Prizes solve – incentivize innovation

D. Incentivizing R&D for Essential Medicine in The Absence of Patents

1. A National Prize Fund

A 2017 bill, the Medical Innovation Prize Fund Act, recently proposed a national prize fund.237 The bill recognized market exclusivity to be an “expensive, inefficient, and unfair mechanism to reward investments in new products”238 and asserted that drug development would benefit from “greater sharing of knowledge, data, materials, and technologies.”239 The bill recommended removing the link between R&D incentives and product prices, claiming that this will allow a dramatic decrease in the costs of innovation and an increase in access to inventions.240 The bill thus proposed to abolish patents and market exclusivity for drugs and biological products, as well as related manufacturing processes,241 and to fund R&D through a national prize fund.242

This Article similarly proposes a fund with a specific focus on essential medicines. Prizes will be awarded by a board, based on the impact of each drug on global public health,243 and payments will be conditioned upon abandonment of patents, if any. In addition to disclosure of all clinical trial data and other information enabling those “skilled in the art . . . to make and use” the invention,244 eligibility for prizes will require disclosure of all relevant information on the AI system used in the R&D process.

A national prize fund designed in this manner will provide the incentives necessary to sustain essential medicines research. The government will also be in a position to allocate prizes to encourage investment in certain areas over others. For instance, higher prizes may be offered to essential medicines with smaller markets, such as orphan drugs. Prizes for AI-enabled essential medicines will also encourage the use of AI in the innovation process and allow access to data that will build a better understanding of how AI systems work.