Perspectives from Law, Economics and Political Economy
Edited by Meir Perez Pugatch
Chapter 9: Pharmaceutical Innovation and Intellectual Property Rights: A Global Public Good?
David Goren INTRODUCTION In the course of this chapter I will address the question of how a new balance must be achieved between rewarding innovative pharmaceutical research, while meeting the needs of a growing public demand for innovative health care solutions at lower prices. The pharmaceutical industry is in a transition phase. An unusual social contract has prevailed over the past decades between innovative pharmaceutical research companies and the societies they serve. This balance permitted high risk to be highly rewarded. However, this covenant is breaking down – as equilibrium moves to instability. It is with this environmental shift in mind that I propose a fresh examination of the needs of the parties (that is, those doing research, and those beneﬁting from it) in order to achieve a new balance between what research companies do and what is expected of them. In order to understand possible alternatives to the current IP structure, it is necessary to deﬁne the components of IP, and identify those that are failing, or at least leading to failure. Once the problem areas are deﬁned, I will shift to describing (or explaining) the rewards and diﬃculties we ﬁnd in society, which at least in part, derive from the problem areas deﬁned. This will be followed by an analysis and discussion of solutions and their global implications. BENEFITS AND PROBLEMS ARISING IN PHARMACEUTICAL INTELLECTUAL PROPERTY RIGHTS The most signiﬁcant dilemma facing the world today in health care is a mismatch between society’s...
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