Abolish the Innovation Patent System - Advisory Body to Government Recommends

Posted at Legal Practice Intelligence - 12 January 2016

 


 

The Productivity Commission has come to the conclusion that:

• Australia’s intellectual property (IP) arrangements fall short in many ways and improvement is needed across the spectrum of IP rights

• Australia’s patent system grants exclusivity too readily, allowing a proliferation of low quality patents, frustrating follow–on innovators and stymieing competition. 

• To raise patent quality, the Australian Government should increase the degree of invention required to receive a patent, abolish the failed innovation patent, reconfigure costly extensions of term for pharmaceutical patents, and better structure patent fees.


IPTA describes recommendations “anti-innovation”

Recommendations in the Productivity Commission’s Report on Intellectual Property Arrangements would significantly weaken the Australian patent system, introduce uncertainty into obtaining and enforcing patent rights, and make the patent system more expensive for innovators, The Institute of Patent and Trade Mark Attorneys of Australia (IPTA) has warned.

The Report makes a number of “anti-patent” recommendations including abolishing the innovation patent system, introducing an objects clause into the Patents Act, virtually removing the availability of extensions of patent term for pharmaceutical patents, raising the threshold on inventive step and significantly raising patent renewal fees.

“Ironically, the recommendations of the report appear to be in conflict with the Coalition Government’s Innovation Agenda, which prompted Prime Minister Malcolm Turnbull to say, in support of innovation, “we’ve got to be prepared to have a go and be more prepared to embrace risk and experimentation”, IPTA spokesman Dr Grant Shoebridge points out.  

Anathema to the Prime Minister's sentiments is the Report’s statement that “the system should provide incentives for IP to be created at the lowest cost to society”, a statement which underpins the recommendations that weaken existing IP rights for innovators. 

The Report adopts a unilateral view without evidence that “Australia’s intellectual property arrangements fall short in many ways and improvement is needed across the spectrum of IP rights”. It also appears to agree, in a biased manner, with certain “participants” that the current patent system hinders innovation and creativity, but there is a conspicuous lack of evidence to support this view. In addition, it arbitrarily takes a position that the current patent system results in a multitude of low-value patents without clear and credible guidance on what constitutes a “low-value patent”.

More curious still, the report has a lofty and unrealistic view that the patent system should only contribute to socially-valuable innovation that otherwise would not occur. There is however, no direction on what socially-valuable innovation is and how to determine whether such innovation will only occur as a result of the patent system.  It simplistically considers innovation from an academic perspective and fails to understand, or even consider, the necessary financial investment and risk that is required to commercialise innovation for the benefit of the public; the very reasons why the patent system needs to offer both rewards and a degree of certainty to innovators and investors.

“IPTA believes that Australian innovation policy, which encompasses the patent system, should provide a substantial incentive and compensate innovators for the risk and financial investment necessary to bring innovation to the market for the benefit of the general public. Australia’s current innovation policy should not be weakened and made uncertain based on the academic views of economists who have neither proximity to innovation nor expertise in relation to commercialisation of innovation,” Dr Shoebridge added.

 

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