Just a short note on patents

Viagra has been making a fortune for Pfizer for some years now. It\’s going to stop doing so soon.

Pfizer\’s worldwide patents on sildenafil citrate will expire in 2011–2013.

Now I think we can all agree that the invention of the drug has increased human happiness? At least, it has done amongst men. Whether their female partners of a certain age are quite so happy about it is another matter. And of course there are those cases like Rod Liddle where he was able to chase a much younger secretary (while, amusingly, stating that he was "testing" the drug for an article) much to the distaste of his then wife.

One can think of various other methods by which one might pay for the development of drugs. In an entirely free market they\’re difficult things to make money from. The marginal cost of production is usually pennies. But the R&D costs (the largest of which are usually the clinical trials) are in the $800 million per drug range. So you spend your $800 million and when the drug looks like it has a market you find everyone and their grandmother selling stuff they\’ve been making for pennies.

Other methods might be paying a bounty out of tax revenue for the successful development. Not entirely convinced personally, as I can see the political difficulties of charging tax just so that middle aged men can get hard ons.

The patent system means that Pfizer has had a monopoly on manufacture since 1996. That monopoly, as above, runs out in a few years\’ time. Then anyone can indeed make it for those pennies and sell it in a free market.

This is very much the same argument used about copyrights. We want more innovation, we like lots of innovation. But the huge upfropnt costs and the very low costs of duplication mean that it\’s difficult to make money out of innovations. Thus we get less of it than we might desire. So, we institute a limited monopoly so as to allow earnings and thus encourage innovation.

There might be other systems possible and there are those who propose such. However, a lot of the criticism seems to me ill founded, in that it can just be aimed at "big companies making profits" without understanding the basic economic problem that we\’re trying to solve. That without some mechanism of rewarding innovation we\’re not going to get much of it.

I will admit though that I could be biased. The current system is going to make Viagra cost pennies a dose just as I enter my 50s…….

 

10 comments on “Just a short note on patents

  1. Pfizer’s patent on Viagra was overturned in the UK in 2000, and in the US in 2005 because of prior art.

  2. The disadvantage of the patent system is that drug companies concentrate on creating patentable drugs rather than effective drugs.
    It’s that pesky no-solutions-just-trade-offs again.

  3. I will admit though that I could be biased. The current system is going to make Viagra cost pennies a dose just as I enter my 50s…….

    Yes, but what’s the point of the hard on, if no one will shag you without your Rohypnol, Worstall?

  4. I have no problem with 20-year patents. Boo hoo if you have to wait four more years to get cheap viagra. Better than it not existing at all.

    More important is copyright. Copyright needs to be reduced at least to 20 years, preferably 14.

  5. “More important is copyright. Copyright needs to be reduced at least to 20 years, preferably 14.”

    Spoken like a true socialist.

  6. How the fuck is it socialism to oppose an artificially-created, state-guaranteed monopoly created as part of a government plan to restrict individual freedom for the greater good?

  7. ” an artificially-created, state-guaranteed monopoly”

    Like property. Do you oppose that, too?

    Property is theft, man – now give me your house and car. I am an internet citizen, and deserve them.

    What’s yours is now mine.

  8. Eh? Being granted a monopoly on making a certain sort of stuff – which, let’s be clear, is *exactly* what patents and copyright are – is rather different from having a house.

  9. I’ll spell it out slowly for you.

    Property is an artificial state-backed monopoly. So is copyright.

    Apart from a few ex-Communists at The Guardian, no one thinks copyright is a bad thing – we want to reward investors, and create markets for the dissemination and exchange of cultural goods. We get more of this by rewarding the creators.

    Your suggestion (with a number picked out of your backside at random) discourages investment and destroys markets.

    Do you by any chance work for a local authority or polytechnic?

    If you oppose the appropriation of property, you

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