False. Get your facts straight first. AM-101 was patented and it failed in the trials. Many drugs are patented and fail in clinical trials.
Yeah, this is absolutely right. The patenting process is a joke. There is a guy in Australia that managed to write a patent application and get it approved that would make him own the patent for the wheel. That's right! The wheel! The thing invented thousands of years ago. Of course he didn't write "wheel "in his application but non the less he got a paper from the patent office that he was the rightful patent owner of "a circular transportation facilitation device". Funny story!
Anyways, you are right, patents are applied before testing. As soon as you make a new chemical compound that can potentially be used for anything, you apply for a patent.