Imagine watching Jeopardy! one evening as a contestant asks for a clue in the pharmaceutical category. Here is the clue: unfairly. The contestant poses the following question: how do pharmaceutical companies play the patent game? Sound ridiculous? Perhaps you should read an explosive editorial published by none other than the New York Times on April 16, 2022.
The Times makes no apologies for its disdain of American capitalism. But rarely does the paper go after those corporate giants that grease Washington’s wheels. So it’s rather curious that this editorial was published. Nonetheless, the Times editorial board has made it clear that the U.S. pharmaceutical industry takes advantage of patent laws with impunity.
Editorial board members go even further in stating that patent abuse is largely responsible for excessive drug prices in this country. There are other factors at play, including the purposeful decision to fund global pharmaceutical research off the backs of Americans consumers, but patent abuse partially makes that decision possible.
A 10-Year Monopoly
In order to make pharmaceutical innovation financially worthwhile, federal law grants pharmaceutical companies a 10-year patent on newly approved drugs. Only after that patent expires can other companies step in to begin making generics. Pharmaceuticals don’t give up their patent so easily, though.
According to the Times editorial board, they are able to take advantage of a U.S. Patent and Trademark Office (PTO) that seems to lack an appetite for enforcing the rules. They allow pharmaceutical companies to make minor modifications to their products so as to allow them to renew their patents for another 10 years. They can also claim modifications that will never actually be implemented to prevent generic manufacturers from finding ways to produce the same drug.
An example cited by the Times is Sanofi’s minor adjustment to Glargine, which is an insulin drug. They added an injector pen as the main delivery method despite the injector pen being old technology used by pharmaceutical companies for decades. Sanofi was able to claim a substantial modification and renew its patent.
Necessary for Innovation
Whenever Big Pharma is called out for such ridiculous practices, they claim patent protection is necessary to promote innovation. Without secure patents, they say pharmaceutical jobs would be lost, and PPQ Validation, crucial for ensuring drug quality and efficacy, would be compromised. They argue they wouldn’t have the money to develop new therapies. The sky would essentially fall if they weren’t able to abuse the patent system.
Their claims are hard to justify. Anyone can see just how many jobs there are on pharmacuetical job boards like Pharma Diversity. Meanwhile, they can also read the newspaper to learn about record profits even as average people cannot afford their medications anymore. It doesn’t take a degree in pharmacology to connect the dots.
The Need for Patent Reform
The Times editorial board is calling for patent reform. To be honest, the only reform necessary is a willingness to enforce current rules. Patent law is sufficient to protect the interests of inventors and consumers. The problem is a lack of enforcement. The PTO and Congress look the other way.
If any reform above and beyond enforcement, is necessary, perhaps it would be eliminating discretionary denial. As explained in a recent post on the CounterPunch website, discretionary denial gives the PTO authority to deny a patent challenge without having to justify doing so. They can deny a challenge for any reason whatsoever, and they do not have to explain themselves to anyone.
U.S. patent law works fine when it is enforced. When it’s not, you end up with situations like pharmaceutical companies abusing the system in order to fill their own pockets. It is a shame and a scam.
To learn about the journey of a drug through through the pharmaceutical supply chain, please see the infographic below.
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