Thirty Years of Flawed Incentives: An Empirical And Economic Analysis of Hatch-Waxman Patent-Term Restoration

摘要

Thirty years ago, the Drug Price Competition and Patent Term Restoration Act ("Hatch-Waxman") created a new foundation for pharmaceutical innovation by extending patent term for pharmaceutical patents and expanding access to generics. This Article explores the effects of Hatch-Waxman's patent-term restoration provisions through an empirical and economic analysis and concludes that major structural reforms are needed. The life of a pharmaceutical patent continues to be highly unpredictable and subject to numerous biases and inefficiencies. For example: effective patent term for Hatch-Waxman patents can vary from several months to fourteen years; biologies receive more than a year and a half more patent protection than medical devices; and the implementation of the Uruguay Round General Agreement on Tariffs and Trade ("GATT") has caused billions of dollars of windfall gains and losses while accelerating reliance on improvements over new products. Moreover, Hatch-Waxman's unnecessary and heavy-handed incentivization of obtaining FDA approval as quickly as possible places adequate safety and efficacy testing in direct conflict with brand name pharmaceuticals' profit motives. This Article thus recommends moving towards a system of market exclusivity that provides pre-defined periods of protection for novel pharmaceutical products.