This is Lesson 1.1.3. I'm Bryana Mayer, and this lecture is focused on intellectual property in the pharmaceutical industry. So intellectual property involves the creation of an idea, so applying that, in this example, to treating a patient. And then getting protection for that idea so that you can make that idea into a product that's viable in the commercial market. So as I mentioned in an earlier lesson it can take anywhere from six months to two years for the patent office to grant a patent. And according to the United States patent office anyone who invents or discovers Any new and useful process, machine, manufacturer or composition of matter, or any new and useful improvement thereof, may obtain a patent. So patent life is approximately 20 years. But some drugs can get extensions, so extensions could be made for new indications, for new patient populations, such as pediatric testing in a drug that was currently on the market for adults. That could lengthen patent life anywhere from six months to a year. So before 1994 there was a lot of variability in patent regulation. So over 50 countries including Europe did provide patent protections for medicine and food products. And in the 1980s drug companies banded together to achieve a globalized standard set of baseline protections for patents, copyrights and trademarks. And this allotted them to get drugs to the market and be able to get enough revenue from those drugs to invest in R&D for future drugs. So international IP ground rules were created in order to create a uniform floor of intellectual property protection worldwide. And this is what led to the 20-year term of patent protect that I mentioned earlier. It also led to restrictions on the use of clinical trial data. And restricted discrimination against fields of technology, for example, medicines, against importation. So transition periods for developing, in least developed countries, but most important non-product-patent countries, were given until January 1 of 2005 to become compliant with the restrictions to these medicines. So compulsory licenses and non-commercial use licenses can be granted for local production or for importation. There may be patent and data restrictions on exporters that may limit the effective exercise of this right. So most of the major pharmaceutical companies are located in the United States and Europe. You can note the consequences of extensive merger and acquisition activities from the 1980s onwards where there are many more companies prior to the 1980s in which a lot of the bigger companies started buying out some of the smaller ones. And that led to very few truly big pharma companies today. So, major generic producers, and you can see these are often in developing companies, can produce base ingredients and finished products at really a fraction of US prices. A few other developing countries have the capacity to formulate drugs. But most developing countries have no capacity whatsoever, except for maybe to package and label the drugs. So the right to import generics is illusitory because products produced pursuant to a compulsory license must be predominantly for domestic use. So this might mean that 51% must be consumed locally. This was a major defect in the trade intellectual property agreement, when the US and Europe could find loopholes to consuming locally, and allowed for, that allowed for access to medications because they have local capacity in large rich markets. Poor, small countries that could not produce domestically, might be barred from importing key medicines. So limited technical expertise and limited manufacturing capacity in most African and Asian countries would really affect their capacity to produce medicines. So small, and poor markets, don't have the economies of scale, that you find in Europe and United States. So countries with or without patents, but with limited pharmaceutical capacity needed a way to import cheaper, generic medications of assured quality. India supplies generic medications broadly in developing countries. No patients have benefited more than people living with HIV. In fact, 70% of HIV patients receive treatment with low cost generics of assured quality from India. Due to market competition from Indian companies, first-line AIDS treatment regimens now cost approximately 90 to $130 per patient per year. And this is really about only 25% of the price of the research and development costs that go into these drugs. So this concludes lesson 1.1.3 in the Pharmaceutical and Medical Device Innovations course.