Accelerating technological innovation is necessary for achieving robust long-run economic growth. Hence, a key challenge of social policy is to find ways to improve the design of structures to incentivize innovation—including the design of the U.S. patent system. In this paper we argue that, while there is uncertainty about how and to what degree patents affect innovation and productivity, this uncertainty does not imply that the patent system cannot be improved. We propose three tailored reforms that would improve the patent system without needing to take a stand on the overall contribution of the patent system to innovation and productivity.

Each of our three proposed reforms addresses a failure of the patent system to accomplish one of its stated goals. First, a key goal of the patent system is to disclose accurate information about new discoveries. In service of this goal, we argue that U.S. patent applicants should be required to clearly distinguish hypothetical experimental results from results achieved with real data, which would avoid confusing key audiences—such as scientists, investors, and foreign patent examiners—without impacting the legal rights of patentees. Second, the patent system is meant to provide notification about ownership of patent rights. With this intention in mind, we argue that patent owners should be required to provide disclosure of patent ownership that is both more transparent and more standardized. Finally, the patent system is meant to provide uniform patent terms across inventions. However, there is clear evidence that in practice this goal is not met. For example, drugs that require long clinical trials—such as many preventive medicines—receive shorter effective patent terms because patents are filed prior to the start of clinical trials, while some drugs receive longer effective patent terms because of what is called “pay-for-delay,” or because of other strategic behavior by pharmaceutical firms. We argue that reforms should be considered that would increase uniformity in effective patent terms across inventions.