The Legal Ecology of Resistance: The Role of Antibiotic Resistance in Pharmaceutical Innovation

Abstract

Antibiotic effectiveness is a common pool resource that can be prematurely depleted through resistance. Some experts warn that we may face a global ecological collapse in antibiotic effectiveness. Conventional wisdom argues for more intellectual property rights to speed the creation of new antibiotics. Recent theoretical literature suggests that conservation-based approaches may yield superior results. This Article describes a novel typology for organizing these emerging theories, and provides an early empirical test of these models, using proprietary data on the sales of vancomycin, an important hospital antibiotic for the last three decades.

The results challenge the assumptions in several models, and will force a reevaluation of the role of intellectual property rights in antibiotic resistance and conservation. In particular, insurance reimbursement may be a more effective policy lever than patent law to preserve antibiotic effectiveness.

Keywords: antibiotic, antimicrobial, resistance, pharmaceutical, innovation, intellectual property, patent, reimbursement, MRSA, public health

JEL Classification: H41, H51, I18, K11, K19, K32, K33