Patents are legal documents that grant exclusive rights to the owner of the invention to prevent others from making, using, selling, or importing the same product or process for a period of 20 years from the date of filing the application (in most cases). The goal of patent protection is to incentivize innovation and promote technological progress. However, in recent years, a new trend has emerged, and it is called the "evergreening" of patents. It refers to the practice of making minor changes to a patented product to extend its patent protection beyond the original period. Patent holders typically in pharmaceutical drugs use a variety of tactics to extend their patent protection beyond the initial 20-year period, effectively creating perpetual monopolies over their products.
How do evergreen patents differ from regular patents?
Patent evergreening refers to a strategy employed by some companies to extend the lifespan of their existing patents by filing new patents on minor modifications or improvements to the original invention. Essentially, evergreening is the practice of obtaining a new patent on an existing product, intending to maintain market exclusivity and delay competition.
On the other hand, regular patents are granted to an inventor or assignee for a new and non-obvious invention or discovery. The purpose of regular patents is to encourage innovation by granting inventors exclusive rights to their inventions for a limited period of time, typically 20 years from the date of filing.
While regular patents aim to incentivize innovation by granting exclusive rights to inventors, patent evergreening can be seen as a way to prevent competition and maintain market dominance beyond the original patent period. Some argue that patent evergreening can stifle innovation by preventing new entrants from bringing new and potentially superior products to market.
Impact of Evergreen Patents on Innovation and Competition
Evergreen patents, which have been in existence for several decades, have become a topic of increased attention due to their potential impact on innovation and access to essential medicines. While some argue that these patents are necessary to incentivize research and development, they have received criticism for their potential to stifle competition and lead to higher prices for consumers.
One of the main criticisms of evergreen patents is their ability to delay the entry of generic drugs into the market, which can significantly impact access to essential medicines. To prevent the entry of generics, pharmaceutical companies file evergreen patents for new dosage forms, methods of delivery, or formulations of the drug, which can add several years to the exclusivity period and delay the entry of generic versions of the drug into the market.
/Evergreen patents can result in higher drug prices and reduce access to essential medicines, particularly in developing countries, where patients rely on generic versions of drugs to treat their illnesses. Moreover, evergreen patents can reduce innovation in the industry, as companies focus on filing secondary patents to maintain their monopoly on a particular product or process, rather than developing new drugs or making significant improvements to existing ones.
Companies filing evergreen patents argue that developing a new drug is a costly and time-consuming process, and they need to recoup their investment to fund future research. However, the practice of filing multiple patents for minor changes to the original product reduces the incentive for competitors to innovate and create new products, leading to a lack of competition and stagnant industry growth.
The impact of evergreen patents on competition is a significant concern, as the extended patent protection allows the original patent holder to maintain a monopoly on the product, limiting competition and driving up prices. This can create barriers to entry for new competitors in the marketplace, further reducing innovation and limiting access to essential medicines.
With the rise in demand for drugs worldwide and increased healthcare spending, technological advancements have opened up new avenues for treating illnesses. However, the pharmaceutical industry's innovation has not been able to keep up with the rate of demand for new treatments to meet unmet medical needs. Rather than developing brand-new medications, companies are frequently rebranding and reusing old medications through patent evergreening or patent thickening. An example of this is AbbVie, the manufacturer of Humira, which has been granted over 130 patents, resulting in a market exclusivity period stretching from its launch in 2002 until 2023. Despite being launched almost two decades ago, Humira remains the market leader and the highest-grossing product globally, maintaining its exclusivity due to the multiple patents granted to its manufacturer.
Evergreen patents have both positive and negative impacts on innovation and competition. While they can provide an extended period of exclusivity for companies to recoup their research and development costs, they can also create barriers to entry for new competitors in the marketplace. In the pharmaceutical industry, evergreen patents can lead to high drug prices, limiting access to essential medication. Therefore, it is essential for policymakers to strike a balance between incentivizing innovation and promoting competition to ensure that patients have access to affordable, high-quality medicines. This may involve rethinking the patent system and exploring alternative models that incentivize innovation while also promoting competition and access to essential medicines.
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