Trips Have Been Adopted with a View to Encourage Fair Competiotion at International Level

There are multiple health concerns worldwide and more and more drugs are needed every day. Many drugs however, are extremely expensive to develop, test, and produce. According to the Tufts Center for the Study of Drug Development (2002), it costs up to $802 million to bring a new drug to the market. In 2002, pharmaceutical companies spent $34 billion in research and development (Center-Watch, 2003). In addition to the costs, the overall time from the discovery to approve and market the drug can take up to 15 years.

Economic: Globalization of the pharmaceutical industry is an exciting opportunity to have research and development done at cheaper prices in other countries. However, this could be a double edged sword for companies because it is easy for other countries, such as India, to produce generic versions of the drug in bulk.

Some pharmaceutical companies are feeling grief from a decline in research slump but the issues are more serious in reference to the United States intellectual property laws on which these same companies need to inflate their profits. Maybe the focus should be on an idea that came about several years ago. Give drug patents a shorter term of 15 years but don’t start the clock until the FDA approves the drug.

Improvements in health care and life sciences are an important source of gains in health and longevity globally. The development of innovative pharmaceutical products plays a critical role in ensuring these continued gains. To encourage the continued development of new drugs, economic incentives are essential. These incentives are principally provided through direct and indirect government funding, intellectual property laws, and other policies that favor innovation. Without such incentives, private corporations, which bring to market the vast majority of new drugs, would be less able to assume the risks and costs necessary to continue their research and development (R&D). In the United States, government action has focused on creating the environment that would best encourage further innovation and yield a constant flow of new and innovative medicines to the market. The goal has been to ensure that consumers would benefit both from technological breakthroughs and the competition that further innovation generates. The United States also relies on a strong generic pharmaceutical industry to create added competitive pressure to lower drug prices. Recent action by the Administration and Congress has accelerated the flow of generic medicines to the market for precisely that reason. By contrast, in the Organization for Economic Cooperation and

U.S. based companies hold rights to most of the world’s rights on new medicines and holds thousands of new products currently being developed. As of 2012, the industry helps support almost 3.4 million jobs in the U.S. economy. It is also one of the most heavily R&D based industries in the world. In the United States, the environment for pharmaceuticals is much friendlier than other countries around the world in terms of pricing ability and regulations. Both the Pharmaceutical and Biotechnology industries have experienced significant growth in the past year with year-over-year increases of 13.02% and 34.69% respectively. It is an even more striking when looking at the past five years considering both have beat out the S&P 500 with pharmaceuticals increasing an additional 31.44% and the biotechnology sector besting an astonishing 269.3% more return than the

Protection of intellectual property are investments based on acquired knowledge, thought and effort by one or multiple individuals on behalf of themselves, the business they work for when the property is created, and a financial investment. Each of these – acquired knowledge, thought, physical effort, financial investment – have a value that can be attached as it relates the usefulness or importance of the resulting product. That value will have a level of importance to the individual(s) creating the product and if applicable, the investor providing the funds in support of the creation.

It is intended both to provide thumbnail descriptions of the various intellectual property regimes to economists working in this area and to indicate where additional economic research might be useful. The other papers in this symposium provide important examples of ongoing research on the economics of intellectual property. Suzanne Scotchmer analyzes the complex effects of patent protection when innovation is cumulative. Rather than analyzing situations in which several firms vie to develop the same innovation-the approach of the "patent race" literature-her analysis examines circumstances in which only one firm can develop an initial innovation but others can also build upon it. She focuses on how the incentive to develop both the initial and subsequent inventions may be affected by the scope of patent protection. Janusz Ordover considers ways of adjusting the patent system that may help to both provide returns to the inventor, and encourage the diffusion of the innovation in the economy. His paper is part of a line of work that explores the place of the intellectual property system among the large number of institutions that affect the amount and nature of research and development that takes place. In the final paper, David

After watching the video, I have realized that intellectual rights protection is based on the foundation of R&D investment, which are also the building blocks of the pharmaceutical industry. There is adequate evidence to proof that intellectual rights in the form of trademarks and patents are very significant in the pharmaceutical industry as is compared to any other industry. This may be caused by the fact that copyrights on prescription drugs are a better effective measure for increasing the limitation costs than copyrights on other commodities. The value of copyright protection relies on the duration of exclusivity. Although the lifespan of copyrights is predetermined by international treaty at 20 years from the filing of the copyright application, the actual period between gaining market approval and patenting, the significance of the copyright is much less than 20 years.

Intellectual property is a broad term that is used to refer to the rights that the owner of an invention or an artwork enjoys. An example of intellectual property law is the Trade Related Aspect of Intellectual Property Rights (TRIPs), which gives individual rights such as patent, designs, and trademark. Intellectual property is contained in the Article 2(viii) of the convention, which led the establishment of the World Intellectual Property Organization (WIPO). Literary works, inventions, discoveries, trademarks, and industrial designs are among the rights that are provided in WIPO. Intellectual property in Australia has a strong judicial support.

If competitor could immediately copy a new drug the long and high cost development process would be less attractive. In order to encourage drug manufactures to have active R&D, prescription drugs are protected by patents (lasting anywhere from 10-14 years based on the contract). These patents create a monopoly for that drug and ultimately the one for the company that produces it.

There are several reports and studies stating several disadvantages of imposing strictly IPRs rules and regulations. According to Correa, C. (2000), emerging countries are going to suffer from tremendous price increases and other costs. Strong implementation of IPRs will make some pharmaceutical companies to be monopoly in some drugs. Due this monopoly in some good will make companies to charge very high price which poor person cannot afford. With strong implementation of patent protection in emerging countries, price rise will become regular feature not an accidental. Companies will raise price without any reasons and life saving drugs will not be easily available to common people.

The stated purpose of IP law is to promote progress on the consumer side and further on in the society, this is done by disclose new inventions and creative works that will mutually benefit to the society. The idea behind it is that creators wouldn’t have sufficient motivation to invent unless they were legally entitled to own the rights and full value of their work and inventions (Overbeck, W., & Belmas, G., 2014)

Therefore, protection of patents is one of the key conditions necessary for further development of the pharmaceutical industry. At the same time, non-efficient legislation that does not provide the necessary level of patent protection is one of the factors that hamper expansion of “Big Pharmaceutical” companies to the developing countries8.

The concept of product patent for pharmaceutical products is likely to make life saving medicine beyond the reach of the poor and deprived section of the society around the world.

Although R&D has been retained by the large pharmaceutical firms, there has been a continuous decline in the R&D productivity. Controlling R&D is imperative to the success of a Pharmaceutical firm. However, as the pharmaceutical industry is maturing, there are diminishing returns to the R&D investment. Fewer and fewer blockbuster drugs are being discovered and therefore R&D is not the most value adding component in the value