Tag: waiver

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Patents Pharma

Policy Brief: The TRIPS Waiver for COVID-19 Vaccines, and Its Potential Expansion: Assessing the Impact on Global IP Protection and Public Health

This policy brief, including the following “Introduction and Executive Summary,” comes from Eric M. Solovy.

CLICK HERE to read the brief in full.

Overlaid images of pills, a gloved hand of someone expecting a pill, and an eyedropperIntroduction and Executive Summary

On June 17, 2022, in the early morning hours of the final day of the World Trade Organization’s (“WTO”) 12th Ministerial Conference, the Members of the WTO adopted a waiver of the Agreement on Trade Related Aspects of Intellectual Property Rights (“the TRIPS Agreement”), commonly known as the “TRIPS Waiver for COVID-19 Vaccines” or the “TRIPS Waiver.”[1]  The TRIPS Waiver, with its primary focus on compulsory licensing of patents (i.e., licensing without the authorization of the patent owner) that are “required for the production and supply of COVID-19 vaccines,” reflected a compromise position among WTO Members.[2]  The initial proposal advanced by India and South Africa, on October 2, 2020, would have gone much further, authorizing WTO Members to waive the substantive and enforcement-related provisions of the TRIPS Agreement not only for patents but also for copyrights, industrial designs, trade secrets, and test data protection; moreover, the original proposal would have gone far beyond COVID-19 vaccines, to cover intellectual property (“IP”) “in relation to prevention, containment or treatment of COVID-19.”[3]

The debate over the TRIPS Waiver began at a time when the development of the first COVID-19 vaccines was already nearing completion.  To wit, the Pfizer-BioNTech COVID-19 Vaccine received emergency use authorization from the U.S. Food & Drug Administration (“FDA”) on December 11, 2020 – i.e., just two months after India and South Africa had submitted their original TRIPS waiver proposal.[4]  Yet, at the same time that certain countries began attacking IP rights as an obstacle to addressing the pandemic, it was already well understood that the rapid development of COVID-19 vaccines, therapeutics, and diagnostics would not have been possible but for the billions of dollars in private investments, over the course of many years, in technologies that were incentivized by strong IP protection.[5]  It is no coincidence that the first COVID-19 vaccines were developed in industrialized countries that offer strong IP protection – protection that provided the incentives necessary for private investors to take the huge risks required when researching revolutionary technologies.[6]

For example, although mRNA was discovered in 1961, it took many years of research, at huge expense and great risk, to create the mRNA-based technology used in COVID-19 vaccines.[7]  BioNTech’s Dr. Sahin and Dr. Tureci, a married couple, had been working on mRNA technology for more than 25 years, without any successful commercial applications prior to developing their COVID-19 vaccine.[8]  To take another example, before going public in 2018 with its mRNA technology, Moderna had raised USD 2.6 billion in investments and partnership funding, along with USD 600 million raised in an IPO.[9]  At the time of its IPO, Moderna was spending hundreds of millions of dollars a year, reporting in September 2018 that it “had an accumulated deficit of $865.2 million.”[10]  This scale of private investment in a venture as risky as these ground-breaking new technologies would simply have been impossible but for the upside potential offered by the promise of IP rights over any resulting therapeutics or vaccines and, in turn, the potential to recoup returns on those investments.  Further, the assurance that IP rights would be honored and, where necessary, enforced, in multiple countries enabled the creators of vaccines to enter into voluntary licensing agreements with enterprises around the world for the manufacture and distribution of the vaccines, making them rapidly available throughout the world.[11]

Since the inception of the TRIPS Agreement nearly thirty years ago, there have been voices calling for its dilution.  The ongoing COVID-19 pandemic amplified some of these voices.  Ignoring the role of IP in the creation of COVID-19 vaccines (and diagnostic and therapeutic products), many governments bought into the narrative claims that protection of IP rights obstructs access to important vaccines and therapeutic products.  In making this argument, they conveniently put to the side the multitude of trade, regulatory and logistical barriers that clearly prevented vaccines from quickly going into arms in a number of developing countries.[12]  At the same time, some have argued that certain countries viewed the pandemic, and a TRIPS waiver in particular, as a strategic opportunity to get access to next generation technologies that would provide benefits to their domestic economies long after the COVID-19 pandemic ends.[13]

Upon the announcement and public release of the terms of the TRIPS Waiver, the reactions were, not surprisingly, mixed.  They were generally aligned with the long-term views of international IP rights that had been consistently expressed by countries, activists, and industry since the inception of the TRIPS Agreement.

For those countries and activists that have long advocated against IP protection for pharmaceutical products, they characterized the TRIPS Waiver as a compromise that did not go far enough but that nevertheless served to validate (in their view) that they had been right all along about the relationship between IP protection and global health.  For example, Médecins Sans Frontières (“MSF”) expressed disappointment that the scope of the TRIPS Waiver was not as broad as the original proposal but then went on to question whether patent protection is ever appropriate for pharmaceutical products, calling “on governments to take concrete steps to rethink and reform the biomedical innovation system to ensure that lifesaving medical tools are developed, produced and supplied equitably where monopoly-based and market-driven principles are not a barrier to access.”[14]

For those who, in record time, created and produced the revolutionary vaccines, diagnostics, and therapeutics that have enabled families and businesses around the world to begin returning to normal, the TRIPS Waiver was understood as a threat to IP rights, to the incentives they create, and ultimately, to innovation itself.  As the U.S. Chamber of Commerce stated in advocating against a TRIPS waiver:

Waiving intellectual property rights would only hobble the innovation that is critical to improving lives and raising living standards globally.  If enacted, this move would set an unfortunate precedent and may limit innovative companies’ ability to devote unprecedented resources to quickly discover and deliver solutions for the next global crisis, be it pandemic, food security, or climate-related.[15]

There are currently calls for a further expansion of this waiver, both in terms of duration and product scope.  As explained below, any expansion of the waiver could deal an additional blow to incentives to biopharmaceutical innovation, which would, in turn, compromise our ability to deal with future public health emergencies (as well as possible future variants of COVID-19).

When WTO Members gather in Geneva, Switzerland, to decide, pursuant to the direction in paragraph 8 of the TRIPS Waiver, whether the waiver should be “extend[ed] to cover the production and supply of COVID-19 diagnostics and therapeutics,” it is important to take a step back from the public rhetoric and evaluate the TRIPS Waiver in view of its actual text, as well as the text of the provisions of the TRIPS Agreement that it waives and/or purports to “clarify.”

In Part II, below, this paper briefly discusses the evolution of global IP protection and why a multilateral treaty such as the TRIPS Agreement is absolutely essential to incentivizing R&D in an increasingly globalized economy.  Part III then offers a summary of the legal content of the TRIPS Waiver.  Part IV places the TRIPS Waiver into its proper context in the WTO system, explaining the legal nature of a waiver as a matter of WTO law.

Next, in Part V, I turn to the potential impact of the TRIPS Waiver.  After first noting that no WTO Member has given notice of an intent to make use of the TRIPS Waiver since its inception over five months ago, I explain (in Part V(A)) that, by creating uncertainty as to the value of pharmaceutical patents, the TRIPS Waiver may serve to decrease the incentives to innovation created by the patent system, to the detriment of global public health.  Part V(B) highlights how, in contrast to the mechanism set out in Article 31bis of the TRIPS Agreement, the failure to include tracking, tracing, and detailed transparency requirements in the TRIPS Waiver could lead to diversion of vaccines, which would be counterproductive to the stated intent of the TRIPS Waiver.

Part V(C) considers the potential harm that may arise if WTO Members rely on one of the so-called “existing good practices,” as referenced by the TRIPS Waiver, for determining remuneration to a patent owner whose patent is compulsorily licensed.  In Part V(D), I consider the potential impact of the provision of the TRIPS Waiver addressing regulatory data protection, a type of IP right distinct from patents which provides important incentives to bring new pharmaceutical technologies to market.  Part V(E) considers the public debate, particularly in the United States, surrounding the possible impact of the TRIPS Waiver on the global competitiveness of certain WTO Members.

Finally, Part VI considers how the proposed expansion of the product scope of the TRIPS Waiver to COVID-19 diagnostics and therapeutics (as not yet defined) could serve to create uncertainty for a much larger group of patent owners and, in turn, further reduce incentives for innovation, to the detriment of global public health.  It would do so at a time when R&D is rapidly progressing in preparation for new variants of COVID-19 and ultimately for the next pandemic.

CLICK HERE to read the brief in full.

[1] See Ministerial Decision on the TRIPS Agreement, WTO Doc. WT/MIN(22)/30 (Jun. 22, 2022), available at: https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=q:/WT/MIN22/30.pdf&Open=True (“TRIPS Waiver”).

[2] Id. at ¶ 1.

[3] TRIPS Council, Communication to the TRIPS Council from India and South Africa, Waiver from Certain Provisions of the TRIPS Agreement for the Prevention, Containment and Treatment of COVID-19, Annex at ¶ 1, WTO Doc. IP/C/W/669 (October 2, 2020).

[4] Press Release, U.S. Food & Drug Admin., FDA Approves First COVID-19 Vaccine(Aug. 23, 2021), available at https://www.fda.gov/news-events/press-announcements/fda-approves-first-covid-19-vaccine#:~:text=The%20first%20EUA%2C%20issued%20Dec,trial%20of%20thousands%20of%20individuals.

[5] Eric M. Solovy, The Doha Declaration at Twenty: Interpretation, Implementation, and Lessons Learned on the Relationship Between the TRIPS Agreement and Global Health, 42 Nw J. Int’l L. & Bus. 253 (2022), at 289-296, available at https://jilb.law.northwestern.edu/issues/?vol=vol%2042%20-%20issue%202.

[6] See Bojan Pancevski & Jared Hopkins, How Pfizer Partner BioNTech Became a Leader in Coronavirus Vaccine Race, Wall Street Journal (Oct. 22, 2020), https://www.wsj.com/articles/how-pfizer-partner-biontech-became-a-leader-in-coronavirus-vaccine-race-11603359015.

[7] See Elie Dolgin, The Tangled History of mRNA Vaccines, Nature (Sept. 14, 2021), https://www.nature.com/articles/d41586-021-02483-w.

[8] See Pancevski & Hopkins, supra note 6; see also David Gelles, The Husband-and-Wife Team Behind the Leading Vaccine to Solve Covid-19, New York Times (Nov. 10, 2020), https://www.nytimes.com/2020/11/10/business/biontech-covid-vaccine.html.

[9] See Moderna, Inc., U.S. Securities and Exchange Commission filing (Amendment No. 1 to Form S-1 Registration Statement), November 28, 2018, at i, 1.

[10] Id. at 20.

[11] See, e.g., Guilherme Cintra, Is an extension of the TRIPS waiver needed for COVID-19 tools?, Global Health Matters, IFPMA (Oct. 15, 2022), available at https://www.ifpma.org/global-health-matters/is-an-extension-of-the-trips-waiver-needed-for-covid-19-tools/; see also COVID-19 vaccines and treatments output continues apace, IFPMA (Apr. 13, 2022), available at https://www.ifpma.org/resource-centre/covid-19-vaccines-and-treatments-output-continues-apace-as-health-systems-and-last-mile-hurdles-remain-collective-stumbling-blocks/ (“The COVID-19 vaccine manufacturing scale-up has seen 372 partnerships forged, of which 88% (329) include technology transfer or fill & finish. 51 manufacturing and production agreements were made in developing countries (LICs and LMICs).”).

[12] See Indicative List of Trade-Related Bottlenecks and Trade-Facilitating Measures on Critical Products to Combat COVID-19, WTO Information Note (July 20, 2021), available at  https://www.wto.org/english/tratop_e/covid19_e/bottlenecks_report_e.pdf.

[13] See Shayerah I. Akhtar, Cong. Rsch. Serv., R47231, World Trade Organization: “TRIPS Waiver” for COVID-19 Vaccines (2022), at 13.

[14] Lack of a real IP waiver on COVID-19 tools is a disappointing failure for people, Médecins Sans Frontières (Jun. 17, 2022), available at https://www.msf.org/lack-real-ip-waiver-covid-19-tools-disappointing-failure-people (asserting that “we are disappointed that a true intellectual property waiver, proposed in October 2020 covering all COVID-19 medical tools and including all countries, could not be agreed upon, even during a pandemic that has claimed more than 15 million people’s lives.”).

[15] Press Release, U.S. Chamber of Commerce, Proposal at WTO to Waive Intellectual Property Would Set Harmful Precedent (Jun. 15, 2022), available at https://www.uschamber.com/intellectual-property/proposal-at-wto-to-waive-intellectual-property-would-set-harmful-precedent; see also, e.g., Press Release, PhRMA, PhRMA Statement on the TRIPS Waiver Agreement (Jun. 17, 2022), available at https://phrma.org/resource-center/Topics/Trade/PhRMA-Statement-on-the-TRIPS-Waiver-Agreement (stating that the COVID-19 TRIPS Waiver “undermine[s] the very intellectual property rights that enabled hundreds of collaborations to produce the COVID-19 vaccines on a global scale.”).

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Biotech C-IP2 News International Law Patents

Panel Discussion: Vaccines, Intellectual Property, and Global Equity

scientist looking through a microscopeThe following post comes from Colin Kreutzer, a 2E at Scalia Law and a Research Assistant at C-IP2. 

The COVID-19 pandemic has shined a spotlight on the role of intellectual property in modern medicine and on the complex social questions surrounding a system that grants exclusive rights over life-or-death products. On the one hand, there is clearly a difference between public access to lifesaving medicines and other patented goods, such as consumer electronics. However, creating these drugs required billion-dollar investments and enormous risk, made feasible only by that promise of IP rights. Wouldn’t taking that promise away harm future development of new medicines? As the world considers a waiver of IP rights over COVID-19 vaccines and other technologies, experts are analyzing not only what’s right and what’s wrong, but also what works and what doesn’t.

On June 10, 2021, C-IP2 and the Smithsonian’s Lemelson Center for the Study of Invention and Innovation held a panel discussion on vaccines, intellectual property, and global equity. With opening remarks by Lemelson Director Arthur Daemmrich, and moderated by C-IP2 Faculty Director Professor Sean O’Connor, the panel featured Dan Laster, Director of the Washington State COVID-19 Vaccine Action Command and Coordination System (VACCS) Center; Professor Arti K. Rai, Elvin R. Latty Professor of Law and Co-Director of the Duke Law Center for Innovation Policy; and Eric Aaronson, Senior Vice President and Chief Counsel, Corporate Affairs, Intellectual Property and Intellectual Property Enforcement, Pfizer Inc.

Opening Remarks

Mr. Daemmrich began with a historical perspective of medical developments in this country, as well as the social, economic, and regulatory issues that would invariably be tangled up within them. His tale foretold many of the conflicts we see today—going from a time when most modern medicines didn’t exist, and high mortality was a fact of life, to a time when vaccines and other treatments existed, but access depended partly on wealth. In between those two periods, we saw rapid growth in IP protection that helped move society from one to the other. But whether in the form of religious opposition to smallpox inoculation, regulatory reforms after tragedies from bad medicine, or protests from a marginalized community during the AIDS crisis, legal and social issues have always played a prominent role in the story of medical science.

Building on this historical base, Mr. Daemmrich posed the problem now facing us: compared to other medicines, there are relatively few vaccines. On a grand scale, the entire field of vaccination is still in a stage of early development, and there exists great potential for growth in the future. The question is how to best stimulate that growth, or rather, how to ensure the greatest access to already-developed vaccines without stifling the creation of new ones?

Prof. O’Connor then led the panel with a series of questions. He began by asking about the difference between two classes of medicine. Vaccines are generally thought of as biologics—treatments that are derived from live cells­—whereas pharmaceuticals belong to the class of “small-molecule” drugs. They are primarily chemical compounds rather than a biological product.

Q: From an IP perspective, are vaccines different from small molecule pharmaceuticals? What role does IP play in making vaccines available?

 Prof. Rai responded that vaccines are indeed very different from small molecule drugs. From an IP perspective, the two classes derive their greatest protection from different sources.

Small molecule drugs can be produced without the need for company trade secrets. All the most critical information can be found within the text of the patent. So, the greatest protection comes from the patent itself, which grants its owner the right to exclude others from making or using the drug, and from data exclusivity, which prevents other companies from using the original developer’s clinical data to obtain regulatory approval of its own product.

Vaccines, on the other hand, cannot be quickly copied solely by reading the patent. There is a great deal of “know-how” involved in the manufacturing process. Because of this, trade secrets can be just as important to vaccine protection as the patent.

The role of IP in vaccine access, she said, is an interesting question. While public funding exists in the world of small molecule drugs, it has a “heavier footprint” in vaccine development, which then has some impact on the incentive model as it applies to vaccines.

Mr. Laster said the role of public funding was critical to his prior work at PATH, an organization devoted advancing global healthcare equity through public-private partnerships and other initiatives. Public funding has a “de-risking” effect in that the high costs and uncertainty of clinical trials are not borne entirely by the private sector. And because vaccine development typically requires cooperation among many parties, it is valuable to have different types of incentives in play (i.e., “pull”-type incentives, such as patent grants, as well as “push”-types, such as public funding). But from an IP perspective, exclusivity can pose a challenge to those cooperative efforts.

Additionally, he said that the detailed know-how involved with vaccines makes technology transfer incredibly difficult. If the intended receiver in a developing nation lacks the capacity to utilize the technology, how can effective tech transfer work in real-world practice? The question is less about whether we should be transferring vaccine technology to developing nations than it is about whether we can.

Mr. Aaronson said that a key piece of our IP system is that it does allow for greater cooperation by providing a means of transferring technology among partners while preventing that technology from being used for unauthorized purposes. He credits that cooperative system for enabling Pfizer to partner with BioNTech, producing a vaccine in record time. He added that this vaccine is currently supplied in 116 countries and counting, that they have committed to supplying at least 2.5 billion doses, and that they have just struck a purchase agreement with the United States for 500 million doses to supply lower-middle income nations. The required research, discovery, and development would not have been possible without a strong IP system that provides the right incentives and enables secure technology sharing among a large host of players.

Q: While we don’t know what final form the waiver might take, do you see it playing a necessary role in actually increasing vaccine supply and access in the coming year or two? Are there potential downsides to an IP waiver that should be considered?

Prof. Rai said that the biggest effect of a waiver would likely be its “symbolic” value, as other factors will have a much greater impact on vaccine access. But even if there were no substantive effect, it would be good for high-income nations to demonstrate an interest in global health issues. However, she considered the waiver issue “a little bit of a sideshow,” saying it likely would be “neither as bad as opponents fear nor as good as proponents hope.”

Prof. O’Connor noted that this is a particularly difficult question to answer when nobody knows what form any potential waiver would eventually take.

Mr. Laster based his perspective on his ten years of negotiating vaccine development and distribution efforts with PATH, saying he is “not sure [the waiver] aligns well” with what’s needed. Recognizing the importance of trade secrets and the complexity of the partnerships involved, he says a successful system must encourage willing cooperation. Simply waiving IP rights won’t necessarily do that. He also cautioned against taking a “static view” of the problem by taking for granted that the vaccine already exists rather than considering the IP system that helped create it, and failing to ensure that the same system is incentivizing new vaccines in the future. That said, the threat of a waiver might provide enough encouragement to bring about voluntary participation before an actual waiver becomes a reality. He credits this threat with already having a noticeable effect on pricing and other strategies.

Mr. Aaronson added that we are dealing with multiple vaccines based on very different technologies. Concentrating “a little more on the practical versus the theoretical,” he noted that the impacts of an IP waiver can vary greatly from one technology to another. The mRNA vaccine is the first drug of its type to ever receive approval. Much of the necessary tech transfer would not be limited to COVID-19, but could apply to the entire mRNA technology platform, drastically impacting its value. Waiving the rights to a groundbreaking technology could reduce the incentive to explore uncharted technological fields.

He also said it’s not certain that waiving IP rights would yield a net increase in the number of doses produced. The existing developers are producing large amounts of the vaccine. Opening the supply chain up to new entrants who may not be able to effectively utilize those supplies could yield a net decrease in production.

Prof. O’Connor also took audience questions for the panel. Some are listed below, starting with a “great foundational question.”

Q: How would it be ethical to allow lifesaving medicines and vaccines to be patented?

Prof. O’Connor began by addressing the purely legal perspective—that such patents are allowed under U.S. law, although there have been exceptions in some other countries at certain times because of this complex ethical question.

Mr. Aaronson said it’s important to think about patents as a part of a broader incentive structure. Are we putting the incentives in place to get someone to get up every morning and put in the work, money, and risk to create a product? We need an incentive structure, or there won’t be anyone making those lifesaving medicines. A patent system is one way to achieve this.

Q: If patent disclosures cannot teach producers how to make a vaccine without also getting corresponding know-how, how can they satisfy the disclosure requirement for patentability?

Prof. Rai has written multiple articles about this question (see one here) and offered several reasons. Some of the know-how is not easily written down. The need for shared know-how could possibly be satisfied by depositing biological materials with the Patent Office, but this is unlikely to happen. Another reason is that the final product that emerges from a years-long regulatory approval process is not always identical to the product described in the patent. There is also a mistaken view that patents and trade secrets cannot protect the same product. It is true that a singular feature cannot be both patented and kept as a trade secret, but a single product may have different features that are protected under one regime or the other.

Mr. Aaronson also pointed out that a single drug may be protected by many patents. Some of the know-how simply involves knowing how to properly combine the patented technologies.

Q: If most of the medical innovations occur in wealthy nations, IP laws will lock developing nations out, at least initially. Is there a way to include developing nations earlier in the innovation process?

All panelists agreed on the importance of this issue, as well as on the fact that it’s much easier said than done. Prof. Rai said that every nation must begin to create its own manufacturing capacity to avoid reliance on others, but this requires large amounts of human capital and infrastructure. The problem really goes beyond medicine to the balance of rich and poor nations generally. Mr. Laster said this is the sort of thing he was working on with PATH, which has created some networks, but there is a long way to go. Building the required skillsets and infrastructure locally takes time, but public-private partnerships can help. Mr. Aaronson said that it’s essentially like asking a nation to stop being a low-income country. It’s a somewhat circular issue, in which money is required to build infrastructure, but infrastructure is required to make money. However, this is where IP is not the problem; it is the solution. A strong IP system can create the necessary investment incentives to begin building a better future in any nation.

Closing Remarks

In closing, Prof. Rai said that “regrettably, the public debate on the . . . waiver has been very simplistic.” She hoped that the panel had “shed some light” on the issue and thanked her fellow panelists for a respectful and productive dialogue. Mr. Last er agreed that “it is a complex topic” but said that “it’s not about the waiver;  I do think there are mechanisms that can lead more likely to the outcomes we want.” Mr. Aaronson finished by saying that “we all have the same goal, to figure out ways to bring medicines and vaccines to patients, no matter where they are in the world. We’re fortunate and thrilled that our vaccine has had that potential to change lives, and our goal is to continue . . . to ensure access” to both this and to future vaccines.

A recording of the panel is available here.

Categories
Healthcare International Law

A View from Both Sides: COVID-19, the TRIPS Waiver, IP Rights, and How to Increase the Supply of Vaccines

scientist looking through a microscopeIssue

The United States and other wealthy nations have access to plenty of COVID-19 vaccine doses and thus are beginning to get the pandemic under control, while less affluent countries do not have access to adequate doses and are still struggling with rising cases. In October 2020, India and South Africa proposed addressing this problem by waiving certain portions of the TRIPS Agreement, the most comprehensive agreement on intellectual property (IP) aspects of international trade among the WTO’s 164 member states. The waiver cites “an urgent call for global solidarity, and the unhindered global sharing of technology and know-how in order that rapid responses for the handling of COVID-19 can be put in place on a real time basis.” While this proposal broadly applies to any COVID-19-related technology, much of the conversation is currently focused on vaccines.

The proposal would temporarily suspend patent rights covering COVID-19 vaccines and possibly also be used to compel the transfer of trade secret “know-how” and “show-how.” Proponents say this would allow any manufacturer to begin production—boosting vaccine supply while slashing prices—to end the surge of cases in less developed nations. Critics argue that the reality is more complicated: the waiver will be ineffective, even harmful, and it would have a devastating impact on our readiness for future health crises.

In Support of the Waiver

For supporters of the waiver, the answer is clear: cases are rising in many nations because they still don’t have the vaccines they need. It’s only reasonable to make exceptions to our ordinary system of business incentives during times of global crisis.

The Biden Administration

That is essentially what U.S. Trade Representative Katherine Tai stated when the Biden Administration announced its support for the waiver: “This is a global health crisis, and the extraordinary circumstances of the COVID-19 pandemic call for extraordinary measures. The Administration believes strongly in intellectual property protections, but in service of ending this pandemic, supports the waiver of those protections for COVID-19 vaccines.”

It affects all of us

WHO Director-General Dr. Tedros Adhanom Ghebreyesus says that the “me-first approach” among powerful nations “is self-defeating and will lead to a protracted recovery with trade and travel continuing to suffer.” Under this rationale, even purely self-interested parties should support the waiver, if only because modern commerce is so globally connected.

Dropping IP barriers will facilitate greater collaboration

Many say the threat of IP litigation prevents the kind of collaboration needed to quickly ramp up production and development, and that a waiver can remove that threat. The president of Médecins Sans Frontières, Dr. Christos Christou, says that “[t]he waiver proposal offers all governments opportunities to take action for better collaboration in development, production and supply of COVID medical tools without being restricted by private industry’s interests and actions, and crucially would give governments all available tools to ensure global access.”

Patents were not meant to impede emergency action

A recent editorial in the journal Nature argues that patents are designed to protect ordinary commercial interests, not to hinder global cooperation against a common threat: “A pandemic is not a competition between companies, but a race between humanity and a virus. Instead of competing, countries and companies need to do all they can to cooperate to bring the pandemic to an end.”

It solves an immediate need without setting a troubling precedent

While opponents of the waiver argue that it will weaken future drug patent protection, Imron Aly and Ahmed M.T. Riaz of Schiff Hardin LLP call those concerns “unfounded” in their post at IPWatchdog. Not only is the current proposal limited specifically to COVID-19, but it was also not created carelessly. Instead, it “has taken substantial international efforts and official international law amendments.” Aly and Riaz say this exceptional action is appropriate if it can succeed where our IP system has yet to do so: “The TRIPS waiver simply allows countries the option to suspend patent enforcement to encourage COVID-19 vaccine production, which makes sense for those countries where current investment has not resulted in vaccine access.”

Even if the waiver doesn’t work, it might work

University of Houston Law Center Professor Sapna Kumar acknowledges a number of functional issues with the waiver approach but notes that it may still have a positive effect on the pandemic: “Overall, the greatest benefit of the Biden Administration’s support for the waiver is that it signals a departure from the prior approach of punishing countries facing health crises and that it might spur pharmaceutical companies to voluntarily increase out-licensing and donations of vaccines.” Her prediction was borne out by a recent pledge to donate 2.3 billion doses by Pfizer/BioNTech, Johnson & Johnson, and Moderna.

Opposed to the Waiver

Opponents of the waiver argue that it will not be effective because it fails to address the real problems. Further, it could actually be detrimental to quality control and supply chains in the present crisis, while quite possibly affecting how pharmaceutical companies choose to allocate investment dollars in the future.

It’s a long process that requires much more than a temporary waiver of licenses

Vaccines are not like other drugs. Writing for Foreign Affairs, Peter J. Hotez, Maria Elena Bottazzi, and Prashant Yadav say that we can’t compare the current situation to similar actions on HIV treatments, and that most nations are not prepared to make use of the patented technology: “Producing vaccines—particularly those as technologically complex as the messenger RNA (mRNA) inoculations against COVID-19—requires not only patents but an entire infrastructure that cannot be transferred overnight.” The authors state that “[t]he effective transfer of such complex technology requires a receiving ecosystem that can take years, sometimes decades, to build.”

We need another way

Professor Yogesh Pai of the National Law University Delhi says that simply waiving trade secret protection won’t automatically disclose everything a manufacturer needs to know. Accessing “hard tacit knowledge of manufacturing/quality control measures for production and clinical data required for regulatory clearances” could require forced technology transfer (FTT) by national governments. He recalls how detrimental such efforts were to India’s economy when it tried FTT with Coca-Cola in the 1970s, prompting the company to leave the country altogether.

Prof. Pai instead recommends efforts to encourage voluntary cooperation: “Where blunt legal instruments don’t work, using track-1 and track-2 diplomacy to place moral coercion on western governments to nudge firms to actively engage in technology licensing may still work wonders.”

“China First” policy?

Sixteen U.S. senators issued a sharply worded letter to the executive branch, questioning the true motives of “China and other countries which regularly steal American intellectual property—like India and South Africa,” and expressing shock that an American president would go along with it: “These nations are falsely claiming that granting such a waiver would speed the development of new vaccine capacity. Nothing could be further from the truth.” Instead, the senators are suggesting that the waiver is being used as a means to unfairly to acquire trade secrets that took massive resources and time to develop.

Reuters reports that “some U.S. officials fear the move would allow China to leapfrog years of research and erode the U.S. advantage in biopharmaceuticals” and quotes a senior U.S. official as saying that the country “‘would want to examine the effect of a waiver on China and Russia before it went into effect to ensure that it’s fit for purpose.’”

IP is not the Issue

A waiver on patent rights, even with the corresponding trade secrets, can only give permission to manufacture. But Eva Bishwal of Fidus Law Chambers writes that the real problems in India “are state inaction, dearth of raw materials and low production capacity.”

According to Patrick Kilbride of the U.S. Chamber of Commerce’s Global Innovation Policy Center, and as cited in Pharmaceutical Technology, “[p]roposals to waive intellectual property rights are misguided and a distraction from the real work of reinforcing supply chains and assisting countries to procure, distribute and administer vaccines to billions of the world’s citizens.”

Low-quality vaccines could do more harm than good

Former USPTO Director Andrei Iancu voiced concern recently at a World IP Day event, asking, “if we waive IP rights, and exclude the original manufacturers, how are we going to control the quality of the vaccines that go into people’s arms? How are we going to control for the fake vaccines? Just last week we saw fake Pfizer vaccines.” And as Philip Thompson points out for IPWatchdog, when investigators are forced to “determine if adverse events or sub-par effectiveness originate from ‘real’ vaccines or fake doses, we should expect global production starts and stops to become much more frequent.”

It will discourage investment in the most critical areas

Pharmaceutical developers invest unfathomable amounts of money into bringing drugs to market. The path to success is long, expensive, and highly uncertain. But what is certain is that successful drugs can yield a profit that covers the loss from failures. Now critics are deeply worried that this waiver will skew future cost-benefit analyses against important classes of medicine. All other things being equal, a developer has a better chance at a positive return by investing in drugs that pose no risk of seizure during a global emergency. As Amanda Glassman of the Center for Global Development writes, the waiver sends the wrong message to innovators and investors: “don’t bother attacking the most important global problems; instead, throw your investment dollars at the next treatment for erectile disfunction, which will surely earn you a steady return with far less agita.” The scramble amongst pharmaceutical giants to develop a vaccine was an all-out race, with good reason, and that’s exactly how it should be. If those companies believe that forfeiture is waiting at the finish line next time around, we might see fewer contestants.

Even “no-profit” vaccine makers appear to oppose the waiver

Pfizer CEO Albert Bourla laid out everything the company has done to combat the vaccine in an equitable manner and argued that “waiver of IP rights could only derail this progress.” And while Pfizer and Moderna are selling their vaccines at a profit, Johnson & Johnson and AstraZeneca have pledged not to do so during the pandemic.

However, it appears that even those companies oppose the waiver. As reported in The Wall Street Journal, the trade group PhRMA, which represents Johnson & Johnson and AstraZeneca among many others, is “lobbying members of Congress to oppose the Biden administration’s support for the waiver.” Johnson & Johnson’s Chief IP counsel Robert DeBerardine says that patent rights are responsible for the breakneck pace of development and that the drug’s makers are the best-equipped people to continue the fight: “What we’re able to do, because we have control of the IP, is to pick the best companies to help us supply the world. If you were to give everything to everybody, you may see a flood of vaccines, but you would have no idea if they’re safe and effective.”

Conclusion

While we share the concerns of other organizations that effective, affordable, and accessible vaccines be made available to all persons regardless of location or wealth, we do not believe that upending longstanding U.S. patent policy for a solution that will do little if anything to increase the vaccine supply is advisable. Strong IP rights remain the best way to incentivize innovation and ultimately increase the supply of life-saving medicines. The Biden administration’s unprecedented support of the proposed WTO IP waiver, while well intended, is likely to create long-term harm and unlikely to have much of an impact on global vaccine supplies. Ultimately, encouraging companies to license IP and engage in voluntary knowledge transfer, along with the sharing of excess doses that are being produced, are methods far more likely to alleviate the vaccine supply issues than waiving IP rights and would be a better path forward out of the current crisis.