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How Intellectual Property Reinforces Inequality 272

Posted by samzenpus
from the no-sir-I-don't-like-it dept.
An anonymous reader writes "Here is an article by Dr.Joe Stiglitz on how intellectual property reinforces inequality by allowing patent owners to seek rent (aka license / sue) instead of delivering goods to the society. From the article: 'At first glance, the case, Association for Molecular Pathology v. Myriad Genetics, might seem like scientific arcana: the court ruled, unanimously, that human genes cannot be patented, though synthetic DNA, created in the laboratory, can be. But the real stakes were much higher, and the issues much more fundamental, than is commonly understood. The case was a battle between those who would privatize good health, making it a privilege to be enjoyed in proportion to wealth, and those who see it as a right for all — and a central component of a fair society and well-functioning economy. Even more deeply, it was about the way inequality is shaping our politics, legal institutions and the health of our population.'"
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How Intellectual Property Reinforces Inequality

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  • by KiloByte (825081) on Monday July 15, 2013 @09:45AM (#44283727)

    That's common to all monopolies in general: by disallowing newcomers and competition, they serve no purpose but feeding whatever company/cartel holds that monopoly. And governments, instead of disrupting them, take more and more bribes to allow creating even more monopolies...

    • Nice simple sound bite. Pity that like most sound bites it grossly oversimplifies the situation. Monopolies form for a variety of reasons, some of which are very much in the public interest. Monopolies are not something to be generally desired but it's not difficult to point out circumstances where they are the least worst option available.

      Patents create a monopoly for a time in order to combat the free rider problem [wikipedia.org] which is a FAR worse problem in most cases than a temporary monopoly. There are lots of inventions that are simply not economically viable without something resembling patent protection. If you want to do away with patents and the problems with their associated monopoly, all you have to do is explain how your alternative to patents will combat the free rider problem. So far no one has come up with a lesser evil but if you can do so I believe a Nobel prize awaits you. (and no, just doing away with patents without a replacement will NOT improve things - particularly for tangible manufactured goods) Please note that I'm in no way implying our current regime of patent law is well designed or without problems. I quite firmly believe our current set of patent regulations are quite broken. I'm merely saying that patents (with their associated monopoly) as a concept are in the public interest due to the existence of the free rider problem.

      In many cases you have a natural monopoly [wikipedia.org] whereby the lowest cost of production is only possible if carried out by a single firm. Public utilities tend to fall into this category. If the cost of production is not as low as possible then prices to consumers by definition cannot be as low as possible either and low prices are very much in the public interest. However because any monopoly creates potential opportunities for abuse and monopolistic pricing, such monopolies are often regulated. Again, it isn't perfect but it certainly serves a purpose beyond "feeding whatever company holds that monopoly".

  • by jcrb (187104) <<moc.oohay> <ta> <brcj>> on Monday July 15, 2013 @09:49AM (#44283765) Homepage

    The article author seems to assume that patented technology just falls from the sky and comes for free to the lucky patent holder who then exploits the rest of the world, when they say;

    "But the patents had devastating real-world implications, because they kept the prices for the diagnostics artificially high."

    they are arguing from false premises. Now in this case I happen to agree with not allowing patents on unmodified genes however it is still the case that the prices are only artificially high if the diagnostics would have existed had it not been possible to acquire patents on them in the first place,

    According to the article it would have been ok if they had gotten the patents if they were motivated to save lives rather than make money. This is not an article which rationally discussed the problems of the patent system, and those problems are legion, it is an article that says if you try and make money you are bad. Not really very interesting.

    • Re: (Score:2, Informative)

      by jeffmeden (135043)

      This is one of the rare cases where I have to side with the patent holders (despite how uncomfortable it is). Myriad Genetics did *not* patent a gene, they patented a propensity for disease test, that featured a specific gene at the center of the test.

      What did getting a patent do for them? It allowed them (or their licensees) to be the only ones legally allowed to perform propensity for disease tests as a service, using that gene. What else did it do? It allowed them to be open about their research, so t

      • by larkost (79011) on Monday July 15, 2013 @11:09AM (#44284701)

        The vast majority of the basic research into disesases is done in univesity labs, funded by government grants. Only when the results hint at commercial viability do businesses (often the reasearchers by leaving the university) then take over and commercialize the work. I am not saying that there is not a lot of effort still left to do, but in many cases the patents are mostly comming out of the early work, and are then blocking people from doing the commercialization work.

        While the drug companies might spend a lot of money to do the final commercialization work, the vast majority of the development cost (lots and lots of dead ends) is born by the government. I am not arguing that that is not how it should be (that is how science gets done), but rather saying that it is silly to think that without patent protections that new things would not be discoverd.

        The case at hand the company was trying to use teh cour system to prevent anyone from creating tests that looked for naturally occuring genes. They were not just blocking people from using the test method they developed, but from using any conceviable method of teting for those specific genes.

        • by TheSync (5291) on Monday July 15, 2013 @02:08PM (#44287057) Journal

          I am not saying that there is not a lot of effort still left to do

          Myriad spent about $500 million on the "effort still left to do" by the way.

          Pharmaceuticals are even more expensive because of the massive cost of FDA testing.

          You are correct - university labs tend to create the basic knowledge, but without that intellectual property right existing to be licensed, Pharma companies would not invest in the testing and manufacture of the drug.

          Much of what Myriad owned in IP on BRCA testing came from the owner's lab at the University of Utah, with research money coming from Eli Lilly.

      • by sjbe (173966) on Monday July 15, 2013 @11:13AM (#44284757)

        Myriad Genetics did *not* patent a gene, they patented a propensity for disease test, that featured a specific gene at the center of the test.

        If what you say is true then why did the recent Supreme Court ruling invalidate [wikipedia.org] Myriad's patents on the BRCA1 and BRCA2? Myriad was apparently granted patents on naturally occurring genes they had managed to isolate and they used these patents to prevent anyone else from testing for the presence of these genes. The Supreme Court ruled unanimously against Myriad on this topic. This does not prevent Myriad from developing some novel test technology, it simply means they can't patent something that is just found in nature the same way they cannot dig up a pile of some mineral and get a patent for what they found.

        How many other diseases will go unstudied, now that there is no reward for linking a gene to a disease?

        There is plenty of reward for coming up with a therapy, coming up with novel testing equipment, etc. There is no public interest to be found in allowing patents for things simply found in nature.

      • by sjames (1099)

        The problem is, effectively they patented fundamental knowledge. Everyone in the industry knew those particular genes conveyed risk of cancer. There were several different ways to test for the presence of those genes. The patent holder MIGHT have reasonably been granted a patent on a particular way to test for those genes if it was novel, but their patent claimed that any detection at all was covered in their patent. It's like patenting "fire is hot".

        None will go unstudied now. Most of that research is done

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      I am fairly sure that it is you that doesn't understand the issue. The patent was for knowledge that many others would have discovered in short order anyway - because they patented a section of the actual human genome. They were perhaps that first to discover its relationship to a type of cancer, or perhaps they were only the first to hit upon the idea to try and patent the human genome. The underlying technology - the test they developed - is fully patentable. But not the human genome itself.

      The patent

    • by mx+b (2078162) on Monday July 15, 2013 @10:22AM (#44284129)

      ... it is an article that says if you try and make money you are bad...

      The author I'm sure very well understands patents. I think your statement over-simplifies his argument though.

      One of the conversations we as a society need to be having right now is regarding HOW people make money. Is it bad to try to make money? Absolutely not. Everyone needs to be able to at a minimum cover basic life needs, and those that work harder should definitely be able to reap what they sow and have extra goodies and a good retirement. I think that's fair.

      The question is, are people making money by exploiting people? Are they knowingly taking advantage of people's ignorance, or taking advantage of laws and systems, to maintain their upper hand and avoid competing against others that very well might have better ideas and more drive, but cannot get a foothold to even start a business? Worst of all, are people suffering when they do not have to, if such a business model was not in the way of a better system? Patents make sure that anyone with a better idea (perhaps someone could come up with a way to make healthcare more affordable while still making money??) is not able to actually compete. What about the right of the entrepreneur to establish a new business? Why is everything always framed in the established businesses, rather than the people prevented from creating businesses (and jobs)?

      IMHO, there is something sociopathic about one's business model being to make money on the suffering of others (particularly things like medical issues, which are often through no fault of one's own -- cannot choose your DNA, etc.). Simply saying "Well someone has to pay for it, and they have a right to make money" doesn't really correct the fact that someone is still capitalizing on someone's illness. Perhaps this is a place where the government makes a lot of sense -- perhaps most medical research should be publicly funded and available to all. Get the idea of "I have to make money off of this cancer patient!" out of the system entirely. (Really, I think education and health care should be rights (or "perks", if you prefer) of any citizen; the function being to give everyone a similar base when they start out in the world. After that, it is up to you what you want to make of yourself, but at least everyone is given a fair chance.). This isn't saying patents in general are a bad idea, but simply questioning whether patents on human health are a good idea..

      I can't say I know the answer, but I think pretending any attempt at conversation is an assault on business's rights to make money is disingenuous, and I'm really getting sick of "...but business!" being the response to everything. How about we agree that if current business models are not working, we try to allow new ones to take over?

      • by cptnapalm (120276)

        "there is something sociopathic about one's business model being to make money on the suffering of others"

        This is ridiculous. They aren't making money by MAKING people suffer; they are making money by STOPPING human suffering. They profit by IMPROVING human life. Hell, this is the entire idea behind things like patents and copyrights: create something that may improve the world and you get a time limited monopoly to benefit from it.

        There's certainly a great amount of room for debate on how long that time

      • by mcmonkey (96054) on Monday July 15, 2013 @12:01PM (#44285433) Homepage

        I think pretending any attempt at conversation is an assault on business's rights to make money is disingenuous

        But then you say,

        IMHO, there is something sociopathic about one's business model being to make money on the suffering of others

        You could argue calling someone sociopathic isn't an assault, but I'd say you were being disingenuous.

        I work for a biomedical company. We make money on the suffering of others. We make money because other people are sick. We didn't cause that sickness, and I'm sure most of us would happily find other work if the diseases we treat didn't exist, and we'd love to be in the business of selling cures rather than treatments, but it is what it is.

        If the business aspect and the profits and the patents were removed and access to our products was a right, our treatments would not be any cheaper. In fact they'd be infinitely more expensive, because they'd likely not exist.

        These ideas--that intellectual property and patents are wrong and represent some social injustice--aren't just wrong, they're dangerous. First, these swords cut both ways. I am a strong believer in government funding for basic research. The same IP laws the private sector uses to build businesses and make profit are also necessary for We The People to get credit for the discoveries and inventions we pay for.

        Second, as a practical matter, history tells us this system (in a larger sense) works. Look at the industrial revolution. Why were some areas rich with invention and progress and others not? The necessary factors included access to raw materials such as iron ore and energy sources such as coal, but another large factor was a strong IP system. In cultures where innovation is rewarded with profit, we see more innovation.

        The patent system specifically as it exists today certainly has many issues. But what we have is still better than no patent system at all.

        Patents make sure that anyone with a better idea (perhaps someone could come up with a way to make healthcare more affordable while still making money??) is not able to actually compete. What about the right of the entrepreneur to establish a new business? Why is everything always framed in the established businesses, rather than the people prevented from creating businesses (and jobs)?

        I think you have that backwards. Large corporations certainly have twisted the patent system to serve the status quo and reduce the rewards of independent innovation, but that's a political problem. We can cover that in a discussion of lobbyists and role of private money in politics.

        Let's say the patent system was weakened or removed entirely. Does that make it more likely the entrepreneur can establish a new business model? Does that make it easier for the new-comer? Easier to complete with the established company that already has the brand recognition, already has the manufacturing capabilities, already has the distribution network, already has the agreements for shelf space with retailers?

        The solution for protecting the independent entrepreneur from established businesses is a stronger patent system, not a weaker one.

        I think patents should be for non-obvious, working implementations of novel ideas--inventions, not discoveries. Something that already exists by definition fails the "novel" test. This includes human DNA. Invent a new way to manipulate DNA to diagnose genetic issues? That might be worthy of a patent. Discover something in gene X causes disease Y? No patent.

        How about we agree that if current business models are not working, we try to allow new ones to take over?

        You want better, more affordable, more accessible health case? Forget patents. Even if I grant your assessment of the patent system, you have a loooooong list of issues to address that are having bigger impacts on health case costs. Start with insurance companies and the way prices for health services are determined.

        But that covers issues with existing treatments and services. You want better health care through innovation? Then you should embrace the patent system. It can be better and should be stronger.

  • by Anonymous Coward on Monday July 15, 2013 @09:50AM (#44283775)
    Yet in Australia, the most corrupt and inequitable country in the English-speaking world, the courts ruled that the BRCA1 patent owners can screw 'we the people' for all they are worth, all the while their porcine politicians snorted and squealed in delight.

    Gene patenting: Australian court rules BRCA1 patent is legal http://theconversation.com/gene-patenting-australian-court-rules-brca1-patent-is-legal-12240 [theconversation.com]

    This is nothing new. When asked to rule if Australians had free speech the Australian courts wouldn't even grant them that: http://www.findlaw.com.au/articles/4529/do-we-have-the-right-to-freedom-of-speech-in-austr.aspx [findlaw.com.au] http://www.sbs.com.au/news/article/1741850/QA-What-are-the-limits-to-free-speech [sbs.com.au] http://www.ask.com/question/what-countries-don-t-have-freedom-of-speech [ask.com]

    Well, nice to see America putting Australia to shame: http://en.wikipedia.org/wiki/Implications_of_US_gene_patent_invalidation_on_Australia [wikipedia.org]
  • by Anonymous Coward

    I'm not a fan of patents but Mr. Stiglitz's central argument is silly unless this is a pitch to Marxists or whatever-Richard-Stallman-is types. Landlords can hold arbitrary amounts of property and charge rent on all of them... isn't that an accepted part of our society?

  • by Elbereth (58257) <krachtm@yahoo.com> on Monday July 15, 2013 @09:54AM (#44283829) Homepage Journal

    I've tried making that argument, but most people won't really care until it becomes a talking point beaten to death by demagogues on TV. Also, I cringed a bit when I read that summary, because every phrase screams "leftist academic". That's one of the quickest and easiest ways to get dismissed by moderates and center-right allies.

  • by tgd (2822)

    As others have said, all property rights exist to protect and promote inequality.

    And what's the problem with that? Inequality is pretty much the defining characteristic of life. Evolution works because something got more than something else.

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      Your logical mistake is equalling a "characteristics of life", inequality, with evolution.
      Just because A has C and B has C, does not mean that A is B.
      The problem is logical failure.

      Now, if someone is truly better than someone else, clearly they "deserve" a bit more. However, nobody "deserves" to treat other human beings as slaves, or getting rich from their diseases when it can be cured by a simple cure. Modern soceity is built on the foundation of "equality", that all people are "equal".

      It's a logical mist

    • by danbert8 (1024253)

      Actually "intellectual" property rights exist to encourage new ideas. At least that's what they were supposed to be...

      To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

      • by tgd (2822)

        Actually "intellectual" property rights exist to encourage new ideas. At least that's what they were supposed to be...

        To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

        Um, no shit. And by securing for a limited time, you're promoting inequality for that time.

        You know, exactly like I said.

  • by coldsalmon (946941) on Monday July 15, 2013 @10:24AM (#44284157)

    This is a feature of all private property protections. We don't mind having private property because the goal of our society is promoting general welfare, not promoting equality. Sometimes these two goals are compatible, and sometimes they are not.

  • overblown (Score:4, Insightful)

    by slashmydots (2189826) on Monday July 15, 2013 @10:34AM (#44284283)
    So (in cases other than this DNA one) a company spending billions on research for something and then making a basic effort to prevent bottom-feeding generic companies and foreigners from ripping off their work with zero investment in the initial research causes Earth's elite population to move to an exclusive space station orbiting Earth called Elysium? I think this article is a little overblown, as is my hyperbolic oversimplification of it.
    The real issue here is stupid patents. People patenting round corners and touch to open and the wheel or whatever other stupidity the patent office lets pass by. Those pretty much result in extortion to other companies. But then you've got Dungeons and Dragons. The company invents something that cost a fortune to develop with staff time, spell checking, math, balancing, etc. Someone shouldn't be able to rip it off freely and resell it or give it away just because it's intellectual property and not "real" property. Some copyrights and patents reflect actual value and some are made up BS to go around suing people over. THAT is what needs to be fixed. Depriving the poor masses of their right to D&D information by lording it over them with patents and copyrights is a completely made up fantasy though (pun intended).
    • The real issue here is stupid patents. People patenting round corners and touch to open and the wheel or whatever other stupidity the patent office lets pass by.

      The real issue is stupid journalism that leads people to believe that the patent office is letting patents through on "round corners" and "touch to open" and "the wheel".

  • intellectual property reinforces inequality

    That's the whole idea.

    • private property reinforces inequality

      That's the whole idea.

      Fixed that for the original author but your comment still holds.

      Personally, I kind of like the idea that what I've busted my butt working to get is mine and can't be taken away to give to some snivelling, lazy-assed bastard who thinks he or she is entitled to what I've worked for but are too lazy to work for it themselves.

      Cheers,
      Dave

      • by PopeRatzo (965947)

        Personally, I kind of like the idea that what I've busted my butt working to get is mine and can't be taken away to give to some snivelling, lazy-assed bastard who thinks he or she is entitled to what I've worked for but are too lazy to work for it themselves.

        That's fine, but "intellectual property" has nothing to do with that.

  • Oddly enough... (Score:4, Insightful)

    by Oligonicella (659917) on Monday July 15, 2013 @10:38AM (#44284347)
    his articles are copyrighted.
  • premise is correct (Score:5, Insightful)

    by Simulant (528590) on Monday July 15, 2013 @10:38AM (#44284353) Journal

    The problem with IP today is the complete lack of reasonable limits on who can make money from IP and for how long.

    It's is fundamentally unfair to the world to expect unlimited and life-long (or longer) income from your IP (or even worse, from someone else's IP to which you have acquired the 'rights').

    IP is a human mental construct that was brought into being to address fairness. The pendulum has swung way too far.
  • confiscation? (Score:2, Insightful)

    by Anonymous Coward

    So if society is going to confiscate intellectual property for the good of the whole.. is it going to compensate those who spent millions iventing it. or subsidize those who in process? As hard as it may be for some of you to beleive.. these people and companies invested A LOT of time and money into these products.

    • Perhaps this might be a job for the takings clause. The U.S. government already has power under the Fifth Amendment to seize private property in exchange for "just compensation", which courts have defined as fair market value. Here's how it could work: An independent assessor comes up with a figure for the value of a copyright or patent, some non-profit organization crowdfunds buying the property, and then the government condemns the property under eminent domain and makes it available to the public under a
    • it wouldn't be confiscation, per se. They could just opt to not give you that particular handout in the first place.
  • While I can see the temptation to compare IP to land ownership, I do not think they make for a good comparison.

    Land, as a limited resource, can indeed run into a lock-in problem. When a small number of land owners have a lock on the majority of the usable property they can collect rent and essentially prevent people from building their own resources without actually contributing anything. This was a serious problem when it came to say farm land since once land owners grab up the land, actual farmers have
    • It's a lot like land. A songwriter has been successfully sued over having accidentally copied an eight note sequence from another song. But there exist only a limited number of eight note sequences. There are seven intervals in the scale from one note to the next, and the time from the start of one note to the start of the next can be short or long. (The last note has no following note.) This means 7 * 2 = 14 possibilities per note other than the last, or 14^(n - 1) possible n-note sequences, or fewer than
  • I like inequality (Score:3, Insightful)

    by melted (227442) on Monday July 15, 2013 @11:58AM (#44285395) Homepage

    Am I the only one who likes inequality? Not to the extend that it exists today, but it's pretty much the only thing that makes most folks to get out of bed in the morning: the hope that they'll be better off than those that skip the "getting out of bed and going to work" part. That's why inventors invent, researchers research, directors direct, actors act, writers write, software engineers code, and folks at Boeing make airplanes and space ships. What would be their motivation if no matter what they did, they'd still be "equal" to someone who sits on his ass all day and does nothing? There are not one but several large scale examples that equality does not work. Russia, pre-capitalism China just the two largest ones. And not working was a crime in those countries, punishable by jail time.

    Why must everything be the lowest common denominator?

  • the court ruled, unanimously, that human genes cannot be patented, though synthetic DNA, created in the laboratory, can be.

    If only that were true! Read the SCOTUS decision, already.

  • Stiglitz does not point out that Myriad spent $500 million developing its BRCA tests. Without assurances of a limited period of patent protection, who would have made this investment?

    What else did Myriad do? Myriad entered into a Memorandum of Understanding with the National Cancer Institute (NCI) to provide at cost or below cost testing to the NCI and any researcher working under a NCI funded project. Myriad created a network of health care professionals, service providers and insurers, and hired a larg

  • The U.S. Government decided that intellectual property don't have a meaning anymore as they decided that we don't need to have privacy (we aren't owners of what we produce for ourselves anymore?). So is another corporate leverage tool, not something that we can have. Is just another misplaced title over something that don't have that meaning, like "Department of Justice", to fool you.
  • by jxander (2605655) on Monday July 15, 2013 @02:34PM (#44287339)

    The issue isn't the concept of Intellectual Property. The problem is how IP rights are doled out, and the breadth of patents issued.

    The fact that patenting a genome was even ever up for debate is systemic of the patent office in general not knowing what the fuck they're doing. You should be able to patent the method by which a genome is altered, sure. You could even claim that a sequence that you created from scratch in a lab is your IP (assuming that sequence doesn't occur naturally) But the original proposition was beyond asinine. It would be like inventing a camera, taking a picture of someone, and then claiming that person's face is now your IP. And this concept gained traction. WTF. That they weren't immediately laughed out of the office is just another symptom of the root cause.

    Likewise, Google has IP rights over their search process, and the algorithms used in searches ... but they certainly have no dominion over the concept of "web searching." Movie studios have IP rights over their specific movies, and characters contained therein... but Marvel doesn't have rights over the concept of Super Hero movies. These examples are obvious and clear. But as soon as we start talking about something even a little bit abstract, like "genomes," everyone drops the common sense.

    I'm not familiar enough to know the root cause, but my SWAG* is simply age and indifference. Those in charge of the Patent Office are old farts who can't be bothered to learn these newfangeled thingy-ma-whats-its. A more cynical view would be that those in charge know exactly what they're doing, and have been well paid to keep doing it... but I'll side with Hanlon's Razor on this one.

    *that would be this SWAG. [wikipedia.org] Not whatever newfangled definition you kids are using today.

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