Biotech on Steroids

Surprisingly, Glenn Reynolds hasn't covered this today, though he did discuss the nanotechnology bubble the other day.

The Wall Street Journal has a front page story today on the surge of nanotechnology patent filings. Its a subscription only link, but as I said before, pick up a copy of the paper - its the best $1.50 you will invest today.

But the intensifying race to file patent applications has sparked concern that a proliferation of patents, especially broadly defined ones, could hobble innovation and produce a thicket of conflicting legal claims that could eventually drive up costs for consumers. In addition, the combination of scant products to date and surging investor interest raises fears of another high-tech bubble.

At stake is control over innovations that could have wide-ranging applications in the computing, defense and energy sectors. "It's the culmination of the historical miniaturization of many technologies," says Thomas Theis, director of physical science research at International Business Machines Corp., Armonk, N.Y. "This will only happen once."

Its quite an interesting read and discusses, among other items, the wealthy range of uses for nanotechnology. For instance, while IBM and other computer makers owned the most patent applications other users like GM and Levis Strauss are also fairly active in technology development.

General Motors Corp. says it will use 540,000 pounds of nanocomposite resins this year in the body of autos like the Chevy Impala. Levi Strauss & Co. sells stain-proof "nano-pants" in its Dockers khaki line impregnated with water-resistant molecules.

Of course, as Glenn discussed, with all this activity comes overhyped expectations, especially the kind that can lead to unsustainable internet like bubbles and an explosive new round of IP related lawsuits (which we also saw during the internet boom).

Experts predict that nanotechnology could rival information technology as an economic driver, but some observers point out key differences. Many seminal inventions in software and computing were freely licensed or not patented at all, notes Ted Sabety, of Sabety + Associates, a legal and consulting firm in New York. By comparison, U.S. universities and companies now patent far more aggressively, and courts are more likely to find competitors guilty of patent infringement.

I've just got to wonder though, by placing warnings far into a major front page article, is the Journal going to take a role as an active contributor to a coming boom and the overhyped expectations that sustain them?

"It's like biotech on steroids," says Charles Wieland, an attorney with law firm Burns Doane Swecker and Mathis LLP in Alexandria, Va.

Indeed it is. Indeed it is.