ESD Dissertation Defense – Kenneth Huang

Innovation in the Life Sciences: the Impact of Intellectual Property Rights on Scientific Knowledge Diffusion, Accumulation and Utilization

Abstract:
The impact of intellectual property rights on the production, diffusion and accumulation of scientific knowledge has been a central concern of public policymakers and economists in both public and private institutions, and scholars in management economics and sociology. In this dissertation, I examine the central patenting debates over the role of patenting the life sciences and address a set of interrelated questions: (1) the impact of strategic intellectual property policies of institutions on their cumulative
knowledge dissemination, utilization and commercialization; (2) the unique attributes of life science innovations captured by patents generated under different institutional settings; and (3) the degree to which patenting activities impact the rate and trajectories of scientific knowledge accumulation under varying intellectual property conditions.

I take as my research setting, the Human Genome Project (HGP) and our mapping of the entire human genome that emerged from the project (as defined in both scientific publications and patents). The HGP was a 13-year, $3.8 billion research effort funded and coordinated by the U.S. Department of Energy and the National Institute of Health, and one of the most significant life science research projects ever undertaken. To address the first question, I study the seven key genome centers in the HGP, which produced almost all the genome sequence output and provide an unusually matched and well-controlled natural experiment to examine the impact of different knowledge institutions on the subsequent diffusion of scientific knowledge.

To explore the second question, I build on the data set of the population of 4270 gene patents to systematically quantify and analyze the important attributes of these genebased innovations. Through the construction of a set of validated measures, I specifically characterize the variation in these innovations when made under public versus private institutional settings and compare them to the innovations across broad technology fields from previous studies. To answer the third question, I identify and construct a large-scale, novel data set of 1279 unique patent-paper pairs from the gene patents and apply econometric models to shed light on the degree to which patent grant in the life sciences impacts the rate of follow-on scientific research.

I find that publications with matched patent pairs are associated with higher cumulative citations. Since only an institutional policy allowing patents results in patents, such policy does not stifle cumulative knowledge dissemination and use. In addition, patents contribute to technological innovation, commercialization and start-up. Furthermore, I
identified a growing convergence of public/academic and industry innovations in the life sciences especially in terms of their “basicness” and appropriability as characterized by the Pasteur’s quadrant. I also find evidence of “technological trajectories”, coherence and persistence across various attributes of life science innovations.

However, I determine that gene patenting impedes temporal knowledge diffusion and use and decreases citations of paired publications once they are granted and become visible to the public, as predicted by the anti-commons effect. I also ascertain the differential impact of patenting on knowledge diffusion and use for public versus private sector authored publications, U.S. versus non-U.S. authored and corporate patents versus public institution patents. And as the first study of its kind to directly test the “patent thicket” conceptualization, I find direct statistical evidence of the adverse effect of “patent thickets” and that the patenting of disease and cancer genes negatively impacts knowledge dissemination and use by follow-on scientists and researchers.

Thesis Supervisor:
Fiona Murray

Committee members:
Tom Allen, Anthony Sinskey, David Gabel