Universities and access to medicines: What is the optimal ‘humanitarian license’?

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Universities and access to medicines: What is the optimal ‘humanitarian license’?

Author Info

Annamaria Conti () (Chaire en Economie et Management de l'Innovation, Collège du Management de la Technologie, Ecole Polytechnique Fédérale de Lausanne)
Patrick Gaulé () (Chaire en Economie et Management de l'Innovation, Collège du Management de la Technologie, Ecole Polytechnique Fédérale de Lausanne)

Additional information is available for the following registered author(s):

Patrick Gaulé

Abstract

This paper seeks to add an economic contribution to the current debate on using university licensing contracts to improve access to medicines in developing countries. We build a simple model in which we have a university licensing out an academic invention to a profit-maximizing pharmaceutical company. We compare three different types of licensing contracts that the university might use to enhance access to pharmaceuticals in the South: (1) an exclusive license limited to the North; (2) an exclusive license worldwide with a price cap in the South; and (3) an exclusive license worldwide with a price cap in the South and a clause specifying that the licensee would lose its exclusivity in the South if it does not supply the Southern market. We show that in a simple model with asymmetric information on production costs the latter type of contract dominates the two others.

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Paper provided by Ecole Polytechnique Fédérale de Lausanne, Collège du Management de la Technologie, Management of Technology and Entrepreneurship Institute, Chaire en Economie et Management de l'Innovation in its series CEMI Working Papers with number cemi-workingpaper-2008-005.

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Length: 25 pages
Date of creation: Feb 2008
Date of revision:
Handle: RePEc:cmi:wpaper:cemi-workingpaper-2008-005

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Find related papers by JEL classification:
L3 - Industrial Organization - - Nonprofit Organizations and Public Enterprise
O32 - Economic Development, Technological Change, and Growth - - Technological Change - - - Management of Technological Innovation and R&D
O34 - Economic Development, Technological Change, and Growth - - Technological Change - - - Intellectual Property Rights
O38 - Economic Development, Technological Change, and Growth - - Technological Change - - - Government Policy

This paper has been announced in the following NEP Reports:

NEP-ALL-2008-07-20 (All new papers)
NEP-HEA-2008-07-20 (Health Economics)
NEP-IPR-2008-07-20 (Intellectual Property Rights)

References listed on IDEAS
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Macho-Stadler, Ines & Perez-Castrillo, David & Veugelers, Reinhilde, 2007. "Licensing of university inventions: The role of a technology transfer office," International Journal of Industrial Organization, Elsevier, vol. 25(3), pages 483-510, June. [Downloadable!] (restricted)
Thursby, Jerry G & Jensen, Richard & Thursby, Marie C, 2001. " Objectives, Characteristics and Outcomes of University Licensing: A Survey of Major U.S. Universities," The Journal of Technology Transfer, Springer, vol. 26(1-2), pages 59-72, January. [Downloadable!] (restricted)
Donald Siegel & David Waldman & Albert Link, 1999. "Assessing the Impact of Organizational Practices on the Productivity of University Technology Transfer Offices: An Exploratory Study," NBER Working Papers 7256, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
Jensen, Richard A. & Thursby, Jerry G. & Thursby, Marie C., 2003. "Disclosure and licensing of University inventions: 'The best we can do with the s**t we get to work with'," International Journal of Industrial Organization, Elsevier, vol. 21(9), pages 1271-1300, November. [Downloadable!] (restricted)
Iain Cockburn & Rebecca Henderson, 1999. "Public-Private Interaction and the Productivity of Pharmaceutical Research," NBER Working Papers 6018, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)

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