Xuzhou Xinbaisheng Protective Equipnent Co., Ltd. , https://www.xinparkson.com
Prominently enclosing the patented drugs also requires counter-institutional "killing"
The challenges posed by patent systems have long been a major pain point for local pharmaceutical companies. While multinational corporations dominate core technologies, they often employ various strategies to suppress Chinese enterprises in the realm of intellectual property. According to past data, the U.S. holds 59% of biotechnology patents, 51% of pharmaceutical patents, and 40% of human genetics patents, while all developing countries, including China, collectively hold just 5%, 4%, and 3% respectively in these areas. This stark disparity highlights the deep imbalance in global innovation power.
When it comes to balancing public health and patent protection, the interests of developed and developing nations diverge sharply. On one side, developing countries need affordable medicines to safeguard public health and national security. On the other, developed nations invest heavily in R&D to create patented drugs, and their governments often prioritize protecting domestic industry interests. This ongoing struggle reflects a long-standing conflict between access to essential medicines and the rights of innovators.
Domestic companies face significant hurdles in securing and maintaining intellectual property, especially given the gap in innovation capabilities. Under a profit-driven model, companies are reluctant to give up their competitive advantages. Drug patents are a key source of revenue, and once a patent expires, drug prices typically drop by 80%, leading to sharp declines in sales. To sustain market dominance, multinational firms frequently acquire smaller companies or expand their market share through mergers and acquisitions, further consolidating their control over the pharmaceutical landscape.
The revised Patent Law of the People's Republic of China is expected to address some of these issues. In response to the patent dominance of global giants, China is adopting a more proactive stance. By leveraging the intellectual property system, the country aims to secure a stronger position in global competition—a practical and direct approach to navigating the current challenges.
Interestingly, even in a major patent-holding country like the U.S., there is a strong tradition of using flexible provisions under the TRIPS Agreement. The U.S. has a complex “patent exception system,†which includes the Bolar Exception, Sovereign Immunity, and Special Compulsory Licensing Acts. These mechanisms allow for exceptions in certain cases, such as for drug registration or public interest purposes. The Bolar Exception, in particular, is seen as a safe haven for managing patent risks during drug development.
U.S. courts have increasingly broadened the interpretation of the Bolar Exception. It now applies not only to human trials but also to animal studies. Even if preclinical data is not submitted to the FDA, the exception can still be applied if the information is suitable for regulatory submission. This flexibility helps reduce legal exposure for generic drug manufacturers and supports the timely availability of affordable medicines.
While the patent system is designed to reward innovation with temporary monopolies, respecting intellectual property does not mean surrendering competitiveness. Despite the strength of the patent framework, flaws and loopholes remain. For local companies, overcoming these challenges requires not only courage but also strategic use of patent exemptions and compulsory licensing to level the playing field.
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