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Comment by felipeko | Hacker News Reader

I don't think you can prove this.

I'd love to see research proving patents do more good than harm (in any field).

Actually in medicine we have both the good and bad of patents. For any drug to be brought to market in the U.S. there is, by necessity, a long and expensive process to ensure a drug does more benefit than harm. This process can cost millions of dollars but producing the formula + manufacturing is often not nearly as expensive. Hence, a patent, because of the legal framework for which these inventions are conceived within, granting a monopoly for a short period of time is the only thing that promotes or gives companys an incentive to continue on with FDA approval.

This, by the way, is no means or excuse for some of the shenanigans drug manufacturers take part in. It merely is one illustration of why a patent system should exist.

In medicine, patents are a government-granted benefit to inventors that sort of counteracts the government-imposed penalty of having to go through FDA approval. There's a nice symmetry here.

If we look at industries with less regulation, like software, the necessity for a patent system is a lot less clear.

> like software, the necessity for a patent system is a lot less clear.

Software is a terrible example, since every story such as this one demonstrates how absurd and stupid software patents are. It is plain as day.

No it's not. It's a illustration of a need for some kind of regulation on the field.

Patents are much more 'powerful' than needed for pharma industry. They hinder good research by universities and other NGOs.

The parent post ask for "research proving patents do more good than harm", not for a theoretical problem which patents might do some good, regardless of the potential harm it might do at the same time.

The big elephant in the room problem with patents on medicine, is that government trade the life of some poor people for the incentive that some people might be more willing to invest in medicine research with patents rather than without it. We don't even ask if there is an alternative ways for the government to intervene, and use an 200 year old approach which creates value by excluding people who can't afford to pay to get access to medicine.

When people builds nuclear reactors, we ask what the potential good vs the potential harm there is. If we don't people die, which is why there is regulations. With patents, we have chosen the path of causing deaths, and we don't even ask if the price tag is worth it.

It would be interesting to see a breakdown of who pays for what in the development of a needed drug. For instance, how big are the tax credits for R&D? How much of the testing is subsidised or outright paid for by taxpayers?

And of course: what proportion of drug development is to replace high earning drugs for which the patent protection is expiring. (ie "solved problems").

I am not convinced that the drug industry needs patent protection. I have a gnawing suspicion that we have reached a point where it might be a better idea to just remove patents and see where the chips fall.

Patent is what keeps research institutions running. The only reason MIT gets so much every year is because they make great research and companies are willing to do joint research with professors. And for smaller, less competitive research institutions, patents help finance department. Grants are great but on top of grants departments can do better with revenue coming from patents. You'd be surprised how many a department can make on top of grants by just having patents. The IP director at my institution came to my class and talked to us. One postdoc made an impressive method on some neuroscience stuff and his invention would have been worth hundreds of millions to him and to the department. He was only able to get US patent not international patent only because he published his work to a journal.

Patent has good and bad. We need to balance the two. And believe it or not, when you face a lot of competitors, if your invention can drive them out, you'd want to patent that. This is just how business works. If patent is bad because everything should be open, then military inventions should be open too. It might sound extreme, but patent is the weapon businessman uses.

Did someone say "research" and "patents" in the same sentence? :-)

I was going to rifle through my vast collection of references to studies about patents, but I just came across a pretty good review of the research of economics of patents:

"Recent Research on the Economics of Patents" - Bronwyn H. Hall, Dietmar Harhoff (Google for PDF)

I'm still going through it, but it will give you an idea of what the current research looks like.

Here's the deal: Whether patents promote innovation, and whether their benefits outweigh the harms, are extremely difficult questions to answer. I mean, how do you even measure "innovation"? You could say by "counting patents", but that's simply a circular argument! Not to mention the complaints that many patents are low quality, or that companies like Twitter are regularly called "innovative".

So in absence of any direct indicators, what the vast majority of studies do is roughly this:

1. Pick a few metrics that act as proxies for whatever they measure (innovation, patent quality, economic benefit, economic harm, productivity, R&D efforts, etc.);

2. Gather data from which these metrics can be gleaned, typically constrained along many dimensions such as time, industry sectors, sources, etc. to make gathering it feasible. (Sometimes this step is actually optional and author outright just run simulations on what they think are "reasonable" approximations of data. Sometimes they don't even do that. In the paper above, they're referred to as "Theoretical Evidence");

3. Present a hypothesis;

4. Construct a model;

5. And test the model to see if their hypotheses stand up to the data or not.

And at each step they provide varying degrees of explanations of their methodologies, assumptions, controls, potential confounding factors, flaws in their data, and so on.

As you can imagine, it is rather difficult to make solid, generalizable conclusions. For one, the metrics may be pretty poor approximations. Or the model may be poor. Or the hypothesis may be flawed - an unfortunate problem with many studies is that they do not take into account changes in the legal environment (such as the changes wrought by the AIA and decisions like Medimmune v. Genentech) so their very premises are flawed.

Fortunately, many studies are all about finding flaws in other previous studies, so there's some semblance of balance.

Really, go through the paper above and the papers it cites, and you'll see why it's downright impossible to make broad assertions like "patents promote innovation" or "patents harm innovation".

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