Economic Benefits Lie at the Heart of Patent Protection, Not Altruism

The ideas that an inventor’s time and investments should be protected and new inventions encouraged through the granting of patents, underlie some of the justifications of our current patent system.  Theorists such as Adam Smith and Jeremy Bentham claim that patents are necessary to encourage invention at no social cost (1).  Professor Heller of Columbia Law School argues that our patent system stifles innovation.  Heller asserts that patent gridlock plays a large role in the development of new lifesaving drugs (2).  Therefore, patent holders ‘block’ innovation, in turn creating the social costs of deteriorating human health and loss of human lives.  Heller suggests that research and development of new drugs that improve human health would increase if the current fragmented patent system is overhauled.  Thus, more lives would be saved through innovation.  Heller’s arguments take for granted one major problem: the invention of new and innovative drugs does not necessarily lead to the dissemination of these products to poor people in developing (“third-world”) countries.

If patent protection was lifted for the purpose of research and development of ‘lifesaving’ drugs, poor people in developing countries in need of these drugs would still suffer.  The lure of economic gain through development of new innovations overshadows the need to benefit society through these inventions.  Thus, commercial drug developers may focus more on the profit that they will gain through the development and marketing of new lifesaving drugs than the aid that these drugs will provide poor people who cannot afford them.  Altruism is not the driving factor for many entrepreneurs who invest in biomedical innovations.

However, weakening the monopoly granted by patents may increase competition and thus reduce the prices of new ‘lifesaving’ drugs.  There is no guarantee that poor people who cannot afford expensive ‘lifesaving’ drugs from provider A, will afford slightly less expensive ‘lifesaving’ drugs from provider B or C.  Heller fails to bridge the gap between the development of new ‘lifesaving’ drugs and the dissemination of these drugs to the people who need them, but cannot afford them.  Heller works under the assumption that new developers will seek less profits and act altruistically in helping distribute their new ‘lifesaving’ drugs, either at low or no costs.  This assumption is flawed.  Discovery of a “new life-saving” drug, does not necessarily mean that the distribution of that drug to impoverished populations will be even.  Thus, even the removal of patent grid locking may not benefit humanity by disseminating these new drugs that may improve human health.  Distribution of these new drugs may be limited, and costs may be the same or even more.  Thus, access of these ‘lifesaving’ drugs remains obscure.

Heller claims that ‘tweaks’ to the patent system, such as changing the formula of determining patent litigation damages and limiting money damages available in patent infringement litigation of ‘low-quality’ patents, would reduce patent gridlocking.  The reduction of patent gridlock does not automatically lead to the rampant dissemination of new ‘lifesaving’ drugs.   The ‘lifesaving’ aspect of these drugs is limited by access.


[1] Vaver, David. Some Agnostic Observations on Intellectual Property. (1990) 6 I.P.J. 125

[2] Heller, Micheal. Where are the Cures? How Patent Gridlock is blocking the Development of Lifesaving drugs. August 11, 2008.