Clearing Houses and Patent Pools: Access to Genetic Patents

Aoki Reiko

No 325, Discussion Paper from Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University

Abstract: We consider four institutions to facilitate access to patent, three types of clearing houses and patent pools, and identify characteristics that determine their success. We first regroup the four into "exchanges" and "collective rights organizations" (CRO). Network effect of exchanges means that a critical mass of members must be guaranteed for success. Among the two CROs, royalty collection clearing houses and patent pools, the striking difference is their stability. Royalty clearing houses impose negative externality on non-members which makes it easy to attract new members and makes them very stable. On the contrary, patent pools generate positive externality to non-members which makes them unstable.

Date: 2007-03
Note: May 2006, Prepared for Workshop "Gene patents and clearing models", June 8-10 2006, Centre for Intellectual Property Rights, Katholieke Universiteit Leuven, Belgium.

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