[Ip-health] compulsory license boosts Abbott profits

[Benjamin Krohmal]

Two weeks ago, Abbott announced that it would retaliate against
Thailand's compulsory license of Kaletra by denying lifesaving drugs
to Thai patients.

But Abbott didn't complain in 2005 when it was awarded a compulsory
license of Boston Scientific's patented stent technology that is now
poised to generate huge profits for Abbott.

 From CNN Money, 3/27/2007: "Boston Scientific Corp.'s stock slid to
a 4-1/2-year low Monday while shares of Abbott Laboratories Inc.
jumped after a study showed Abbott's drug-coated stent was better at
treating clogged heart arteries."

Abbott shares reached an all time high yesterday based on promising
clinical findings on its Xience V heart stents.

But how did Abbott get so far with drug-coated stents?

As James Love reports in his research note on examples of compulsory
licensing:

<In 2005, the FTC ordered a compulsory license of Guidant=92s
intellectual property surrounding the RX delivery system for Drug-
Eluting Stents (DES) as a condition of Guidant=92s acquisition
by either Johnson & Johnson or Boston Scientific.  Boston Scientific,
which eventually won the bidding to acquire Guidant, was required to
license DES patents to a potential entrant,
Abbott.>

Apparently government interventions to allow competition and lower
prices on patented goods are acceptable when they make Abbott rich,
but not when they save the lives of poor people in developing countries.





The FTC statement on requiring the stent license:
"Under the terms of the order conditionally approving the
transaction, Boston Scientific and Guidant are required 1) to divest
all assets =96 including intellectual property =96 related to Guidant=92s
vascular business to a third party, enabling that third party to sell
drug eluting stents (DES) with the rapid exchange (RX) delivery
system, percutaneous transluminal coronary angioplasty (PTCA) balloon
catheters, and coronary guidewires on requiring licensing of the
stent;"  The "third party" was Abbott.
http://www.ftc.gov/opa/2006/04/bostonscigui.htm

James Love. KEI Research Note 2. "Recent examples of the use of
compulsory licenses on patents"
http://www.keionline.org/index.php?option=3Dcom_content&task=3Dview&id=3D30