Study Urges Compensation-Based Approach to Drug Patent Compulsory Licensing

A Penn State researcher argues that ambiguous international rules outlining when and how governments may "break" pharmaceutical patents may end up significantly reducing incentives for innovation while at the same time failing to increase access to medicines. In a new paper "Confronting Myths and Myopia on the Road from Doha," Daniel Cahoy, associate professor of business law at Penn State's Smeal College of Business, argues that the problem is a lack of clarity in compensation for patent owners. He suggests that a three-tiered approach to compulsory license remuneration based on a country's individual ability to pay would do much to resolve the predicament.