Ignoring industry efforts and market risks, WTO considers another IP waiver

When the World Trade Organization (WTO) agreed to waive patent protections for COVID-19 vaccines in June, the organization claimed the agreement “proved that WTO members can put aside differences and work together to respond to the most urgent health challenges.”

In hindsight it appears WTO did nothing but take away biotech companies’ international intellectual property (IP) rights, even though biotech has voluntarily shared IP for a long time in response to global need. The waiver of WTO’s Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement was meant to address the vaccine shortage, but it did not achieve its goal. And by the time it was agreed upon, vaccine shortages were no longer an issue.

What the waiver did do was hurt innovation by threatening the promise of return on R&D investment that IP can offer. And yet the WTO is considering an expansion of the waiver, to eliminate IP rights on COVID-19 therapeutics as well—further shaking investor confidence in the market incentives for drug development.

“When companies share voluntarily, they maintain control over their patents and the extent to which they want to share that from a public perspective,” explains Dorothy R. Auth, Ph.D., Head of Cadwalader’s Intellectual Property Practice. “There has to be a balance between respecting the companies that develop technologies, and public access to those technologies. The main companies have been very forthcoming in sharing their technologies without substantial compromise on patent laws and rights that come with patents.”

Obstacles to vaccine sharing

Many of the major actors in the WTO’s decision played a role in low- to middle-income countries not getting vaccine access in a timely manner. With high-income countries hoarding COVID-19 vaccines early on, low- to middle-income countries simply could not get to the front of the queue to get the doses they needed.

The hoarding of vaccines meant that millions of doses were inevitably going to be thrown out. In the US alone, over 82 million doses were thrown out between December 2020 and mid-May 2022.

When high-income countries did finally donate excess vaccines, the doses were closer to their expiration dates. This oversaturated the market in low- to middle-income countries with doses that they simply did not have the infrastructure to distribute in time. Coupled with the vaccine hesitancy present in these countries, vaccine doses were doomed to expire before they hit pharmacy shelves. According to Global Citizen, “At the beginning of December, Nigeria had to dispose of close to one million COVID-19 vaccines that it received, despite the fact that just about 3% of its population is fully vaccinated.”

“Two years into the pandemic the WTO finally gets around to issuing a patent waiver,” added Dr. Auth. “But really, it’s yesterday’s story. We have plenty of vaccines and access is not really the issue anymore.”

The limited use of the waiver is a clear indication that it was not needed.

“Honestly, nothing has really happened with it, which tells us a bit in and of itself,” explained Hans Sauer, Deputy General Counsel and VP for IP at the Biotechnology Innovation Organization (BIO), of the IP waiver. “The argument for the waiver had been that this is a life and death matter, and we must urgently waive intellectual property, otherwise the world can’t be vaccinated. Then, they passed the waiver and it has not really been used, which supports what we have been saying for a long time, that waiving IP is not going to be a solution.”

WTO aims to further weaken IP protections with a waiver expansion

But enthusiasm for waivers continue in the WTO. “In Geneva, the discussion is going to be whether to expand this TRIPS waiver for vaccines to COVID-19 therapeutics as well,” noted Sauer.

There is no clear need for a second waiver: The first waiver had no real impact on vaccine distribution, but it did shake incentives to develop new treatments. A second waiver seems likely to have the same effect.

“It takes roughly $2 billion to bring a drug to market. Exclusive patent rights give biotech investors confidence that they’ll be able to generate adequate returns if they’re lucky enough to get their experimental medicines through the regulatory approval process and onto pharmacy shelves,” Kenneth E. Thorpe, former deputy assistant secretary of the U.S. Department of Health and Human Services, wrote for STAT

If you kill investor confidence, you kill investment in a field that is already considered highly risky. Coupled with the increased targeting of drug pricing stateside, the results threaten a dangerous slowdown in biotech R&D that would surely have far reaching consequences in a world that has seen not one, but two novel diseases appear in the last three years.

Biotech companies voluntarily shared COVID-19 technologies

Meanwhile, biotech has been voluntarily doing what it can to make COVID-19 technology available. Early in the pandemic, biotech took steps to share technology, vaccines, and therapeutics—in other words, intellectual property.

“The companies that developed these vaccines really stepped up to the plate and shared their vaccines with countries that needed them as they were able to,” said Dr. Auth. “These things organically happened.”

Over 20 major biotech companies initiated hundreds of individual IP-sharing partnerships with governments, universities, and communities, with the goal of expanding COVID-19 production and distribution globally, especially in middle- and low-income countries. These partnerships were started early in the pandemic, and they were well underway by the summer of 2022, when the WTO finally agreed to the waiver. And partnerships continue to expand, despite attacks on IP protections.

Here are a few examples:

  • In October 2020, Moderna promised they weren’t going to enforce their COVID-19 patents while the world was in the pandemic. By February 2022, Moderna established new subsidiaries in Malaysia, Taiwan, Singapore, and Hong Kong, providing local presence to support the delivery of mRNA vaccines and therapeutics.
  • In October 2021, “AstraZeneca’s COVID-19 vaccine manufactured in Thailand [was] authorized under the World Health Organization (WHO) Emergency Use Listing (EUL) procedure, with immediate effect.” The company branched out early and announced in “February 2021, [that] the WHO granted EUL to AstraZeneca’s COVID-19 vaccine, enabling global access during the pandemic.”
  • More recently, Novavax partnered with Serum Institute of India to increase Novavax’s global production capacity to over 2 billion doses annually. “The vaccine, also known as NVX-CoV2373, is manufactured and marketed by the Serum Institute of India under the brand name Covovax,” and is especially useful as a pediatric vaccine option.
  • Pfizer agreed last year to allow licensing agreements for COVID-19 oral antiviral treatment candidates to low- and middle-income countries on a voluntary basis.
  • And Gilead has put great effort into expanding access for its COVID antiviral Veklury (remdesivir). Gilead signed non-exclusive voluntary licensing agreements with nine manufacturers based in India, Pakistan, and Egypt to expand access to generic remdesivir in 127 low and middle-income countries. The company also forged collaborations with more than 40 trusted manufacturing partners in North America, Europe, and Asia to expand its manufacturing network and meet global demand. When COVID-19 cases began surging in India in April 2021, Gilead initiated efforts to expand availability of remdesivir by providing technical assistance to its seven India-based voluntary licensing partners.

Changing the healthcare landscape in Africa through IP sharing

There seems to be an endless push-pull between the NGO and commercial sectors when it comes to international IP rights for biotech companies. It is a tension that has found its battleground politically in the WTO.

“This has been a long-term position of NGOs in the developing world, that patents are the problem,” explained David Lachmann, Senior Director of Federal Government Relations at BIO. “We heard this during the AIDS pandemic. And it’s, quite frankly, partly a commercial endeavor. Big NGOs are purchasers of these goods, and they are engaged in a campaign for Walmart economics: ‘Let’s move production to the cheapest areas of production that had the poorest labor standards and no environmental standards and let’s turn these things out for cheap.’ And they’re pretty blunt about it.”

But it does not have to be this way. BIO founded BIO Ventures for Global Health (BVGH) two decades ago and since then has proven that if the nonprofit sector works with biotech companies collaboratively, they can effectively and efficiently create access in the long-term, rather than simply respond to acute, short-term needs.

“Biotech companies are taking these steps of their own accord,” said BIO’s Sauer. “They all know that there is not really any money to be made in low- to middle-income countries, but there is an incredible need that needs to be addressed.”

Established across the African continent in 2003, BVGH connects international biotech companies with local and regional governments and communities in an effort to create reliable access that predates COVID-19.

BVGH has been battling Africa’s growing cancer burden by assisting procurement and delivery of affordable cancer drugs from “port to patient” in Cameroon, Côte d’Ivoire, the Democratic Republic of the Congo, and Nigeria. As a result, 3,000+ patients have received treatment and agreements are expanding to include additional drugs, hospitals, and countries.

BVGH and biotech companies have worked with governments to ensure drugs are provided to African partners at prices that are both feasible for those partners and aligned with corporate objectives, making their work a win-win for all parties involved—and these initiatives extend to technology access and installation, as well.

“At Janssen Oncology, we are dedicated to achieving equitable access and diversity in our clinical trials, including for cancer patients in Africa,” Craig Tendler, Vice President of Oncology Clinical Development & Global Medical Affairs at Johnson & Johnson, stated. “Through a partnership with BVGH, we are building capacity to conduct oncology clinical trials at sites in five African countries. This initiative will support our diversity and equitable access strategy while facilitating improved treatment practices and better outcomes for patients in Africa.”

As these long-standing efforts have shown, the biotech industry is ready to share medicines, while still keeping the market mechanism of IP intact.

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