Global protection of intellectual property : Pfizer case study
A case on the global protection of intellectual property HarleenV. Rishani A. Sheena C. Neha R. Dexter A. Thuwarga P. Zahin
Introduction- Pfizer• Pfizer- a global pharmaceutical company• Founded in 1849• Before WW II – Largest producer of citric acid• During WW II – Largest producer of penicillin• After WW II – Emphasis on innovation• 1972 – Edmund Pratt, Chairman
International Pharmaceuticals Industry• Innovation increased, emphasising patent rights and protection• Patent protection became critical to corporate strategy• Cost of production only a miniscule part of total cost• Major cost: research and discovery of new products
“The biggest single change in management during my career has been the increase in the time that managers spend in dealing with the government” - Edmund Pratt Chairman and CEO Pfizer Inc.
Importance of the Patent System• Patents gave exclusive rights to make, sell or use the product or process for a limited period of time• 2 types of patents – Product – Process• Incentive for innovation
Patent protection at PfizerPfizer was aggressive in protecting and defending its pharmaceutical patents
Patent problems in developing countries• Offered process patents but not product patents• Inadequate duration of patents• In India, government would price control and force Pfizer to license the product to local companies.
Network of Influence - Priority• Company leaders in favour of intellectual property protection• Internal memos• Operating plans and budgets
Network of Influence - Result• Country managers worked in favour of intellectual property• Pfizer executives for intellectual property protection
Pratt’s Role in forming the IPC• Chairman of ACTPN• Intellectual property protection• GATT negotiations• Intellectual Property Committee (IPC)
Members of the Tripartite Coalition• Intellectual Property Committee (IPC)• The European Union of Industrial Employers’ Confederation (UNICE)• The Keidanren
Basic Framework – six categories of intellectual property• Patents• Copyrights• Semiconductor chips• Trademarks• Industrial design• Trade secrets
Challenges to the coalition viewsIs stealing drugs any more acceptable than stealing food?
1984 Trade and Tariff Act Retaliation Measures – tariffs, quota’s etc. VSU.S. Generalized System Of Preferences – loss of tariff preferences
1988 Omnibus Trade and Competitiveness ActMain Objective• Increase transparency of Offending countriesHow?• Watch List Vs Priority Watch List
Trade Leverage• Mexico Case - Free Trade Agreement• Important Player - Pharmaceutical Manufacturers Association
Encountering Resistance• Canada – 20 yr patent protection• Brazil – 100% levied Tariffs on imports• Thailand – Revoked Tariff Preference
Developing countries Point of View• Freedom in policy making• Lack of adequate resources and time Eg : China and Latin America• India’s patent laws a self sufficient pharmaceutical industry
Our Analysis• Pfizer- the only one• Incentive of Innovation Vs. Security of prices desired by the developing countries• Redistribution of wealth• An aggressive approach - Special 301 by the USTR