Protecting Intellectual Property Sans Monopolies
The Ministry of Public Health recently announce some news: it would remove compulsory licensing (CL) from all generic medicines copied from patented overseas medicines. This new policy, officially called the Patent Act, will make expensive foreign medicines more affordable to the ordinary Thai citizen who cannot afford the expensive foreign medicines. However, by making this announcement, the Ministry of Public Health demonstrates considerable courage.
This measure worries foreign drug companies who own the patents because this act, in effect, destroys their monopolies. This Act will no doubt put a big dent in their profits and provoke them to lobby for counterblows against Thai products in the trade arena.
This incident is only one example of the problems caused by the pharmaceutical monopolies and the expensive patent fees they levy. Their practices of setting astronomical prices and controlling production volumes hold the consumer hostage.
Even though the real purpose of granting patents (the power to monopolize) is given to the patent owner in order to reward the patent owners and motivate further innovation. Patents are supposed to enable the survival of the innovators. However, because the prices that drug companies are allowed to place on their designer drugs is so very high, this system runs the risk of destroying itself.
In fact, giving drug conglomerates the power to monopolize the market also has significant disadvantages. For instance, consumers are forced to buy expensive products and services, yet they do not receive the benefit of products and services, whose quality is determined by a competitive markct. In the existing monopoly, the consumers still lack the freedom to choose because they are constrained to buy products from one manufacturer only.
This case raises the question of whether there might be other methods other than patents that would both reward innovation and, at the same time, preserve consumer benefit.
The idea I would like to propose here is a way to transform innovation into public products. This could be done if the government were to compensate innovators. The premise of my proposal is that innovators bring benefit to society, but they must bear the cost burden themselves.
Instead, the government would invest in innovators by buying knowledge and technology from them. The government would pay innovators and then sell or license the information to the private sector, which would in turn manufacture the products in a competitive marketplace. The government would earn VAT or taxes from manufacturing and distributing the products.
A second method would be to allow manufacturers to freely copy products, but the government would collect special taxes from the manufacturers for copied products. In turn, the government would give the taxes to innovators as compensation. The government will set the tax rate for copied products and services by considering the costs to the innovator and the benefit the innovation would yield to society.
This method would help to lower the prices of new products and services down from the sky high monopoly prices, enabling more people to afford the new products.
Because a number of manufacturers would be competing in the marketplace, manufacturers would be motivated to improve the quality of their product. At the same time, innovators would be rewarded. But this systemrsquo;s success is contingent on its success in sufficiently rewarding the innovators.
Another idea is to prohibit the first innovator from become the sole proprietor of the patent but instead to allow other innovators to also have the right to manufacture such products.
This idea assumes that innovators may invent similar innovations, for example, the theory of quantum physics as well as the nuclear bomb were developed simultaneously by different parties. Knowledge and technology are so advanced that many innovations may be ready to be developed by any number of innovators. Giving the rights to the first innovator may not be fair to other innovators because have worked almost as hard as the first-past-the-post innovator.
However, my ideas are still in the nascent stage. Other considerations are still necessary before my ideas can become practice, for example,
middot; How do we prove that an innovation was not copied from the first one?
middot; Should those who innovate after the first innovator has finished also be given copy right protection?
middot; Should the first innovator be given greater monopoly rights that then who finish innovating the same thing later on?
I challenge the government to consider my ideas. This government could help to break the misnomer that innovations are for the rich only.
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2007-02-24