Former President Jimmy Carter recently learned that a new therapy brought the brief disappearance of cancer on his brain. This miracle wouldn’t be possible were it not for strong intellectual property.
It should be noncontroversial to state that U.S. patents are property, they help advance science, and American innovation provides tremendous value for each dollar spent, as plainly seen in medical innovation.
But politicians, anti-intellectual property types and advocates for government-run health care would fight you over these factual statements.
Want proof of IP-derived progress?
- Americans are living longer. Life expectancy stands at 78.8 years, up from 69.7 in 1960.
- Americans are living healthier. Nearly 70 percent are in excellent or very good health, including about half of 65-74 year olds. Fewer of us smoke. More of us exercise.
- What would have been incurable or debilitating medical conditions not long ago are now survivable. The 5-year cancer survival rate has reached 69.4 percent for whites and 61.5 percent for blacks, up from 49.8 percent and 39.0 percent, respectively, 40 years ago.
- We’re now curing diseases, thanks to advances in genomics, biologics and personalized medicine.
Carter illustrates the marvel of modern, IP-based medicine. Carter underwent new immunotherapy and radiation treatments. The new therapy enables one’s immune system to identify camouflaged cancerous cells and attack them.
This treatment temporarily eliminated all traces of cancer on Carter’s brain in less than four months. The immunotherapy drug, combined with standard cancer treatments, cures a small proportion of patients and adds years of life to one-fifth of cancer patients. Though in some cases like Carter’s cancer may reappear, before, cancer on the brain would have meant certain death.
Intellectual property enables this progress. U.S. patents make the long times and high costs of inventing and commercializing such innovations a win-win.
Despite the billions of dollars of research and development required for a single new pharmaceutical product (average 10 years and $2.6 billion) or millions invested in medical device R&D (average $94 million for a new device, $31 million for an improvement, or 501(k), on a similar device), the value of each innovation benefits patients, providers, payers, as well as investors, companies and society.
Each invention — in medicine, telecommunications, electronics, aeronautics, manufacturing, materials, etc. — is newly created property. It belongs to the inventor. A patent protects this property and the ability to enforce the patent against anyone who tries to steal or use it without permission.
Here’s why having a property rights-based IP system is critical. Capital-intensive businesses require substantial up-front and ongoing costs for building and maintaining sophisticated factories and laboratories, highly specialized equipment and machinery, and a highly specialized workforce.
Plus, there are substantial R&D costs. Plus regulatory costs, such as those of the Food and Drug Administration, which account for about three-fourths of the R&D costs of a new medical invention. In sectors that bring about important advancements, many research leads result in dead ends, only a few in a viable commercial product.
The combination of financial and regulatory risks means these sectors attempt to mitigate the risk. One key way is by acquiring IP protection through a patent. A patent serves as a deed to property. It grants the owner exclusive control over that property for a period of time.
This high-value business model necessarily relies upon creating new markets for new kinds of products during the exclusive right under a patent. That’s a reward for the risks taken. Thus, the integrity of the patent system is imperative to firms facing significant costs and hurdles.
Importantly, the IP-centric business model must recoup all R&D costs throughout the term of the patent, which may be shortened by regulatory hurdles. They also must make good on the investments of their financial backers. And they must replenish the R&D coffers in order to stoke the pipeline of new products still years from reaching customers.
How does this benefit society? Strong IP rights drive innovation. Patents enable the IP owner to persist through the arduous path to commercialization, such as assuring financial investors the property rights are secured. The same patents spur competitors to research and develop based on the new knowledge disclosed in an approved patent application.
Hence, America achieves progress in science and useful arts, as the Founders intended in securing this inherent right to one’s intellectual property.
Such IP-derived progress creates new wealth. That wealth grows America’s economic pie, creating new jobs that pay far better than unskilled work like retail clerk. And the benefit of the new products and processes raises average Americans’ standard of living.
Congress must not infringe further on patent property rights. That would stall progress and stymie creation of new property and attendant new wealth. It would rob us of the type of value that makes cancer go away.
