Much of the conversation surrounding the COVID-19 pandemic in recent months has focused on access to vaccines – specifically, vaccine accesses in low- and middle-income countries. But to what extent is re-examining intellectual property (IP) rights part of the solution?
As Health Issues India reported in May, “patent waivers for COVID-19 vaccines have been offered up as a suggestion as a means to address the global crisis. While in theory this would allow a shift in production from high-income nations to developing countries, achieving this requires overcoming a significant hurdle – a lack of production capacity.”
Even as the IP exemptions proposal – with India and South Africa backing it – won endorsements from World Health Organization director-general Dr Tedros Adhanom Ghebreyesus and U.S. president Joe Biden, we noted how “many experts have suggested that it is nothing more than political point-scoring.” As per the original proposal, intellectual property rights exemptions were on the cards for items including diagnostic kits, vaccines, protective equipment, ventilators, and therapeutics.
Yet, we reported, “as per the opinion of many experts in the field, patent restrictions themselves are not the issue. Rather, it is the resources and the expertise to make the vaccine. This fact is demonstrable. Moderna has already waived the patent rights to its vaccine. This took place in October of last year, giving six full months for other companies to take advantage of the free patent. Moderna has noted the lack of companies able to rapidly manufacture a similar vaccine and secure approval for their own production of the vaccine.
“The patent, in regards to the production of vaccines, is simply the first hurdle. There are numerous other factors that must be considered, including the expertise needed to make the vaccine, supplies of raw materials, adequate production facilities, quality control measures, and cold chain infrastructure to facilitate rollout of the vaccine. Simply handing out patent-free blueprints does not equip developing nations with the capacity to make the vaccine and so, will not aid in addressing the current COVID-19 crisis.”
Patrick Kilbride, senior vice president of the Global Innovation Policy Center at the U.S. Chamber of Commerce, recently spoke with me to discuss further the issues surrounding IP and COVID-19 vaccines and therapeutics. Our conversation has been edited for length and clarity.
Q: Intellectual property has been a cornerstone in many respects of the discussions surrounding the pharmaceutical industry during this pandemic. How has the discussion changed?
A: It takes us back, I think, a number of years to the World Trade Organization (WTO)’s TRIPS Agreement, referring to the Agreement on Trade Related Intellectual Property Rights. It was entered into force in 1995. It’s one of those foundational pillars of the WTO and yet it’s never been fully implemented. There’s really a relative handful of countries that have been required to fully implement it because there’s been a waiver for less-developed countries, from the very beginning that’s now been extended. We produce an annual international IP index that ranks global economies on the strength of their IP systems. We’ve really found that very few countries have fully and faithfully implemented the TRIPS agreement so in many senses it hasn’t been tried.
It’s in that context that we come into a pandemic situation where intellectual property becomes very central: the ability to first produce and then access solutions, including the technological solutions to the technical problems of overcoming a virus. What we saw is that the system worked. The safest and most effective vaccines emerged from the countries with the strongest intellectual property systems. Those systems have worked to foster a network of partnerships that has successfully expanded production to the point where we expect to have upwards of ten billion doses produced by the end of this year and many more in 2022.
Q: How have said discussions impacted the pharmaceutical industry?
A: What I think has happened, interestingly, is that policymakers and the public and even the press have taken a greater interest in innovation, asking the questions of where did these vaccines come from, how do you they work, and how is it that they were able to be produced in such a short time. We’ve had an opportunity to get a much deeper dive into this process of innovation and when we look at it, we find that it’s not monolithic. It’s not simply one government or one company producing vaccines or any other breakthrough innovation all by themselves. They’re operating within an ecosystem that includes governments, universities, etc., investing in basic scientific research as well as startup companies who take breakthrough ideas and advance it and then try to sell it to bigger companies who have the scale to further develop and test it and manufacture it with the potential to reach billions.
More than ever, this ecosystem was illustrated in real time in front of us, and I think it’s been very important to recognise that, while the government’s role is very important, it’s not the whole story. While the research universities are very important, they’re not the whole story. While the private sector’s very important, it’s not the whole story. Then behind this ecosystem is the rule of law, intellectual property rights, financial markets, and all of the enablers which create the conditions by which investments can move forward. In the countries where these conditions don’t exist, frankly, you don’t see that kind of innovation.
Q: How has the change in the discourse on IP affected low- and middle-income countries, whose access to vaccines is considerably lower than their higher-income contemporaries and what are your thoughts on waiving intellectual property protection for COVID-19 vaccines? Specifically, is this an effective and sustainable means of shoring up equitable access to vaccines for the global population?
A: This goes back to my earlier point of intellectual property not really being tried yet. In the 25 years and more since the TRIPS Agreement entered into force, you’ve seen steady and consistent resistance to the idea of intellectual property as something the developed world is foisting on the developing world. During the pandemic, that clamour has only increased. I would relate it to a hypothetical scenario where during a flood, you have people in safety on a roof and people on the ground are yelling to be let up. The people on the roof point to a ladder and say “grab the ladder.” Then the people on the ground say “I’m done carrying your ladder, let me up on the roof.”
The point there is that intellectual property is the ladder and when you examine the Chamber’s IP Index, you do see a clear architecture of intellectual property policy that creates rights, builds reliability around them by surrounding them with the rule of law, and makes them a reliable basis for investment and innovation. In countries where that happens and you have that system, the private sector will invest in transformative innovation because they’re able to take the risk. In the biopharmaceutical industry, nine out of ten drugs entering clinical trials will never make it to market, so investors won’t make a return on that product, but because there are the companies that are able to make the investment because they can get a return, that enables their investment in the whole pipeline.
Until we change this mindset around IP globally, I fear that the developing countries will continue to be at a disadvantage. In terms of the pandemic and broadening the capacity to produce vaccines that have already been discovered and developed and tested, their ability to participate in the ecosystem is limited.
One of our partners is the Biotechnology Innovation Organization that represents the startup biotech community as well as some of the larger players. They’ve pointed to some 300 industry partnerships that have emerged over the course of the last year that are expanding production; not just the vaccines but therapeutics and other solutions. All of these partnerships involve tech transfer, but it’s not always about taking a factory and replicating it from whole cloth somewhere else. It’s about sourcing inputs and agreeing on specifications and building a network of capabilities that in the aggregate increase global capacity. The tech transfer happens both ways between suppliers, between purchasers, and frankly the world is the beneficiary because it means you know people are learning how to do new things, and we’re getting more production of the vaccines and therapies that we need.
Q: In terms of collaboration in manufacturing and rollout, what have we seen when it comes to COVID-19 vaccines?
A: What we’ve seen is that when you’re racing in real time to produce something that’s never been produced before, there is a wide range of skill sets that come into play. The basic science is arguably the most important piece to figure out. mRNA, for instance, although it’s not the only vaccine modality, it is a very important one and maybe the most successful one that was available and applicable to this particular problem. We had to overcome the technical challenges of using it as a vehicle to produce an antibody response, but also had to figure out how to get it to billions of people around the world and produce it at a scale that would make achieving that possible. All of the problems require partnerships and collaborations. This ecosystem has been phenomenally successful and, frankly, we need more people to have the skill sets to be part of that ecosystem, but it doesn’t come overnight and there’s no shortcut and that’s why an IP waiver would be such a bad idea, because it actually prevents people from investing in those capabilities.
Q: We speak, of course, at length about vaccines but there is also the question about treatments for COVID-19 and other conditions many of which do exacerbate the condition of those who unfortunately become infected. How do we address the issues surrounding intellectual property and access in this regard?
A: From our point of view, intellectual property is the answer to ensuring a steady supply of safe and effective therapeutics and vaccines. Moreover, the strength of the IP system is key to a much broader range of technological solutions to a whole host of issues not limited to public health, but including climate change and sustainable energy and hunger, and so many other problems. Heading into the pandemic, we saw an emerging global middle class, where you know hundreds of millions if not billions were raised above the poverty line to a point where they were able to start to invest in themselves and their families and their communities in a much deeper way. These people need and want access to reliable food sources, clean water, energy, etc. – all of the things that maybe the existing middle class has come to take for granted.
Making sure that those resources are available is going to require more innovation. The way that we get there is that you have a system of reliable property rights that enable private sector investment and innovation.
Ultimately, you can boil it down to the rule of law: When you have a system that provides legal certainty, the ability to enter into and to enforce contracts, and the ability to go into debt in order to leverage the assets that you have to innovate, within that framework, assets come to life and financial markets can inject resources, people can take risks and economic activity accelerates. That was Peruvian economist Fernando de Soto’s rationale as to why capitalism works in some countries and not in others.
We’re living in an intangible economy where ideas are increasingly the driver behind productivity. We have to provide that Rule of Law environment for these intellectual or intangible assets if we’re going to see the innovation we need as we have needed it during this pandemic. This pandemic is something that we will eventually overcome, but we need to sustain a global middle class and that really should be our overarching goal.
Read more about Patrick Kilbride and his work at the U.S. Chamber of Commerce here.
