The Intellectual Property Debate NEW HORIZONS IN INTELLECTUAL PROPERTY Series Editors: Christine Greenhalgh, Robert Pitkethly and Michael Spence, Senior Research Associates, Oxford Intellectual Property Research Centre, St Peter’s College, Oxford, UK In an increasingly virtual world, where information is more freely accessible, protection of intellectual property rights is facing a new set of challenges and raising new issues This exciting new series is designed to provide a unique interdisciplinary forum for high quality works of scholarship on all aspects of intellectual property, drawing from the fields of economics, management and law The focus of the series is on the development of original thinking in intellectual property, with topics ranging from copyright to patents, from trademarks to confidentiality and from trade-related intellectual property agreements to competition policy and antitrust Innovative theoretical and empirical work will be encouraged from both established authors and the new generation of scholars Titles in the series include: The International Political Economy of Intellectual Property Rights Meir Perez Pugatch Software Patents Economic Impacts and Policy Implications Edited by Knut Blind, Jakob Edler and Michael Friedewald The Management of Intellectual Property Edited by Derek Bosworth and Elizabeth Webster The Intellectual Property Debate Edited by Meir Perez Pugatch The Intellectual Property Debate Perspectives from Law, Economics and Political Economy Edited by Meir Perez Pugatch University of Haifa, Israel NEW HORIZONS IN INTELLECTUAL PROPERTY Edward Elgar Cheltenham, UK • Northampton, MA, USA © Meir Perez Pugatch 2006 All rights reserved No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical or photocopying, recording, or otherwise without the prior permission of the publisher Published by Edward Elgar Publishing Limited Glensanda House Montpellier Parade Cheltenham Glos GL50 1UA UK Edward Elgar Publishing, Inc 136 West Street Suite 202 Northampton Massachusetts 01060 USA A catalogue record for this book is available from the British Library Library of Congress Cataloguing in Publication Data The intellectual property debate : perspectives from law, economics, and political economy / edited by Meir Perez Pugatch p cm – (New horizons in intellectual property series) Includes bibliographical references and index Intellectual property Intellectual property–Economic aspects I Pugatch, Meir Perez II New horizons in intellectual property K1401.15556 2006 346.04Ј8–dc22 2005031605 ISBN-13: 978 84542 038 ISBN-10: 84542 038 Printed and bound in Great Britain by MPG Books Ltd, Bodmin, Cornwall Contents vii List of contributors Introduction: debating IPRs Meir Perez Pugatch PART I TRADE, INVESTMENT AND ENFORCEMENT POLICIES OF IPRS A critical analysis of the TRIPS agreement Michael Blakeney The TRIPS agreement: the damage to the WTO Brian Hindley Can stronger intellectual property rights boost trade, foreign direct investment and licensing in developing countries? Douglas Lippoldt The enforcement of intellectual property rights: an EU perspective of a global question Paul Vandoren and Pedro Velasco Martins 17 33 44 62 PART II IPRS, BUSINESS AND PUBLIC–PRIVATE PARTNERSHIPS What is an idea worth? Richard P Rozek and George G Korenko Intellectual property policies and scale neutrality: strategic management implications for SMEs Grant E Isaac Encouraging cooperation among the academic, government and private sectors in US biomedical R&D Richard P Rozek and Bridget A Dickensheets University technology transfer policy matters: is it time for a ‘Bayh-Dole Modernization Act’? Robin J.R Blatt v 81 103 118 139 vi Contents PART III IPRS, PHARMACEUTICALS AND BIOTECHNOLOGY 10 11 Pharmaceutical innovation and intellectual property rights: a global public good? David Goren The realities of TRIPS, patents and access to medicines in developing countries Eric Noehrenberg Patenting genes Trevor Cook 159 170 187 PART IV IPRS, COMPETITION, ACCESS AND ANTITRUST IN THE AGE OF THE INFORMATION SOCIETY 12 13 14 Balancing intellectual property rights and competition law in a dynamic, knowledge-based European economy Duncan Curley Technology, time and market forces: the stakeholders in the Kazaa era Uma Suthersanen Author’s rights and internet regulation: the end of the public domain or constitutional re-conceptualization? Guido Westkamp PART V 15 16 17 213 230 268 IPRS AND GEOGRAPHICAL INDICATIONS Geographical indications and TRIPS Michael Blakeney The treatment of geographical indications in recent regional and bilateral free trade agreements David Vivas Eugui and Christoph Spennemann Geographic indications, trade and the functioning of markets Phil Evans 293 305 345 Conclusion: placing IPRs at the heart of the public discourse Meir Perez Pugatch 361 Index 365 Contributors The Editor: Meir Perez Pugatch Meir Perez Pugatch (MSc Ph.D.), University of Haifa in Israel, is a lecturer on intellectual property policy, management and exploitation of knowledge assets and entrepreneurship He is also a guest lecturer at the Department of International Relations, Hebrew University Jerusalem, where he lectures on the international political economy of trade policy, and the exploitation of IPRs in the international arena He finished his B.A studies in 1997 at the University of Tel-Aviv and received his MSc degree from the London School of Economics in 1998 He was awarded his Ph.D from the London School of Economics in July 2002 Meir Pugatch is an independent consultant to the private and public sectors Since 2005, he also heads the intellectual property and competition programme of the Stockholm-Network, a leading pan-European think-tank Meir Pugatch is the author and editor of an extensive number of academic and professional publications His previous book The International Political Economy of Intellectual Property Rights (June 2004) was also published by Edward Elgar Michael Blakeney Michael Blakeney is Herchel Smith Professor of Intellectual Property Law at Queen Mary, University of London and Director of the Queen Mary Intellectual Property Research Institute and the Centre for Commercial Law Studies He has held academic positions at a number of universities in Australia and the UK and formerly worked in the Asia Pacific Bureau of the World Intellectual Property Organization He is an arbitrator with the International Court of Arbitration Professor Blakeney has advised the Asian Development Bank, Consulting Group for International Agricultural Research, European Commission, European Patent Office, Food and Agricultural Organization, World Intellectual Property Organization and a number of university and public research institutes on intellectual property management He has written and edited a number of books in the fields of intellectual property, media and competition law His most recent publications are: Trade Related Aspects of Intellectual Property Rights A Concise Guide to the TRIPs Agreement, London: Sweet & Maxwell, 1996; Intellectual Property Aspects of Ethnobiology (Editor), London: Sweet & Maxwell, 1999; vii viii Contributors Border Control of Intellectual Property Rights (Editor), London: Sweet & Maxwell 2001; IP in Biodiversity and Agriculture: Regulating the Biosphere (Editor with P Drahos), London: Sweet & Maxwell 2001; Enforcement Handbook, Brussels: EC, 2003, Encyclopaedia of International Intellectual Property Agreements, Oxford: Oxford University Press, 2004 Robin J.R Blatt Robin J.R Blatt, RN, MPH is an Adjunct Lecturer at the Harvard School of Public Health She is the President of Applied Biogenuity, providing global consultation in the life sciences to senior executives in law firms, public and private companies, research institutions and government agencies Her work entails strategic planning, business development, education and training, facilitation of technology licensing, alliance formation and marketing communications In addition, Ms Blatt is the Founding Editor and Publisher of The Journal of BioLaw & Business (www.biolawbusiness.com) – an international quarterly journal established in 1997 to identify and address emerging legal, business, regulatory and policy matters pertaining to biotechnology and the life sciences Ms Blatt has over two decades of experience in public health genetics, having formerly served as Director of the Massachusetts Genetics Program at the Massachusetts Department of Public Health Ms Blatt is also an Eisenhower Fellow Trevor Cook Partner, Bird & Bird Trevor is a solicitor and has acted on many of the leading patent cases in the English Courts, including Merrell Dow v Norton and Kirin Amgen v TKT, both of which reached the House of Lords, and in most of the pharmaceutical regulatory cases in the European Court of Justice; namely Generics, Novartis/Sangstat and APS/Lilly Duncan Curley Dr Duncan Curley is a partner in the Intellectual Property, Media & Technology Group of the law firm McDermott, Will & Emery UK LLP Dr Curley handles technical disputes relating to infringement and validity of intellectual property rights, protection of confidential information and licensing, in the UK courts and before the European Patent Office Dr Curley acted in one of the major UK cases on ‘Eurodefences’ (Sandvik v Pfiffner) He has a particular interest in the interface between IP rights and European anti-trust law and he is the author of the leading textbook on the EU Technology Licensing Block Exemption, Intellectual Property Licences and Technology Transfer He is a member of the EC/Laws Committee of the Licensing Executives Society (Britain and Ireland) Contributors ix Bridget A Dickensheets Bridget A Dickensheets is a Consultant in the Washington DC office of NERA Economic Consulting Ms Dickensheets has valued intellectual property assets to assist companies in decision making and conducted analyses for intellectual property disputes She has worked on projects in the pharmaceutical, chemical, and automotive industries Phil Evans Phil Evans is a visiting lecturer at Bristol Business School and an independent consultant on competition, trade, consumer and IP issues Prior to that he was Principal Policy Adviser at the UK Consumers’ Association where he was responsible for dealing with competition policy investigations and submissions and developing its trade policy He has co-authored two books for the Economist Intelligence Unit on the subject of international trade and trade policy; authored a consumer guide to international trade (currently being updated); one on aviation competition and The Which? Guide to Rip off Britain: and How to Beat it He has written widely on matters of international economic policy and has authored numerous country reports on economic policy issues in developing countries For a number of years he wrote a quarterly briefing on US trade policy for business readers He has written a number of studies on various aspects of international economic policy and has completed a study on aviation and tourism competition developments for UNCTAD Phil has developed and taught a range of courses on globalization and international management issues at a number of universities, including the LSE and the University of North Carolina He has also acted as an adviser to a number of national and international groups on trade policy and competition matters David Goren Mr David Goren is Head of Global Strategic Planning Pfizer Pharmaceuticals Mr Goren joined Pfizer Pharmaceuticals in 1991, where he has held positions of increasing responsibility in marketing, market research, sales and general management He is currently leading the Commercial Global Strategy Group, responsible for strategic planning and business development He established Pfizer’s commercial presence in Israel in 1997, initially serving as Business Development Manager and Sales Director before becoming Country Manager Before going to Israel, Mr Goren worked at Pfizer’s Headquarters for seven years in marketing and sales Prior to joining Pfizer, Mr Goren was employed at American Express and McGraw Hill, and did private consulting for various hi-tech start-up companies Mr Goren has been a guest lecturer for graduate programmes in business and economics Mr Goren holds an MBA in Marketing and x Contributors International Business from Columbia University, a Bachelor of Arts in Biology, and is currently studying for an MS in Information Systems Brian Hindley Is Emeritus Reader in Trade Policy Economics at the London School of Economics, and he also lectures on trade policy at the Amsterdam Law School He is a consultant on trade-policy matters to a number of international organizations and businesses, including the European Commission and the World Bank He led (with Patrick Messerlin) the internal OECD assessment of the outcome of the Uruguay Round, which included an appraisal by him of the TRIPS agreement Among his recent publications are, ‘What subjects are suitable for WTO agreement?’ L.M Kennedy and James D Southwick (eds), The Political Economy of International Trade Law, (Cambridge University Press, Cambridge, 2002); Better Off Out?, (Institute of Economic Affairs, 2001); Nice and After (Centre for Policy Studies, 2001), ‘Is the Millennium Round worth reviving?’, Zeitschrift für Wirtschaftspolitik, (March 2000); Antidumping Industrial Policy (American Enterprise Institute Press, 1995) with Patrick Messerlin; ‘Competition law and the WTO: alternative structures for agreement’ in J Bhagwati and R Hudec (eds) Fair Trade and Harmonization (1996) Grant E Isaac Dr Grant E Isaac is the Dean of the College of Commerce at the University of Saskatchewan and Professor of Biotechnology Management He is also an Associate with the Estey Centre for Law and Economics in International Trade Dr Isaac’s teaching interests are primarily in the strategic management of the research, development and commercialization of advanced technology products with a specific emphasis upon products of modern biotechnology Similarly, his research interests are primarily in the areas of: international trade of technology products; the role of technology in economic growth; and the strategic management of intellectual property rights and regulatory processes He is the author or co-author of two books as well as numerous book chapters and research articles appearing in academic journals, including The World Economy, Journal of World Trade, Journal of Applied Corporate Finance, Journal of International Biotechnology Law, International Marketing Review, Journal of International Law and Trade Policy, Journal of World Intellectual Property, Food Policy, Journal of Aboriginal Economic Development, AgBioForum and ISUMA – Canadian Journal of Policy Research among others George G Korenko George G Korenko is a Senior Economist at the Federal Housing Finance Board He was previously a Senior Consultant at NERA Economic 360 IPRs and geographical indications must be reformed and placed under the full rigour of competition regulation Once the anti-competitive nature and effect of these rules has been dealt with, then the Commission has a case to persuade WIPO to develop a central database and registration process which allows for a low-cost arbitration system to stop inappropriate or misleading GI trademark or registration schemes at the national level NOTES For more detail on the origins of competition policy see F.M Scherer and David R Ross (1993), Industrial Market Structure and Economic Performance, Houghton Mifflin Wisconsin Center for Dairy Research, Dairy Pipeline, December 2003, Vol 15 No Wisconsin Center for Dairy Research, Dairy Pipeline, December 2003, Vol 15 No 4 Official Journal B 30 of 20.04.1962 Adam Smith (1982), The Wealth of Nations, Book I, Chapter X, London: Penguin For example see Communication from Bulgaria, Cyprus, the Czech Republic, the European Communities and their Member States, Georgia, Hungary, Iceland, Malta, Mauritius, Moldova, Nigeria, Romania, the Slovak Republic, Slovenia, Sri Lanka, Switzerland and Turkey: Negotiations Relating to the Establishment of a Multilateral System of Notification and Registration of Geographical Indications Submission to a special session of the Trips Council TN/IP/W/3 Sunday Telegraph, 25 May, 2003 ‘Victory tastes sweet to the Parma producers A court ruling on the slicing and packaging of the ham has dismayed British supermarkets but delighted the Italians’, reports Bruce Johnston in Parma, 25 May, 2003, Sunday Conclusion: placing IPRs at the heart of the public discourse Meir Perez Pugatch One of the most straightforward conclusions of this book is that there is no single conclusion – at this point of time – on the current system of IPRs Nor was it the intention of this book to suggest that there can be one single conclusion or one view or one approach that we should adopt when studying the field On the contrary, if there is one thing that this book does suggest is that the debates and dispute surrounding the IP filed have not been narrowed or toned down over time, but rather the opposite But this also means another very important thing: IPRs – even when not treated as such – have a very real and extensive effect on our lives, including those of us who are not familiar with the IP field Regardless of the positive or negative views expressed in this book, the different contributors seem to suggest that IPRs touch upon many aspects of our lives, from the very basic elements to the most sophisticated ones Evidently, IPRs have an impact on the foods that we eat, the medicines that we require and the entertainment that we consume IPRs will have an effect on the availabilty of these products, their prices and their compositions IPRs have become an inseparable part of our knowledge-based economies and the so-called information society IPRs affect the way in which we evaluate, commercialize and utilize different knowledge products and informational services IPRs are an important mechanism (some would add the term crucial) in the overall process of technology transfer They affect the magnitude, pace and direction of the exchange of information and knowledge between those who create knowledge, those who produce knowledge, and those who consume it Finally, IPRs have also become an international issue, often a celebrated one, concerning trade and investment agreements, as well being included in the discussion and debates on the effects of globalization and the north–south divide as a whole The book also leads to some structural conclusions that one may consider as worthy of perusing in future research and publications First, we need to develop a more general, as well as coherent framework, to discuss IPRs The IP field has reached a stage of maturity As demonstrated 361 362 Conclusion: placing IPRs at the heart of the public discourse in this book, the level of IP expertise is extremely high and the avenues of research are rich and diverse However, thus far the IP field has not been conceptualized or framed in a manner that would define it as an independent field of study This is not to say that IPRs not receive enough attention The numerous research institutions and programmes that are dedicated to the study of IPRs, as well as the increasing role of IP themes in academic and professional curriculums are indicative of their importance and vitality Nevertheless, the field of IP is still being viewed as a secondary subject and is still typically linked to the more established fields of study For example, students of the law will be exposed to some of the legal aspects of IPR; students of economics will learn about the challenges of applying economic principles to public goods in the domestic and international markets; political science and political economy students will undoubtedly find some facinating material in the goal-orientated behaviour of different IP interest groups; and accounting students will learn how to evaluate intangible assets as part as their standard valuation education But while this is perfectly understandable, it is also long overdue to develop a framework that will treat the IP field as a primary subject and that will collect and connect different themes of the IP field into a single field of study Secondly, and not unrelated to the above conclusion, we need to develop and implement a more clear-cut distinction between the IP field in general and the different forms of IPRs This is not just a matter of terminology but also of substance To some extent this is a new development in so far as the IP field has become larger than the sum of its parts Today, the field of IP encompasses a range of economic, legal, political scientific and social forces that shape and influence specific forms of IPRs – patents, trademarks, copyrights, GIs, and so on The IP field is broader, and perhaps even more complex, than any single form of IPR It can also be argued, with a certain degree of conviction, that, today, the IP field is the plain upon which policymaking is taking place Also, this policy-making has a different effect on different forms of IPRs and on the fields of technology within each form For example, consider the case of patents The challenges surrounding the patent system today are enough to fill in an entire book on this issue (and probabaly more than one) Each challenge is affected by a different set of factors, or at least represents a unique combination of factors and circumstances For example, the challenges deriving from the issue of pharmaceutical patents are not similar to those deriving from the issue of gene patenting, and both are quite different from the debates over other other fields of technology, such as the patenting of computer implemented inventions in Europe or the tension between patent protection and antitrust Certainly all of these challenges have some underlying themes in common, but each also generates Conclusion: placing IPRs at the heart of the public discourse 363 a different debate In other words, we need to bear in mind that any certain debate on a certain aspect of a certain form of IPR does not represent the current status of the IP field as a whole Therefore, we need to adopt a more general and comprehensive IP perspective Finally, and coming back to the beginning of this book – we to need to make the history of the IP field and of IPRs known! It is puzzling that despite the very long and rich history of discussions and debates in this field, we not seem sufficiently to recognize their implications, insights and contribution to our present time By neglecting to so we tend to miss the crucial evolutionary path which the IP field has travelled We also risk repeating some of the arguments that were raised in previous discussions and which were found to be partial, unsatisfactory or even flawed Mostly, by the time the next wave of IP debates take place (perhaps in 50 years’ time), we may find our debates and our insights completely omitted from the pages of history After all, this is what Machlup and Penrose have warned us about Index Legal cases and publications referred to in the text are in italics A & M Records Inc v Napster 231, 233, 234, 236, 237, 251, 253 AAAI 174 abolition of patent system negative economic effects on international commercial relations 21 academic institutions biomedical research and development 123–4 commercial development of discoveries made with federal funds 141–2 incentives and rights for innovation 139, 149 interaction with government and private sectors 118, 121, 126, 127–9, 130–33, 142, 143, 155, 156 licensing income 130 technology transfer 142, 143, 146 offices 139, 141–2 Accelerating Access to AIDS drugs Initiative (AAAI) 174 access to medicines 28, 29, 170–71, 173, 174, 175, 183 partnerships with patent holders 175, 183 ageing societies 162, 163 Aghion, P 106 agriculture competition law 345, 353 European regulation 352–3, 359 see also geographical indications Aimster 253 Arnst, C 165–6 Attaran, A 172, 173 Ayres, I 258 Bagwell, K 103 Barro, R 106 Bayh-Doyle Act (1980) 122, 139, 142, 143, 144, 146–7, 149, 153 Benkler, Y 255 Berkowitz, L 111 Berkowitz, R 177, 178 Berne Convention (1886) 245, 259 Bernheim, D 103 Bhagat, S 111 bilateral trade agreements 30, 31, 72–3, 307, 320, 325 see also geographical indications biomedical research and development 118 academic institutions, role of 123–4 government role 119, 125, 126 basic research and development 119, 120 creation of framework to encourage research 120–22, 123 technology transfer 140–41 interaction of academic, government and private sectors 118, 121, 126, 127–9, 131, 133 examples of 131–3 license agreements 118–19 private-sector organizations clinical trials 124–5 location of facilities near to academic institutions 123–4 product development 124, 125 role of 124, 125 Bishop, E 20 Black, F 93 Boyle, J 245 Breyer, Justice 231, 239, 240, 260 Buchanan, J 104 C.B.S Songs Ltd & Ors v Amstrad Consumer Electronics Plc & Anor 235 365 366 Index Chamberlin, E Chiron Corporation v Organon Teknika 197 Cockburn, I 126 Colson, T 111 competition law 213, 214, 226, 227 agricultural markets 345, 353 geographical indications 351, 352, 354, 355, 356 prohibited agreements 215 compulsory licenses 171, 179, 180, 181, 182, 183, 218, 220, 223, 226, 227 Conrad, J 12, 13 Consten and Grundig v Commission 214 consumer protection laws geographic origin of goods 348 labelling 320, 348 unfair competition 348 see also geographical indications consumer substitutes 251 Cooperative Research Act (1984) 149–50 Cooperative Research and Development Agreements (CRADAs) 122 Copyright Act (1976) 270 copyright law 160–61, 247, 268, 269 access control 278, 279, 280, 281, 282, 284 conflict with freedom of information 281, 282, 283 communication rights 271, 272, 275, 276 consumer substitutes 251 contributory or secondary infringement 259 copy protection devices 251 developing countries impact on 29, 30 future issues 284–5 global definition of the standard of copyright 285 inducement of infringement 237–8 internet regulation 280–83 justifications for 232, 240, 241 balance between property as capital reward and the public domain 241, 242, 243 ensuring fair and equal shares for all based on ethical grounds 243–4 music industry 244, 245, 246–7 new business models 251, 252, 253 public domain 269–70, 283 human rights 284 reproduction rights 271, 272, 273–5 shared monopolies effect on competition 253–5 stakeholders 232 corporate 249–50 multilevel-creator 250–51 single-creator 249 technological measures 276, 277, 282, 283 technology 230, 231, 245 as driving force of copyright law 258, 259, 260 example legal cases 232–40 see also file-sharing technology counterfeiting see violations of intellectual property rights CRADAs 122 data protection deficiencies in 63 de Bouftler, S 3, Deardorff, A 38 designation of origin 300 definition of 299 protected designations of origin 300, 313, 347 see also geographical indications developing countries copyright problems of 29, 30 foreign direct investment inflows 48, 49 health care problems 163 impact of intellectual property rights 5, 20–21 imports of goods and services 48 perspectives on the importance of intellectual property rights 47 technology transfer 57, 58, 59 acceptance of 39–40 adoption of model laws 24 implementation 24, 25 pressure to comply with 24 Index violations of intellectual property rights 65, 66, 67 disease cost of 166 prevalence of 163 Doha Declaration 41–2, 179, 180–81, 183 downstream markets 256, 257 Drahos, P 27 Drug Price Competition and Patent Restoration Act (1984) 145 Druker, B 132 DSM’s Patent 197 EC see European Commission economic development relationship with intellectual property rights 18, 19, 20, 21, 22, 23, 44, 45 Economist Eisenberg, R 143 enforcement of intellectual property rights 69, 70 costs of 38 dispute settlement mechanisms 74–5 EU guidebook 76 institutional cooperation within 76–7 outside EU borders 70 responsibility of individual Member States 69 strategy 70–77 identification of priority countries 72 joint initiatives 73 multilateral and bilateral agreements 72–3 obstacles to 67–8 organizations’ strategies 114 political dialogue 73 positive steps towards 68–9 public awareness-raising 75, 76 public–private partnerships 75 technical cooperation 74 see also violations of intellectual property rights essential medicines 172 access to 170–71, 173, 174 367 partnerships with patent-holders 175, 183 extent of patenting in developing countries 172, 173, 183 prices of patented medicines 183 European Commission (EC) 63 abuse of a dominant market position 217, 223, 224 refusal to licence 218, 219, 220, 221, 222, 223, 227 Article 81 215, 225 Article 82 217, 226, 227 competition law 214, 226, 227 impact on intellectual property rights 213, 214 prohibited agreements 215 innovation, encouragement of 224, 225, 226, 227 negative sentiment about intellectual property rights 227 technology licensing 215, 216 Technology Transfer Block Exemption Regulation (TTBER) 215–16, 224, 225, 226 Executive Orders 12591 and 12618 (1987) 151 existence/exercise distinction 213–14 Fahey, L 111 FDI see foreign direct investment Federal Technology Transfer Act (1986) 122, 140–41, 150–51, 153 Field, B 104 File-sharing technology 233–5, 236–7, 238, 239, 240, 246–7, 251, 252, 253, 255 benefits of 255, 256, 257 stakeholders 259–60 Finger, J 41 Fink, C 53 Firestone, O 19 food security 26, 27, 28 Forbes 161 foreign direct investment (FDI) impact of intellectual property rights 23, 38, 49, 50, 51, 52, 53, 54, 58, 59 inflows to developing countries 48, 49 technology transfer, role in 48–9 free-rider problem 106 368 Index gene patents 188, 205, 206 claims to genes 188, 189, 190 criticisms of 203–4 industrial applicability 200, 201, 202, 203 inventive step Europe 194–7 United States 198, 199 products of nature, as Europe 191, 192 United States 193, 194 public policy concerns 199–200 utility, lack of 200, 201, 202, 203 generics companies access to drugs 145 entry into developing countries’ markets 173, 174 prices of copy drugs 173, 174, 175, 183 Genetech Inc’s Patent 192, 195, 196, 197 genomics 133 collaboration of government, academia and industry 133 geographical coverage of patent sytem 38 transferring wealth from the poor to the rich 39 geographical indications (GIs) 8, 293, 294, 295, 305, 347 anti-competitive nature of 356, 358, 359, 360 authenticity of standards 350, 351 barrier to market entry 298 beneficiaries of 301, 302 bilateral and regional agreements 308, 335, 338 conflicting EU and US obligations 315 boundaries 351, 356, 357 collective nature of the protection 351 competition law interface with 351, 352, 354, 355, 356 consortia administering of 354, 355, 356 definition of 293, 300 developing countries 301, 302 development and promotion of rural society, role in 298–9 divergent food cultures problem of 358 economic impact of 297 EU bilateral agreements 314 accordance of automatic protection 315, 316 comparative analysis of 321–4 definition of geographical indications 321 elimination of TRIPS exceptions 316, 317, 322, 337 homonymous geographical indications 317 level and means of protection 315, 321, 336 mutual recognition 324, 337, 338 objectives of 314, 335 relationship with trademark protection 318, 323–4 scope of 337 structure of 314–15 traditional expressions 318, 319, 320, 323 EU system for the protection of 299, 300, 301, 312, 313 higher value markets restriction of 359 history of 295–7 inappropriate registrations 356, 357 market definitions 355 migration of products 349–50, 357 multilateral register 295, 307 problems of 348, 349 protected geographical indications 300, 313, 347 shared character of 309–10 source of information for consumers 297 traditional knowledge, protection of 302 adoption and implementation of standards 306 continued and similar use of GIs 350 definition 293, 309, 310 exceptions 311, 312 levels of protection 310–11 scope of protection 310 US regional and bilateral agreements 325, 326, 327 Index comparative analysis of 333–4 definition and scope 327–8, 333, 337 legal means of protection 328–9, 333, 335–6 mutual protection clauses 331, 332, 334, 338 objectives of 335 procedural features 331, 334 relationship with trademarks 329, 330, 334 TRIPS exceptions 330, 331, 333, 337 violations of 63 wines and spirits 294, 311, 312 see also designation of origin Georgia-Pacific v U.S PlywoodChampion Papers Inc 86 Gillespie–White, L 173 Ginsburg, Justice 239, 260 Gleevec 132 government biomedical research and development 119–23, 125, 126, 140–41 interaction with academic and private sectors 118, 121, 126, 127–9, 131–3 provision of intellectual property protection 133, 134 sponsored research policy issues 143–4 title to inventions 144–5, 149 technology transfer 140–41 Greater Access to Affordable Pharmaceuticals Act (GAAP) 145 Grossman, G 33, 106 Hall, B 111 Hansen, F 111 Hatch-Waxman Act (1984) 145 Hay, J 165 health care financing of 164 Helpman, E 106 Henderson, R 126 Hoffman, Lord 189, 206 Howard Florey Institutel Relaxin 191, 199, 201 Howitt, P 106 Hume, D 242 369 ICI and CSC v Commission (Commercial Solvents case) 218–19, 224 ICOS Corporation 192, 202 imatinib mesylate 131–2 imitation of ideas disincentive to innovate 106 implementation costs of IPR agreements 47 IMS Health v NDC Health 221, 222, 223, 226, 254 In re Bell 198 In re Deuel 198 In re Wallach 199 incentive to disclose secrets 3–4 industrial significance of patent protection 19 innovation subsidy policy 107 innovative firms 109, 111 Intellectual Property Institute (IPI) 204 intellectual property rights (IPRs) forms of 362–3 framework for studying 361, 362, 363 history of 363 impact of 361 internet regulation of 279, 280 copyright 280–83 IPRs see intellectual property rights Jones, C 45, 106 Kazaa 236 see also file-sharing technology Kearney, A 54 Khan, A Killinger, S 103 Kirin-Amgen Inc and others v Transkaryotic Therapies Inc and others 188, 192, 194, 195, 206 Kline, D 111 knowledge excludability of, 106–7 investments in 109 high fixed costs of production 106 low marginal costs of production 106 non-rival nature of 106, 107 product life-cycle curve 109, 110 370 Index knowledge-based growth (KBG) 105, 106, 107 patents as dominant policy instrument 108 ‘knowledge commons’ 143 Kortum, S 111 Lamberton, D 20 Lamy, P 173 Lang, J 111 Lanjouw, J 111, 114 Laramie, A 104 large organizations long-term patent strategies 111, 112, 113 patent enforcement strategies 114 resources available for patent applications 112–13 timing of patent filings 113–14 Lee, J.-Y 53 Lerner, J 111, 114 Lessig, L 245 licensing 54–5, 56, 57, 58, 59, 154, 215, 216 academic institutions licensing income 130 between private companies 129, 130 biomedical research and development 118–19 compulsory licenses 171, 179, 180, 181, 182, 183, 218, 220, 223, 226, 227 provisions in license agreements 127, 154 royalty payments 128, 129 technology transfer 54, 55, 56, 127, 128, 129, 133 valuations 84 Lippoldt, D 44, 46, 47, 49, 50, 51, 52, 53, 54, 55, 56, 57 Litman, J 255, 256 Llewellyn, D 19 local reputations 296 see also geographical indications Locke, J 240, 241, 242, 243 Macfie, R Machlup, F 2, 3, 4, 5, 6, 19, 363 Macleod, H Mair, D 104 Mandeville, T 20 Mansfield, E 19, 53, 88 market power 217–18 Maskus, K 44, 55, 56 material transfer agreements (MTAs) 154–5 reach-through provisions 155 Matthews, D 111 McCain, J 145 medical technology access to 165 Merges, R 111, 112 Metro-Goldwyn-Mayer Studios Inc v Grokster Ltd 230, 231, 236, 237, 238, 240, 253, 255, 256, 257, 260, 261 Michelangelo, B 249 Microsoft 223–4, 226, 227, 257–8 Mill, J 168 monopolies 1, 175 Monsanto Canada, Inc v Schmeiser 26–7 Moran, W 299 Murtha, E 81 music industry copyright law 244, 245 P2P services 246–7 technological protection measures 246 new technologies 244, 245, 251, 252, 253 Music Publishers Association 259 Nalebuff, B 258 National Academies Press 198 National Competitiveness Technology Transfer Act (1989) 152 National Institute of Standards and Technology Authorization Act (1989) 151–2 National Institutes of Health (NIH) 153 grants 155–6 natural property right in ideas 2–3 Nelson, R 112 new businesss models 251, 252, 253 NIH see National Institutes of Health Nogues, J 41 Nowell, P 131 Nunnenkamp, P 53 Index OECD 45, 49, 54, 298 Olewiler, N 104 Omnibus Trade and Competitiveness Act (1988) 151 Organization for Economic Cooperation and Development (OECD) 45, 49, 54, 298 organized innovation 6–7 Orphan Drug Act (1983) 161 P2P technology see file–sharing technology paclitaxel 132 Palda, F 104 parallel importation 171, 181, 182 counterfeit and substandard drugs 181 Park, W 44, 46, 49, 50, 51, 52, 53, 54, 55, 56, 57 Parke-Davis v HK Mulford 194 patents 153, 154 applications 112 resources available for 112–13 as charge for knowledge 36 claims 153 dissemination of information 107–8 drivers for 111, 112 exception from monopolies historical debates over patent protection 2, 3, 4, 5, incentives to innovate 107–8 infringements of 63 need for when inventions cannot be kept secret 34–5 organizations’ strategies 111, 112, 113 social impacts of 35, 36, 38 specification 153 terms 37–8 timing of patent filings 113, 114 tradeoff between public and private benefit 160 PDOs 300, 313, 347 Peer-to-peer (P2P) technology see filesharing technology Penrose, E 2, 3, 6, 363 Persson, T 103 PGIs 300, 313, 347 371 pharmaceutical industry extent of research and development 165 global differential pricing systems 182 incremental innovation 176, 177 intellectual property rights 159–60, 164, 165, 166, 167, 168 data protection 161 impact on prices in developing countries 177–8, 183 orphan drugs 161–2 patent life 177 patent term extension 161 proposed global agreement 167 monopoly pricing power 175, 176, 177, 183 pharmaceutical products financial burden borne by private sector 163–4 financing the development of 42 free-riding countries 167 therapeutic competition 176, 177, 183 Philips v Ingman 220 Pickering, F 111 Pioneer Hi–Bred International Inc v J.E.M Ag Supply Inc 26 piracy see violations of intellectual property rights Plant, A 4, plant variety protection 26, 27, 28 Polanyi, M pricing 161 Primo Braga, C 53 private goods 36 private property rights 36 private sector biomedical research and development 123–5, 126, 127 interaction with academic and government sectors 118, 121, 126, 127–9, 131–3, 142, 143 licensing between companies 129, 130 source of patented technologies to academic institutions 131 sponsorship of research 130–31, 155, 156 protected designations of origin (PDOs) 300, 313, 347 372 Index protected geographical indications (PGIs) 300, 313, 347 Prusak, L 111 public goods 36 financing the production of 36–7 governmental provision of 37 Recording Indus Association of America, Inc v Diamond Multimedia Systems Inc 233 regional trade agreements (RTAs) 47, 307, 320, 325 see also geographical indications Ricardo, J rights holders importance of intellectual property rights 45, 46 Rivette, K 111 Roberts, K 104 Rogers, J Romer, P 106 Romer, T 104 Rothschild, R 111 Rousseau, J.-J Rozek, R 177, 178 RTAs see regional trade agreements RTE and ITP v Commission (Magill case) 219–20, 222, 223, 224, 226, 254 Sala-i-Martin, X 106 scale neutrality of intellectual property policy instruments 103, 104, 105, 114–15 drivers for patenting intellectual assets 111, 112 patent enforcement strategies 114 resources available for patent applications 112, 113 timing of patent filings 113, 114 Schankerman, M 111 Schechter, F Scholes, M 93 Schumer, C 144, 145 Schwartz, M 88 secondary markets 256, 257 Securities Data Corporation 56 Shapiro, C 33 Silbertson, Z 19 Small Business Innovation Development Act (1982) 149 small organizations patent enforcement strategies 114 resources available for patent applications 113 short-term patent strategies 112 timing of patent filings 113 Smarzynska, B 53 Smith, A 354 Smith, M 111 social contract social progress Somaya, D 114 Sony Corp v Universal Studios Inc 230, 231, 232, 233, 234, 235, 236, 237, 238, 239, 240, 257, 259 Space-shifting activities 233 Spatz, J 53 sponsored research 130–31, 143, 144, 145, 149, 155, 156 stakeholders 232, 248 corporate 249–50 multilevel-creator 250–51 primary 248 secondary 248 single-creator 249 Statute of Anne (1710) 245 Statute of Monopolies Stevenson–Wylder Technology Innovation Act (1980) 139, 149 Sunday Telegraph 356 survival rates 165, 166 Tabellini, G 103 targeted treatment 166 Taxol 132 Taylor, C 19 technical designs infringements of 63 technology copyright law 230, 231 as driving force of 258, 259, 260 example cases 232–40 time and 258, 259 see also technology transfer technology transfer 21, 39, 146 academic institutions 142, 143, 146 Index developing countries influence of intellectual property rights 57, 58, 59 need for complementary conditions 58–9 foreign direct investment, role of 48–9 government sector 140–41 government sponsored research policy issues 143–4 title to inventions 144–5, 149 interaction of academic and private sector 126–7, 142, 143 legislation 149–52 licensing 54, 55, 56, 127, 128, 129, 133 market forces 133, 134 offices 139, 141–2 trade as a vehicle for 47, 48 Teece, D 109, 111 theft of intellectual property concern of businesses 54 Thomas, Judge 230 Tiercé Ladbroke v Commission 221, 223 time-shifting activities 232, 235 timing of a patent filing 113–14 Tizzano, Advocate General 222 Toole, A 131 trade influence of intellectual property rights 49, 50, 51, 53, 58, 59 trade-related aspects of intellectual property rights (TRIPS) agreement 5–6, 17, 18, 40, 41, 46–7, 178, 348 amendments to 41, 42 beneficiaries of 22 compulsory licenses 179, 180 copyright 30 counterfeit medicines 180 countries’ differing stances 305 developing countries acceptance of 39–40 adoption of model laws 24 implementation 24, 25 pressure to comply 24 enforcement of intellectual property rights 72, 73 expenses of 41 373 geographical indications 293, 294, 295, 305, 308, 318 adoption and implementation of standards 306 continued and similar use of GIs 350 definition of 293, 309, 310 EU elimination of exceptions 316, 317, 322, 337 exceptions 311, 312 levels of protection 310–11 multilateral register 295, 307 scope of protection 310 wines and spirits 294, 311, 312 impact on access to medicines and public health 178–9, 183 institutional costs of compliance 25–6 review agenda 22, 25 technology transfer objectives 21 traditional expressions 319, 320 transfer of wealth from poor to rich 33, 39 see also Doha Declaration Trademark Clarification Act (1984) 150 trademarks 8, 160 violations of 63 see also geographical indications traditional expressions 318, 319, 320, 323 traditional knowledge 302 Trajtenberg, M 111 TRIPS agreement see trade–related aspects of intellectual property rights agreement UK Commission on Intellectual Property Rights 23 United Nations Conference on Trade and Development (UNCTAD) 5, 19, 25 United States access to generic drugs 145 bilateral and regional agreements 320, 325 preference for 30, 31 government funding for science and technology 140 374 Index state-sponsored agricultural certification programmes 346 see also geographical indications Universal City Studios v Reimerdes 278 universities see academic institutions US Patent and Trademark Office 346 valuation of intellectual property 67, 81, 83, 99 accounting standards, compliance with 85 acquisitions 84 bankruptcy proceedings 86–7 business decisions 83–4 consistency in valuations 87 cost approach 82 divestitures 84 holding of patents 84 importance of 111 income approach 81, 83, 87–8, 99 discounted cash flow (DCF) method 81, 88–9, 90, 97, 98, 99 real option method 81, 89, 91–7, 99 licensing transactions 84 litigation 86 market approach 82–3 patents as a proxy for 111 spin-offs 84 tax regulations, compliance with 85, 86 venture capital financing 85 Vernon, R 4, violations of intellectual property rights 63 criminal organizations, involvement of 65 developed countries, effect on 64–5 developing countries, effect on 65, 66, 67 health and consumer protection 64–5 impact on trade 17, 18, 62 need for comprehensive policy to tackle 66, 67 tax revenues, effect on 65 types of 63 see also enforcement of intellectual property rights Volvo v Veng 219, 220 von Justi, J 168 Wagner, S 88 wealthier countries impact of intellectual property rights 47 Weidenbaum, M 103 Wertheimer, A 176 WHO 164, 171, 172, 174–5 WIPO see World Intellectual Property Organization Wolowski, L World Health Organization (WHO) 164, 171, 172, 174–5 World Intellectual Property Organization (WIPO) 18, 19 international IPR agreements 46, 246 World Trade Organization (WTO) 45, 46, 47, 180, 183 developing countries’ view of 33 see also trade-related aspects of intellectual property rights agreement Zahra, S 111