Diamonds Are Forever. Why Not a Drug Patent?
(Page 3 of 3) As noted above, patents do not in and of themselves lead to monopolies and any lack of competition, and so patent owners still need to compete in the market on the basis of price and quality. In fact, a perpetual patent would be more likely to lead to lower drug prices. Many factors go into drug pricing, but one definite factor is the need to recoup development expenses and maximize revenues and profits over the lifetime of the patent. Since drug companies currently only have a finite lifetime during which they have patent protection, they have to try to squeeze every drop of profit possible in that short period. This leads to prices higher than in a completely free market. In fact, this perverse disincentive was only exacerbated when patent lifetimes were shortened from seventeen years from patent issuance to twenty years from patent application. It often takes three years just to get a first office action from the United States Patent & Trademark Office (the first subst
