So far research on patent pool has been centering on electronic industry and none on biotechnology. Chinese herbal medicine industry in Taiwan is often small and scattered and has no concentrated resource. Particularly in the sector of intellectual property rights, the industry hardly pay due attention to such issue to protect the R&D results. By means of analyzing current patent pool models in the US、EU、Japan and Taiwan, this thesis attempts to propose a patent pool management system to handle a likely IP cluster from within the industry. Firstly, to extract patents from the existing herbal medicine database, the search results were further classified into 24 categories by characteristics such as skin care, cardiovascular use, anti-oxidation, anti-cancer, uses in liver, gall-bladder, lungs, or kidneys, the treatment of paraplegia, enhancement of memory, and so on. Through hypothesizing a product, an acne treatment drink which requires various patents licensing to become the ultimate commodity, how to construct the feasible patent portfolio from the above 24 categories is the following task. Finally, according to the Chinese medical theory, this soft drink will involve improvement of lungs, spleen, heart, and liver functions. By means of negotiating patent licensing needed for the commodity within the proposed patent pool, should the effectiveness of commercialization of such product become possible. The management mechanism of the patent pool consists of many levels. They are entry level, practicing level, commercialization level, and feed-back level. Each level has criteria laid down by the member assembly and executed by the management committee. The agenda of the management committee was also designed taking into consideration of the functions, business model, common interests of the members and the outreach strategy of the pool etc….
One may worry that the construction of such patent pool may run against fair trade law and cause unfair competition in the market. However, whether this worry will ultimately sustain or not depends on how the management principles will be practiced and how much the market concentration effect is resulted.
By referring to the regulations in EU and Japan, this thesis attempts to propose a workable patent pool designed specially for Chinese herbal medicine in order to better the current domestic R&D environment and promote the international competition as a whole.