reverse-engineered quickly. Probably just as easy to copy software, but I still feel like this is probably a useful pillar.
3) The IP by itself constitutes the majority of the value of the product. In medicine there isn't typically tons of other IP around that come together to form the product. In SW there is rarely a single piece of IP that is more than a small fraction of the value of the product.
4) The IP has longevity as a standalone product. Viagra can be sold for decades. Aspirin still probably does hundreds of millions in revenue. There is little SW IP that, by itself, has longevity. The nature of SW is to continuously improve it.
5) Time to market isn't a huge advantage. Since most medicine is just sold as effectively a commodity, being 6m ahead of your competition usually just means you have 6 extra months of revenue. Whereas in SW it also means that gives you 6 months to build on your current IP. In medicine you don't typically do Viagra 2.0, with a boatload of new IP that makes the original obsolete (and hence any competitors shipping the old version scrambling).
Among other reasons, in an industry that is entirely dependent upon patent protection to defray the costs of getting FDA approval, it is impossible to get treatments through the approval process when they are not covered by patent.
For example somewhere on the order of half a million people in North America have Crohn's disease. This is a rather nasty sickness that destroys quality of life, and requires lots of rounds of only marginally effective medication. Research indicates that hookworm infection is an effective treatment. The FDA has decided that this treatment requires their approval. But you can't patent hookworms, and therefore nobody will pay for the necessary tests to get FDA approval. And so a half-million people continue to suffer.
If the rules were changed to grant a temporary monopoly to the company that got FDA approval for a treatment, this problem would vanish. A number of known treatments would go through trials and get approved.
Bringing drugs in the discussion has more of a relative role than any absolute metric though. We could subsume the reasoning as such though:
- patents work better on drugs than on software by leaps and bounds
- patents are far from a perfect fit for drugs
- it follows that software patents are an atrocity of abysmal scale
So no, not really in the range of crowdfunding.
And if you did get it approved, and managed to sell the treatment to everyone in the USA who has Crohn's disease, you'd need to make a profit of several hundred dollars/person just to pay for the cost of FDA approval. Realistically you'd want to charge more to recover up front risks, the cost of marketing, and uncertainty about what fraction of the target population you'd successfully sell to.
In drugs, the end result gets patented. Some chemical formula that's just right, which (in most cases) was not simply stumbled upon in the pursuit of something else. And even if it was stumbled upon, it's still novel and was not likely to be created as a product or byproduct by another party very easily. The insight required to develop the drug was most likely unique.
The equivalent to most software patents today in the drug field would be patenting methods of, say, mixing chemicals. Imagine if there was a patent on mixing two solutions by pouring one from a beaker into the other in a flask, twirling around twice and then shaking gently four times. What if someone had a license to that mixing method and everyone else had to pay to do it? It'd be ridiculous. It seems like that's basically what software patents are.
The equivalent to drug patents in the software world would be, I guess, patenting an entire OS, or an app, or some fully integrated, significant piece of software. For example, no one should be able to make a counterfeit copy of iOS as a whole and sell it as their own. That I would support legally. I (think?) this is already covered by copyright law.
In reality, nearly all patents are just ::at best:: a year or two of an engineering team crunching on a problem using existing methods - usually far less. It's difficult to say which are which though - so maybe patents are really what we want at all for nearly all things?
Like patenting the use of a hinge for a door instead of patenting how to make a hinge, and the patent being granted for the entire time humanity uses doors at all.
The equivalent of describing the molecule for a drug patent is providing the source code, which is already covered under copyright protection. Sounds like a good case to make software patents redundant
This goes the other way too - Edison's Lab developed the first phonograph supposedly in months - yet that's far more on the "deserving" side of patents.
Time isn't the best measure, but we have to consider what an actual good one would be. Giving at patents with relatively little oversight leads to a ton of prevented inventions, but how could we possibly inspect patents to a degree that we'd be able to. I haven't seen a plausible explanation that this search problem is even tractable.
take some classic physical patent like the Bessemer process for steel--given a suitably general collection of industrial robots and reconfigurable equipment, "make steel like this" is "implementable" in software.
or any random machinery patent--"be this specific kind of rotary engine" is software if your hardware is a few trillion nanites.
what exactly the implications are for the patent system, i'm still not sure....
Sounds like a flawless abstract of most engineering papers in academia.
Actually, there is an entire class of drugs known in medicine as "patent extenders". Take your expiring patented drug, alter the formulation, or attach an unnecessary chemical group that doesn't affect the mechanism of action, et voila! Twenty more years of monopoly.
As a result of this, there are drugs which were prescribed twenty years ago that are no longer available-- since the original developer has moved on to an "improved" version which may be less effective, while the generic version is not profitable enough to be widely available.
What this means for intellectual property, I'm not sure. It's a tricky issue.
Your patients don't want the old drug, do they? They don't want some pain, they want none.
Of course, Nopainatall is just Lowpainex combined with Tylenol... but that's inconvenient to take separately.
I can't imagine these things are hugely different in the land of the free.
Of course, she wanted to refuse it-- but after they walked it all the way down the wing, how could she tell her staff that they weren't actually getting any cake?
They are scumbags, for sure.
Another class of "patent extender" is to take two existing good drugs, package them together, and then trial and sell it as a new drug. The combined product is not the same as the two off-patent generic parent drugs.
There are hundreds of examples -- this is a totally standard patent expiration strategy in medicine. This whole area is called "ever-greening".
The weirdest one is getting an existing drug approved for a new use. This can be used to extend patent protection.
In Germany, 100 pills desloratadine are about 50 EUR. 100 pills loratadine are 10 EUR.
One wonders how many doctor-hours per year are spent
by the consumers/patients initiating such conversations.
Malcolm Gladwell, covered this and other issues affecting pharmaceutical pricing in a 2004 article. It's an even-handed article, worth reading the entire piece -
the one relevant to me on a daily basis is zyrtec/xyzal -- xyzal is just zyrtec filtered for the correct chiral form, but the prescription is cheaper than the OTC for me thanks to my insurances' rules.
Well, some patients can't take Crestor because of a rare side-effect, so they switch to Lipitor and are happy. You have to remember that patients have individual needs and sometimes what looks like two identical drugs actually provide a benefit to the patient.
Name calling is not a pleasant or productive way to debate a complex issue.
It's not easy, and trying to create property artificially is hardly 'barbaric', even though it has its drawbacks (unfortunately, so do all the other solutions).
Now, you may not see the barbarism clearly or at all. But that merely explains why you don't why calling it barbarism.
Calling people barbaric for disagreeing with you is not really ok in this community.
Turns out this classifies most innovation ever.
Patents are neo-feudalism.
If you think "I thought of it and no on else did" is not worthy of being protected property then that is fine and you can make that argument and I wouldn't necessarily argue against you, but I don't think it is accurate to solely argue against patents by characterizing them solely as protection against random other people independently coming to the same idea without the original inventor affecting them at all.
So there are billions of people in the world who are left without medication or use wrong medication because of intellectual property licensing and pricing issues. This leads to unnecessary suffering and other bad things like antibiotics overuse (particularly in India) and drug-resistant strains of deceases.
People can die during this time because they can't afford the drug.
A possible solution:
1. Add to drug patents a compulsory license, allowing anyone to make the drug provided they pay a royalty determined by statute to the patent owner.
2. This royalty rate would be low enough that the generic drugs are cheap--maybe 5 to 10% more than they would be if there was no patent.
3. This would make it harder for the patent owner to recover their costs over the life of the patent. We want them to recover their costs (and make enough to finance developing more drugs) so need to do something to counter this. We can do this by making the patent term longer for drug patents. Instead of 20 years, make it something like 50 years or 75 years or even 100 years.
We all win with this. The drug companies (as long as they are in it for the long haul) make money when they put in the effort to develop new drugs, but the patients get the drugs at an affordable price right away instead of waiting 20 years.
R&D is an incredibly risky proposition. The drug company I worked for had a success rate of 0.69%. That is, less than one drug that ever entered formal testing in animals, ever made it to market. Note, all the work done up to the point of testing it in animals is a tiny fraction of the overall cost of getting a drug approved.
So combine those two issues. You have an investment that requires huge amounts of capital, typically in the several hundred million dollar range (to get a drug approved). You also have a very low chance of a positive result. What does this mean when you are trying to raise capital? A very large pay out.
If you reduced the return on this investment by 80%+ (which is what you'd do if you added a 5 to 10% royalty to the current generic prices), you'd have all that capital moving to investments with much better risk/return profiles.
I don't have the source available, but I remember reading that of the drug that are approved, only 1/3 of them actually ever make a profit for the company overall. It's the massive blockbusters like Lipitor that not only pay for all the R&D that failed, but also all those drugs that didn't fail, but didn't even break even.
This would be quite a common misunderstanding, and imply that we should focus on reducing these latter-stage costs rather than treating drugs as a special case that really need patents. Can you elaborate?
You are correct in saying that efforts to reduce the costs of failure are paramount to R&D companies. In fact it is a huge focus right now. However, the requirements for approval are growing in size, so it's somewhat of a one-step forward, two-steps back deal.
Based on your experience, is it the companies themselves who can get these later costs down, or is it entirely dependent on outside parties (regulators - only reduceable by lobbying)?
In the context of the patent debate, it would make more sense for government to grant monopolies/patents where its own policies introduce the costs. Even if these costs do not decrease, because of e.g. public safety, this may actually be quite a nice criterion for things that should get protection.
In the future I think it will be a combination of new technologies that allow drug makers to prove efficacy and safety in a more cost effective way. I also think regulators will soften their hard-line stance on safety (in some areas). The FDA has already started to do this. Instead of saying "that drug isn't proven safe" they are saying "that drug has been proven safe, but it helps a lot so maybe we'll allow the drug company to sell it to a few patients until we get more data".
The current drug patent system isn't the best way to incentivise R&D investment, but all the other options out there seem worse right now. You are correct, however, in saying that the costs associated with drug approval are often external to the company (the FDA). So when you pay $300/month for a new drug, a lot of what you're paying for is an assurance of efficacy and safety (and the gov't agency that assures it's done right).
Note that pharma companies already try to do this (because price discrimination does maximize profits), but they break pricing down by country. Countries with low per-capita income are charged less. But this neglects low-income people living in high per-capita income countries like the US; just because you live in the US does not mean you can afford the highest price. A pricing system based on individual incomes would solve this.
Furthermore, individualized pricing would help to limit the offshoring of jobs. Consider that an auto worker in the US has to pay the full US price for medication, but an auto worker in China only has to pay the price in China, which is undoubtedly lower. Therefore, the current system of nation-based pricing distorts economic incentives and unnecessarily encourages the offshoring of jobs. But a system of individual income-based pricing would correct this, and make US auto workers more competitive with their foreign competition.
Now the voting public could say that a drug was important enough that it should be funded via tax dollars.
This ambiguity is bad in itself. You might not like the chemical patent, but at least you'll know for certain whether you infringe it or not, which saves a lot of court battles.
I'd love to see him be our champion for sanity for this system (since our squabbling legislature can barely keep us from defaulting on our debt, let alone tackle patent reform), but this just seems to draw a huge target on his back for complaints of "judicial activism."
1. They disagree with a court decision.
I don't think it makes a measurable difference whether he draws a huge target on his back or not.
I would hope as a professional judge he would have a strong interest in law. Naturally he'll have opinions about it, whether he talks to the press after the case is over or not. So long as the written court opinion cites the law as it is now, I actually like having personal opinion added later.
Professionally, judges have to think about what harms people and what serves their interests. There's no way a human judge could avoid having this spill over into thinking how laws harm people and serve their interests.
It's convenient that I agree with his opinion, but I'm a little uncomfortable with the way he's going about things.
If there is a real disagreement between law and what the judge thinks is right they should rule in favour of the law (but grant sanctions etc. as close to just as possible). He/she can then publicly complain about the law or run for congress to change it.
Please note that I am in favour of what the Judge has said but think that if his ruling stands it is a big change in the law and it is the wrong way to do that.
If party A has a valid patent party B must license or work around. I don't understand why it would be just for party A to have to prove actual damages. That they have been denied license fees OR elected not to license to retain exclusivity is surely evidence it self of damage.
Had the judge taken one look at the patents and declared them obvious and lacking novelty And given the Patent Office an earful I would fully have approved but to me he seems to have said even valid patents are only enforceable in limited conditions which should be set out in law.
It is difficult to overestimate our combined ability to reverse engineer virtually any type of product made these days and in that sense patents aren't very useful anymore relative to their original purpose.
Easily reverse-engineering products makes the initial purpose even more necessary.
Modern patents don't work this way. Seriously, who reads patents to learn who new inventions work? I'm sure there is someone who does but mostly they are just dense legal mumble-jumble. Also, it seems most of them are totally obvious that don't need a detailed explanation of the "invention".
I do sometimes, actually. But you're right that it's not a very understanding-conducive format. They're more concerned with making sure the claims are watertight than making sure the public can figure out what's going on in them.
As far as software patents go, if their claims are "watertight" it must be in some technical legal realm that is utterly removed from the field of invention. As software designs, the vast majority (that I've seen) are risible.
For this reason, a lot of companies I've worked for have had a blanket policy requesting that software developers never read patents, especially in areas the company is working in.
Of course the fact that you can very easily violate many patents without having ever read them is just more evidence that the patent system isn't currently serving a useful purpose for anyone but patent trolls and lawyers.
The reversion to a use of trade secrets, at least in software (because patents are largely unenforceable), is recreating some of the issues that patents were intended to avoid. In my own area of computer science, the private state-of-the-art is at least half a decade ahead of academia. This was the situation that patents were intended to avoid.
In the jurisdiction relevant to this article (i.e. United States) the original intent was to promote progress.
Good to see this one mentioned. Most people seem to forget that the original intent for all "IP-laws" originally was to broaden the public knowledge and to ultimately benefit the public.
That private entities was incentivized with limited monopolies which they could use to profit was merely a means, not the goal. These days everyone takes for granted that the means is the goal and the original goal is long forgotten.
If the original intent hadn't been forgotten as well as it has at this point, I doubt we would have seen the massive expanse of "IP-laws" which we have seen these last decades. Heck, back in the days there was no such thing as "IP". People were rational enough to realize there is no such thing as "intellectual property" which you can possess in a meaningful way.
Copyright law, patent-law and all these "IP-laws" should be reverted back to their original intent. Unfortunately that is not going to happen.
The US has way too much invested in so called "intellectual property" to go back on this now. Look at the US these days. What brings in the money? Traditional industry? All gone. Manufacturing? All outsourced.
In fact all the US has left of value is "intellectual property". Think Microsoft, Apple, Google and Hollywood. Now imagine the current US without the likes of those, or a world where their "property" could be had by anyone at no cost. Where would the US be then?
For all the bad things IP laws brings about (and don't get me wrong, I do think they are bad) there is a reason the US (and mostly the US) is pushing so hard on copyright-law and patent-law and trying to divert us from their original intent by instilling the idea of "intellectual property" as a legitimate one in the public mind.
Right now, this so called "intellectual property" is the only thing the US have left.
Many patents these days get the best of both worlds. We give them that monopoly and they give not a thing back. I say if we're to have software patents, they need to all include working code. If the code doesn't produce your patentable idea, no patent.
Epstein on Property Rights and Drug Patents http://www.econtalk.org/archives/2007/02/richard_epstein.htm...
Boldrin on Intellectual Property
Blakley on Fashion and Intellectual Property
Pharma is a different beast, it's much more difficult to have a low-bar pharmaceutical, usually by the time the work is done the medication far exceeds the threshold of patentability. (Patent exploitation does still happen, as others have pointed out with insincere drug enhancements.) It's not about regulating specific industries(which would be exploited), but rather about raising the bar on what is indeed an original invention.
The blame for this mess lay on the USPTO. The patent system is being run like a commercial entity. A granted patent will attract over $5,000 in fees to USPTO, a rejected patent will only garner $125, with much of the granted fees attributed to curiously undefined 'maintenance' cost.
I'd like to see some organized demonstration and resistance from Silicon Valley to this new Silicon Valley Patent Office. Patents are a toxic waste polluting our tech economy, and the feds have decided to increase the flow of pollution.
The cynic in me says that this is bureaucracy 101, where the bigger the problem, the more staff you need to solve it, the more staff you need to manage, the more important you become.. ergo the answer is to exacerbate the problem rather than solving it.
I've also heard that they don't get paid for appeals, so rejecting a patent is more work than accepting it, which could also be shaping the landscape.
Either way something is seriously messed up in the US patent office and it's effecting the world in a bad way.
The patent system needs to balance the need for an incentive to invent, with the goal of maximizing quality of life. The current state of the American patent system stagnates society on multiple levels:
1) Patents, in too many cases, are a prohibitive barrier to entry for entrepreneurs. We have a system in which entrepreneurs know that if an adequately wealthy corporation were to knowingly file frivolous patent lawsuit, the cost, time, and energy to defend such a lawsuit could threaten the life of a fledgling business. Such a system can only have a chilling effect on entrepreneurship and economic growth. Trying to improve the world should -not- feel like walking on a minefield, and until that is fixed, our economy is not receiving the full benefit of its entrepreneurs.
2) Another inventor may be able to use a patented idea as a component for a broader, more useful (patentable) idea. A patent holder should not be able to prevent the development of innovations based upon their own.
3) In many cases, the inventor is not the best producer of his own invention. Society, as a whole, is best off when the best inventions can be produced by the most capable producers, and a patent holder should never be able to prevent this optimal economic arrangement.
American society generally values creativity far more than productivity, as reflected not only in its patent system, but in its popular culture, heroes of industry, etc. But in terms the health and sustainability of society, and economic output, productivity is at least as important. If Americans don't collectively acknowledge this, broader economic, and ultimately geopolitical, consequences will continue.
As a minimal solution to reverse these trends, I would suggest that patent holders be stripped of the ability to prevent others from being able to use their ideas in a product, but should be able to retain the ability to charge reasonable royalties. Thus, our society may be able to approach a healthier balance between its need for innovation and production.
How many ridiculous software patents do you think something like a common smartphone must infringe on. If you infringe on 100 patents ("ability to tap on icon", "drag gesture to move things", "method for turning down volume", etc.) that's a $5.00 cost per phone. A low end phone may only cost $200 unsubsidized. If you only make $30 per phone, that's over 15% of your profits.
The core issue still exists. None of this would be as much of a problem if software patents were required to be much better defined and extraordinary, were granted faster, could be invalidated with prior art or independent invention, didn't last as long, and there was some sort of damage limit.
Right now, if the iPhone infringes on some patent that objectively covers 0.02% of the software on the phone, the patent holder can still go after tons of money. The damages aren't tied to the utility.
If Apple won the slide to unlock patent, and (due to the scope) could only win $0.001 per Android device sold... would they have still done it? What if (again, due to scope) they couldn't get an injunction on something so small?
Valid patents are meant to grant the owner an exclusive right to manufacture or licence the technology described. Until this case I've not heard the theory that you can commercially use the patented technology without a license if the other side can't show damages.
In my view Google should have been given a little time to work around the patent but to have been required to do so. Actually the only way the law is going to get changed is if it properly enforced and its ridiculousness is made obvious to the public.
I think patents should only be for actual products, something you can hold in your hand. People like Apple trying to patent things like slide to unlock are idiots, you shouldn't be able to patent a movement.
As it has been shown many times, software patent litigation is a joke. Patent something real or GTFO. Look at people like James Dyson the dude has tonnes of patents all mostly on real products and techniques for doing unique things in the case of Dyson suing for competitors stealing his patented methods of cyclonic vacuum cleaners that's a real patent lawsuit right there, not arguing over whether or not a swipe is a zero length touch.
ETA: They argued non-infringement.
And Google didn't argue invalidity because they agreed (to streamline the trial).
(Yes, I know Posner is an appellate judge. He was sitting by designation as a trial judge in Apple v. Motorola.)
I'm inclined to accept grellas' assessment that Posner's court opinion was on solid ground: http://news.ycombinator.com/item?id=4086642
Good luck with that, USA.
 Ok, not strictly true. Other strategies can dominate under certain conditions (finite and pre-known number of iterations, possibility of signal error, etc) but I don't feel that those conditions apply in this case.
Also, don't correct people with 'you do realize' because it makes you seem like an asshole.
It's the fashion industry.
It moves at a breakneck pace. Nobody claims the fashion world is dying or moving too slowly because of lack of legal monopoly protection. The competition is fierce, and consumers are rewarded with many great options.
I'm sure other industries would do fine without patents.