Retrospective Patents as an Incentive to Open Research

Why do we say we need patents?

A patent is a public declaration of knowledge in return for a form of exclusivity. The deal is that by revealing to others what you have achieved, you have some time to profit from the invention, allowing you to recoup expenses incurred in development without being overly pressured by fast followers. Patents are usually promoted as a way to encourage innovation because they are currently a way towards a guarantee that offsets the financial risk of R&D. This seems reasonable. We should all support public disclosure and risk-taking. However, only those who have read a lot of patents will understand how far from the ideal (of being useful documents) patents usually are.

The offset of risk means that patents are seen by many in pharma and global health as a way to guarantee access to new drugs by the greatest number of people – i.e. as being an essential part of equitable access to essential medicines. Thus despite patents often being perceived (I think) as a tool that benefits big pharma, they are seen as being necessary if we want to see medicines developed and distributed. I understand this is broadly the current position of the Gates Foundation, for example.

Yet there is a significant downside to patents, which is the associated need for secrecy. To patent something requires that that something has not previously been revealed in the public domain. This means that the novelty in the patent is not merely a novelty, but is a novelty that has not been previously described anywhere. So it is not possible to make something new, start using it, and then later on (when it’s clear that the invention works well) to apply for a patent.

In other words, there is no way to be rewarded for an invention if you have already revealed it to people. “Well done on developing something new that works – here’s a period for you to make your money back.” Colloquially, there is no such thing as a “retrospective patent”.

The terminology of course makes no sense. Why would you need to patent something if it’s already public? Correct. So maybe there is another word for a retrospective patent. A license? A monopoly? What? Does this already exist?

I started looking around at the early history of patent law. I wondered whether, when patents were first created, they were awarded (e.g. by a monarch) for a clearly demonstrated invention already of public/commercial value, and one which needed rewarding through a little market exclusivity. But I can’t find anything of this kind. Was it the case that the first patents were awarded on already-operating objects? I’d love to know.

Nobel Patent

Nobel Patent, via Wikimedia Commons


So as it stands patenting cloaks scientific research in secrecy. This means R&D in pharma and, increasingly, in academia, is a secretive process. The secrecy is infecting university research, where many patents are sought on the off-chance that discoveries could be profitable later. Indeed quite generally patents are seen as necessary if we are to capitalize on discoveries made using public sector funds by using downstream private investment.

The secrecy of this process is the most significant barrier to open research. In many cases people are reluctant to share because there is the expectation that we must patent if we are to avoid jeopardizing the financial structure of the whole research system.

Let’s drill down to pharma for a moment. The secrecy means we don’t share the failed R&D campaigns, the current bottlenecks, the early successes. If a drug will fail, it can fail several times, expensively. There’s much duplication in research, wasting money.

There are non-traditional ways to fund drug discovery that offset some of the risk. One can make a guarantee that funding is available later on in development by amassing commitments up-front, and such things (GAVI, HIF) are being used particularly in the area of neglected tropical diseases. These are not yet mainstream, and the funding just isn’t yet there to replace the current pharma R&D system. But in any case, such instruments are still being used within an inherently secretive R&D system. Patent pooling also clearly requires patents, which are generated using the same secretive R&D system.

So: how can we combine an incentive to work openly (and share all our work) with the possibility we can recoup R&D expenses later?

The retrospective patent (RP) (or whatever it’s called) would mean one could invent something using a completely open R&D process where everything is shared publicly as it’s done, improving efficiency in various ways. Indeed that would be a precondition of being granted the patent – a solid paper trail that demonstrates invention (in much the same way we require this with the current patent process where a patent is challenged). Once the invention is shown to function correctly (and perhaps even to function well) the RP is written as a full, static definition of the scope of the invention (to summarize all the work that has been done and clarify the claim) then a period could be granted of financial exclusivity, by some means i.e. a licensing arrangement, with a period that might depend on the degree to which the invention innovates. Those providing the contributions that led to the invention (rather than those just swooping in at the end) would be granted proportional shares of the exclusivity agreed in the written document. Interestingly this means the State could be an awardee, allowing financial kickback for public investments in research, of the kind argued for by Mariana Mazzucato in her book.

Trying to determine who should benefit from this process (who was responsible for the innovation) when the invention was carried out openly will generate a lot of arguments. But we already have a lot of arguments about patents in the current system.

So an RP wouldn’t be a prize* (just as a patent is not a prize) since it would be something with a value that is determined by market forces during a period of exclusivity.

This proposal for “retrospective patents” is naive, but it gets to the core of the problem: the current need for financial exclusivity promotes secrecy which lowers the efficiency of the research process. If financial return could be guaranteed on condition that the research process is revealed openly in full detail in real time, and that the research needs to be demonstrably effective, and that all who contributed could be eligible for financial reward, we would actually incentivize openness.

So my question is: Does this legal/financial instrument already exist by some other name?


(*A note on prizes: Interestingly the kind of post hoc determination described above of who was responsible for past breakthroughs would allow prizes to be run openly, and would allow postmortems on prize funds – i.e. who should get how much of the prize and for what. So the prize could be run with a transparent workflow as a precondition for entry – and after a critical point is reached and a prize awarded the funds could be distributed according to achievement. This would significantly change closed prizes like the Longitude Prize (where people work in isolation in a way that does not change the way the research is done vs. the current system). The need for demonstrating one’s competence as part of an open R&D process should lead to a rather intense level of competition since there is disadvantage to being secretive or doing work that is not reproducible. Open competitions in coding are not mainstream as far as I know, but have shown these intense bursts of creativity. For those used to closed competitions, where one can mull on a problem at leisure without revealing one’s progress, this would be unsettling.)