Out of Control Policy Blog

Newton's poor business sense

If Sir Isaac Newton had a sliver of business acumen akin to his scientific mind, he would have been a very rich man (or at least his decedents would have been). As Forbes explains below, patenting basic natural science can prove quite lucrative.

A patent case decided in the U.S. District Court of Massachusetts in Boston has the possibility to make life even more difficult for big pharmaceutical companies by forcing them to pay license fees to discoverers of basic biology. ...
In the case, Ariad Pharmaceuticals (nasdaq: ARIA - news - people ), a tiny, money-losing biotech based in Cambridge, Mass., asserted that it had licensed a patent on a basic chemical pathway called NF-kappa-B that is targeted by literally dozens of drugs. Ariad asserted that two Eli Lilly (nyse: LLY - news - people ) drugs infringed on the patent: Evista, for osteoporosis, and Xigris, for severe blood infections. Massachusetts Institute of Technology, the Whitehead Institute for Biomedical Research and the president and fellows of Harvard College were co-plaintiffs in the case.

The drugs in question were invented before the patent was issued. A jury unanimously voted in Ariad's favor, and said that Lilly should pay Ariad $65.2 million and a royalty rate of 2.3% on the sales of both drugs until they lose patent protection ...

"The Ariad position is equivalent to discovering that gravity is the force that makes water run downhill and then demanding the owners of all the existing hydroelectric plants begin to pay patent royalties on their use of gravity," says Lilly general counsel Robert Armitage

Heck, I'd like a patent on photosynthesis; talk about a goldmine!


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