Rai: Patents aren’t sole incentive for exploring new uses for existing drug compounds

August 9, 2012Duke Law News

In a newly published article in the New England Journal of Medicine, Duke Law Professor Arti Rai examines a new shift in the “war” between patent-protected and generic pharmaceuticals.

An authority in patent law, innovation policy, and administrative law, Rai outlines the problem in her introduction to "Use Patents, Carve-Outs, and Incentives — A New Battle in the Drug-Patent Wars,” published Aug. 9.

“The Drug Price Competition and Patent Term Restoration Act of 1984, commonly known as the Hatch–Waxman Act, aims to strike a balance between the innovation incentives provided by patents and the greater access provided by low-cost generic drugs.  The legislation, which relies in part on an explicit link between the Food and Drug Administration (FDA) drug-approval process and the U.S. patent system, has been controversial, particularly because of the ways in which firms producing brand-name drugs have exploited that link to delay market entry of generics as long as possible. Now, the tactical landscape has shifted again, with a recently decided Supreme Court case, Caraco Pharmaceutical Laboratories v. Novo Nordisk.”

“With the number of approved drugs that are new chemical compounds dropping in recent years, new uses for existing compounds are becoming an increasingly prominent source of innovation,” said Rai. “The Caraco case increases patient access but arguably reduces patent-related incentives to rigorously test potential new uses.  However, patents are not the only possible incentives. Public funding can (and already has) played a role.”

Rai, Duke University’s Elvin R. Latty Professor of Law, is a member of the Duke Institute for Genome Science and Policy.  Her academic research on innovation policy in areas such as synthetic biology, green technology, drug development, and software has been funded by NIH, the Kauffman Foundation, and Chatham House. From 2009-2010 she served as the administrator of the Office of External Affairs at the U.S. Patent and Trademark Office, leading policy analysis of the legislation that ultimately became the America Invents Act and working to establish the PTO’s Office of the Chief Economist. Prior to that time, she had served on President-Elect Obama’s transition team reviewing the USPTO and as an expert advisor to the Department of Commerce’s Office of General Counsel.

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