Even though the U.S. announced on May 5, 2021 that it supported the temporary waiving of the patent rights for COVID-19 vaccines, any agreement may take weeks of negotiation with the World Trade Organization and much longer before any production may begin. This idea was first proposed by South Africa and India at the end of 2020 and was related to the prevention, containment or treatment of COVID-19. Exactly what the U.S. is proposing hasn’t been made clear yet.
The critics of waiving the intellectual property rights, many European countries with vaccine industries, argue that this poses a danger to future vaccine innovation while also being unnecessary as most countries that need the vaccine do not have the facilities, technology and technicians to produce the vaccines. The vaccine ingredients and other supplies are also being prevented from being exported to those countries in need as well.
Moderna has voluntarily agreed to not enforce its patents and while they and Pfizer/BioNTech have licensed to a few other companies, they have not shared trade secrets or the knowledge to use the new MRNA technology used in the vaccines. AstraZeneca and Johnson & Johnson have licensed to companies that provided clinical trials but have refused to license to other experienced drug manufactures in Canada and Israel. It’s obvious that the vaccine makers are not licensing to the point needed to stop the pandemic.
When a country approves a patent, it usually provides the patent holder a monopoly for a limited time of 20 years. Once the time assigned a patent runs out, others can make the product. Generic drugs are an example of this. However, in the case of an emergency, the patent system has safety regulators that give governments the opportunity to intervene before that limited time is up. Centering on public needs, like health emergencies, a government can step in and allow others to make the product by setting up compulsory licenses which usually includes a sensible royalty, or fee, paid to the patent owner.
Any country that has issued a patent to a COVID-19 vaccine maker can use that patent simply by issuing a compulsory license to enable production by its own companies. Problematically, many countries don’t have vaccine production facilities and rely on imports and compulsory licenses can’t be used to produce vaccines for exporting to other countries. That means countries like China and the Philippines that have successful pharmaceutical industries can’t use compulsory licenses to send vaccines to other countries who are in desperate need.
The U.S. support of the waiver proposal could lead to an effective outcome if the vaccine makers give up some control, but the countries must ensure those companies are appropriately compensated. The waiver could work on the current system for compulsory licensing of patents and extend to trade secrets and knowledge. This waiver could give countries a fairly seamless system to successfully expand vaccine production. The waiver needs to allow countries to require sharing of trade secrets and knowledge, and most importantly, lift the limitations on exports. This would allow a country to issue a license for COVID-19 technologies, allowing its companies to produce the vaccines developed elsewhere and then export those vaccines to countries that lack their own manufacturing capacity.
If a waiver can be implemented, it would incentivize more companies to voluntarily license their vaccines and give the knowledge necessary to manufacture them to partners in other countries. If enough pressure is applied, production for export to other countries could be allowed. Companies and governments in developing countries would have better chances in negotiations with vaccine makers for licenses. The waiver would also ensure that pharmaceutical companies would be compensated while making sure that they cannot prevent broader production of the vaccine.