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The Law of Unintended Consequences: Patents
An anonymous reader writes "Fortune has an
interesting article about the relationship between patent law and innovation. It compares the biotech industry with the computer industry and discusses the effects of the Bayh-Dole amdendment, which has allowed universities to make a lot of cash. But in the process innovation and scientific collaboration seem to have been stifled."
... is actually a fundamental problem built into all IP law: the assumption that money is the prime motivator for creative endeavors. (And yes, science is a creative endeavor.) This is a myth successfully propagated by generations of moneymen, but a myth is all it is. Scientists, like artists, certainly want to make a living from their work, but the best ones pretty much always do what they do simply because they want to do it, not because they expect it to make them rich. If your primary concern is making money, OTOH, you don't have the time (or, probably, the brainpower; suits who think of themselves as intellectuals because they have an MBA simplye have no idea what goes into a serious scientific education) to become good at anything that constitutes real creative work.
The correlation between ignorance of statistics and using "correlation is not causation" as an argument is close to 1.
While there are certainly areas of crossover, like the algorithms to filter through the volumes of data that biotech firms have, the fundamental difference between bio companies and computer companies is that biotech produces *something*. Computer technology is basically ephemeral. But Biotech leads to medicines and other discoveries that are both difficult to discover and inherently valuable.
It makes sense to cover biotech with patents, as it took significant effort to research and develop those things.
Computer tech, on the other hand, is primarily focused on automating processes. Computers are inherently faster than humans at doing repetitive tasks, especially in regards to calculations. But it is difficult to find a program that implements a process that doesn't exist already in another form, or that isn't blatantly obvious to everyone. Something like developing "a secure mechanism by which encrypted media data is stored on a device and available for playback when read and decrypted by the client application" would probably be a good candidate for a patent. "Users can click once and purchase an item without having to load the shopping cart menu" is both obvious and not really that far removed from the systems that preceded it.
That people get greedy and innovation slows down when companies are competing is just a small side-effect of the patent process.
Jesus saved me from my past. He can save you as well.
Also, if someone wants to question the patent system in biotech, then what's the alternative? Patents have, despite a few cases of misuse, been proven to be the suitable intellectual property rights regime in that field. In contrast, today's leading software companies like Microsoft, Oracle and SAP needed no patents at all during the first 10+ years of their existence. SAP only had a total of four patents a few years ago. It would be too simplistic to say that copyright law alone protects software because it's actually a combination of copyright, trade secrets, complexity, trade marks, and the possibility of converting a technological lead into sustainable economic value (by selling products, acquiring customers, building the brand identity of an innovator). That form of protection is much more dynamic than patents because it requires someone to actually market a product, as opposed to just sitting on a patent and waiting for others to unwillingly and unknowingly "infringe" upon it.
The other issue is who should own the outcome of the research work that is performed with tax money. I don't think it's reasonable to let the public pay twice for the same work, upfront by employing many such scientists for decades in each case (the fewest of which ever come up with something that can be commercialized on a large scale) and subsequently through patent royalties.
From the article.
" A 1979 audit of government-held patents showed that fewer than 5% of some 28,000 discoveries--all of them made with the help of taxpayer money--had been developed, because no company was willing to risk the capital to commercialize them without owning title"
To all those in this thread that argue "scientists will do it for the love" or any of that crap. That sentence above says it all. Scientists might do it for the love, but companies won't pay to develop it. I work at a biotech company - we won't do stuff that won't make us money. We have to pay our salaries. If we do something that we DON'T have patent coverage on, our competition will just copy it at no cost to them... oh yeah - we will have spent A LOT of money to do the development. If we can't get an exclusive license, then for the most part we won't touch it. It WONT make financial sense to do so.
You can preach about "greater good of man" and all that. At the end of the day I just want to send my daughter to college and be able to go surfing. To do that, we have to make tools that help people, and I enjoy being part of that. I love solving the problems. I enjoy working on the projects. BUT - I have to eat and the company has to make money.
Gavin Fischer
As usual, you didn't read the article or get the point.
While Bayh-Dole was about commercialization of products developed with federal funding by universities (not particularly onerous a concept if you accept the basic concept of the state in the first place), the "unintended consequence" was patent legal wars - which are a direct result of there being patents.
And then you have the nerve to talk about pharma - which is exactly the point and example of the article.
RTFA next time.
And yes, you DO pay twice (or X or multiple times X) when the company is granted a monopoly on a drug invented by someone else. The issue - and the point of the problem the article has with Bayh-Dole - is that those with patent monopolies tend NOT to license or cross-license their products - which raises the cost of those products to monopoly rates and limits the spread of the IP - which is supposed to be the point of patents in the first place.
Just because patents are supposed to grant you a monopoly, that monopoly is supposed to be limited in time and subject to the provision that the IP gets licensed to all comers, so invention and distribution are both served.
Of course, it doesn't work that way. Monopoly is monopoly - I get it all, you get nothing. That's how humans work when they can use the coercive power of the state in their favor.
In a TRUE free market, you take your chances and the only thing keeping you from bankruptcy is smarts and speed.
And that's how it SHOULD be - raw evolution in action.
You monkeys just can't handle that, however.
Richard Steven Hack - This sig is TOO GODDAMN SHORT TO DO ANYTHING USEFUL WITH! MORONS!
The problem with patenting algorythms and functions is in the very concept and purpose of computers. Programming languages are basically tools for expressing thoughts. As human toungues are used for expressing speakable words, programming languages are used to implement thinking processes of the mind. Data is non-material, and computers merely receive, process and output data, as human nervous system does. Algorythms are same as thoughts - they are ways of analyzing and processing data.
Patenting physical devices (ever computer hardware) is fine by me, but patenting algorythms is comparable to patenting and restricting ways of thinking. Imagine what would happen if a law ordered people to think (or avoid thinking) in a certain way...
I am not saying that everything on the computer must be completely patent-free. I believe that only unique, sophisticated and unparalleled applications should be allowed to be patented by the US Patent Bureau, for a limited time.
- Matvei M.S
09 f9 11 02 9d 74 e3 5b d8 41 56 c5 63 56 88 c0
Basic academic research is a phenomenally important beast - perhaps the most important component of our long-term economy and the long-term health of our nation. It's impossible to overstate this or to use enough hyperbole here.
And contrary to the tiresome pop-culture tirades, America doesn't have a terrible shortage of scientists. We could use more, sure, but our labs are jam-packed with Ph.D.s and incoming students. In fact, we have a slight overabundance of them, which is reflected in their unappreciatively low salaries.
When I talk to scientists about the factors holding back their research - which I do frequently, in fact, as part of my job - I get a pretty consistent answer.
Grants are getting more competitive. While federal funding overall is growing, it hasn't kept pace with the explosion in life sciences research in labs across the country. Life sciences research complexity and data have experienced Moore's-Law-like rates of growth; just look at the sizes of GenBank and the Protein Data Bank over time. But because all universities are increasingly focusing on federal research dollars (in part because their academic rankings are based on it), it's becoming harder every year to get a grant funded. Scientists must show more data, and argue more convincingly that the research is useful.
Contributing factors:
The federal government has taken a stronger role in guiding research. A growing proportion of federal funds is earmarked for research on specific topics - e.g., AIDS or bioterrorism defenses. This necessarily diverts funds away from other areas of research.
Also, the administrative oversight of federal grants has grown. Universities are now held to much stricter rules about how those federal funds are spent. If a grant proposal indicates that a scientist will commit 40% of his employment to a project, he must actually commit that 40%. Funds must be carefully tracked by university admins - no more "I want to buy a Light Cycler with my unrelated grant money" discretionary BS.
These are real rules, and are strictly enforced. The penalties for violating them include paying the grant money back to the federal government, large penalty fines, and potentially getting barred from future federal funding. As a result, scientists and university admins have to spend tremendous time on administrative tasks - which detracts from research.
Those are the factors that scientists most frequently cite. Surely there are others.
- David Stein
Computer over. Virus = very yes.
From TFA
Universities have evolved from public trusts into something closer to venture capital firms. What used to be a scientific community of free and open debate now often seems like a litigious scrum of data-hoarding and suspicion. And what's more, Americans are paying for it through the nose.
And who's to blame for that? Yup, the good old American system.
The fact of the matter is, America doesn't care about science. We worship things like actors and singers and sports figures and then snub our nose at scientists in academia and pay them crap. Business is the most popular major, not because it provides the most to society, but rather it is the most profitable. In other countries, scientists are looked up to and admired (for example, India).
In the US, the budgets have been cut drastically for academia (most grants are getting a 8% cut straight across the board this past year). Adjusting for inflation, the NIH and NSF budget's have actually shrunk over the past 10 years-- which is ridiculous considering the massive amounts of improvement in technology that have occured. With such a drastic decrease in available funds, researchers need to tighten their projects, search for alternative funding, and be wary of who they tell people what they are doing. Sharing data with someone you aren't collaborating with or on unpublished work is a sure way to find yourself out the door in academia. This is further being complicated by the fact that tenure reviews are starting to shift from the old paradigm of how many papers you published, to a newer paradigm of how much grant money you bring in (while this is usually correllated, it is not always the case).
It's not the scientists that have created the environment, it's the environment that has created the scientists. There's a reason why College Professors were listed as one of the top 5 undervalued professions in America. Patents are the one bone that academia gets and the writer seems to think that scientists are exploiting America. Academia is already losing a lot of great talent (and henceforth, progress) as it is in America due to lack of funding-- how do you think it would be if patents didn't exists?
I personally think you skimmed the article.
However, lets get to the reality of patents. First there is no NEED whatsoever to spend 5 billion to develop a test a drug! 5 billion is 5 billion! The argument that you need so much money to bring out a drug is bogus! The biotech industry can do with less, but because it is so easy to pump the clientel it is done!
I detest patents because they don't promote innovation. Cars became popular because a Mr Henry Ford broke the car patent and mass produced a car! It is possible to earn money in an pure competition world.
The reason why biotech is different is because it deals with the lives of humans, and that is why I don't agree with patenting of drugs. I like capitalism, but bio-tech is a vulture preying on the lives of humans. They say, "Oh you want to live? Well here is a drug, but guess what it is going to cost you!" That, my friend, is very scummy! Again not against those that want to earn money, but reasonable money like all other industries!
I am glad that you mentioned Microsoft. First yeah sure Microsoft copies, but Netscape was not the original maker of the web browser, neither was Eudora, neither was WordPerfect. If you accurately check your history books before Netscape was what Tim Berners Lee wrote, before WordPerfect was Wordstart, and the list continues.
In other words you have proved the argument that by copying we get a vibrant industry! You get real innovation! Because copying is evolution as multiple ideas are combined to create a new idea!
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
Just look at art and science in totalitarian countries. In all former communist countries, you definitely couldn't get rich by doing science, not even in relative comparison to general population. Yet they had a lot of excellent scientists, and produced huge amount of research.
As far as art goes, not only you couldn't get rich, in many cases you could get yourself locked up. Still, all the Soviet block countries had very active unofficial art scenes.
AccountKiller
Wrong root cause--the blame lies with the left and their reaction to the Vietnam War, with their one permanent reform the destruction of basic research in United States universities through the Mansfield Amendment. Just go to the musty bookshelves of one's university to the mathematics section and look for books before 1970. Many of them will have an acknowledgement of funding through some agency such as the Office of Navel Research.
The Mansfield Amendment deliberately destroyed the relationship between the United States military and university basic research, so that instead of getting crumbs from a gargantuan Department of Defense budget, which meant the crumbs were quite substantial, basic research had to rely on the politically castrated National Science Foundation with no important constituency to push for funding.
Faced with the prospect of basic research almost completely disappearing, the only alternative was something similar to Bayh-Dole, because there was no way anymore to politically push through explicit funding. What an irony that now what were once considered public goods are now the property of the largest corporations and the rich only get richer. Now that is the true unintended consequence considering who initiated the Mansfield Amendment.
"If you spent $5 billion developing and testing a new drug, would you let your competitors buy the rights to sell their own versions?"
What part of LICENSING don't you understand?
You license so you can partake of the profits of everybody else selling your invention as well or better than you can yourself.
By not licensing, all you do is stimulate everyone else to come up with a better product - under a different patent - and put you out of business.
Read my lips. Patents don't last. No form of IP lasts. Monopolies that are not coercively protected by the state do not last. If you rely on a patent to make you money, you will shortly go out of business or spend most of your monopoly profits fighting legal battles in court.
Richard Steven Hack - This sig is TOO GODDAMN SHORT TO DO ANYTHING USEFUL WITH! MORONS!
"If you spent $5 billion developing and testing a new drug"
The vast majority of the pharm money is not spent on R&D. It's wasted on marketing, administration and inefficient production.
"But their product strategy is simple reality, owing to the very simple fact that copying is easier than innovating."
The very simple fact is that once you have a monopoly, marketing, lobbying and litigating is easier than either copying or innovating.
The very simple fact is that we're not getting even 20% efficiency out of the monopoly money we're paying.
The very simple fact is that we'd get more than five times as much R&D done for the same money we're spending today if we simply got rid of the patents, paid for the R&D outright and let generic producers run a competetive industry instead.