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2016-02-05 -Lurid Crime Tales-

Pharma Execs Worry About Presidential Candidates Demanding Reform

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Posted by Sven the pelter 2016-02-05 00:00|| || Front Page|| [2 views ] Top

#1 It's been some time since I practiced but ....

The patent timeline is only going to get more negative from here on out. Until a couple of years ago the US, alone, utilized a "first to invent" system. However a couple of years ago our illustrious political masters implemented a longstanding dream of our European and Asian competitors and "harmonized" the US system with the rest of the world by adopting a "first to file" system. This incentivizes earlier and more frequent filings.

In light of the rather extraordinarily protracted timelines involved in bringing new drugs to market, thanks largely to our hyper-regulatory state and the unlimited liability to which we subject pharmaceutical companies, this incentive to file even earlier will only shorten the effective profitable term of any patents that actually issue for useful compounds. Recall that the term of a patent is presently 20 years from the filing date, itself a worse deal for patent owners than the prior 17 years from issue date regime. Thus, even earlier filing + constantly lengthening lead time to market = ever shortening window in which to recoup one's investment. Which, in turn, leads to higher prices during said shortened widow.

As noted above many single-payer systems simply won't allow new treatments. Other nations regulate the cost to less than necessary to keep the lights on in a third world factory (forget about recouping research costs or meeting FDA manufacturing requirements). Much of the world does not recognize drug or other medical patents. Many of those governments encourage, even actively participate in, counterfeiting. The free rider problem here is as enormous as it is intractable; a few hundred million persons, primarily in the United States, essentially pay the cost of all the world's pharmaceutical R&D.

One cannot have unlimited liability, absolute safety, heavy-handed regulation, a trend towards lessening the financial value of IP and a robust pipeline of new treatments. Sadly, it's the latter that will die while the others march on.

Posted by Halliburton - Foreign Affairs Division 2016-02-05 04:41|| 2016-02-05 04:41|| Front Page Top

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