Suppose that a drug for treating cancer is cleared by the Food and Drug Administration and that the company is successful in obtaining a patent for its product. Which of the following is then TRUE?

Question

Quizplus · Accepted Answer

Obtaining a patent gives the holder exclusive rights to produce and sell the product for a limited period, which creates a temporary monopoly for the patent holder. Therefore, C is true. A is incorrect as the barriers to entry are created by the patent, not the FDA clearance. B is incorrect as the method of producing the product can be included in the patent, making it a part of the intellectual property. D is incorrect as a patented drug does not have close substitutes until the patent protection expires.

Suppose That a Drug for Treating Cancer Is Cleared by the Food