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Are Patents Needed to Make Up for FDA Kneecapping?

Update: See Kinsella, “FDA and Patent Reform: A Modest Proposal” (May 5, 2023)

Even some opponents of IP sometimes say that the case for patents is strongest in the field of chemicals and pharmaceuticals,1 although this empirical/utilitarian argument is eviscerated in ch. 9 of Boldrin & Levine’s Against Intellectual Monopoly.

A friend told me:

I think there may be a slightly stronger argument that patents are more economically significant in the chem and pharma industry, from a certain point of view. I know of a number of people who have said that regulation and legal issues from FDA/EPA/etc. basically rot away at the profits of the industry, and it’s very hard for the non-mega-corps to expect return without “IP protection”. If the former statement is true to a significant enough extent, then you could see why people would accept the latter as the current state of things and a kind of “necessary evil.”

Again, it’s from a certain point of view, and there is an economic argument against IP anyway, but without some serious reflection you wouldn’t see it.

As I wrote in reply, this is just an example of a more general phenonemon: the state kneecaps you then offers you a wheelchair. For example they force unemployment on blacks then they take jobs with the military, or welfare. Here, the state (via the FDA) imposes costs, and the state (via the patent system) gives advantages to some companies (at the expense of competitors and consumers). The patent system itself, though it benefits some oligopolistic companies, imposes immense costs on the economy, as does the FDA and related laws like antitrust. So the patent-FDA-antitrust regulatory complex simply harms people and the economy, and is yet another instance of how the state can only destroy, not create wealth.

  1. See here and here. []
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To the extent possible under law, Stephan Kinsella has waived all copyright and related or neighboring rights to C4SIF. This work is published from: United States. In the event the CC0 license is unenforceable a  Creative Commons License Creative Commons Attribution 3.0 License is hereby granted.