The central point made by Francois Gadenne and Ben Williams in their feature article in this issue, in my view, is the "real reason" the Patent System exists. It's often said that patents reward innovation, or encourage early publication of ideas. But we could live without either or both of these supposed benefits, and it’s likely neither is worth the cost of administering the patent system or the burden patents often place on the unwary.

The patent system instead exists to protect the investment that MUST BE MADE if innovations are to be successful, and won't be made without patent protection. The "smart money" will never invest the time and money needed to develop, perfect, and market new products or services that can be easily copied by others who simply wait to market what experience has proven can be successful. It's a far better plan to let others be the pioneers, let them suffer the arrows in their backs, and instead spend money only on proven ideas.

The pharmaceutical industry understands this. A hoard of generic drug vendors waits in the wings until basic patents expire on successful drugs. Why would any company spend a fortune on R&D, most of which comes up empty, and then spend years more shepherding the few successful drugs that are discovered through the FDA approval process, if imitators can clone the successful products without bearing those expenses?

Those who think patents are legally sanctioned predatory tools designed solely to enrich speculators should think again. Most patents are obtained to protect the investment needed to bring new things to market against unfair competition from those who have born no comparable burden.

Viewed this way, patent protection is essential to any successful effort to provide innovative new products and services. The insurance industry doesn't yet understand this. Happily, we don't need to persuade the entire industry, just a few smart people.