How Patents Harm Biotech Innovation

from the scaring-people-off dept

Patent defenders often claim that patents are necessary because top venture capitalists would never invest without patents. And yet, we keep pointing to examples of some of the best venture capitalists in the business who are quite skeptical of patents. For the most part, those have been limited to software patents, but Brad Feld seems to have jumped the hurdle to recognizing it's not just software patents that are the problem, and is digging into the research on how much patents have held back innovation in lots of other fields as well (Brad: if you want a list of more such research, let us know...). He's written up a post about some upcoming research concerning patents in the biotech field, where he explains how patents are hindering innovation in that field as well by scaring off research into certain areas:
Regularly, patent advocates tell me how important patents are for the biotech and life science industries. However, there apparently is academic research in the works that shows that patents actually slow down innovation in biotech. The specific example we discussed was that there is increasing evidence that when a professor or company gets a patent in the field of genetics research, other researchers simply stop doing work in that specific area. As a result, the number of researchers on a particular topic decreases, especially if the patent is broad. It's not hard to theorize that this results in less innovation around this area over time.
I can't wait to see the final results of that study, as it would fit in well with a few other studies that have found similar results.

Filed Under: biotech, brad feld, innovation, patents, vcs

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  1. icon
    Ronald J Riley (profile), 8 Feb 2010 @ 3:42pm

    Re: Re: Patentees Make Staggering Investments

    "It would be simply stupid to risk major legal costs (and more importantly the interruption of your ability to deliver product or service) when you could buy out the inventor reasonably easily. You do not get to be a company the size of Microsoft or Google by being that stupid."

    If you understood the history of this then you might understand had the we can steal whatever we want corporate culture came to be.

    From the 1920 through the 1960 time frame large corporate crooks owned the courts and not one patent was upheld for small entities. They loved venue then. Decades of being able to take what they wanted with total impunity led to a very nasty culture developing in large companies.

    Today these companies can steal up to $10 million at a time without being held accountable because of the cost of having one's day in court. From ten to a hundred million they have a fairly good chance of getting away and it is only over a hundred million that they are certain to have their day in court.

    At this point companies are stealing billions of dollars every year and only occasionally facing a $500 million dollar judgment. This kind of crime does pay.

    This matters to you because they are undermining every developed country's economy resulting in more job loss and less job creation.

    Ronald J. Riley,

    I am speaking only on my own behalf.
    President - - RJR at
    Executive Director - - RJR at
    Senior Fellow -
    President - Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (810) 597-0194 / (202) 318-1595 - 9 am to 8 pm EST.

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