Abstract
As the COVID-19 pandemic is affecting the lives of thousands of people worldwide, the problem of timely access to affordable medicines has intensified today. Based on past experience of accessing medicines for life-threatening diseases there is a justifiable fear that access to any vaccines and treatments that are eventually developed may be hindered by patents, leading to unaffordable prices. In particular, one of the reasons that typically leads to high prices is strategic patenting employed by pharmaceutical companies. While this practice is currently considered lawful, this article argues that strategic patenting requires a long-overdue intervention by competition authorities and aims to attract their attention to its harmful effects. It maintains that, along with a more immediate negative effect in the form of high drug prices, strategic patenting affects dynamic competition by stifling innovation of both originators and generic companies. The article outlines the current approach to strategic patenting and provides arguments for the intervention of competition law. This, in turn, will open the possibility for competition authorities to investigate this practice and prevent its harmful effect on drug prices and pharmaceutical innovation, for the benefit of consumer welfare.
Highlights
As the COVID-19 pandemic is sweeping through the world, thousands of people urgently need access to affordable medicines
Based on past experience of accessing medicines for life-threatening diseases there is a justifiable fear that access to any vaccines and treatments that are eventually developed may be hindered by patents, leading to unaffordable prices
It is argued in this article that, along with the practices condemned by the Commission in the decisions discussed above, strategic patenting can harm innovation by impairing incentives to innovate of both originators and generic companies, and should raise competition law concerns
Summary
As the COVID-19 pandemic is sweeping through the world, thousands of people urgently need access to affordable medicines. It aims to attract their attention to the harmful effects of strategic patenting It will contest the argument traditionally put forward by originator pharmaceutical companies that the intervention of competition law into patenting practices will reduce their incentives to innovate. Originators argue that strong patent protection is essential in order to recoup investments, as well as to incentivise them to engage in further innovation.20 Once such patent protection expires, other companies may develop generics of a branded drug, and start competing with the originator for the market. Resulted in a loss of almost 70 per cent of its market and $2.4 billion in annual U.S sales.24 This effect of generic competition is beneficial for society, as it reduces the financial pressure on healthcare budgets and increases the accessibility of drugs Resulted in a loss of almost 70 per cent of its market and $2.4 billion in annual U.S sales. This effect of generic competition is beneficial for society, as it reduces the financial pressure on healthcare budgets and increases the accessibility of drugs
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