An Organizational Approach to the Design of Patent Law

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276 MINN. J. L. SCI. & TECH. [Vol. 13:1
tent literature.
Studies of the academic-firm interface offer important insights
into roles that patents might play in science-based entrepreneurship.
The role of academic scientists in the process of
creating and growing new ventures is particularly significant in
the life sciences, where much of the basic research underlying
drug discovery and development is conducted in universities
and other non-profit research labs. They participate in venture
creation and development through consulting, sponsored research,
and other forms of collaboration that can involve transfer
of both human and social capital. 273 Patents offer mechanisms
for structuring collaborations that might otherwise be
unavailable, but in allocating ownership and control over the
fruits of collaboration they might also foreclose certain types of
research and collaborative activity. Despite the importance of
these activities, the effects of science-based entrepreneurship
and, in particular, the roles of patents in promoting it, on the
conduct of academic science have yet to be fully understood. 274
Policy implications uncovered by an organizational approach
include tailoring of patent policy to include broader research
use exemptions to distinguish between applied and basic research.
275
CONCLUSION
Truly among man’s innovations, the use of organization to
accomplish his ends is among both his greatest and his earliest.
276
In 2009 President Obama announced a new “Strategy for
Innovation” designed to “lay the foundation for the innovation
273. See, e.g., Fiona Murray, The Role of Academic Inventors in Entrepreneurial
Firms: Sharing the Laboratory Life, 33 RES. POL. 643, 644 (2004) (examining
the extent and mechanisms through which academic scientists contribute
not only human capital but also social capital to entrepreneurial
firms).
274. Cf. Mark Edwards, Fiona Murray & Robert Yu, Gold in the Ivory Tower:
Equity Rewards of Outlicensing, 24 NATURE BIOTECH. 509, 515 (2006)
(“[T]he impact of startup involvement on scientific competition, the behavior of
academic scientists and the diffusion of publicly funded science to a wide audience
has yet to be fully unraveled.”).
275. See generally Merges, supra note 41 (proposing broader research use
exemption).
276. KENNETH J. ARROW, ESSAYS IN THE THEORY OF RISK-BEARING 224
(1971).