Level Of Patent Protection Research Articles

Patent protection for complex technologies

We analyze patent protection with sequential and complementary innovation. We argue that in these cases the classic Nordhaus trade-off between innovation and static monopoly distortions is different from the case of isolated innovations. We parametrize the degree of innovation sequentiality and complementarity and show that the optimal level of patent protection increases with both. We also address the issue of the optimal division of profit among different innovators.

Measuring cross-country heterogeneity in the value of patents based on the patent-trade relationship

ABSTRACT Because of the heterogeneity of the patent protection system and the business environment across countries, the private value of patents varies. Therefore, current approaches that mostly consider the level of patent protection have limitations in capturing the strategic value of patents. This paper suggests a new approach for estimating the perceived private value of a patent in a country by considering the scale of trade in the United States, Europe, China, Japan, Korea, Brazil, India, Canada, and Russia. The results indicate that the value of patents in a country changed over the sample period, regardless of the level of patent protection, suggesting that changes in the strategic business value of patents played a key role in the value of patents in those countries.

The Deterioration of Appropriate Remedies in Patent Disputes

The Deterioration of Appropriate Remedies in Patent Disputes

WIPO’s Role in Procedural and Substantive Patent Law Harmonization

This Chapter, part of a book examining the history of the World Intellectual Property Organization (WIPO), focuses on WIPO’s activities in the patent realm. The Chapter begins with a description of the successful procedural initiatives undertaken by WIPO and its administrative predecessor, the United International Bureaux for the Protection of Intellectual Property (BIRPI), notably the development of the Patent Cooperation Treaty, the Strasbourg Agreement, the Budapest Treaty, and the Patent Law Treaty (PLT). It then considers the less successful substantive efforts of WIPO and BIRPI to raise the level of patent protection, notably through the failed attempt to revise the Paris Convention in the 1980s and, later, in negotiations over a Substantive Patent Law Treaty. We argue the lesson to be learned is that when a regime governs a single area of law (in this case, intellectual property), especially one that is closely tied to health, safety and economic growth, it is not possible to achieve substantive gains without giving due consideration to the interests of all relevant parties. We end more optimistically by asking whether recent developments provide the basis for a renewed attempt to craft a better harmonized normative framework. In addition to the effort to raise substantive standards, these include an interest in procedural mechanisms to facilitate transnational litigation involving intellectual property rights, concerns about the adequacy of defenses and limitations, and a desire to recognize new kinds of intellectual contributions, such as traditional knowledge and genetic resources.

Patent protection and threat of litigation in oligopoly

In a context of imperfect patent protection, this paper analyses the strategic use of patents from a novel perspective; patents are seen as a means available to the incumbent firm to control entry and, more importantly, to influence the post-entry market interaction process effectively, by creating the conditions that favour collusion. The level of patent protection chosen by the incumbent affects the likelihood that a potential entrant will be found guilty of patent infringement. This mechanism can operate as a punishment device that eases the conditions for collusion sustainability. Therefore, in a sense, patent protection can be regarded as an instrument allowing replication of the monopoly outcome in the context of a contestable market.

Активізація інноваційного розвитку соціально орієнтованих економік Білорусі та України: проблеми та чинники

The purpose of the article is to study and highlight the main problems and factors characterizing the innovative development intensification in the socially oriented economies of Ukraine and Belarus, and to suggest the ways to eliminate the causes of hindering this intensification. Taking into account the correlation-regression analysis results and the characteristic features of the structural elements of the innovative development index of Ukraine in 2007-2017, we have identified the main problem and a significant factor hindering the innovative activity in the economy, namely, “innovative products sales in the industry”, i.e., the low level of commercialization of the scientific and technical activity results, caused by a low level of patent protection and patent research. The analysis of marketing and patent research in Ukraine shows the necessity to perform a number of the following tasks: 1) to adopt the national standard of Ukraine titled “Patent and Market Research”; 2) to introduce changes to the DSTU 35-75-97 “Patent Research. Basic Provisions and Procedure”, which is the national standard for implementing the process of patent and market research; 3) to adopt the Methodology for Patent and Market research; 4) to eliminate the hindrances for providing enterprises and organizations with modern market and marketing information. Emphasis has been placed on the imperfections in the methodology for evaluating the efficiency of projects related to the innovations implementation, which have recently attracted some interest from businesses. This primarily applies to licenses, as the right to use an invention, industrial design or license can become an object of transference in a specially defined area and during a specified period of time. A methodology for paying for license agreements (contracts, agreements) has been suggested, based on assessing the net present value received from implementing licenses, which determines the cost of licenses and operating costs paid to authors from the license income during the time agreed under the contract. This will intensify the businesses’ innovative activity and create appropriate conditions to develop the socially oriented economies of Belarus and Ukraine.

Imperfect patent protection, licensing, and willingness to pay for the innovation

This article analyzes the ways in which imperfect patent protection affects patent holders’ licensing decisions, firms’ willingness to pay for the innovation, and social welfare. We consider a cost-reducing innovation by either an incumbent or a (potential) entrant. According to our analysis, when patent protection is high enough, the entrant is willing to pay more compared with the incumbent, it licenses the innovation exclusively, and it acts as a non-practicing entity. In the case of low patent protection, the threat of imitation discourages licensing agreements, and consequently, the incumbent ends up investing more. Thus, the level of patent protection impacts the structure of the market, affecting R&D appropriability and social welfare.

PATENTS AND GROWTH IN OLG ECONOMY WITH PHYSICAL CAPITAL

We study the implications of patents in an overlapping generations model with horizontal innovation of differentiated physical capital. We show that within this demographic structure of finitely lived agents, weakening patent protection generates two contradicting effects on innovation and growth. Weakening patent protection lowers the (average) price of patented machines, thereby increasing machine utilization, output, aggregate saving, and investment. However, a higher demand for machines shifts investment away from the R&D activity aimed at inventing new machine varieties toward the formation of physical capital. The growth-maximizing level of patent protection is incomplete. Shortening patent length is more effective than loosening patent breadth in spurring growth, due to an additional positive effect on growth, that is decreasing investment in old patents. Welfare can be improved by weakening patent protection beyond the growth-maximizing level.

On the trade, growth, and welfare effects of intellectual property rights protection

To examine how intellectual property rights protection affects trade, growth, and welfare, I develop a two‐country R&D‐based growth model in which final goods firms in both countries determine the range of imported varieties in the overall use of intermediate inputs. I show that strengthening patent protection in either country increases the range of imported varieties of intermediate goods and stimulates economic growth in the country that strengthened patent protection. Moreover, I also show that the Nash equilibrium level of patent protection is stronger than the globally optimal level of patent protection.i

Patent Protection and Threat of Litigation in Oligopoly

In recent years, the increasing awarding of patents has captured the attention of scholars operating in different fields. The economic literature has studied the causes of this proliferation; we propose an entry game focusing on one of the consequences, showing how an incumbent may create a patent portfolio in order to control market entry and to collude. The incumbent fixes the level of patent protection and the threat of denunciation reduces the entrants expected profits; moreover, if the entrant deviates from collusion, the incumbent can strengthen punishment suing the competitor for patent infringement, reducing her incentive to deviate. Our analysis suggests that antitrust authorities should pay attention to the level of patent protection implemented by the incumbent and note whether the holder of a patent reacts to entry by either suing or not suing the competitor. In the model, we use completely general functional forms in analyzing the issues, and this allows us to obtain general results not depending on the assumptions about the kind of oligopolistic competition.

Effects of patent protection on economic growth and welfare in a two-R&D-sector economy

This paper examines the effects of patent protection in a growth model, where final goods firms and intermediate goods firms engage in R&D. The results show that: (i) strengthening patent protection is likely to increase the technology level of the final goods sector relative to the intermediate goods sector in most cases; (ii) if R&D productivity in the final goods sector is lower than that in the intermediate goods sector, the relationship between patent protection and economic growth is an inverted-U shape; and (iii) an increase in R&D productivity in the intermediate goods sector can reduce the welfare-maximizing level of patent protection.

The Impact of Patent Protection on Outsourcing Decisions by U.S. Manufacturing Firms

Many countries have strengthened their patent laws over the past 20 years as they have implemented their WTO intellectual property obligations. This benefits American firms, many of which lobbied for the establishment of enforceable intellectual property rights within the WTO framework. It is often assumed to be unambiguously beneficial for American workers at these firms. However, it may be that American workers who produce goods embodying patented technology were better protected when the level of patent protection offered in the U.S. was higher than that offered in countries with lower production costs. The rationale is straightforward – firms that rely on patent protection may have been more inclined to produce domestically when producing overseas was more likely to result in intellectual property theft and competition from infringing goods. As intellectual property protection strengthened in countries with lower production costs, outsourcing may have become more feasible.This paper tests the hypothesis that U.S. firms have been more likely to outsource production of patent-intensive intermediate goods from countries with stronger patent laws. A series of regressions demonstrate that this was indeed the case for three broad patent-intensive industries between 1997 and 2010, a time when both the strength of intellectual property rights and outsourcing were on the rise. Controlling for variables related to factor costs, gravity model determinants, and institutional quality, as well as time, industry, and country fixed effects, an increase in a country’s score on the Ginarte-Park Patent Index was associated with a significant increase in U.S. imports of intermediate goods from that country. The degree to which patent protection affected these trade flows differed by industry. As individual countries adjusted the level of patent protection they provided during this time, firms in those countries found themselves shipping more intermediate goods from these industries to the U.S.

THE RISKS AND POSSIBLE CONSEQUENCES OF THE LIMITATIONS OF PATENT RIGHTS IN THE PHARMACEUTICAL SECTOR

The Federal Antimonopoly Service made a proposal to extend the compulsory licensing to pharmaceuticals. The author of the article proves that the legislative initiatives of our Antitrust Service can have strong side effects on our pharma industry. She examines the interrelationship between the issuance of compulsory licenses for essential medicines and the influx of FDI, incentives of «Big pharma» to register new drugs in countries with a low level of patent protection.

Patenting Activity - A Proxy of the Technology Gap? The Case of Korea and China. Intel Prop Rights

Technology is a key factor shaping economic growth. The technology gap between countries can be seen as a consequence of the disparity between patent protection levels and patenting activity. Technological progress depends on both domestic and foreign stocks of knowledge, the national infrastructure and the social institutional system. This paper discusses the extent to which the technology gap may be narrowed by strong levels of patent protection. The underlying premise to be assumed throughout is that patent rights have the power to influence the creation and diffusion of technology. As the importance of appropriability under many legal system increases, having a coherent strategy concerning intellectual property rights is crucial, both at the business and national levels. By considering data pertaining to patents, patenting activities, and social infrastructure, gathered from a number of sources, including IMD, World Bank, WIPO, and the Korean and Chinese national archives, this paper will focus on exploring the possibility that patents or patenting activities could serve as indicators forecasting the rate of adoption of new technologies within a country, whilst at the same time acknowledging some of their limitations in functioning as a proxy of the technology gap between countries.

TRIPS and Article 27.1

The member countries of WTO have to abide by the rule of TRIPs which all the member state does as it is mandatory. But the TRIPs criteria are too strict to be implemented by all the member states equally. Thus there are exceptions, over compliance, textual silence and flexibilities provided by the TRIPs agreement for the countries to frame their national laws as per the need of its society but in compliance with TRIPs. Therefore it is the choice laid on the country to abide by the TRIPs strictly or have a lenient implementation of it. When it come to the interpretation of the term “inventive step” TRIPS provides a flexibility by not define the term. It is left on the various countries to interpret the terms according to its convenience. The World Trade Organization (WTO) Trade Related Aspects of Intellectual Property Rights Agreement has set out a minimum standard in order to protect intellectual property which included patent for pharmaceuticals has been criticized by various countries because it resulted in the increase level of patent protection on drug prices. The TRIPS Agreement has become an important tool in order to standardize the protection of pharmaceuticals in the world and this is actively sought by government of developed countries and also by big pharmaceutical companies. The Agreement consists of various IPR issues in a manner that no international convention had dealt with previously including both substantive and enforcement rules in some area with considerable detail. The article is an effort to search for a concrete guideline when it comes to interpretation of “inventive steps” and focusing on different countries implementing it.

Imperfect Patent Protection and Innovation

We present a model of process innovation that offers an explanation for the negative relationship between patent strength and R&D investment. We show that under the popularly used damage rule of reasonable royalties, the innovator might favor imitation. Since imitation is discouraged for strong levels of patent protection, we find that R&D investment is often maximized for an intermediate protection level. In addition, an increase in patent protection can enhance the innovator's reliance on damages. This, in turn, can reduce the innovator's incentives to pursue R&D because the compensation is not directly linked to the size of the innovation. These findings have an important policy implication: when the equilibrium investment is below the socially efficient level, a further reduction in investment as a result of stronger protection decreases social welfare. Furthermore, we observe instances in which overinvestment occurs in equilibrium. In this case, if stronger protection generates more R&D investment, a socially desirable policy calls for weaker patents.

Imperfect Patent Protection and Innovation

The paper studies the effect of strengthening protection on R&D incentives in the context of process innovation. It shows that for non‐drastic innovations, that do not render the pre‐existing technology obsolete, the innovator might favor imitation if the expected royalty rate determined by the court is sufficiently high. Since imitation is discouraged for very high levels of patent protection, R&D investment is maximized for an intermediate level of patent strength. This finding provides a theoretical explanation for emerging empirical evidence questioning the effectiveness of strengthening protection on innovation incentives. It also serves as a justification for the imperfections of the existing patent system that allows for some infringement.

Patents in TRIPS-Plus Provisions and the Approaches to Interpretation of Free Trade Agreements and TRIPS: Do They Affect Public Health?

The proliferation of regional or bilateral FreeTrade Agreements (FTAs) has seen the adoption of an increasing number of TRIPS-plus measures to provide heightened levels of intellectual property protection. One implication is that protection of public health may be affected if access to medicines is restricted by the relevant patent provisions in these TRIPS-plus provisions. The interpretation approach adopted by WTO has led to an understanding of TRIPS in a manner supportive to public health. Many FTAs have established their own interpretation approach that will also impact on issues concerning access to medicines and public health. The patent provisions in the TRIPS-plus provisions seem to cause conflict between the protection of public health in TRIPS and that in TRIPS-plus regimes if higher levels of patent protection are adopted in FTAs. This article analyses the relationship between the approaches to interpretation of TRIPS and TRIPS-plus and discusses the impact of this interpretive relationship. This article examines the object and purpose of TRIPS and its subsequent developments for the interpretation of TRIPS-plus. This article then discusses the justification of heightened patent protection in the TRIPS-plus and the justification narrative upon the interpretation of the patent provisions in FTAs. This article then concludes that the interpretation of the patent protection provisions in the TRIPS-plus should be conducted with reference to TRIPS and its subsequent developments in order to harmonize TRIPS and TRIPS-plus in the context of public health protection.

Welfare effects of patent protection and productive public services: Why do developing countries prefer weaker patent protection?

This paper examines the welfare-maximizing degree of patent protection in a growth model where the engines of economic growth are R&D and public services. The result shows that if public services are small, the welfare-maximizing level of patent protection is weaker.

Understanding Current Trends and Outcomes in Generic Drug Patent Litigation: An Empirical Investigation

This thesis examines the role of patent litigation in the generic drug approval process. Generic drug companies wishing to enter a brand-name drug market early may challenge a brand-name’s patents by filing for an Abbreviated New Drug Application (ANDA) with a paragraph IV certification. While anecdotal evidence on the characteristics of paragraph IV lawsuits abound, there has yet to be a comprehensive study on these unique cases. Leveraging a new dataset of district court cases, this thesis presents an empirical investigation into some of the current trends in generic drug litigation from January 1, 2006 to August 1, 2011. Using several basic econometric specifications, I study the determinants of settlement and other outcomes in these cases, observing that factors such as declaratory judgment, the size of a pioneer company, the level of patent protection, and remaining exclusivity may be significant factors.