Patent is the right to exclude others from making, using, or selling an invention or product. The term of the patent begins on the date on which the patent is issued and ends 20 years from the date on which the application for the patent was filed. Patents are granted and issued by the U.S. Patent and Trademark Office at the U.S. Department of Commerce.
When a pharmaceutical company creates a new drug, the company will file a patent application in order to prevent other pharmaceutical companies from making, using, or selling the new drug. The company that created the new drug will be the only company making and selling this drug until the patent expires.
In addition, a patent can be sold to another company, or the patent-holding company may give other companies permission to use the invention or the drug, generally in exchange for royalty payments.