Congress is considering a bill that could deter billions of dollars of medical research investments, undermining U.S. global leadership as a healthcare innovator and harming U.S. patients
That’s not Congress’s intent, of course. Lawmakers are trying to fix perceived abuses of the patent system that — supposedly — block cheaper generic drugs from reaching the market, thus keeping medicine prices needlessly high for decades.
That’s the story told to Congress, but a close look at the data shows it’s deeply mistaken. In seeking to solve problems that don’t exist, lawmakers risk creating real ones and doing lasting damage to America’s massively successful drug research ecosystem.
It’s hard to overstate just how vital patents are to drug development. Bringing a single new medicine to market usually takes more than a decade of risky research and clinical trials, at an average cost of $2.6 billion. Only one in 10 medicines that enter clinical trials ultimately receives FDA approval.
Patents — property rights in new drugs — make it possible for innovators to navigate this risk. Property rights — exclusive rights — secured in the fruits of productive labor are the key means of investing, developing and bringing new products to market. This is as true for farmers investing a year of their lives in creating new food as it is for scientists spending over a decade and billions of dollars creating new life-saving drugs.
If lawmakers strip away patent protections for drug innovators, investors will flee the biopharmaceutical industry. R&D funding for experimental treatments will dry up, and the rate of medical innovation will slow to a crawl.
Opponents of the patent system assert that drug innovators create “patent thickets”— obtaining numerous patents on a single drug — and engage in “evergreening” — acquiring new patents on minor improvements after the first patent expires. They accuse drug innovators of abusing patents solely to keep cheaper generics off the market at the expense of patients.
The evidence, though, says otherwise.
Consider, first, that 90 percent of all prescriptions in the United States are filled with generic drugs, the highest rate in the world. If “patent thickets” and “evergreening” were as pervasive as critics claim, generic drugs would not dominate the market.
Moreover, numerous studies have found that brand-name drugs face generic competition after an average of 11 to 13 years, far less than the 20-year patent term set by law, and that this average has remained stable for decades.
In one 2023 study, for example, professors Erika Lietzan and Kristina Acri found that the average time before a brand-name drug faced generic competition is just 11.3 years. An earlier 2015 analysis by other researchers similarly found that the average market exclusivity period for new drugs is 12.5 years.
In other words, there’s no evidence that drug innovators are abusing patents to stop generic drugs from quickly reaching patients.
So where does the “patent abuse” narrative come from?
It can be traced to publications by groups claiming certain drugs are protected by dozens or even hundreds of patents. These patent numbers rely on deeply flawed methodologies, such as counting abandoned patent applications or patents on unrelated inventions. When the U.S. Patent and Trademark Office and the Food and Drug Administration examined these claims, they found they could not replicate the results of the claims.
Nevertheless, these inflated numbers continue to shape the policy debate, as evidenced by the ETHIC Act that lawmakers are considering. The bill would prevent drug companies from preventing others from using their patented innovations, even when those patents are valid and protect innovations that took many years and billions of dollars to create.
The ETHIC Act would set a dangerous precedent in which misleading rhetoric trumps real data in upending a massively successful part of the U.S. innovation economy. Businesses in other industries, such as semiconductors, would surely take note of this politically motivated attack on what is currently a technology-neutral patent system and wonder whether their industries might be similarly targeted in the future, if the political winds turn against them.
If lawmakers are serious about improving patient access to medicines, they should start with evidence, not rhetoric. That means rejecting proposals that weaken patent protections based on flawed data and unproven claims, especially since those patent protections have incentivized decades of life-saving medical progress.
Originally appeared at InsideSources.com
