Intellectual Property
The biopharmaceutical industry has delivered more than 900 new medicines since 2000 for devastating illnesses such as cancer, heart disease, neurodegenerative conditions and rare diseases. With over 8,000 innovative medicines in development, America’s strong intellectual property (IP) protections help fuel groundbreaking treatment advances while balancing affordability.
Innovation. Competition. Lower Costs.
When you go to the pharmacy to pick up a prescription, you’re seeing our IP system at work. IP protections, including patents, incentivize complex biopharmaceutical research leading to new medicines for patients. This system encourages innovative biopharmaceutical companies to compete by developing new brand medicines, expanding the number of treatment options available to patients. The most promising innovative medicines often face significant brand-to-brand competition within two years, lowering costs for patients by up to 50% or more. Brand medicines then face competition with lower cost generics and biosimilars, giving patients the benefit of that innovation at a fraction of the cost, indefinitely.
As a result, under the American IP system, prescription medicines accounts for a small and stable percentage of overall health care spending, exactly the same share as it has been for the last decade, even as new innovative medicines have made their way to patients.
America’s IP system balances innovation and affordability, providing U.S. patients with more medicine choices than anywhere else in the world. Over the past three years, 77% of new medicines launched globally were launched in the United States first. America’s world-leading innovation ecosystem - supported by strong IP protections - helps attract top scientists and fosters industry collaboration with academics and research centers. A strong IP-driven R&D pipeline further helps ensure Americans can access the latest medicines without relying on other countries.
Benefits
woman looking at tube in lab
Nearly 90% of medicines are filled with generics and biosimilars.
Every generic and biosimilar medicine depends on an innovative brand medicine to first reach the market. Today, nearly 90% of prescriptions in the U.S. are filled with lower cost generics and biosimilars.
On average, brand-name small molecule drugs face generic competition after just 13-14 years on the market—significantly shorter than the basic 20-year patent term.
America’s average cost of prescriptions is 18% less than in other wealthy countries.
America’s innovation ecosystem fuels a thriving generic market, helping make Medicare and Medicaid prescription prices 18% lower on average than in other wealthy countries.
18%
Use of generics and biosimilars have saved a collective $3.6 trillion over the last 10 years alone.
Our IP system fuels a thriving generic and biosimilar marketplace. When medicines come off patent, landmark legal frameworks – including the Hatch-Waxman Act and the BPCIA – expedite the entry of generics and biosimilar competitors.
Our IP system:
- Ensures American patients have access to more treatment options than anywhere else in the world, with the average prescription for generic medicines costing just under $7.
- Provides access to low-cost generics can lead to price reductions of nearly 85%.
- Generics and biosimilars have helped save over $3.6 trillion for patients collectively over the last 10 years including $496 billion in 2025 alone.
- Requires innovators to publicly share information about their inventions, enabling generic and biosimilar manufacturers to reference clinical trial data from innovators and rely on abbreviated FDA approval pathways.
When America leads in medicines, every American benefits.
Innovative treatments are transforming patient care and reducing long-term health care costs. Because of this ecosystem, American patients can get breakthrough medicines years ahead of the rest of the world. America’s leadership in biopharmaceutical innovation is the result of smart policy choices, including strong IP rights, public‑private partnerships and incentives that reward risk-taking.
Get the Facts
Critics often misrepresent our IP system, which effectively promotes innovation, competition and patient choice. Here are the IP facts:
A new patent cannot extend the term of another patent — each patent has its own basic 20-year term from filing, regardless of whether additional patents are later granted for post-approval innovations like new formulations or new uses. That's why brand medicines face generic competition within 13-14 years on the market on average today.
The biggest barriers to patient savings aren't patents — they're supply chain middlemen who block access to lower cost generics and biosimilars already on the market. Reports show that the three largest PBMs increasingly exclude generic and biosimilar medicines from coverage, limiting patient access to low-cost treatment options.
Medicines are complex products with patents covering different innovations like the active ingredient, formulations and uses in different diseases and manufacturing processes. Ongoing R&D on ways to improve a medicine or bring it to new patients over time may result in additional patents, but that does not extend the term of earlier patents. Evidence has failed to show a link between the number of patents on a medicine and the timing of generic entry, which has consistently averaged 12 to 14 years for decades.
No company has a monopoly on treating a disease—new medicines often face brand-to-brand competition within two years which can lower the costs of medicines by 50% or more. Once generics and biosimilars enter the market, prices can decline considerably. Generic medicines alone reduce prices by an average of 85% within a year of launching.
Critics claim that enforcing patents in sequential lawsuits is inherently abusive — but this ignores how drug development actually works. New patents on real innovations may not issue until after initial litigation has begun, and existing legal safeguards already prevent companies from re-litigating the same issues twice. In the vast majority of cases cited by critics, generics still launched within about 14 years of a brand drug's approval prior to the expiration of that brand drug’s patents.
Patent settlements have saved $423 billion over the last decade, helping cheaper generic and biosimilar drugs reach the market before the expiration of patents covering the branded drug. They do this by efficiently resolving legal disputes between brand and generic companies.
Related Resources
Americas Intellectual Property System Key Things to Know
America’s Intellectual Property System: Key Things to Know
The result of the IP system helps balance innovation and affordability. Prescription medicines remain a small and stable share of overall health care spending even as new treatments reach patients, and U.S. patients have more medicine choices sooner than anywhere else in the world.
Intellectual Property
Resource
The “Patent Thicket” Talking Point Falls Apart Under Scrutiny
Critics of the U.S. IP system claim that drug companies obtain excessive amounts of patents to lock out lower cost generic competitors. But those claims fail to show a link between patent counts and the timing of generic entry. These misleading attacks threaten to undermine the very system that fuels American leadership in biopharmaceutical innovation while also paving the way for low-cost generic competition.
Intellectual Property
Resource
Better Medicines Not Meaningless Tweaks Debunking the Product Hopping Myth
Better Medicines, Not “Meaningless Tweaks:” Debunking the Product Hopping Myth
America’s IP system rewards research before and after FDA approval. New formulations may qualify for their own patent protections, but they do not extend protections on the original medicine or delay generic or biosimilar competition for the earlier medicine.
Intellectual Property
Resource
Every Patent Stands Alone Debunking the Evergreening Myth
Every Patent Stands Alone: Debunking the “Evergreening” Myth
America’s intellectual property system rewards research before and after FDA approval. New patents don’t extend old ones, and generic competition keeps arriving right on schedule.
Intellectual Property
Resource
Thanks to America’s IP System, Medicine Costs Go Down Over Time
Thanks to IP and the competition it fosters, the cost of the world’s most innovative medicines declines over time, making it the only part of the health care system where prices go down. Today, 90% of all prescriptions in the U.S. are filled with generics with an average copay of just $6.95. That’s a cycle of innovation and competition that is a uniquely American success story.
Thanks to America’s IP System, Medicine Costs Go Down Over teaser
Intellectual Property
Fact Sheet
How Intellectual Property Drives U.S. Innovation and Biopharma’s Impact
Biopharmaceutical companies are at the forefront of medical innovation. Every treatment the industry develops, and every therapy brought forward, is the result of many years of research, risk and investment. While some critics continue to question the necessity of intellectual property (IP) and patents in this process, the data tells a very compelling story.
How Intellectual Property Drives U.S. Innovation and Biopharma’s Impact.png teaser
How Intellectual Property Drives U.S. Innovation and Biopharma’s Impact.png teaser
Intellectual Property
Fact Sheet