Patents and Eminent Domain 510
mrbill writes "Interesting take on the Eminent Domain case now before the Supreme Court. Could the same logic behind using Eminent Domain to take real property be used to take a Patent? Apparently some states are contemplating taking drug company patents to force lower drug prices." From the article: "Patents are the key to huge drug-company profits. The industry will fight vociferously to protect them. In West Virginia, where the issue came up last summer, industry lawyers warned a legislative advisory council away from proposing such action on patents, claiming it would be unconstitutional. "
Skeptical of courts... (Score:3, Insightful)
they don't even have to do that... (Score:3, Interesting)
most drug patents are close enough to expiration that the company could delay enough in court to make it a moot point.
eric
Heh (Score:3, Interesting)
When a drug patent comes close to expiring (which they'll prolong), the company generally makes a chemical change to the drug just slight enough such that it can pass as something different (e.g. adding an extraneous methyl group or similar), change the packaging around, maybe make it a 12hr dose instead of 6hrs, and say "WHOA HOLY SHIT NEW DRUG HERE!" and get a new patent. That heartburn/acid reflux drug that I'm totally forgetting the name of now (Nexiium
Re:Skeptical of courts... (Score:3, Insightful)
That's the sort of legislation that is very hard to "buy." Everyone wants cheap prescription medicine. Politicians can and do lose elections, especially when they stand up for legislation that is widely unpopular.
Just think of the commercials. "My opponent voted against legislation that would have lowered the price of prescription medications by up to 45%." That's the sort of thing that could easily lose a politician the election.
Patents are for 17 years (Score:3, Insightful)
Drugs cost hundreds of millions of dollars to develop. If the government gets in the habit of stealing the patent rights, then why should investors pony up the $$$ to develop new drugs?
Re:Patents are for 17 years (Score:3, Insightful)
Next question.
Re:Skeptical of courts... (Score:3, Insightful)
Bugged (Score:4, Interesting)
Re:Bugged (Score:3, Informative)
Re:Bugged (Score:4, Informative)
Re:Bugged (Score:2, Insightful)
Re:Bugged (Score:3, Insightful)
fair market value (Score:4, Insightful)
Re:fair market value (Score:4, Insightful)
Patents aren't really evil, just misguided, but the power of eminent domain is truly evil.
Re:fair market value (Score:2)
Re:fair market value (Score:3, Insightful)
Your rationale has been the excuse of dictator, tyrant and despot in history, all you need to do is replace "humanity" with "our tribe". That you've expanded "our tribe" to include all of humanity isn't going to change matters.
Re:fair market value (Score:3, Funny)
Re:fair market value (Score:2)
Re:fair market value (Score:3, Interesting)
Fair market value is what the drug company paid the government in the first place, IMHO.
Patents are government granted monopolies. What the government grants, the government can taketh away. When you spend ceaser's coins, don't complain when he taxes you.
Re:fair market value (Score:3, Insightful)
Tell me... If you're going to either die, or take drug X, isn't that the definition of desperate?
Lessing did a good one! (Score:5, Interesting)
The Law gives, the law takes away" was the court's basic argument.... It will be really funny to find out what happens when the Congress wants to "take away" This could be good or bad, after all, When We want to get copyright back under control we'll have the same basic argument again by the *IAA's...
Hopefully the court will keep tooting it's horn!! This jsut the IP trap we need to get the IP situation under control... then all we have to do is convice lawmakers... their decisions will stick.
Re:fair market value (Score:5, Insightful)
Besides, the drug companies' ridiculous profits represent the unfair market value, not the fair market value!
Re:fair market value (Score:3, Insightful)
There is zero reason to be pushing prescription drugs on TV. They should only be advertising to doctors and then only with factual information, audited by an unbiased third party, and not marketing them like underarm deodorant with catchy names and pretty colors.
The drug companies are spending stagger
Re:fair market value (Score:3, Insightful)
They could advertise over the counter drugs all they want, just not prescription drugs.
There is considerable irony in the Republican's outrage about Janet's breast and what Howard says but there is a daily bombardment of ads concerning Viagra and erections. I wonder how all the bibl
Re:fair market value (Score:3, Insightful)
Yes we did. Congress banned cigarette ads on television and radio in 1971 (the exact year I'm not sure of). The tobacco companies circumvented it somewhat by plastering signs and their name on sporting events, car racing in particular but there are have been no outright cigarette ads in the U.S. for 34 years. Some places outside the U.S. ban them in sporting events too so racing teams sponsored by tobacco companies have to race with logoless cars
What about copyrights? (Score:2, Interesting)
Not everything would be that way, of course, but if the government has the right to take land to preserve our natural heritage, why not take art to preserve our cultural heritage?
Re:What about copyrights? (Score:3, Insightful)
Their rationale is that it is okay to do that if the new owner will pay more in taxes.
Of course, the new owner, in addition to being able to receive stolen property, is often given a tax break. So it's not about increasing tax revenue -- it's about doing favors for the rich and powerful.
evil government (Score:2, Insightful)
Yup. Always remember that government is a necessary evil. As such, it should be kept as small as possible - no larger than is absolutely necessary to do the job. Oh, and it likes to define more and more things as "government responsibility" so that it can grow. Beware of that, too. They key to personal liberty is personal responsibility. Jealously guard both.
Won't this deter research? (Score:3, Insightful)
Re: Won't this deter research? (Score:5, Interesting)
> Since the drug companies invest so much in research due to the potential profit, wouldn't reducing the potential profit reduce the incentives for research?
I don't know whether it's true or not, but critics claim that the drug companies spend 10x as much on advertising as they do on research.
Profits at a pharmaceutical company (Score:5, Interesting)
There's no need to discuss these things theoretically, when all publicly traded companies have to make SEC filings of their financial statements.
According to Pfizer's most recent 10-Q filing, for instance, they incurred "selling, informational, and administrative expenses" of $4,036 million (or 31.5% of revenues), and "research and development expenses" of $1,888 million (or 14.7% of revenues). The former category includes much more than advertising (administrative expenses include accounting, payroll, facilities maintenance, etc.) Nevertheless, total administrative and marketing expenses were only about twice as much as R&D costs.
People like to talk about the rapacious profits of drug companies. Well, go and look at the numbers for yourself: Pfizer's earnings per share are $1.19; Eli Lilly's are $1.66; Merck's are $2.90. By way of comparison, American Electric Power is $1.51, Wal-Mart is $2.41, Staples is $1.40, Home Depot is $2.26, Anheuser-Busch is $2.77.
Drug companies are not massively more profitable than everything else. People who think that they are should simply invest in them and benefit from the price-gouging which they are supposedly inflicting upon the public.
Re:Profits at a pharmaceutical company (Score:3, Insightful)
Example: MSFT made $0.92 per share last year, BRKA made $4,134.48 per share!!! So Berkshire-Hathaway is way more profitable than Microsoft right? Wrong - Microsoft made about $9 billion last year vs about $4 billion for Berkshire-Hathaway.
The difference is that Microsoft has TEN BILLION outstanding shares and Berks
Re:Profits at a pharmaceutical company (Score:3, Insightful)
They act precisely as a business governed solely by economics should. And this is bad, because they are given power that affects the lives of people who aren't necessarily benefited by what benefits them.
I would recommend that dr
Return on Equity at a pharmaceutical company (Score:3, Informative)
This, too, is easily available. Return on equity is a good measure of whether investors in drug companies are enjoying disproportionate returns. For Pfizer, RoE is 13.46%; for Eli Lilly 17.06%; for Merck 38.46%. For Home Depot, RoE is 21.71%; for Wal-Mart 22.99%; for Staples 18.45%; for Anheuser-Busch 82.26%. The conclusion is the same.
Re:Profits at a pharmaceutical company (Score:3, Informative)
EPS will tell you whether revenues are being utterly devoured by marketing expenses, which is the original assertion I was responding to. If you examine the comparative profit margins of these companies, you arrive at the same conclusion.
Re: Won't this deter research? (Score:2)
Re:Won't this deter research? (Score:4, Insightful)
Im not sure about this, but isnt some drug research partially funded by public money? If the public pays for it, why should a corporation get exclusive control over it?
Re:Won't this deter research? (Score:3, Insightful)
So no loss to the end customer.
Re:Won't this deter research? (Score:2)
Drug companies don't invest much in research anyways, as research money comes from governments and is also subject to tax credits; most of their money goes to marketing.
Brazil did this with AIDS drugs... (Score:5, Informative)
Its a shame that the states are doing what the federal govt. should be doing these days.
For those slashdotters unaware of the SCOTUS case (Score:5, Informative)
Re:For those slashdotters unaware of the SCOTUS ca (Score:3, Insightful)
No one wants to think of their home as the property of the government but there are significant advantages to having it that way.
Re: (Score:2)
local leftism is the way to save America? (Score:2, Interesting)
Re:local leftism is the way to save America? (Score:5, Insightful)
Because if I'm living in a state that's wasting my taxes on this broadband, healthcare, and other ridiculous shit, I can just move to Nevada.
Re:local leftism is the way to save America? (Score:2)
Re:local leftism is the way to save America? (Score:2)
Uh... your state probably already has a department of revenue.
and go ahead with universal healthcare, long term unemployment, low cost broadband, and other progressive/leftist quality of life improvement
Nothing is stopping states from attempting such programs now.
Re:local leftism is the way to save America? (Score:2)
Once the IRS is killed off and the neoliberals can be made to honor their pledges of small govt, then the states can take over and adopt european style welfare state benefits--using the money that the Fed govt is no longer taking from them.
Re:local leftism is the way to save America? (Score:2)
Oh, that would work great. Because I'm sure that the majority of doctors are altruistic enough to stay in a state where their profits are controlled by the government rather than move to a state where more patients means more money. I'm not saying doctors are greedy, just that they're human.
There are enough problems in Canada with people having to wait months for serious health problems to be treated because of wa
Re:local leftism is the way to save America? (Score:2)
The first thing I will do is stop working, and if you feel like working for your money when I can get it for free due to your "long term unempoyment" idea, well... go right ahead.
Matter of fact, I might just become unemployable over the long term. Enjoy taking care of me. Provide my food and shelter, and work your ass off so that I can get it for free.
Gee, most West European countries pay unemployment benefits for many years. And they have been doing it for decades. They seem to be doing qui
Re:local leftism is the way to save America? (Score:2)
Europeans also have MUCH higher tax rates, higher unemployment, and lower economic growth rates.
That is because Europe counts everyone. America stops counting people after their 6 months of benefits run out.
WRONG. Official US numbers are calculated from household surveys that count everyone. Here is a Bureau of Labor Statistics report [bls.gov] if you don't believ
Re:local leftism is the way to save America? (Score:2)
And how do things like average percentage covered by health care, average number of people above the poverty line, average income, etc, compare? After all, having a low unemployment rate is great, until you discover that most people aren't earning subsistence-level wages...
Re:local leftism is the way to save America? (Score:2)
Re:local leftism is the way to save America? (Score:2)
Re:local leftism is the way to save America? (Score:2)
This aint rocket science
Re:local leftism is the way to save America? (Score:2)
*chuckle* The Soviets found that that only works when coupled with the other solution - a heavily militarized border to prevent people from escaping. The Left never changes.
Not so much profit (Score:3, Informative)
In West Virginia, where the issue came up last summer, industry lawyers warned a legislative advisory council away from proposing such action on patents, claiming it would be unconstitutional.
With good reason, since the concept of eminent domain is not actually part of the constitution. Not that it will stop political bodies from trying it.
Of course, the "huge profits" that phamaceutical companies get from selling a drug under patent are not all that great. Not after paying for the cost of creating the drug... not to mention a dozon other drugs that don't make it through the FDA approval process.
Re:Not so much profit (Score:2)
The 5th and 14th amendments recognize de facto that the government has the power to take property for the common good, and requires fair compensation for that property.
Now ot seems to me that the taking of a patent with the idea that it would save the government money is truly a stupid idea - fair compensation would require that the company not be hurt by the taking. The constittion also provides protection against bills of attainder t
Re:Not so much profit (Score:2)
"Fair" does not mean "cater to every whim". If a company spends $10 million devellopping a drug in partnership with a public-funded university, and then spends $80 million marketing it, when the government tak
Re:Not so much profit (Score:5, Informative)
That's funny, I could have sworn that an amendment to the Constitution [house.gov] addressed the taking of private property for public use [reference.com]:
Article [V.] [house.gov]
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation. (Emphasis mine.)
You might actually try reading the Constitution and some of the laws you like to talk about. Seriously, you might learn something. Now, what were you saying?
Re:Not so much profit (Score:2)
Re:Not so much profit (Score:2)
http://bigcharts.marketwatch.com/quickchart/qui
part of the constitution (Score:2)
The concept of breathing is part of the Constitution either, and that will not stop anybody from doing it.
In any case, patents are only property to th degree that Congress makes them that way. We, the people, can limit them any time we like.
Oh yeah, this is a brilliant solution... (Score:3, Insightful)
That'll keep drug companies in business developing new drugs. In fact, if I was president of a drug company, I'd make sure I got my products to market faster after this happened the first time. I would just love deals like this. Here, let me bend over for you... do you mind if I lean on my desk?
It's The American Way! (Score:4, Funny)
It's such a great idea, I can't believe no one's tried it before!
The only concern would be those damn Commie Ruskies trying to undermine our great system.
Re:It's The American Way! (Score:2)
(I hope no mayors, city managers,
Looks like a way to extort a settlement (Score:2, Insightful)
The councilman argues that if drug companies were smart, they would "start talking about price reductions now rather than leave themselves open to a long, drawn-out due process review and hearings to determine just compensation."
So the states wouldn't want this to go to trial. They'd very likely lose. Isn't this just blackmail? However, if their argument is that falicious, the drug companies may not be persuaded to do anything and simply fight back.
Such review and hearings, he warns,
Re:Looks like a way to extort a settlement (Score:2)
That's an interesting question though: How much does drug R&D cost? How much does a few big selling lifestyle drugs like viagra offset those costs? Should we trust the drug companies coporate accountants on those figure? I'm not suggestin
Re:Looks like a way to extort a settlement (Score:2)
Cox-3 inhibitors (such as Tylenol) are relatively safe. I believe you meant selective Cox-2 inhibitors such as Celebrex and Vioxx which have recently come under heat for their link to heart attacks. These drugs had a lot of potential for their ability to block Cox-2 withough affecting the Cox-1 enzymes. Asperin blocked both Cox-1 and Cox-2, so while it had good pain blocking abilities, it's interference with Cox-1 led to a number
Dumb move... (Score:2, Insightful)
Re:Dumb move... (Score:2)
Eminent Domain & Compensation (Score:3, Insightful)
Personally, I think there are cases where eminent domain should be applied to patents-and cases where the government should offer prizes for creation of patents that will be placed in the public domain. The only real dangers of application of Eminent Domain to patents are
a) the price will be too low so folks have their property expropriated
b) the price is too high-so companies lobby to get
Eminent Domain applied to their patents
Of these, I tend to see 2 as the lessor danger.
IFRC... The Wright brothers know about this (Score:2)
Re:IFRC... The Wright brothers know about this (Score:2)
You think wrong. During WWI a consortium of aircraft manufacturers was formed for wartime production. The companies participating pooled their patents ending the possibility of infringement lawsuits. After the war was over the consortium was disbanded and the patents reverted back to the original holders.
Eminence Front (Score:3, Interesting)
Aspirin... (Score:2)
Aspirin is (was) a trademark of Bayer, a German company, who was a big supporter of the the Nazi regime in Germany.
The U.S. Gov't nullified the trademark and patents back in the early 40s, thus allowing other drug companies to call their product "aspirin".
-Charles
Re:Aspirin... (Score:2)
Poor (or Rich) State v. MNC = expensive drugs (Score:3, Insightful)
Even so, eminient domain requires "just compensation" by the state at the time of the taking. With a monopoly on the drug for the duration of the patent, "just compensation" is going to be nothing any rich states can afford, let alone a poor mid-west or southern state. So it seems to me, the states attempting this will spend a lot of tax dollars only to find out they are really not getting any kind of "deal" from the drug companies. Drug companies like Merck, Smith Kline, etc. have as much money, if not more, than the budgets of most states. They can afford to drag this out, even to the point when the patent expires.
Real less Valuable that Intellectual? (Score:2)
Courts have already ruled that taking real property (ie, realestate) for state projects, such as road construction for the greater good, is constitutional. However they might rule that allowing ideas to be used for the greater good is not? Stop the planet, I'm getting dizzy.
Something like this happened in Brazil (Score:2)
Drug company patent history. (Score:3, Insightful)
The moral of this story appears to be, the more you rip off other people's "IP", the better chance you stand of become a multigazillionaire. I'm all for it, then.
In the past... (Score:2)
to take real property be used to take a Patent?
This happenen in France in the 1800's, with the Jacquard loom.
Joseph-Marie Jacquard began his invention, and was interrupted by the French Revolution, and then afterwards completed his invention in 1801. He presented his invention in Paris in 1804, and was awarded a medal and patent for his design, however the French government claimed the loom to then be public property, giving Jacquard a slight royalty and
just wait 20 years (Score:2, Insightful)
I don't have a problem with it (Score:2)
If eminent domain is going to continue to be part of the legal landscape, patents should be among the first things subject to be taken away for the public good.
Paying the Piper (Score:2)
In point of fact, the entertainment industry has already applauded government seizure of intellectual property on
Ahh, socialism (Score:3, Insightful)
But then, we do that with religion too (in an attempt to promote "faith-based initiatives" and such). Perhaps I shouldn't be surprised.
Eminent Domain is the worst legal doctrine in the world, and it is routinely used by small cities to bulldoze private property for the benefit of large corporations for the sales tax revenue the city gains from doing so. Wal-Mart is a classic example of this.
And now the socialist hippies of America want to use Eminent Domain to steal patents from drug makers? Who the hell is going to develop new drugs then?
Some people seriously need to go fucking read Atlas Shrugged. Then take at least 2 courses in economics, and then read some about economic history, because nobody who understands economics, even economists on the left, promote such idiotic ideas.
Solidarity comrade, solidarity.
If only WE would fight so hard... (Score:3, Informative)
If only the citizenry of the US would fight as hard for our REAL property rights! Over the last several years, eminent domain has been used by many municipalities to force people off of the property they OWN so that developers like Wal-Mart can build stores. Some examples:
Alameda Square in Denver Colorado: The City of Denver is considering condemning the shopping center so that Wal-Mart can build a super center. story [reclaimdemocracy.org]
Alabaster, Alabama: Colonial Properties Trust wants to build a shopping center anchored by a Wal-Mart in the town of 24,000. The local government is all for it because they're "not receiving enough in tax revenue to support the town." Trouble is, there are a few property owners that don't want to sell. Answer, local government is resorting to eminent domain. They're citing the increase in tax revenue as the "public good" that justifies condemnation of the property. story [boortz.com]
Ardmore, Pennsylvania. A local government plan to "revitalize" the town of Ardmore has officials seeking to use eminent domain to oust property owners and demolish several historic buildings. story [zwire.com]
New London, Conneticut. (This is the Supreme Court case that's being heard and was referenced in the posted article). The town is attempting to use eminent domain to forcibly evict seven property owners and sieze their property so that a private company can develop more tax-profitable properties on the land. story [cnn.com]
Lakewood, Ohio. Scenic Park, a middle class neighborhood, was seized under eminent domain. The homes were deemed "blighted" because they didn't conform to certain criteria. They didn't have three bedrooms, two baths, an attached garage or central air. Incidentally, the mayor's house, in another neighborhood, doesn't fit these criteria, either. The homes were razed in order to put in a mall and high-end condos. story [cbsnews.com]
Ogden, Utah. The Mayor and City Council want to demolish 34 homes and 6 businesses in order to erect a Wal-Mart (there's that Wal-Mart again) Super Center.
Clemson, SC (right up I-26 from me). Pickens County Council voted to invoke eminent domain to condemn a tract of land zoned residential for the purpose of building a Wal-Mart. story [walmartwatch.com]
Between the years 1998-2002, TEN THOUSAND properties were seized via eminent domain in order for the municipalities to sell to private developers!!! The right to own land and property is directly tied to all our other rights. Now, I'm not a big, Anti-Corporation type of guy as I recognize that corporations are not vast, faceless entities, but are made up of individuals that work, eat, sleep, and all that. I have BECOME extremely anti-Wal-Mart, though, in part due to this eminent domain thing and also because of their recent trouble with the labor laws. I don't begrudge Wal-Mart's right to exist, but they've demonstrated time and time again that they are willing to tight rope the law and even break it if necessary in order to continue growing. They're like a virus that must be stopped. I'm on a personal boycott of Wal-Mart. If something isn't done about governments seizing property rightfully owned by law-abiding individuals, a huge pillar of our democratic republic is going to be severely compromised. This is no joke, people. This poses one of the most severe threats to our country.
If you want to keep abreast of the situation, here are a couple of good links. And I especially want to thank Neal Boortz (national talk radio guy, Libertarian). Were it not for him, FAR fewer pe
Re: Unconstitutional? (Score:3, Informative)
> I don't see how it would be assuming there's due process.
The US Constitution gives authority over patents to the US Congress, not to the states.
Re: Unconstitutional? (Score:5, Informative)
However, the doctrine of sovereign immunity and the 11th amendment make it hard to prosecute state governments for patent or copyright infringement. So a statewide agency could just start making patented drugs, and it would be hard to stope them
Re: Unconstitutional? (Score:3, Interesting)
The interesting thing about the current case before SCOTUS is that it is about the city taking private homes to give to a developer who would build facilities for a pharmaceutical manufacturer. The same right that they claim (the right of the state to forcibly buy your land
Re: Unconstitutional? (Score:3, Interesting)
You are right, a patent is just property. It's a government-sanctioned monopoly for a fixed period of ti
Re: Unconstitutional? (Score:2)
Re: Unconstitutional? (Score:3, Insightful)
Re:In the long term... (Score:3, Interesting)
Anyone who independently develops an idea without looking to see how the patent holder did it should be able to use and profit by his work.
Re:the US constituution (Score:2)
Re:the US constituution (Score:2)
The United States Constitution does not grant rights. It instead describes rights which everybody already has by virtue of being human, and which the state and federal governments are prohibited from taking away from you.
Consequently, no "right to healthcare" exists in the United States Constitution, just as there is no "right to cable television" or "right to f
Re:Whoa! Tinfoil hats anyone? (Score:2)
Re:Profits (Score:2)
What y
Re:Profits (Score:2)
But at the same time, there are a lot of drugs that even the generics are very expensive, or there is no generic alternative and you have to have that particular drug and no other. Generally, it seems to be that the more life-threatening the problem the less choice you have and the more expensive the drugs are (just from my casual observations, no hard data there). One drug that I take monthly would be about $140/bottle for
Re:Profits (Score:2)
Yes. Drug companies definitely need to be prevented from developing new migraine medicines, by taking away their ability to profit from their research investments. That would definitely, er, fix it.