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New report highlights impact of intellectual property on U.S. economy

Mark Grayson   |     October 13, 2016   |   SHARE THIS

In late September, the U.S. Department of Commerce released a comprehensive report that found intellectual property (IP) intensive industries contribute more than $6 trillion (38.2 percent) to U.S. gross domestic product (GDP). What’s more, IP-intensive industries are the source – directly or indirectly – of 45 million jobs, roughly 30 percent of all the jobs in the United States.

Of all IP-intensive industries, America’s biopharmaceutical companies stand apart. As the leading research and development (R&D) and advanced manufacturing industry, U.S. biopharmaceutical companies perform and support advanced R&D and sustain a diverse and large-scale supply chain for the development, production and distribution of lifesaving and quality-of-life-improving therapeutics to patients. The treatments and cures that the industry produces are built on IP, including patents, that is the bedrock of our IP system. As the Department of Commerce states, they “are the principal means for establishing ownership rights to inventions and ideas, and provide a legal foundation by which intangible ideas and creations generate tangible benefits to businesses and employees.”

A strong IP system, combined with an innovative R&D system, has led to amazing new cures and medicines. On a daily basis, lives are saved and extended because of the work being done in biopharmaceutical labs across the country. And even beyond the impact such treatments have on patients, the industry is a critical economic engine.

The U.S. biopharmaceutical industry contributes substantially to national, state and local economies by employing nearly 854,000 individuals in 2014. The industry supports more than 3.5 million additional U.S. jobs through its varied supply base and from the additional economic impacts stemming from industry and worker spending. Altogether, the U.S. biopharmaceutical industry directly and indirectly supports more than 4.4 million U.S. jobs. Many of the jobs are a direct result of the annual R&D investment from the industry. A report by NDP Analytics found that between 2000 and 2010, R&D investment in the pharmaceutical manufacturing industry accounted for 27% of all R&D investment among IP-intensive industries.

Strong IP systems and infrastructure are key to future economic growth. As the Department of Commerce understands, IP is critical to innovation, creating jobs and maintaining America’s competitive edge in the global economy.

 

Mark Grayson

Mark Grayson Mark Grayson is deputy vice president of public affairs at PhRMA focusing on intellectual property, trade and international issues. Mark has been at PhRMA for more than 30 years joining PhRMA after a career with large public affairs firms focusing on FDA and financial issues. In his spare time Mark plays squash, bridge and takes long walks with his squirrel-chasing dog Teddy.

Topics: Research and Development, Economic Impact, Intellectual Property, economic growth

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