Health and biopharmaceutical innovation

The biopharmaceutical industry has provided humanity with treatments and cures for a host of diseases and ailments. Innovation and its protection are the lifeblood of the sector and the source of both profits and growth. Fundamentally, the innovative biopharmaceutical industry is characterized by a research and development (R&D) process that is lengthy, expensive, uncertain, and risky. Given this, patent protection and other forms of intellectual property rights protections are disproportionally more important for ensuring that the innovator appropriates the returns to research and development. Moreover, the biopharmaceutical industry is distinguished by three complicating factors: an unusually high rate of R&D, the extensive regulation of virtually every aspect of the industry, and the resulting innovation is a global public good. The combination of these characteristics defines a set of unique economic and legal challenges for the innovation of new drugs and the public health policies that surround their production, marketing, and distribution. This chapter focuses on the most controversial and important challenges: compulsory licensing, generic drugs, biologics and biosimilars, access and affordability, incremental innovation, biopharmaceutical counterfeiting, and “evergreening”. Several challenges and controversies characterize biopharmaceutical innovation, encompassing legal, economic, illicit, scientific, and biological issues. These issues are influencing how innovation is proceeding, shaping academic lines of inquiry, and driving policy recommendations and changes. Some of this is deliberate and well thought out, but more often than we would like, it is haphazard and grounded in misinformation.