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Patents, Spillovers and Competition in Biotechnology

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  • Austin, David

Abstract

I perform an event study on 600+ patents awarded primarily to 20 leading biotechnology firms and find significant changes in market values at the time of the awards. Adjusting for partial anticipation of events, I estimate that core technology patents in highly contested research areas are expected to generate between $13 and $21 million of economic value. They also generate spillover benefits for the patentee’s rivals—presumably including knowledge transfers—valued at $3 to $6 million per firm. Awardees may appropriate only half of private benefits, although I observe negative spillovers for some high-profile awards. Most patents have no significant market impact.

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  • Austin, David, 2000. "Patents, Spillovers and Competition in Biotechnology," RFF Working Paper Series dp-00-53, Resources for the Future.
    • Handle: RePEc:rff:dpaper:dp-00-53
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    Cited by:

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    2. Sandy Campart & Etienne Pfister, 2014. "Technological races and stock market value: evidence from the pharmaceutical industry," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 23(3), pages 215-238, April.

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