Most drugs wouldn’t be developed without strong patents.

Without adequate and effective patent protection, the research-based pharmaceutical industry would not exist. Fortunately, the standards for protection of intellectual property in the United States, Europe, and Japan are, for the most part, adequate. In these regions, there is a mechanism for extending pharmaceutical patent terms to compensate in some measure for the years of effective patent life lost during the lengthy regulatory approval process.

Regrettably, however, intellectual property in the pharmaceutical field is not respected worldwide. Beginning in the 1980s, PhRMA and its member companies began a sustained campaign to make the protection of Americal intellectual property a priority in trade policy. As U.S. comparative advantage has shifted away from basic industrial manufacturing to high technology industries, the protection of intellectual property has become a cornerstone of American economic foreign policy.

The pharmaceutical industry is perhaps more dependent on patent protection than any other industry. A 1988 study of 12 industries indicated that 65% of pharmaceutical products would not have been introduced into the marketplace and 60% would not have been developed in the absence of adequate patent protection (6). Because of the pharmaceutical industry's potential effect on the economy and public health, governments of industrialized countries made the protection of intellectual property, including pharmaceutical patents, an international priority. Such efforts resulted first in NAFTA and then in GATT; both include a chapter on intellectual property.