[Ip-health] Newsweek: Innovation Gridlock. Today's inventors need to put together many bits of IP. Too bad they are all patented.

[Sarah Rimmington]

Innovation Gridlock
Today's inventors need to put together many bits of intellectual
property. Too bad they are all patented.

Michael Heller
NEWSWEEK
>From the magazine issue dated Feb 2, 2009

The first decade of the 21st Century has seen startling advances in
biology. Scientists have cracked the genomes of humans and many plants,
animals and microbes. They've uncovered new cellular processes affecting
inheritance of diseases. Likewise, investment in biotech research and
development has been steadily increasing. So what happened to all the
lifesaving cures that were supposed to come our way as a result?

Big Pharma produces a blizzard of new products, but these are mainly
marketing exercises that often involve little more than tweaks on
existing drugs. New drugs that could lead to improvements in human
health have not been as forthcoming. Drugs that should exist, and could
exist, are not coming to market.

The problem is that now more than ever biomedical invention requires
assembling scattered bits of intellectual property. Because of the
patent system in the United States, that task has become exceedingly
expensive and complex. The idea of granting drug patents is to spur
discovery and cure disease, but a proliferation of patents is having the
opposite effect. It is creating a type of gridlock that is stifling
innovation.

This intellectual gridlock doesn't happen just in the drug industry.
Today most innovation in high-technology fields=97banking, nanotech,
semiconductors, software, telecom=97demand the assembly of innumerable
patents or intellectual property. Next-generation wireless broadband
requires many broadcast-spectrum licenses. Cutting-edge art and music
depend on mashing up and remixing fragments of separately copyrighted
culture. Even the current financial crisis is partly the product of
intellectual gridlock. Mortgages have been pooled, sliced and
securitized to the point that thousands of dispersed owners can block
restructuring of the underlying debts. The story is the same across the
wealth-creation frontier: lost opportunities, lost inventions, lost lives.

The problem is especially acute in the U.S. patent system, as it applies
to biotech. Compared with Europe and Japan, the American system allows
patents on a wider range of subject matter, for relatively less
significant discoveries, and with lower standards for patent grants. The
result: the U.S. Patent and Trademark Office issues hundreds of
thousands of weak, vague patents and has a multiyear backlog of
applications. If you are a U.S. innovator, there is no way even to
figure out who owns rights relevant to your proposed new drug. Usually
we think the sheer number of U.S. patents is a sign of superior
innovative talent and competitive strength. Not so, when innovation
requires assembly.

New drugs remain the starkest victim of this destructive patent
gridlock. This problem started in 1980 when the U.S. Supreme Court began
allowing patents on living organisms. That shift helped jump-start the
biotech revolution, leading to a wave of scientific discovery, including
about 40,000 DNA-related patents. The downside became visible in the
1990s as drug developers began confronting the new patent thicket.

Imagine a drug developer walking into an auditorium filled with dozens
of owners of DNA patents needed for a particular medical breakthrough.
Unless he can strike a deal with everyone in the room, there's no way
forward. Peter Ringrose, former chief science officer at BristolMyers
Squibb, told The New York Times that the company would not investigate
"more than 50 proteins possibly involved in cancer" because patent
holders "either would not allow it or were demanding unreasonable
royalties."

A survey sponsored by the National Academy of Sciences found that
scientists now routinely respond to gridlock by becoming patent pirates,
just like students who illegally download music. Commercial drug
developers, of course, cannot risk disregarding competitors' patents.
Many of the world's leading drugmakers simply redirect investment toward
less challenging areas and innovation quietly slips away. The dearth of
new blockbuster drugs should prod Big Pharma off its longstanding
position that the existing patent regime must be defended no matter what.

Heller, a Columbia Law School professor, is author of =93The Gridlock
Economy.=94

URL: http://www.newsweek.com/id/181310




--
Sarah Rimmington
Attorney
Essential Action, Access to Medicines Project
Washington, DC
Tel: (202) 387-8030
Cell: (202) 422-2687
www.essentialaction.org/access/