Daily Archives: September 7th, 2011

Patent Reform?

To promote the Progress of Science and useful Arts. ~U.S. Constitution on granting Congress the power to issue patents

Patent Reform Refuses To Die, Congress Keeps Cashing In
The patent reform bill cleared the filibuster yesterday – but what a mess. This is not a good bill and has become a case of time is money for those in Washington, which means the people lose again. Harry Reid is now allowing amendments to come in, so after almost a decade of the people’s time and the people’s money, it could go back through the process to pad the pockets of lobbyists and lawmakers once again.

It’s not about the people and it’s not about jobs, although that’s how it’s being framed. It’s a corporate tug of war between the mega-banks, Wall Street, big Pharma and high-tech Titans … and then of course, the Tea Party. The right to divert collected fees seems to be holding up the show for now, but who knows what will happen next?

First to file or First to invent? I think that’s been settled. “First to file” will speed things up and “first to invent” will be protected in the case of disputes, but who has the money to dispute a corporation?

There’s much more to this bill than meets the eye. For the nitty-gritty background, Zach Carter did an excellent job earlier of sorting out some of the real players in The Spoilsmen: How Congress Corrupted Patent Reform, but as biotechnology and GMO’s were not mentioned, I suspect we will be seeing the ramifications over time. “Congress has lost any capacity to piece together these private interests into a public-welfare-promoting change to the patent system,” says Christopher Sprigman, an intellectual property expert at the University of Virginia Law School. “It’s really not about optimization anymore, it’s about which faction is going to win out.”

Today, the patent bill looks like a scorecard tallying points for powerful corporations: a win for pharmaceutical companies whose monopolies are driving up Medicare costs; a win for Wall Street’s battle against check-processing patents; a loss for tech giants who had hoped to curb costly lawsuits.

Left out of the tally is the public, even as the economic landscape for American families grows darker. Historian Richard Hofstadter famously observed that Congress during the Gilded Age busied itself with dividing the nation’s spoils among the rich and powerful. But as the current patent struggle suggests, the spoilsmen are back and Washington is once again an arbiter of who lands the lucre.

If our lawmakers were working for the American people, they might consider separating patent law to give “a different intellectual property model for drugs: direct government-funded research and no patents” as suggested by economist Dean Baker.

“Americans spent $250 billion on prescription drugs in 2009, but would have spent just $25 billion had all drugs been sold as generics, meaning without patent protections. The companies, of course, oppose such a system, since they have no interest in losing the patent money.” Of course they do, because they have forgotten who buys their products and don’t seem to realize that we can’t afford to pay their prices! “The current intellectual property regime is good at protecting drug patents, but not particularly good at promoting public health. The United States is the only country in the world that grants pharmaceutical monopolies without also regulating the price of patented drugs.”

Intellectual property laws do not simply exist to ensure that inventors get rich. The idea is to promote social welfare by encouraging new ideas. A system that fosters a new idea whose benefits are unavailable to most people does little to move society forward. The U.S. Constitution takes an explicitly pragmatic approach, granting Congress the power to issue patents, “To promote the Progress of Science and useful Arts.”

Another idea is from Aidan Hollis, an economist at the University of Calgary, who has proposed a world “Health Impact Fund, which would pay pharmaceutical firms based on the public health value of new medicines. In return, companies would agree to sell their drugs at cost, ensuring the broadest access possible. The plan would require about $6 billion to get off the ground, but would not actually limit pharmaceutical company profits — just reshuffle those profits toward more productive endeavors.”

Under the current bill, “companies also have incentives to develop new drugs that cater to the wealthy. “Tuberculosis, for instance, is incredibly important, but it’s not very profitable, because most of the people who have tuberculosis are poor.”

As populations explode and economies implode, solutions to our problems will continue to require more effort from our legislators than to just ask corporations for a wish list, ramble through it collecting campaign donations for ten years and then call it a jobs bill.

To move forward, to improve the quality of life for Americans and people around the world, we need for our leaders to pay attention to those experts who can and will promote the benefits of creative shifts in thinking. This bill is a poster child for corporate control and government incompetence.