The Partnership for American Innovation (PAI), which is comprised of Apple, DuPont, Ford, GE, IBM, Microsoft and Pfizer, recently submitted comments responsive to a request for public information published in the Federal Register. This Federal Register Notice was published on July 29, 2014, titled Strategy for American Innovation, and largely flew under the radar screen.

In February, 2011, President Obama released a Strategy for American Innovation, which described the importance of innovation as a driver of U.S. economic growth and prosperity, and the critical role the government plays in supporting the innovation ecosystem. The Office of Science Technology Policy and the National Economic Council are now tasked with updating the document to create a revised Strategy for American Innovation. This updating of the strategic vision for innovation in the United States was the subject of this Federal Register Notice.

To remind the White House of just how important a strong intellectual property system is for the U.S. economy. the leading innovators that make up the PAI explained just how important innovation is to the U.S. economy.

• “IP-intensive industries contribute $5 trillion in economic activity to the American economy every year and are responsible for 40 million jobs, nearly half of private sector employment in the U.S.”
• “The protections afforded by America’s IP system motivate venture capitalists to invest in new startup companies, which are a huge driver of job creation in our nation. IP enables the return on investment a company needs to invest billions every year in research, allows them to bring new products to market, and accelerates the pace of innovation.”
• “Without IP protection, businesses shift their R&D resources and commercialization strategies toward the types of innovations that cannot be easily duplicated by competitors. Heavy reliance on this practice clearly limits collaboration and can decrease the overall pace of innovation.”
• “The public disclosure provided by the patent system provides valuable information to other inventors, and enables knowledge transfer through licensing, cross-licensing and joint agreements.”
• “For many innovators, the success of their efforts lives or dies on the ability to secure quality IP rights quickly.”
• “Without these high quality assets, innovators will be hard-pressed to develop the technology that leads to increased jobs and exports. And these assets are at risk. There is a vocal minority waging an ongoing, increasing and significant assault on patent rights. Unending legal challenges to patent eligibility, driven by an organized campaign to redraw legal interpretations of abstractness and indefiniteness, are creating uncertainty about the future of patent protections that will ultimately make it harder to invest.”
• “Heated rhetoric often based on the bad behavior of a few patent assertion entities has fueled an environment where a company is demonized for good faith enforcement of its hard-earned, legitimate property rights. The corresponding policy discussions lead our country away from a balanced IP system that enables collaboration and innovation.”
• “[W]e risk creating a system where foreign competitors gain a competitive advantage by patenting their ideas while copying American IP without consequence.”
• “Our IP system is a major contributor that has allowed the U.S. to lead in innovations for more than 150 years.”

The conclusion of the PAI is simple: “The United States must continue to protect and champion our innovators who rely on intellectual property in our innovation economy… improving the climate of innovation policy is crucial if the United States hopes to retain its global economic leadership.”

History tells us of the importance of strong patents. Recently Dr. Kristina Lybecker explained the importance of patents for innovation by using the U.S. biotechnology industry as an example. She wrote:

[C]onsider the importance of the 1980 Supreme Court decision in Diamond v. Chakrabarty, 447 U.S. 303, 206 USPQ 193 (1980), and the consequences. While the United Kingdom was once the world leader in biotechnology, this changed drastically with the 1980 decision in which the Court “held that microorganisms produced by genetic engineering are not excluded from patent protection by 35 U.S.C. 101.” The importance of this decision to the emergence of the U.S. biotechnology industry cannot be overestimated. In the words of Biotechnology Industry Organization (BIO) President and CEO Jim Greenwood, “By finding that subject matter derived from nature is eligible for patenting if it is modified by man into something new, useful and unobvious, the Court provided assurance to biotech companies and their investors that emerging technologies are protected by the patent system even if they could not have been foreseen when the system was created 200 years earlier.” The result has been transformative for the biotechnology industry. Now dynamic and flourishing, the industry enhances and extends human life through innovations in medicine, agricultural crop productivity, and renewable fuel. These benefits span the globe, incentivized by effective patent protection.

Innovator-friendly manufacturing, tax and patent policy is sorely needed to get America moving in the right direction. So too is true leadership. Hopefully, the White House will closely listen to the comments of the PAI and other similarly situated innovative companies.

Tags: PAI, Partnership for American Innovation, patent, patents, Strategy for American Innovation, White House

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