Strategic Patenting by Pharmaceutical Companies – Should Competition Law Intervene?

Abstract

As the COVID-19 pandemic is affecting the lives of thousands of people worldwide, the problem of timely access to affordable medicines has intensified today. Based on past experience of accessing medicines for life-threatening diseases there is a justifiable fear that access to any vaccines and treatments that are eventually developed may be hindered by patents, leading to unaffordable prices. In particular, one of the reasons that typically leads to high prices is strategic patenting employed by pharmaceutical companies. While this practice is currently considered lawful, this article argues that strategic patenting requires a long-overdue intervention by competition authorities and aims to attract their attention to its harmful effects. It maintains that, along with a more immediate negative effect in the form of high drug prices, strategic patenting affects dynamic competition by stifling innovation of both originators and generic companies. The article outlines the current approach to strategic patenting and provides arguments for the intervention of competition law. This, in turn, will open the possibility for competition authorities to investigate this practice and prevent its harmful effect on drug prices and pharmaceutical innovation, for the benefit of consumer welfare.

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