As the result of the well-received article entitled How Market-Based Policies Could Spur Biotechnology Growth In Russia, recently co-authored by ITSSD President/CEO Lawrence Kogan and Russian government lawyer Yelena Bakulina, accessible at: http://www.wlf.org/upload/03-21-08balukina.pdf; http://www.insideronline.org/summary.cfm?id=7019; and http://www.itssd.org/Publications/03-21-08balukina.pdf , the ITSSD was invited to participate in the First EurasiaBIO Congress Conference convened in Moscow, Russia during April 24-25, 2008.
A copy of the press release announcing the Kogan-Bakulina article appears on the EurasiaBIO website at: http://www.eurasiabio.org/; and http://www.eurasiabio.org/media/news/itssd_russia_can_secure_greatest_biotech_market_advances_following_us_not_eu_innovation_model/
The Official Program of the FIRST INTERNATIONAL CONGRESS FOR BIOTECHNOLOGY, BIOENERGY AND BIOECONOMY is accessible at: http://www.eurasiabio.ru/images/Program/Program/EAB%20V19eng%20FINAL-site.doc .
The ITSSD powerpoint presentation delivered at the EurasiaBIO event is accessible at:
http://www.itssd.org/Programs/KoganPresentationEurasiaBIOMoscowConferenceApril2008.ppt .
The EurasiaBIO Congress is the global event for Biotechnology and Renewable Energy in Russia and CIS countries. The Congress is hosted by the Yu.A. Ovchynnikov Russian Biologists Society and the Russian National Biofuel Asociation. The event offers an unparalleled opportunity for biotechnology, pharmaceutical and energy companies, academic research institutions, and investors from around the world to gather in one place at one time to learn about each other, meet one-on-one, and discuss business opportunities of mutual interest.
The EurasiaBIO is supported by:
The State Duma of the Russian Federation Ministry of Industry and Energetics of the Russian Federation Ministry of Agriculture of the Russian FederationRussian Academy of SciencesRussian Academy of Agricultural SciencesEuropean Federation of BiotechnologyEuropean Commission Research DG
Saturday, May 17, 2008
ITSSD President Participates in Moscow EurasiaBIO Conference Following Well-Received IP Tech Transfer Article
Friday, March 21, 2008
Russia Can Secure Greatest Biotech Market Advances Following US, Not EU Innovation Model
Furthermore as the authors note, "The Kirov Region certainly has the potential to develop effective innovation systems supported by the investment and protection of privately owned intellectual property in the sphere of modern high tech technology. If properly managed...this could create jobs, know-how and other economic and social benefits in the Kirov Region."
"Such an approach," adds Kogan, "would allow Russian biotechnology markets to leapfrog those of the European Union to capture a greater share of the global marketplace for biomedical and bioenvironmental products and processes. Unfortunately, the current EU innovation model is fixated on governmental market control via regulation rather than on market facilitation via economic incentives that ease the burdens and costs of doing business," emphasizes Kogan. "The EU Commission is more obsessed with dictating the rules of the game to ensure 'parity-over-progress' than with providing hi tech European businesses operating in the biotech sectors with
the necessary property rights-based enabling environment and economic freedom to grow and prosper. "Consequently," Kogan notes, "EU biotech and pharma companies have increasingly relocated operations to the US."
The Institute for Trade, Standards and Sustainable Development (ITSSD) is a non-partisan non-profit international legal research and educational organization that examines international law relating to trade, industry and positive sustainable development around the world. This and related ITSSD articles are accessible online at:
http://www.itssd.org/Publications/03-21-08balukina.pdf; http://www.itssd.org/ and http://itssdinternationaliprights.blogspot.com/.
CONTACT: ITSSD, +1-609-951-2222, info@itssd.org
Sunday, March 9, 2008
Europe Must Use Its Head On Academic Research
http://www.ft.com/cms/s/0/85f21278-eb97-11dc-9493-0000779fd2ac.html
Europe must use its head on academic research
By Bruno van Pottelsberghe
Financial Times - Leaders & Letters
Published: March 7 2008
The European Union summit next week is set to decide that the main policies of the much-maligned Lisbon strategy, which aims to make Europe the world's most innovative region, should be carried through until 2010.
And why not? Though average growth is sluggish, the EU has created almost 6.5m jobs in the past two years and 5m more are expected by 2009. Average unemployment is expected to fall to below 7 per cent this year, the lowest since the mid-1980s. The Lisbon benchmark of getting 70 per cent of the adult population into work by 2010, which escaped the EU's recent purge of targets, no longer looks impossible.
[ONE MUST SERIOUSLY QUESTION WHETHER THE JOB GROWTH HAS BEEN IN THE GOVERNMENTAL SECTOR]
So far, so good. But one vital Lisbon policy area is going backwards: research and development.
As the European Commission itself concedes, the proportion of the EU's gross domestic product spent on R&D has actually dropped since the Lisbon strategy was launched. After flatlining for two decades, research spend fell from nearly 2 per cent in 2000 to 1.85 per cent in 2006, thus moving the EU further away from its target of 3 per cent (recently trimmed to 2.6 per cent) by 2010. But what is a target for overall R&D spending worth? Missing the target is bad enough. But publicly missing the wrong target is perverse.
Europe's spend is well below the US's 2.5 per cent and Japan's score of more than 3 per cent. China has engineered a dramatic increase, from nearly nil 10 years ago to 1.5 per cent in 2006. Of course, there are big differences between EU member states. Finland and Sweden leapfrogged the 3 per cent target several years ago. But the vast majority of EU countries spend well below 2 per cent of their GDP on R&D. Does this matter? Yes and no.
No EU member state fulfils the original commitment that governments should finance one third of investment in R&D, or the equivalent of 1 per cent of GDP. Many have reduced their support over the past 10 years, including the UK, Germany, France and the Netherlands. This matters. EU governments should increase their spend and honour their promise. Failure to do so ultimately means lower growth.
As for business, spending varies widely between countries, but these variations are to a great extent attributable to differences in technological specialisation. If a country specialises in information and communication technologies (such as Finland) one would expect a higher R&D intensity than for a country specialising in finance (eg Luxembourg) or tourism. Thus measuring EU countries' private R&D spend against a common benchmark makes little sense. Also, governments cannot decree business spending from on high: it does not respond to policymakers' targets.
What, then, should the EU and governments do to get business to invest more in research? When industrial specialisation is taken into account, only Sweden and the US outperform other countries. According to a Bruegel policy brief ( Europe's R&D: Missing the Wrong Targets ), two factors may explain this and point to what the EU's policy focus should be.
For the US, its large, homogeneous market radically improves the expected return on research activities and hence fosters business R&D spending. Europe does not benefit from such a scale effect despite its larger size because its market is still highly fragmented.
Market size may explain the US R&D spend, but it does not explain the Swedish case. One clue: Sweden has a very high level of spending on academic research, the highest as a percentage of GDP in the whole Organisation for Economic Co-operation and Development area. This strong emphasis on academic research is a stimulus for business R&D: universities generate new ideas, then business is attracted in to develop them, individually or in clusters, foreign or local. The European countries with the highest academic R&D intensities are also those with the highest business R&D intensities.
True, the EU has recognised the need for free movement of knowledge, the "fifth freedom", and has pushed for a new European Institute of Innovation and Technology. Both initiatives may bear fruit in time. But the bottom line is that the EU needs now to adopt a common European patent - under discussion for 30 frustrating years - and spend more, and more wisely, on academic research. These two steps would do more for the success of the Lisbon strategy - and for the EU's credibility - than maintaining top-down targets for business spend on R&D.
The writer is a senior fellow at Bruegel, the Brussels-based think-tank and professor at Université Libre de Bruxelles
Copyright The Financial Times Limited 2008
Thursday, February 7, 2008
Bush Administration Sees Wisdom of Preserving US Global Competitiveness in Life Sciences; IT Coalition Patent Reform Position Deemed Spurious
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/02/05/BUOGURRUS.DTL
Bush staff, tech titans split over patent bill
Tom Abate, Chronicle Staff Writer
Tuesday, February 5, 2008
The Bush administration said Monday that it opposes a key provision of a patent reform bill that has passed the House of Representatives and is awaiting a floor vote in the Senate, taking sides in an intellectual war over how best to promote innovation.
The position puts the administration at odds with big technology firms like Intel, IBM, Apple, Google, Cisco and Hewlett-Packard that have banded together to push the bill, and squarely on the side of the biotech and venture capital industries, which say the proposed change would significantly weaken patents.
A patent is a government-issued monopoly that gives inventors the legal right to control the use of their discoveries for up to 20 years.
[A PATENT IS RECOGNIZED AS A PROPERTY RIGHT OF TEMPORARY DURATION UNDER U.S. CONSTITUTIONAL AND CIVIL LAW]
In a six-page letter written on behalf of the U.S. Patent and Trademark Office, the administration told senators that it disagrees with a provision that would change the way damages are calculated in cases when patent infringement is proven. That change "could promote infringement,"the administration warned, saying it would oppose the legislation unless the bill is changed to "protect the inventor."
"What the administration is saying on damages is our position as well," said Kelly Slone with the National Venture Capital Association, which has sent senators a letter signed by Kleiner Perkins Caufield and Byers, New Enterprise Associates and others.
Mark Isakowitz, a lobbyist with the tech-sponsored Coalition for Patent Fairness, downplayed the significance of Monday's letter, saying the administration made much the same argument before the House passed its patent bill by a 220-175 vote in autumn.
"We strongly and respectfully disagree with their view," said Isakowitz, adding that he still expects the bill to come up for a floor vote in the Senate around the end of February. "Between now and then we have to try and reach a broader consensus on damages," he said.
Patents are authorized in Article I of the Constitution, which gives Congress the power "To promote the Progress of Science." But the Constitution does not say exactly how, which has meant a never-ending series of arguments, said Kenneth Dobyns, a retired patent attorney who wrote a history of the system called "The Patent Office Pony."
"There's never been a time when it wasn't like this," Dobyns said.
At the heart of the current dispute is the fact that patents, which have been on a sort of pendulum swing throughout U.S. history, from worth very little to worth very much, are somewhere at the high end of their historical value.
The reasons have little to do with Congress, which has not really changed patent law since 1952, but rather with a reorganization of the federal court system in the 1980s. That change created what amounts to a special court of appeals for patent cases that has, generally speaking, ended up strengthening patent law, according to Bronwyn Hall, a UC Berkeley economist who has studied the situation.
Perhaps the high point of patent strength, at least to members of Congress, came in recent years when the Canadian company Research In Motion paid $612.5 million in March to settle a patent dispute that had very nearly lead to a court-ordered injunction stopping sales of the BlackBerry device, which is popular on Capitol Hill.
The size of the settlement and the drama leading up to it lent credence to tech industry complaints about patents.
"We have a system which is out of whack, out of balance," said Tim Sheehy, a Capitol Hill lobbyist for IBM Corp., which backs the current language on damages that the White House opposes.
Biotech industry leaders feel particularly threatened by proposed changes because their whole industry has grown up in the past 25 years when, largely thanks to court actions, patents have become more and more valuable.
"If it comes down to a choice between a tilt toward the iPod or a tilt toward cancer cures, I think that's a no-brainer," said James Greenwood, president of Biotechnology Industry Organization.
What remains to be seen is whether the disagreement over damages can be ironed out, or whether the bill will stall.
"A forced choice is a false choice. The current proposal forces a choice of promoting one innovation over another," said Patent Office Director Jon Dudas, who held out hope of an agreement being reached.
E-mail Tom Abate at tabate@sfchronicle.com.
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/02/05/BUOGURRUS.DTL
Sunday, January 20, 2008
Brazil’s ‘Open and Universal Access’ Agenda Undermines its Own Technological Future
Brazil’s ‘Open and Universal Access’ Agenda Undermines its Own Technological Future
The following article was authored by Pat Choate, PhD, Director, Manufacturing Policy Project.
The article was prepared to support the manuscript entitled,
Rediscovering the Value of Intellectual Property Rights: How Brazil's Recognition and Protection of Foreign IPRs Can Stimulate Innovation and Generate Economic Growth, International Journal of Economic Development, Vol. 8, Nos. 1-2 (Sept. 2006), at pp. 1-4, at:
http://www.spaef.com/IJED_PUB/v8n1-2.html
http://www.itssd.org/White%20Papers/ijed-8-1-2-choate.pdf
Brazil’s ‘Open and Universal Access’ Agenda Undermines its Own Technological Future
The great riddle of 19th and early 20th Century economics was the role that technology exerted in economic progress versus the contributions of labor and capital. By the beginning of the 21st Century, most economists agreed that technological innovation was the motor of development and that its continuity and accumulated creations, what the Institutional Economists called “tools,” furthered a progress that persistently reduced squalor and improved the life of nations.
Lawrence A. Kogan’s article is in that tradition. His thesis is Brazil is undermining its national innovation efforts by policies and practices whose ultimate effect is to discourage the creativity of the Brazilian people and divert meaningful levels of direct foreign investment.
Kogan buttresses his argument with a detailed description of how the Government of Brazil has sent forth its diplomats to diffuse the concept of intellectual property rights in various international forums. First at the World Trade Organization (WTO), then the World Health Organization (WHO, and then at the World Intellectual Property Organization (WIPO), among others, he describes and analyses how Brazil has advanced an agenda of “open and universal access” which translates into a “taking” by the state of the creations of others and then making them publicly available without proper compensation, or often even acknowledgement. As a strategy, Brazil, he notes, is forum shopping, changing one provision here, and another there, all the while creating ever more holes in an already cheesy-like regime of global protections.
Unfortunately, Brazil and other developing countries are succeeding. As a condition for entering the Doha Round of WTO talks, Brazil led efforts to change the intellectual property protections for pharmaceuticals, allowing developing nations to force compulsory licensing and then produce patented medicines under terms largely decided by the government. Appropriately, Kogan points out that all except four or five of the more than 400 medicines now on the WHO critical medical list are generic, freely available for production by anyone in the world.
The principal problem is not that a handful of pharmaceutical companies are keeping medicines from peoples in Africa or other developing places, but that those governments do not enforce the integrity of pharmaceutical production inside their countries, nor do they ensure the integrity of the pharmaceutical distribution systems. So, the generic medicines available to billions of people cannot be assumed to be safe.
Brazil’s agenda is an ideological one, backed by a stubborn and confused post-communist politics of state “takings.” Brazil’s leadership in the open and universal access movement is not new. For almost a half century, it led efforts that sought to transfer intellectual properties developed by innovators from the developed nations to the societies of the underdeveloped countries. While justifying its actions on moral grounds, those efforts were and remain tainted by a corrupt political system where well-connected corporations have used the power of the state to advance a privatized and highly rewarding commercial piracy.
Kogan persuasively argues that Brazil would prosper under a strong regime of intellectual property protections. He points out that it has one of the world’s greatest collections of plant and life forms, which could under gird the creation of a world-class pharmaceutical industry, plus the development of biotech, biotechnology, environmental biotech, agro biotech, and chemical sectors, among many others.
But, to seize these opportunities, Brazil needs to acquire and develop technologies on a massive scale.
Fortunately, Brazil has the resources and people required for development on such magnitudes.
China is an example of a nation that has well managed this acquisition/development process. Chinese leaders have exchanged market access and incentives with the corporations from the developing nations for technologies and know how. The bargain is simple: foreign companies get the benefits if they bring their best technologies to China and share patent ownership for any technological improvement made in China. With that exchange China is modernizing its economy rapidly and simultaneously it is making the necessary investments in its human capital to become a world-class research and development center from which future innovations will flow. Even as China blatantly violates its WTO commitments to protect foreign intellectual properties, it is creating a domestic structure of intellectual property protections that is increasingly being used by the Chinese to protect their new creations.
In contrast, to China’s pragmatism, Brazil seems more interested in advancing the ideology of open and universal access. Yet, as Kogan notes, Brazil has treaty obligations with the other WTO members to honor and protect the intellectual properties of foreign owners. In this exchange, the United States has given Brazilian exports largely unimpeded access to the American market. Brazil seems to want the benefits of that deal even as it tries to wiggle out of its corresponding obligations.
It is a risky political approach. Specifically, the companies whose technologies Brazil is trying to take are unlikely to invest heavily there, an opportunity cost of great consequence to that nation. Equally important, Brazil risks reopening the piracy and counterfeiting wars of the 1970s and 1980s with the United States.
But most of all, Kogan argues that Brazil is diminishing its own future by not creating a legal, political, and developmental environment in which Brazilians and foreigners are inspired and rewarded for innovating.
This piece is lucid and written strikingly well. A full set of endnotes with sources, elaborations, and aside comments that merit attention backs the analysis. The audience should be Brazilian intellectuals, politicians, media and business people. The Brazilian government’s ideological pursuit of an open and universal system is undermining its national technological future.
International Journal of Economic Development Volume Eight, Numbers 1-2, pp. 1-4 2006
