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Abstract

Patent holders in the United States are currently provided with protection over their intellectual property for up to twenty years. This paper examines how entities known as “patent trolls” abuse this protection to force settlements with small to medium-sized companies, who are either unable to afford the associated legal costs or find that the risk is too large to litigate. The effect of patent trolling is that corporations seeking to invest in research and development are drained of financial resources, which ultimately threatens technological innovation. Patent litigation cases of this nature are growing exponentially, which has resulted in increasingly strong bipartisan support in the US Congress for patent law reform. Furthermore, corporations in the pharmaceutical industry who hold patent-created monopolies over their discoveries have been able to charge unreasonable premiums on life-saving drugs to the public’s detriment. In both of these situations, the patent system and related laws have failed to achieve a balance between protecting the intellectual property rights of patent holders and safeguarding the interests of the general public. This paper evaluates potential strategies for preventing these unethical exploitations. It also discusses how the current law can be reformed to allow new medicines to be affordable for customers and still be profitable for developers. Through carefully crafted steps, this reform could result in consumers and manufacturers sharing the benefits of continued innovation.