Hopefully by now, Naples readers understand the value of intellectual property assets. But patents, trademarks and copyrights matter more than just economically. We have found two recent stories that do an excellent job of illustrating why it is important to respect a company’s intellectual property and what happens if other businesses disregard those legal rights.

First, a Senate committee recently unveiled the results of a yearlong investigation into the safety of military equipment. That investigation found that “vast numbers of counterfeit Chinese parts” are being used in military equipment, unbeknownst to the agencies that thought they were buying legitimate parts.

In other words, defense contractors and the U.S. military have been duped into buying cheap or ineffective components of planes, weapons and armor that are not made by the companies that have carefully researched, tested and patented the technology — they’re knockoffs made by Chinese companies. The committee said this was a national security risk because ineffective or unreliable parts put military personnel in harm’s way.

Also, a team of researchers from the National Institute for Health recently examined 1,500 samples of the seven most commonly prescribed malaria drugs and found that about a third were poor-quality knockoffs and imitations.

What that means is unscrupulous companies had disregarded the patented formulas of more reputable drug companies and were selling inferior versions. That is troubling because, according to the researchers, the imitation drugs were “causing drug resistance and treatment failure” and weren’t giving malaria patients the help they needed. Malaria remains one of our most persistent diseases; about 3.3 billion people across the world are at risk for the mosquito-borne drug and between 655,000 and 1.2 million of them die every year.

As you can see, companies that have not given their competitors’ intellectual property assets the respect and observation they deserve are causing serious problems in national security and global health. Intellectual property assets exist for a reason; they encourage companies to develop useful and necessary products. When other companies make cheap imitations, customers can get conned into buying less effective goods.

Source: The BBC, “Third of malaria drugs ‘are fake,‘” Michelle Roberts, May 21, 2012