Takeda Lifts Limits on Payments

Japan’s top pharmaceutical firm, Takeda Chemical, will introduce a new compensation policy that removes the ceiling on the payments that researchers can receive for breakthrough discoveries.

Under Takeda’s current rules, its scientists are entitled to a maximum of 30 million yen ($270,000) per year for five years for products successfully launched since 1997. The new policy will entitle researchers to receive bonuses for products introduced as early as 1994.

A Takeda spokesman says that ad hoc compensation committees will decide in the future how much to pay individual researchers whose discoveries contribute to Takeda’s profits. Last year, Takeda paid a total of $850,000 in bonuses to 72 of its researchers.

Across Japan, scientists have been suing their previous or current employers after receiving bonuses that the scientists considered paltry. In January, the Tokyo district court awarded $180 million to Shuji Nakamura, a former employee of Nichia Corp. who had initially received just $180 for inventing the lucrative blue light-emitting diode.

Takeda has not been sued by its scientists. It is changing its policy primarily because Article 35 of the Japanese patent law will be revised this January. The law now mandates companies to adequately compensate employees who make discoveries, without spelling out what adequate is. The revision will specify that companies and their employees must agree on a compensation policy for researchers. Takeda and its labor union designed the new policy, which will apply to Takeda staff worldwide.

Charles E. Miller, an attorney at Dickstein, Shapiro, Morin, and Oshinsky in New York City, says multinational companies are increasingly concerned about being sued by their researchers. Taking their cue from Japan, U.S. researchers will increasingly resort to lawsuits to get more money for their inventions, he predicts.