(63) See Gilbert & Shapiro, supra note 62, at 322 (contending that if the licensing agreement calls for royalty payments beyond the patent term, the parties base those payments on the licensee's assessment of the value of the license during the patent period
; therefore, the Brulotte rule is based on a faulty premise).
In their view, the availability of trademark protection in the post-patent period reduces an investor's incentive to price monopolistically during the patent period
, decreasing deadweight loss attributable to patent protection.
We conclude that, under reasonable assumptions, socially excessive advertising is more likely to occur if there is a stronger persuasive element to advertising, and/or if the patent rent is higher (due to either longer patent periods
or a higher regulated drug price).
* Because patent applicants must fully disclose their invention in the application, patents are generally considered to encourage more research and investment in new methods and processes aimed at further developing the invention after its patent period
Should Roche's rewards for its research and development in the production of Tamiflu, patented 10 years ago, allow it to set its own price, in the absence of competition, for the rest of the 20-year patent period
During the 20-year patent period
, the firm can go after infringers, securing a sizeable licensing fee or, failing that, taking infringement matters to court.
The patent prevents other companies from making and selling the product during the patent period
. Drug patents can last up to 20 years.
It reached a reasonable settlement with Upshur-Smith, paying $60 million for the products in development for which it obtained rights, and agreeing to settle the patent litigation with Upshur by splitting the remaining patent period
(giving Schering an additional five years of exclusivity, and enabling Upshur to enter the market five years before expiration of the patent).