Looking Beyond the Patent Cliff - Pharmaceutical Executive


Looking Beyond the Patent Cliff

Pharmaceutical Executive

Pharm Exec: Given the scope of the transformations affecting the IP climate worldwide, how is Pfizer aligning itself internally to address them?

Waldron: The group I presently lead—Global Patents and IP Policy—is part of our legal division, which is a platform function that serves the R&D function and six business units. I supervise about 130 professionals here and outside the US engaged in activities ranging from patent procurement and local counseling to international policy development. The remit is much broader than in the past, where patent staff interacted primarily with R&D. Our mission is to position IP as a strategic support to the business—a tool to make our commercial practices more innovative and useful to the customer. Our people are now "embedded" in each of the business units, working closely with many functions as part of the management team.

Likewise, we are deeply engaged in our business development group, in helping to structure licensing deals that are increasingly important in fueling our pipeline. This gives us opportunity to move that collaborative business model forward, through more creative application of our knowledge assets. You can analogize patents as the skeleton of a cow, which offers potentially everything from milk to meat. If you want to buy a cow, you don't just want the skeleton. There are many other parts of the asset that can be exploited, but it is patents that help identify where to target the effort and are the solid support on which relationships and understandings and value are built. This is another way of describing the value perspective we bring to the business.

Pharm Exec: Is it still part of your mandate to patent widely—some might say indiscriminately?

Waldron: Pfizer decides to patent based on the simple criteria of whether it makes good business sense. Thus, we do take a broad approach. And it complements what we do on the business and policy front. If we as an industry say that a good patent system will help governments develop their economies, and then refuse to be a player, then the message is, "Well, I don't file patents in your country but I have a lot of advice for you anyway." It's a disconnected argument.

Pharm Exec: Is Pfizer ready for the patent cliff? What is your response to recent comments by another leading industry CEO that pharmaceutical companies would be better served by moving into areas less dependent on patent protection?

Waldron: The combination with Wyeth as well as the move into adjacent businesses will compensate for patent losses, positioning Pfizer for more vigorous revenue and profitability growth in the future. Referencing the comments about patents, I would only say that patents remain an essential part of how this industry works. You can't build an integrated pharmaceutical business without them, given the long product cycle and all the post-marketing commitments imposed by regulators. It is not a process where you can easily reinvent an innovation every two years. And of course, once you get a substance approved, you cannot change it—it is predictability that regulators want in medicines. So it's hard to see how the industry can continue to grow and continue to bring new products to market without engaging in areas that benefit from access to patenting.

Pharm Exec: You serve as chair of the PhRMA IP Task Force. In that role, how do you evaluate the state of the relationship with the major patent and trademark offices and the World Intellectual Property Organization (WIPO).

Waldron: Overall, the relationship is productive. All of these organizations are committed to improving the outreach to customers because of the huge backlog of patent applications. It's a major crisis that can only be resolved with increased resources. Our contribution should be to help these organizations make their case to those that hold the purse strings and to society, by working to help them demonstrate the economic spinoffs and jobs that stem from the patents they register and the innovation that patents represent.

Pharm Exec: What is your vision of the future on IP and patents?

Waldron: Bottom line is that I see IP as keeping pace with the rapid rate of discovery in basic science. We have a steep learning curve on the biology of medicines—and we will likely never have a full understanding of what is going on in something as complex as the individual cell. But we have a fighting chance if we can get more people working on the problems and thinking about the practical solutions that result in new medicine. That is where the patent system yields an advantage. The patent system is flexible enough to accommodate this level of complexity and provide the basis for the ultimate solutions.


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