Patent Policy and Innovation

Patent Policy and Innovation

Do Legal Rules Deliver Effective Economic Outcomes?

Hazel V.J. Moir

This empirical study uses a scientifically selected sample of patents to assess patent quality. The careful evaluation of the assumptions in alternative economic theories about the generation and diffusion of new knowledge demonstrates that the height of the inventive step is critical to effective and efficient patent policy.

Chapter 6: Combining known elements

Hazel V.J. Moir

Subjects: economics and finance, economics of innovation, intellectual property, innovation and technology, economics of innovation, intellectual property, law - academic, intellectual property law


Inventions which are combinations of known elements pose particular problems for grant of a patent monopoly. All the elements are known, so a new use or rearrangement of the elements would surely fall into normal business practice. In general it is unclear why there would be any argument for government intervention to restrict competition. However if there are unusual challenges – particularly challenges incurring a high R & D investment – then there may be a case for intervention. The traditional synergy doctrine required that there be something extra from a combination for it to merit the privilege of a patent. This was specified as either an unexpected result or a result greater than the sum of the known parts. If either of these conditions is met then a new combination may well confer at least some new knowledge or know-how. A simpler approach would simply be to require a contribution to new knowledge or know-how as the condition for grant of a patent. The synergy doctrine remains in effect in the UK and other EPC countries. But in the USA and Australia it has been overturned in favour of a much lower threshold: the suggestion doctrine. Although the Supreme Court recently changed the emphasis in several of the new doctrines introduced by the CAFC it has only partially addressed the relative priority of the Court’s synergy test compared to the CAFC’s suggestion doctrine. The suggestion doctrine makes it virtually impossible for a patent examiner to maintain an obviousness objection to a combination ‘invention’.

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