<p>Our data on the legal status of patent applications is from European Patent Office's (EPO) PATSTAT database which contains bibliographic and legal status firm-level patent data from leading industrialized and developing countries for the period 1995-2015. Sixteen different forms of legal statues are broadly classified and systematized into four broad categories. The first category entails the patent applications sent to EPO. This category is used to code firm-level observations based on whether the patent application has been submitted to EPO. The second category comprises the pooled firm-level observations for which the patent application has been approved and official validated. This category comprises the firms for which a valid patent has been approved in a given year. The third category comprises the firms whose patent application has been rejected by EPO on various ground which exceed the scope of this paper. And fourth, the remaining forms of legal status were coded into miscellaneous category which amounts to a minor fraction of the whole set of applications and which are omitted from the empirical analysis.</p>

No abstract

<p>Our data on the legal status of patent applications is from European Patent Office's (EPO) PATSTAT database which contains bibliographic and legal status firm-level patent data from leading industrialized and developing countries for the period 1995-2015. Sixteen different forms of legal statues are broadly classified and systematized into four broad categories. The first category entails the patent applications sent to EPO. This category is used to code firm-level observations based on whether the patent application has been submitted to EPO. The second category comprises the pooled firm-level observations for which the patent application has been approved and official validated. This category comprises the firms for which a valid patent has been approved in a given year. The third category comprises the firms whose patent application has been rejected by EPO on various ground which exceed the scope of this paper. And fourth, the remaining forms of legal status were coded into miscellaneous category which amounts to a minor fraction of the whole set of applications and which are omitted from the empirical analysis.</p>

Do different pharmaceutical product liability regimes in different countries induce propensity to patent? We exploit the variation in pharmaceutical liability and litigation rules across firms in the pharmaceutical industry and countries to explain the firm-level propensity to patent. Drawing on a large dataset from European Patent Office (EPO) covering over 9,950 pharmaceutical patents from 63 countries over the period 1991–2015, we compute the conditional probabilities of individual pharmaceutical firms to acquire a valid-based patent on the validation outcomes and examine whether different liability regimes encourage or deter firm-level propensity to patent. Our empirical strategy addresses firm-level idiosyncrasies, country-level unobserved effects, and common technology shocks that potentially invoke omitted variable bias in the effects of liability regimes on the propensity to patent. Our investigation reveals that liability regimes combined with damage caps, broad statutory excuses, and reversed burden of proof have a strong positive effect on the firm-level patent stock and a negative effect upon EPO patent validation rate. The evidence suggests that not all liability rules and related litigation procedures are created equal. Firms are systematically more likely to hold (firm-level patent stock) valid patents at the EPO when the liability and litigation rules are not complex and when the damage cap, broad statutory excuses, and reversed burden of proof are introduced.