Patents are so XXth century

The patent system seems in dire need of a rethink. Yes, we all know the rationale behind it: without patent protection an inventor has no incentive to invest time and money into something that can be easily copied by its competitors without incurring significant R&D costs. Patents correct this market failure by providing a temporary monopoly to the inventor. All this is true (and useful), but this rationale may be nonsense in the future.

Patents were created in the XIXth century to meet the needs of an era where innovation was scarce and large corporations dominated the scene. Today, innovation is infiltrating everything around us. “David” beats “Goliath” every day; thousands of small companies compete with large ones. We live in the era of the open-source movement, the free access journals, the peer to peer collaboration among scientists. Today innovation is so fast that a patent may become obsolete the day after is granted. In our time, “sustained” innovation is the important asset.

Successful medical start-ups are the ones that are always ahead, because when competitors copy them, they already have developed something new. The real success of a company in the XXIst century is to be able to smile at competitors and say “you guys are so late”, again, and again, and again… The only way to compete and innovate in our era is to show everyone in the marketplace that you will be delivering newer and better stuff in the future. And that is all. Patents (as understood today) may not help that much in the future (at least to small start-ups). So, maybe at some point in the future we will consider to publish our ideas in wide audience journals, in full detail. This could safely “lock” the idea away in the public domain, preventing others from attempting to patent them, allowing us to concentrate our efforts not on patent litigation, but on faster innovation.

Consider these facts:

• A patent does not prevent others from stealing or using your ideas. If you patent something, anyone is free to market your product or copy your ideas. There is nothing immediate you can do to stop this from happening. All a patent does is give you the right to sue someone in the future, in a ridiculously costly, and easily circumvented legal process.

• There have been several patent productivity studies done. Less than one patent per hundred will ever show any positive cash flow (and think about the costs generated by patents).

• In our technological era, there is always a surprisingly wide range of alternative methods of getting a job done. Most inventions can easily be «patented around» by making small modifications.

• All you really have to do to invalidate any patent is show that the claims would have been reasonably obvious to any "practitioner in the field." That’s all it takes. If you search deep enough, almost every patent can be invalidated or weakened.

• Patent holders may capitalize on inventions by suppressing their development, even though these inventions would benefit society (in a sort of “anti open-source” way, conflicting with the nature of our present world).
  

The system is not working well. I know by heart all the arguments to support patents, and yes, I agree with some of them. Some sort of intellectual protection may be needed (especially in pharma and biotech where R+D investments are so huge). But I think the future needs a different patent system.