Given the current alignment of interests, where might European policymakers start making politically feasible reforms to strengthen Europe's innovative capacity in biotechnology? Perhaps the best place to begin would be IP, strengthening protections inside Europe over invented organisms, genes and other biological subject matters. First, the availability of such increased protections would only begin today. It would not be retroactive to inventions already made and thus would not give away any current market share. Rather, it would only obligate Europeans to give national treatment to foreigners over future inventions. Convenient for the requirement of political feasibility, IPRs and the incentives they provide are by nature 'emergent'. They do not involve a redistribution of existing assets, but only arise when new knowledge and technology assets are created. Furthermore, their value is created only when an innovation truly meets the needs and conforms to the preferences of sovereign consumers, i.e. when it actually sells. Thus, in these regards, a stronger IP regime gives consumers more say over the rate and direction of innovation than does a weaker IP regime. Finally, compared with other options, like financing basic research at universities and institutes, implementing IP reform does not impose a significant cost burden on the government and taxpayer.

An initial strengthening of IP over biological subject matters would achieve three things: (i) it would enormously boost incentives to biotechnology innovators in Europe and worldwide; (ii) it would send a powerful signal to European innovators, both at universities and at firms, concerning the national governments'

and the EU's commitment to innovation in biotechnology; and (iii) it would serve notice to European firms that they are going to compete with the rest of the world for future markets through success in biotechnology innovation, which will focus attention sharply on the need for significant investment in world class R&D.

However, IP reform by itself will not be sufficient to bring European biotechnology to full maturity. As long as regulatory approvals are not granted, European agricultural biotechnology patents will have little value and thus little incentive power. Maintaining case-by-case product approvals would give European regulators some control over entry into domestic markets, which in turn might give some reassurance to European firms that they might be able to edge into their domestic markets ahead of their better equipped rivals. However, a transparent and competitive product approval process that does only the job of protecting consumers and the environment by setting and enforcing reasonable standards - without engaging in any sort of industrial policy - is in the long run best for domestic innovative capacity.

Most importantly, IP reform will have to be quickly backed up by significant investment in the basic life sciences, coupled with clear and workable IP and technology transfer policies for universities and public sector research. These might be qualified with preferences for licensing to domestic firms and made subject to technology export controls. In the USA, research conducted in universities, hospitals and government institutes, funded by the National Institutes of Health (NIH) and, to a lesser extent, by the Department of Energy (DOE) and United States Department of Agriculture (USDA), coupled with technology transfer policies established by the Bayh-Dole Act, have built up the innovative base and driven the commercial development of biotechnology. Given well-reasoned initial steps, European innovative capacity and comparative advantage in biotechnology will increase. European champions will then increasingly come forth, seeking stronger science and technology policies to advance their own interests, and a virtuous cycle of innovation and economic growth will be set in motion.

0 0

Post a comment