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  • Writer's pictureJeremy Rutman

The COVID IP Waiver - a patent Free-For-All ?

Its an unprecendented development in the world of IP - the US has doubled down on Biden's promised support of a World Trade Organization proposal to waive intellectual property (and specifically, patent) protections for COVID-19 vaccines, allowing free use of vaccine developers' IP worldwide. At present, one in four people in rich countries have received at least one vaccine dose. In low-income nations, the ratio is about one in 500 people; the WTO proposal attempts to address this inequity.

Trump's adversarial relationship with both the World Health Organization WHO (suspending US funding for the organization entirely) and the World Trade Organization WTO (criticizing it as unfair, starving it of personnel, disregarding its authority, and effectively crippling the organization’s system for enforcing its rules) made it a foregone conclusion that the US would block adoption of the WTO proposal to allow drugmakers free use of Covid intellectual property.

But with the dawn of the new administration, US support has gathered for the proposal, drafted by India and South Africa and backed by many congressional Democrats, with more than 100 in the House signing a letter urging him to back the waiver. “We, the most powerful nation in the world that can help bring an end to this catastrophe, cannot sit idly by — constrained by Big Pharma — watching millions of people die,” Representative Rosa DeLauro, Democrat of Connecticut, who helped lead the push among House members, said in a statement.

Katherine Tai, US trade representative announced on 5 May 2021 that "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.”

The IP at stake is of immense potential value in times of a global pandemic. The US companies producing vaccines - Johnson&Johnson, Pfizer, Moderna, and NovaVax - stand to lose their control of unique vaccine production methods.

But Britain and the European Union have also been standing in the way, with vaccine producers BionTech (DE) and AstraZeneca (UK) being protected in the meantime. Changes to international intellectual property rules require unanimous agreement at the WTO. Somewhat predictably, the US pharmaceutical industry objected vehemently to the Biden administration decision. The Pharmaceutical Research and Manufacturers of America branded the announcement “an unprecedented step that will undermine our global response to the pandemic... and foster the proliferation of counterfeit vaccines...handing over American innovations to countries looking to undermine our leadership in biomedical discovery.” Just as predictably, health activists worldwide praised the decision, calling it “a truly historic step, which shows that President Biden is committed to being not just an American leader, but a global one” according to Priti Krishtel, executive director of the Initiative for Medicines, Access & Knowledge. The United States’ announcement is only one step toward a potential international agreement on suspending intellectual property rights; to be effective the waiver would also have to accompanied by “tech transfer” where patent holders would supply technical know-how and personnel.

One counterargument to the IP waiver is that knowing how to produce a vaccine, and producing a vaccine are two rather different kettles of fish, the Pfizer vaccine for instance requiring 280 components from 86 suppliers in 19 countries in addition to highly specialized equipment and personnel, requiring an estimated year to build and staff even with unlimited budget. Donation of vaccines to needy countries would be a more effective solution than stripping pharma of IP protection, in this view. Indeed, pharmaceutical and biotech companies sought to prevent a WTO decision, with Pfizer and Moderna announcing steps to increase the supply of vaccine around the world.

Another counterargument is that expropriating the fruits of expensive R&D will discourage future R&D. Who will develop vaccines for Covid-22, should it arise?

The case of Moderna is somewhat unique, as they partnered with the US National Institute of Allergy and Infectious Diseases to develop their mRNA vaccine. Thus Moderna announced, back in October, that it would “not enforce our Covid-19-related patents against those making vaccines intended to combat the pandemic,” and that it was willing to license its intellectual property for post-pandemic use.

The World Trade Organization’s General Council, one of its highest decision-making bodies, meets Wednesday and Thursday - so stay tuned.

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