Biologics, Patents and Regulatory Exclusivities: Incentivising the Development of Future Pharmaceuticals

The term "pharmaceuticals" has traditionally been understood as a reference to small molecule therapeutics. However, over the last several years there has been exponential growth in the development of large molecule therapeutics, more commonly known as biologics. Biologics are a sub-category of pharmaceuticals which utilise naturally occurring phenomena to treat maladies as opposed to chemically manufactured compounds. In Australia the development of pharmaceuticals is primarily incentivised by the patent system and regulatory exclusivities. While these systems incentivise the development of small molecule therapeutics, it should not be assumed that they will have the same effect for biologics. This article analyses the application of the patent system and regulatory exclusivities to biologics to determine whether the unique character of these pharmaceuticals affects the operation of development incentives.