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Biotech vs. High Tech: Opposing Views on Patent Reform

Written by on Tuesday, July 24th, 2007

The International Herald Tribune ran an interesting article last week on the clash between biotech and high tech over patent reform.

The International Herald Tribune reported:

Both industries depend on patented inventions, but high-technology firms have been pushing for changes to lower the risk of expensive patent-infringement lawsuits. And much of what they want is reflected in a bill making its way through Congress.

Biotechnology companies, however, argue that such changes would make it harder to protect new discoveries. . . .

The biotechnology industry. . . . foresees damaging consequences. Biotechnology firms, major drug companies, and universities all stand to earn millions, sometimes billions of dollars on inventions that can be as small as a single molecule.

They attract financing based largely on the potential value of their inventions, whose profits may be many years in the future. If those inventions were more vulnerable to patent challenge, with decreased penalties for infringement, they would become far shakier foundations on which to build a company. 

The article raises an interesting question: is patent reform a bad idea for the biotech industry?

While clearly a case can be made that patent reform is not favored by the industry, I think it is a bit leap to say that patent reform is actually going to harm biotech companies.  Sure, proponents for patent reform are largely members of the high tech industry, which has increasingly had to worry about the phenomenon of "patent trolls" and high litigation damage awards, but that does not mean that patent reform is going to actually have a detrimental effect on biotechnology.  Isn’t it possible that, despite the gap between the industries on this issue, that in the end any patent reform measure passed will ultimately affect both industries to a similar degree? It is not as though the patent reform measures will be industry specific, although I am not so sure that the industries wouldn’t prefer otherwise.











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