Introduction

Effective management of intellectual property is essential for success in the development and marketing of pharmaceuticals. Developing a new drug or a new method of treating or preventing disease is an extraordinarily expensive undertaking; many years of labor and many millions of dollars are needed to bring a new therapy to market. Pharmaceutical research organizations study and discard hundreds of new molecular entities and treatment regimens for each one that can be demonstrated to be safe and effective enough to be approved by regulatory agencies. These costs are borne by the originator of the new drug before the first prescription is written in the expectation that sales of the new drug will repay the development costs and

provide a profit. The term of marketing exclusivity granted by drug regulatory agencies and the exclusive rights provided by patents protect the originating company for a period of time before generic copies of the drug are introduced by competitors who have not shouldered the costs of development. Intellectual property, also known as industrial property, covers intangible assets: inventions covered by patent rights, trade secrets and know how, copyright, registered designs, and trademarks. Intangible assets differ from moveable, material property and real estate in that ideas are protected apart from their physical manifestations; they confer the right to exclude others from making a product, practicing a process, or copying a name, symbol, or text. Patents, trademarks, and design registrations are obtained by filing an application with a national or international patent and trademark office. The application includes a description of the invention, mark, or design for which protection is desired along with the appropriate filing fees. Applications are reviewed by examiners and granted only if they are found to meet the legal requirements for novelty and inventiveness. Practicing an invention covered by a patent—making, using, or selling anything described by the claims—or copying a trademark, design, or copyrighted text without the express permission of the owner is called infringement. Intellectual property rights are defended by filing a lawsuit in the civil courts asking for monetary damages and an injunction against further infringement.

From the need for protection of trade secrets during the early stages of research, through the filing, prosecution, maintenance, and defense of patents to obtain and sustain market exclusivity, to the reliance on trademarks in the generics market, effective management of intellectual property can mean the difference between success and failure for a pharmaceutical company. A pharmaceutical company can increase its profits enormously by extending its exclusive right to sell a drug for many years after the expiration of the regulatory exclusivity period by obtaining additional patents on new dosage forms, methods of therapy, or methods for producing the drug molecule more economically.

Like material property, intellectual property can be transferred to others through sale, inheritance, or assignment of rights. Ownership of intellectual property confers the right to sue infringers. Patent rights are spelled out in patent documents, which form an extensive body of scientific and technical literature. Trademark and design rights are delimited in trademark and design registrations, which are documented in government files and databases. There is, of course, no literature of trade secrets. By its nature, a trade secret is information protected from the knowledge of individuals outside the organization that created it. One learns about trade secrets only when they are violated and a lawsuit is filed. Some court decisions in intellectual property lawsuits are accessible in legal databases, and some are reported in press releases and news stories. Many intellectual property disputes are settled by the parties without producing a public record.

Intellectual property rights are defined by national laws and international treaties and enforced by the courts. In 1995, the Trade Related Aspects of Intellectual Property (TRIPS) provisions of the General Agreement on Tariffs and Trade (GATT) established intellectual property requirements for members of the World Trade Organization (WTO). The laws and procedures of many countries have been modified to meet the WTO requirements. The changes are particularly important to chemical patents (one of the three broad classes of technology covered by patents, the others being electrical and general/mechanical). These changes especially affect patents covering pharmaceuticals and medical treatment, which were previously unpatenta-ble in many countries. As a result of the changes necessitated by TRIPS and of other amendments to patent laws in Japan, the United States, and other major patenting authorities, much of the information about intellectual property published in the past is out of date. In reading about intellectual property law and database coverage, it is necessary to remember that specific details are constantly changing.

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