Painting the Swan Black: On the Art of Re-Inventing Inventions

Abstract

The author argues that it is important to distinguish between genuinely innovative 'Black Swans and Swans that are painted Black, referring to the increasingly common practice of making cosmetic or insignificant modifications to existing innovations in order to obtain or extend patent protection. This, the author argues, is especially significant in the pharmaceutical sector, since experience has shown beyond any doubt that a substantial portion of its revenues emanate from incremental inventions as opposed to Black Swans. This is not likely to change either, given the steadily widening gulf between investment in and return from research and development in the industry. The author goes on to identify a concrete mechanism that is conductive to this process of weeding out Black Swans from the impostors -- pre-grant opposition strategy, and argues that its merits for outweigh any possible delay in the process of the grant of patents.

Keywords: Pharma, reinventing drugs, innovation, Investment, pre-grant opposition, grant of patent, blockbuster

JEL Classification: O31, O34