The Danger of Underdeveloped Patent Prospects

Commentators have long recognized that much of the work of commercializing an invention occurs after a patent issues. They have not recognized, however, that by the time market conditions make commercialization potentially attractive, the remaining patent term might be sufficiently short such that a patentee will not develop an invention to the extent that the patentee would if more patent term remained. This concern about patent underdevelopment provides a counterweight to patent prospect theory, which urges that patents be issued relatively early in the invention process. While the patent system reduces this risk by requiring a substantial degree of achievement before patenting, underdevelopment may still be a problem for some inventions, and in particular, in the field of genomics. A possible solution is a system of patent extension auctions under which a patentee would always be allowed to request such an auction, but could win it only by substantially outbidding third parties. Under such a system, patentees would call for auctions only when the benefits of ownership continuity, and thus of continued patent development, are relatively high