There was a fascinating panel of pharmaceutical patents yesterday evening. It was hard to walk away with the idea that they are a terribly good idea. It really seems that patents are not a subsidy for innovation, but rather a subsidy for marketing effort. I learned some interesting things I hadn't about how Hatch-Waxman works: there is five years protection independent of patent following successful clinical trials. After that firms face patent challenges - and it seems that generic producers have begun to very aggressively and successfully challenge patents after the five year period is over. The patent holders of course have various legal tricks they use to delay things, but basically I think this is good news. However, Hatch-Waxman applies only to chemical entities, not to biotech. Apparently there is a move in Congress to extend Hatch-Waxman to biotech - needless to say big pharam is aggressively opposing this, but it seems it may actually come off.

Basically five years monopoly is the reward for carrying out clinical trials that everyone can use for free. Left open is why other users of the clinical trials should get them for free; and why on earth we have the pharmaceutical companies carrying out the clinical trials in the first place.

This sounds very interesting, as does the other discussions and papers you mentioned in various posts. Are there any papers by the discussants on the drug patent system?