Patent monopoly protections cost companies 148.3 million and consumers, 52.6 billion per year.

[Dee, 4-24-24, UCLA Anderson Review, “$52.6 Billion: Extra Cost to Consumers of Add-On Drug Patents”, , accessed: 7-10-24, AngH]

Pharmaceutical companies gain an average three years in monopoly protections on branded drugs by filing multiple secondary patents, throughout and beyond the development process, a study by UCLA Anderson’s Charu Gupta indicates. Unlike primary patents, which apply to a drug’s active ingredient, secondary patents can cover things like how the drug is administered, what disease it will treat and dosing.

These exclusivity extensions cost U.S. patients, insurance companies and other drug buyers about $148.3 million per drug by delaying competition from producing far cheaper generic brands, according to estimates Gupta describes as conservative in a working paper. In a sample of 355 branded drugs, she finds extended monopoly protection raised consumer costs by $52.6 billion.