Patents and Appropriation: Concerns and Evidence

Abstract

Spurred on by such reforms as the Bayh-Dole Act, which permitted institutions receiving government research funds to patent their inventions, the pro-patent movement has shaped innovation in the United States since 1980.While these pro-patent policy shifts have stimulated patenting among firms and universities, they have also raised a number of concerns. Some fear that the increased patenting of foundational, upstream inventions in cumulative technologies may hinder important follow-up research, while others worry that high patent application approval rates have compromised the patent approval standards.To assess the empirical basis for these concerns, recent research is reviewed. In addition, a study based on 70 interviews with scientists, executives, intellectual property practitioners and university and government personnel is conducted on the impact of patenting and licensing on biomedical innovation.Finally, a model is developed and estimated using data from the 1994 Carnegie Mellon Survey of R&D performing units in the U.S. manufacturing sector. The literature review and studies reveal that concerns arising from the pro-patent movement have only a very weak empirical basis; in fact, the research suggests that patenting stimulates genuine innovation in the very industries (such as semiconductors) that have spawned such concerns.In spite of these findings, vigilance and prudence are still recommended, as the concerns about patenting may be harbingers of more significant problems to come.(SAA)

Keywords: Court of Appeals for the Federal Circuit, Intellectual property, Bayh-Dole Act of 1980, Innovation process, Patent litigation, Biomedical industry, R&D, Patents, Patent infringements, Patent licenses, Academic research