Between- vs. Within-Patent Competition

A patent only protects an innovator from others producing the same product; it does not provide protection from others producing better products under new patents. Between-patent competition may be as important a limit on innovative returns as within-patent competition, particularly in high-tech fields such as the telecommunications, biotechnology, and pharmaceutical industries. Given the importance of both within- and between-patent competition, our study attempts to estimate their relative impacts on innovative returns for the U.S. pharmaceutical industry