patent law, will grant them patent protection for upto 20 times the investment.

Unfortunately, there is no reasonable way to do this, simply because there are too many factors to consider. For example, if the area is difficult, and I have to try out 10000 ideas before getting one that works, granting a patent for 20 times the cost of the idea that works would not be enough.

On the other hand, granting a patent based on the total cost of the 10000 ideas that you had to study would favor stupidity: if a more clever inventor (better intuition, better methods) only needs to study 100 ideas, his invention would be cheaper to produce, thus he would get a "smaller" patent (a patent for a shorter duration) based on the cost of trying out only 100 ideas, not 10000.

Generally, it is a bad idea to base the price paid for anything on the cost for a specific producer. Any such system favors expensive (i.e., inefficient) producers.

This was done under communism: I heard of automobile engineers in communist Poland being ordered to increase cost in order to increase profit. How it works ?

1. There is no competition, so the market does not limit sales when price climbs
2. Price is fixed by the government to be cost plus a 20 % markup
3. The higher the cost, the higher the markup

The slashdot way:

1. Spend more
2. ???
3. Profit !!!

In Soviet Russia, your higher cost benefits YOU !