Study urges drug patent licensing revision

STATE COLLEGE, Pa., July 10 (UPI) -- A U.S. researcher claims ambiguous international rules outlining when and how governments may "break" pharmaceutical patents are stifling innovation.

Pennsylvania State University Associate Professor of business law Daniel Cahoy argues the problem is a lack of clarity in compensation for patent owners. He suggests a three-tiered approach to compulsory license remuneration based on a country's individual ability to pay would do much to resolve the predicament.

Cahoy said current international law has few limitations on which countries can "break" patents simply to control costs, what circumstances create a necessary condition, or even what level of remuneration is required.

As a result, Cahoy said relatively wealthy nations might receive unintended windfalls, while least developed countries might continue to struggle for access.

Regardless of the approach that is ultimately adopted, Cahoy argues: "A revision of essential international law is required to both better enable access and shore up innovation incentives. Considering the problem in terms of remuneration, rather than the legal right to license, one can arrive at clearer, more equitable solutions."

Cahoy, a patent attorney, presents his views in a forthcoming issue of the Georgia Law Review.