An economic analysis of unilateral refusals to license intellectual property

The intellectual property laws in the United States provide the owners of intellectual property with discretion to license the right to use that property or to make or sell products that embody the intellectual property. However, the antitrust laws constrain the use of property, including intellectual property, by a firm with market power and may place limitations on the licensing of intellectual property. This paper focuses on one aspect of antitrust law, the so-called “essential facilities doctrine,” which may impose a duty upon firms controlling an “essential facility” to make that facility available to their rivals. In the intellectual property context, an obligation to make property available is equivalent to a requirement for compulsory licensing. Compulsory licensing may embrace the requirement that the owner of software permit access to the underlying code so that others can develop compatible application programs. Compulsory licensing may undermine incentives for research and development by reducing the value of an innovation to the inventor. This paper shows that compulsory licensing also may reduce economic efficiency in the short run by facilitating the entry of inefficient producers and by promoting licensing arrangements that result in higher prices.

Oxidative Burst and Hypoosmotic Stress in Tobacco Cell Suspensions

Oxidative burst constitutes an early response in plant defense reactions toward pathogens, but active oxygen production may also be induced by other stimuli. The oxidative response of suspension-cultured tobacco (Nicotiana tabacum cv Xanthi) cells to hypoosmotic and mechanical stresses was characterized. The oxidase involved in the hypoosmotic stress response showed similarities by its NADPH dependence and its inhibition by iodonium diphenyl with the neutrophil NADPH oxidase. Activation of the oxidative response by hypoosmotic stress needed protein phosphorylation and anion effluxes, as well as opening of Ca2+ channels. Inhibition of the oxidative response impaired Cl− efflux, K+ efflux, and extracellular alkalinization, suggesting that the oxidative burst may play a role in ionic flux regulation. Active oxygen species also induced the cross-linking of a cell wall protein, homologous to a soybean (Glycine max L.) extensin, that may act as part of cell volume and turgor regulation through modification of the physical properties of the cell wall.