The federal government is one of the most important customers for goods which rely on patent protection to recoup their substantial research and development costs. In some cases, however, the government may use its unique power to the disadvantage of the property interests held by patent owners. Three recent op-eds by Regulatory Tranparency Project experts nicely illustrate this by focusing on two real-world situations.
Writing for IP Watchdog, Brian O'Shaughnessy of Dinsmore & Shohl LLP notes that the United States Air Force is contemplating changes to its procurement policies that will require patentholders to surrender the IP rights of the products they sell in order to do business with the Air Force. Historically, the Air Force has had a flexible approach to contracting, allowing rightsholders to freely negotiate with the government on matters including the IP rights to their inventions and discoveries. The new proposed model, however, would require a surrender of IP rights before the parties go to the negotiating table. This model would create a system in which one part of the government recognizes the property right while another part of the government takes it away.
Brian O’Shaughnessy also contributed an op-ed to the Boston Herald regarding proposals for price controls for prescription pharmaceuticals, while University of Richmond Law Professor Kristen Osenga contributed an op-ed on the same subject to Townhall.com. Both pieces comment on a proposed measure from the Trump administration to tie prescription drug costs to the prices being set by other developed nations. The United States has long allowed the market to set the prices for prescription drugs, which has helped the United States become a world leader in pharmaceutical innovation and development. Such measures would imperil the current standing of the United States pharmaceutical industrial as the largest in the world by a wide margin, and would incentivize innovation in the sector to move offshore.