International investment law (IIL) is an independent international legal regime, established and regulated by international investment agreements. Its purpose is to protect foreign investors against acts of the host state. Investors are offered protection independent from domestic legal recourses through investor-state dispute settlement, more commonly called investment arbitration. Being a self-contained system, IIL is often perceived having a maximalist, pro-investor, perception of property. This often puts it at odds with other legal regimes, both domestic and international. One such instance of conflict is the perception and treatment of property rights. IIL is accused of having a maximalist and inflexible view of property rights, in comparison to domestic legal systems which have a more balanced approach. The problem in this context arises due to the very strong political and economic pressure IIL imparts on host states. This pressure can result in the state being unwilling to act in its full legitimate capacity, hence circumscribing its regulatory space.
Therefore, taking into account that intellectual property rights (IPRs) can be regarded as investments in the context of IIL, one of the main focus point of the thesis will be to analyse the perceived property rights discord in light of IPRs and patents in particular. In continuation the thesis will analyse how this regime interaction affects patent regulation and policy. This will be done by analysing the interaction of patent rights and two aspects of IIL. Firstly, the definition of ‘investment’ and patents as ‘investments’ will be addressed. This is necessary as the definition of the investment is the jurisdictional gateway for investment arbitration. Moreover, defining patents as ‘investment’ places patents in a primarily investment discourse, arguably depriving it of other social and economic properties, like innovation or their role in public health. Secondly, protection against expropriation, one of the main IIL protection standards will be juxtaposed and analysed in the context of patent rights. The primary concern here is that modifications of patent law which are otherwise permissible in light of other international law (TRIPS) or domestic law might be illegal under IIL. This fragmentation of law potentially creates problems in regulatory space.
The second focus point of the thesis will draw upon the findings of the first one. Having established a baseline for the effects of the regime interaction, the findings will be applied to innovation in the pharmaceutical sector. Patents are pivotal for innovation in the pharmaceutical sector. However, patent protection that is too broad can in fact hinder innovation. By juxtaposing the effects of IIL on patents as property and the policy considerations of patent law in relation to pharmaceutical innovation, an analysis will be conducted to determine whether IIL has positive or negative effects on pharmaceutical innovation.