Patent pooling has been observed to be exceedingly exercised when talking about the technological developments in major sectors. A Patent pool is defined as an agreement between two or more patent owners to license one or more of their patents to one another or to third parties. In simpler terms, Patent pool means accumulation of two or more patented subject matter in order to exploit the inventions for obtaining mutual benefits between the contracting parties or between third parties. Strategically, pooling of patent becomes necessary when an inventor gets stuck in complex technology which requires a complementary patent in order to achieve efficiency in the primary patent. Generally, these patent pools cover mature technologies. Patent Pooling is somewhat similar to a joint Venture with a primary objective of sharing one’s Intellectual property rights.

Some of the major players using the mode of Patent pooling are the Pharma and Telecommunication sectors. Many Pharmaceutical manufacturers took over the option of patent Pooling in order to make avail their drugs at an affordable price by reducing the Research and Development cost, amounting to low cost of selling.

Practically, however, Patent pooling has its own positive and negative consequences. The patent pools may have positive effects on competition and innovation by way of increasing efficiency of the developing technology in the concerned field, reducing litigation costs and reducing transactional cost occurred otherwise. On the other hand, under specific circumstances, patent pools may also lead to anti-competitive trade practices which ultimately distorts the competition.

Lastly, the viability of patent pools as a concept, in the endeavour to create better and cheaper means to achieve innovations, is quite sound. However, keeping in mind, such pool doesn’t raise any competitive concerns in future.