In a world where economic growth increasingly depends on “intangible” products and services based on human know-how, knowledge and creativity, only those countries that have the right policy attitude to innovation will thrive.
In addition to skills, regulation and tax policy, intellectual property rights are key to the knowledge economy.
Not only do IPRs provide legal certainty to those investing considerable sums into risky research and development (R&D), they are crucial to today’s networked innovation, in which different stages of product development, manufacturing and marketing are undertaken by multiple organisations, often across borders.
Without clearly defined and readily enforceable IPRs to protect proprietary knowledge, this kind of cooperation between people, companies and countries would be impossible.
Productivity gains, economic growth and crucially higher living standards will accrue to those countries that get the innovation policy framework right.
More countries are recognising this truth. China is in the process of overhauling its IP regime, toughening enforcement and raising standards of protection for copyright, patents and trademarks. Switzerland is raising some patentability standards beyond the EU. Even traditionally IP-sceptic India is taking steps in the right direction and bolstering its IP standards, according to the 2019 Global IP Index.
Given all its economic, demographic and political challenges it seems strange that the European Union should choose this moment to weaken its innovation environment through the SPC waiver (discussed here and here), potentially making the situation worse through a stockpiling provision. This sends out the signal that Europe is not concerned about innovation, but rather with protecting its globally uncompetitive generics manufacturing sector.
Given all its economic, demographic and political challenges it seems strange that the European Union should choose this moment to weaken its innovation environment
Investment capital is globally mobile and Europe does not have a divine right to prosperity. Trading partners are beginning to take note of the EU’s own goal, with the US ambassador to the EU last week accusing the EU of “slowly trying to erode” intellectual property rights.
China now captures more foreign direct investment in R&D than the US, with the pharmaceuticals sector attracting €1.37 billion between 2010 and 2015, according to FDI Markets. The contrast between Europe and such fast-growing markets is stark – and alarming for Europe’s future. The European Commission’s treatment of the SPC issue is yet another black mark against Europe’s international competitiveness.