The construction of patent claims

This paper highlights two recurring facets of the way UK courts approach the construction of patent claims: the adoption of methods typically applied to the interpretation of contracts and the recognition that immaterial variations not expressly claimed nevertheless fall within the scope of protection. Drawing on the normative implications arising out of Ronald Coase's paper on the problem of social cost, this paper argues that the patent system operates as a substitute for an explicit bargain between economically active entities operating in the market under which a duty is accepted by one party in return for acceptance of a burden of risk by the other. This perspective incorporates both the static costs and the dynamic benefits of the system and accords with the monopoly-profit-incentive theory most commonly advanced in support of the patent system. It is shown how the contemporary approach to claims construction is supported by the object of giving effect to the presumed intentions of the parties to this hypothetical bargain and that this underpins both the implication of terms which go beyond those expressly agreed to by parties to a contract and the construction of patent claims so as to embrace immaterial variations not expressly within their scope.

Do intellectual property rights involve a private power to tax

This article criticises the standard approach to intellectual property rights, interpreted as property rights conferring a monopolistic position, by showing that a public good is not a suitable basis for a private monopoly and that the bundle of rights included in an intellectual property right is so different from those enjoyed under a standard monopoly as to suggest that a different mechanism is at work, that is, a private power to tax has been granted. To highlight how this novel approach works, mainstream economic models of economic growth based on research and development, whether protected or not by intellectual property rights, are revisited. The theory of taxation is then recalled to show that taxes involved by intellectual property rights can range from an amount equal to the monopoly profit to Lindahl taxes. Finally, the principles of taxation elaborated by economic theory are examined for clues to improving the design of intellectual property rights.

Evergreening of pharmaceutical patents: A blithe disregard for the rationale of the patent system

Evergreening of pharmaceutical patents has emerged as a serious challenge for access to affordable drugs as it aims to delay the generic competition by extending the length of the exclusivity period beyond the legitimate patent term without any considerable improvement in therapeutic benefits of the already patented pharmaceutical drug. This paper endeavours to question the legitimacy of the evergreening of pharmaceutical patents. This study applies all the recognized theories in support of the patent system – namely the ‘natural law’ or ‘natural rights’ theory, the ‘reward by monopoly’ theory, the ‘monopoly-profit incentive’ theory, the ‘exchange for secrets’ theory or the ‘contract’ theory, and the ‘prospect’ theory – to the practice of evergreening of drug patents in order to check whether or not any of these theories can be used to justify the practice. The study concludes that the practice of evergreening is not consistent with any of these theories and therefore lacks any plausible justification.

Theoretical Analysis of the Relationship Between Monopoly's Optimal Tariffs and Consumer Utility

The article is an extension to the pricing models proposed by Jean Tirol that model the consumption of an environmental good. However, the different consumption patterns of this good, which is characterized by a taste parameter (two tastes or a continuum of taste); always verifying an imbalance between the profit of the monopoly (mainly natural); and the utility function of the consumer agent. Taxation on the price, in relation to consumer preferences, can ensure the objectives of an efficient management of a good which has variations in its physical nature. Moreover, a coefficient of variation in its nature, based on a scale of measurement, can achieve the convergence between economic and social objectives. The underlying results show that the consumer surplus is proportional to the variation between the average and marginal utility. In addition, maximizing monopoly profit provides a reasonable price that ensures social equity measures between the different users.

Monopoly Profit Maximization: Success and Economic Principles

This paper presents a classroom experiment on pricing strategies available to monopolists. Each student makes production decisions as a monopolist during the experiment, learning from his/her own experiences what it means to be a price searcher. Full information is provided on cost conditions, while the demand function remains unknown to the participants. Given a sufficient number of periods, students will in principle be able to maximise their profits by applying a simple trial and error strategy. However, one of the objectives of the experiment is to demonstrate to students that search strategies based on economic principles are more efficient.