What is compulsory licensing ofa patent?
Compulsory licensing is a type of licensing that requires the licensee to pay a reasonable royalty for using a patent. Often, those seeking compulsory licenses are competitors of the patent holder, which can negatively impact their financial interests. However, the public policy considerations that underlie the need for compulsory licensing are crucial. In some cases, the first inventor to reach the finish line of research and development wins, while others are left with nothing. If a patent holder refuses to implement their patent or grant a license at a fair price, scientific and technological progress may be hindered, which is not in the public interest. Compulsory licensing is the only solution that can balance the interests of all parties involved. In emergency situations such as an epidemic, compulsory licensing may be necessary to ensure that qualified companies can manufacture essential patented drugs. To safeguard the interests of the patent holder, compulsory licenses must be negotiated on a case-by-case basis, and sublicense granting is prohibited. However, many countries, including China, are cautious about issuing compulsory licenses.
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