Three essays on proprietary rights and innovation: evidence from the invalidated gene patents

Abstract

The role of intellectual property (IP) rights, such as patents, in innovation is the subject of an ongoing debate. Using a sudden shift in the patentability of genomic compounds, this dissertation contributes new evidence to this debate by shedding light on three different roles that patents can play in innovative processes. In three complementary essays, I examine the impact of patents on follow-on innovations, markets for technology, and scientific research. Compiling data on the population of patents on isolated genes, I show that their sudden invalidation has increased innovation in commercialized diagnostic tests, but decreased the cooperative agreements among the biopharmaceutical firms. I further show that these effects are heterogeneous across firms and markets. The results of my analyses, however, present no significant evidence of patents hindering the scientific progress. The findings of this study provide novel contribution to a vigorous academic debate on IP rights and inform policy by discussing the consequences of a recent high-profile ruling on the patent-eligibility of genomic compounds.