Abstract

This chapter explores the critical role of patents in fostering innovation within the pharmaceutical industry. It begins with an in-depth examination of patent law, focusing on its purpose of incentivizing invention and the specific criteria required for patentability. The discussion then shifts to the unique characteristics of the pharmaceutical sector such as the extensive R&D process, high failure rates, and regulatory hurdles to highlight the importance of process patents in supporting drug development. Further, the chapter analyses the financial incentives provided by patents, including market exclusivity and revenue generation, and their influence on investment decisions. It also examines the role of small and medium-sized enterprises, the practice of patent cultivation, and the impact of the TRIPS Agreement on global access to medicines. Additionally, it addresses the challenges of measuring innovation through accessibility and lays the foundation for subsequent chapters, which will delve into the broader public health implications of drug patents.

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