nep-ipr New Economics Papers
on Intellectual Property Rights
Issue of 2017‒02‒12
four papers chosen by
Giovanni Ramello
Università degli Studi del Piemonte Orientale “Amedeo Avogadro”

  1. Secondary Pharmaceutical Patenting: A Global Perspective By Bhaven N. Sampat; Kenneth C. Shadlen
  2. The Unexpected Consequences of Asymmetric Competition. An Application to Big Pharma By Castanheira, Micael; de Frutos, Maria-Angeles; Ornaghi, Carmine; Siotis, Georges
  3. Digital Music Industry - Background Synthesis By Sellin, Derek; Seppälä, Timo
  4. Copyright Payments in Eighteenth-Century Britain, 1701–1800 By David Fielding; Shef Rogers

  1. By: Bhaven N. Sampat; Kenneth C. Shadlen
    Abstract: Pharmaceutical firms’ use of secondary patents to extend periods of exclusivity generates concerns among policymakers worldwide. In response, some developing countries have introduced measures to curb the grant of these patents. While these measures have received considerable attention, there is limited evidence on their effectiveness. We follow a large sample of international patent applications in the US, Japan, the European Patent Office, and corresponding filings in three developing countries with restrictions on secondary patents, India, Brazil, and Argentina. We examine cross-country comparisons of primary vs. secondary grant rates, consider the differential fates of “twin” applications filed in multiple countries, and undertake detailed analyses of patent prosecution in the three developing countries. Our analyses indicate that measures to restrict secondary patents in developing countries are having limited impact. In none of these three countries are specific policies toward secondary patents the principal determinant of grant rates. Our analyses also suggest the importance of other procedural aspects of patent systems, beyond the formal policies targeting secondary applications, that affect outcomes for these applications in developing countries.
    JEL: I18 O3
    Date: 2017–01
  2. By: Castanheira, Micael; de Frutos, Maria-Angeles; Ornaghi, Carmine; Siotis, Georges
    Abstract: This paper shows that a pro-competitive shock leading to a steep price drop in one market segment may benefit substitute products. Consumers move away from the cheaper product and demand for the substitutes increases, possibly leading to a drop in consumer surplus. The channel leading to this outcome is non-price competition: the competitive shock on thefirst set of products decreases the firms' ability to invest in promotion, which cripples their ability to lure consumers. To assess the empirical relevance of these findings, we study the effects of generic entry into the pharmaceutical industry by exploiting a large product-level dataset for the US covering the period 1994Q1 to 2003Q4. We find strong empirical support for the model's theoretical predictions. Our estimates rationalize a surprising finding, namely that a molecule that loses patent protection (the originator drug plus its generic competitors) typically experiences a drop in the quantity market share-despite being sold at a fraction of the original price.
    Keywords: Asymmetric competition; Generic entry; Pharmaceutical industry
    JEL: D22 I11 L13
    Date: 2017–01
  3. By: Sellin, Derek; Seppälä, Timo
    Abstract: After 15 years of decline, music industry revenues appear finally to have turned a corner with the growth of paid streaming services. However, the industry as a whole may not be equipped to handle the changes brought on by new technology: with affordable home recording equipment, independent artists can release music directly to online platforms; with streaming services, massive per-play consumption reports are generated daily; and with low artist payments reflecting consumer expectations that music should be free, there is growing pressure for the industry to be more transparent with royalty calculations and faster with their payments. In this paper, we describe the state of the global music industry today, and present historical and systemic factors which have led to the industry’s lack of transparency and complexity. We summarize the primary copyrights and licenses involved in music, and present a simplified value web as a basis for future research into possible global solutions. We identify three process layers for infrastructure related to managing assets, rights, reporting, and payments, regardless of physical format: (1) rights ownership, (2) consumption data, and (3) payment systems. Focusing on rights ownership, we summarize the major issues with today’s infrastructure, metadata, and protocols, highlighting causes for industry “black boxes,” the blockages in the system causing creators’ royalty payments to get stuck in the system. Finally, we look at past collaborative initiatives, primarily the Global Repertoire Database (GRD), in order to gain key learnings, and we acknowledge nascent blockchain-related efforts. With the digital music industry thus synthesized, we outline further research to arrive at a future industry architecture and to understand the impacts of the likely music supply chain transformation, and the related managerial implications.
    Keywords: Digital platforms, music industry, value web, global rights database, black boxes, metadata, blockchain
    Date: 2017–02–06
  4. By: David Fielding (Department of Economics, University of Otago, New Zealand); Shef Rogers (Department of English and Linguistics, University of Otago, New Zealand)
    Abstract: Although there have been extensive critical studies of the laws and conceptual understandings of early modern copyright in the past few decades, less attention has been devoted to the authorial payments that followed from those developments. Studies of individual authors or genres have collected details of payments to authors, but no comparative study of the values of those payments exists. This essay assesses 439 examples of copyright payments about which we know enough to match the payment to a particular edition of a book so that we can ascertain the book’s physical format and construction and thus estimate a publisher’s expenses relative to the price paid for the copy. We offer some comparative context for this Data within the larger body of publications across the century, in order to Gauge the degree to which these results are representative.
    Date: 2015–06

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