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Patents and Blood Cells

Tags InterventionismMonopoly and Competition

My wife and I, like yuppies we are, signed up for blood cord storage with NECBB when our baby was born a couple years ago. I get a bill every year for the annual storage fee. It's usually $99. This year I received a letter from NECBB, stating that the fee has increased from $99 to $124 a year, since they were threatened with a patent infringement lawsuit from someone who claimed the right to control any "type of procesing of umbilical cord blood." So NECBB took out a license that costs each user about $2/month, hence the increase in price. It is most likely that NECBB never heard of the patentee and did not use any technology the patentee came up with, and that the patent may even have been invalid. But it's cheaper sometimes to just settle and buy a license. After all, they can pass the costs on to me, and all their competitors will probably have the same price increase.

So, my fees have increased by 25% for no reason whatsoever, except some other company filed years ago a document with the government. Nice.

Author:

Stephan Kinsella

Stephan Kinsella is an attorney in Houston, director of the Center for the Study of Innovative Freedom, and editor of Libertarian Papers.

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