Innovation Management: Legal Considerations
Many of the issues that most people bring up when it comes to unethical practices is the actual technology (or in some cases product) at hand. Morality and ordre public clauses have been designed to legally prevent many immoral practices such as various forms of commercialization of the human body. My aim is to keep this post about ethics in legal practices on a more holistic level than the if genes, stem cells, diagnostic tools, should be patentable.
Lack of IP policy: This can be interpreted as somewhat counter intuitive, but the fact is that by not claiming assets as property much value could be lost. Not patenting important inventions, and instead keeping them as trade secret, keeps society in the dark regarding valuable information rather than teaching in return for ‘the right to exclude others’. Another aspect that should be considered is whether the full potential of a proprietary database is unleashed by not allowing any external access, or whether it could benefit all parties by allowing access, e.g. possibly in exchange for a subscription fee.
Too defensive IP policy: The opposite of the section above. Claiming stakes so broadly in the ground that many of the patent applications are far from reduced to practice, and is only used to scare of the competition. The obvious risk of this is that also universities and non-competitors are ‘scared off’ effectively inhibiting research in certain areas.
Keeping non-value generating patents: A portfolio having a large number of patents that are not utilized is not only costly, but may be blocking others from exploring the territory and the ethical thing may just be to transfer, donate, sell or just be abandoned.
Unrealistic expansion of the legal scope: Patent claims are most often defined broadly to expand the legal scope. This is obviously a fine line between making good strategic sense and weakening your patent, so it may be argued to be somewhat self-regulating. Licensing out the patent using unrealistically broad reach-through claims, however, may stifle research by discouraging actors from licensing in such technology. The broader the claim the more the patent holder can exclude others from using the technology.
Innovation Management: Technical Considerations
A related discussion to the one above, that is at least as important as those considerations, is how in a technical sense ethical considerations can be built into an IPM strategy. One of the factors that should be considered from a technical viewpoint is how openness is taken into account when shaping the innovation. Ethical boards, informed consent requirements and regulation are often established to scrutinize at least some of the related research practices for ethical concerns, but what I am referring to is more early-stage.
Technical barriers: When designing an invention-of-interest, it is obviously desirable to technically prevent competitors from being able to easily replicate the technical function to the greatest extent possible. Nothing wrong with this very logical strategy in regards to ethical concerns from a market competition perspective. However, considering that the way we learn is simply by imitating, experimenting and trying out alternative paths, a technical restriction that fully prevents reverse engineering (or legal documents that prevent experimental use) may not be perceived as ethical from a societal perspective.
Incompatibility: Another aspect is how closed the innovation design is in regards to what is currently being used in the market. Incompatibility with existing technology could be the basis for business models aiming to implement new market standards (e.g. Microsoft), and therefore makes perfect sense internally. Conversely, the external environment may have a different view which can be seen in the many open source initiatives that have sprung up lately. Some actors may claim that their technology is disruptive and therefore need to replace obsolete technologies to drive innovation, but high switching-costs, on the other hand, need to be paid by someone. An argument may rightly be that if the technology is truly disruptive the benefits should outweigh the societal costs in the long term. This may be compared to the concept of ‘creative destruction’ where something new replaces an old industry driving many businesses to bankruptcy only to develop society further.
Not productifying assets: This may be somewhat specific to so-called research tools in biotechnology. Valuable upstream technologies, e.g. biomolecules, that are used only internally as a step in a process (which cannot be found by reverse engineering), for instance as a tool to perform a service can provide an immense competitive advantage as trade secret. But looking at how well that specific technology benefits society will in this case only be reliant upon how many customers the company can serve. Whereas making a product that can be offered from the technology will both allow third parties to perform as much research as wanted using the tool, while teaching society how it is structurally built (through patenting).
Not killing projects: This last aspect is something which may be difficult as a company to do, as substantial time- and monetary investments may have already been made. However, the alternative cost of investing a never-ending stream of resources in a project usually means that resources are halted somewhere else where value may be extracted quicker. A benefit analysis may be in place before continuation.
This list is by no means comprehensive, and is as I mentioned the start of a series of posts. The upcoming blog posts will look into how this translates into broader and higher strategy levels both externally and internally, at company and market levels.