Patent System in the Pharmaceutical Industry

The pharmaceutical sector is a major user of the patent system. While only a small - and declining - number of new chemical entities are approved annually, thousands of patents are applied for to protect variants of existing products, processes of manufacture or, where admitted, second indications of known pharmaceutical products. Since patents confer exclusive rights regarding the production, sale and use of the patented subject matter, they can be used to restrain competition and set prices higher than those that would have existed if competitive products were available. This is the very purpose of the patent system, which is generally justified as necessary to encourage investments to develop new products and processes.1 Given the substantial effects that patents can have on competition and, hence, prices of medicines, the criteria that are applied to examine and grant pharmaceutical patents are extremely relevant for public health policies, and not only a matter of concern for patent and industrial policy. Policy makers in the health area, as well as patent examiners should be aware that decisions relating to the grant of a patent (which is generally presumed valid until proven to the contrary) can directly affect the health and lives of the people of the country where the patent is granted and enforced.