Tuesday, October 2, 2007

The Anticommons?

Reason magazine (oh no! my libertarian tendencies are outed!) has a worthwhile article examining whether the mass of patents in the medical field, such as patents on certain gene tests, are actually proving detrimental to innovation.

Typically, we think of intellectual property protection as encouraging innovation: such legal protection generally allows rents to accrue to the person making the breakthrough, and whether they are modeled through a lower marginal cost, temporary monopoly profits, or whatever, is irrelevant to this dicussion. If you can't protect your invention, everyone else takes it for free, so why would you invest in R&D in the first place.

The concern in medicine (though Reason doesn't make this point perfectly clear) is that there's so much research being done outside of the corporate machine that the private sector's patents are preventing more research in hospitals, universities, and the like, than they are stimulating in the private sector.

Reason argues that the patents have had little detrimental impact:
"Overall, the number of projects abandoned or delayed as a result of technology access difficulties is extremely small (emphasis theirs), as is the number of occasions in which investigators revise their protocols to avoid intellectual property issues or pay high costs to obtain one. Thus, it appears that for the time being, access to patents or information inputs into biomedical research rarely imposes a significant burden for academic biomedical researchers."

They are quoting an NAS report. The problem is not in the projects that were abandoned, but in the projects that were never started. Very few people qualified to do medical research (full disclosure: I am not one of them) are stupid to actually start a project that requires use of a patended, and hence costly or unavailable, lab test, or whatever.

Thus, I think Reason might be understating the depth of the problem. But there's no practical solution I see: decreasing intellectual property protection in the medical sector would lead to ills much, much more severe than this 'anticommons'.

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