The debate over how to maximize global access to COVID-19 treatments while compensating companies for their R&D efforts continues to evolve. Most countries have considered pressing one of three significant provisions throughout the pandemic to increase treatment access – IP waivers, compulsory licensing, and voluntary licensing.
Trade-Related Aspects of Intellectual Property Rights (TRIPS)
To increase global access to COVID treatments, in October 2020, a group of developing countries, led by South Africa and India, put forward a patent waiver proposal before the World Trade Organization (WTO) for Trade-Related Aspects of Intellectual Property Rights (TRIPS). This waiver would apply to pandemic-related vaccines, diagnostics, PPE, and therapeutics. Initially, many jurisdictions, including the USA, UK, and EU, were against the idea of suspending patent protections. However, in May 2021, the US changed its stance and announced its support for temporarily waiving patent rights. In June 2022, the WTO agreed on TRIPS waivers. The waiver proposal was backed by over 100 countries, including Russia and China, and international organizations such as the World Health Organization (WHO) and the United Nations AIDS charity, UNAIDS.
Compulsory Licensing: Compulsory Licenses are standard globally, although minimally used in the United States*. The Central Government can issue Compulsory Licenses in cases of a “national emergency”, “extreme urgency”, or in cases of “public non-commercial use” by following the provisions of the Patents Act. This enables the Central Government to grant a Compulsory License to any applicant, i.e. manufacture and sell the product, to ensure that products are available to the public at the lowest prices
The Central Government can invoke its powers and acquire patent rights granted to a private entity, i.e. what the government gives; it can take away for the good of citizens. In such a scenario, the patentee would be left with no alternative but to accept whatever price/royalty that is given for the patent by the government.
* Laws exist in the United States related to Compulsory Licensing – specifically 28 US Code, section 1498 – yet they are rarely used. Additionally, the Bayh-Dole Act provides the US government with a “nonexclusive, non-transferable, irrevocable, paid-up license to practice or have practised for or on behalf of the United States any subject invention throughout the world” for any government-funded technology. Section 1498 is not a Compulsory Licensing agreement per se but could significantly reduce potential infringement claims that arise during the pandemic.
Generic manufacture without a license: This is the most aggressive and risky act, but when a generic manufacturer proceeds to manufacture a patented drug without any license from the patentee, the natural result would be an enforcement/infringement action on the part of the IP holder. Under this approach, the patentee would likely approach the court to seek a permanent injunction against the alleged infringer.
The most suitable option remains that the patentee considers Voluntary Licensing at reasonable terms. By this, a patentee would protect its patent from the above risks. Actions such as challenges, requests for Compulsory Licenses, or patent acquisition would be unlikely. In addition, this ensures that the patentee can negotiate a better deal and guarantees that the drug is available to the public at affordable prices.
Voluntary Licensing
Many vaccine manufacturers are exploring voluntary licensing agreements to improve access to treatment for the global population. Such an approach allows the company, as opposed to local
governments, to negotiate the terms of the agreement.
One of the earliest voluntary licensing agreements in the fight against COVID-19 came between Merck and Medicines Patent Pool (MPP), an UN-backed public health organization. Under this agreement, MPP can diversify the manufacturing base for molnupiravir, an investigational oral COVID-19 antiviral medicine. Merck has agreed to waive all royalties for the sales of molnupiravir for as long as COVID-19 remains classified as a Public Health Emergency of International Concern by the WHO.
MPP also entered into a voluntary licensing agreement with Pfizer, which allows MPP to increase the production & distribution of antiviral treatments. As part of this agreement, Pfizer has agreed not to receive royalties on selling these treatments in low-income countries.
Remdesivir is a direct-acting antiviral drug that inhibits viral RNA synthesis and was one of the first treatments for COVID-19. The drug was evaluated as a possible treatment protocol for the SARS- Cov2 virus. The US FDA issued an Emergency Use Authorization (EUA) to treat hospitalized COVID-19 patients.
Remdesivir is a classic case of examining existing drugs for new indications. The drug was initially developed as a cure for Filo virus infections and has been patented by Gilead Life sciences in many countries. Gilead entered into non-exclusive voluntary licensing agreements with multiple genericdrug makers to allow them to manufacture the drug for distribution in 127 countries. In 2021 Gilead announced that “In response to the rapid increase in COVID-19 cases in India, the company is providing its voluntary licensing partners with technical assistance, support for the addition of new local manufacturing facilities and the donation of active pharmaceutical ingredients (API) to scale up production of remdesivir rapidly.” Therefore, Remdesivir was approved in India for restricted emergency use to treat suspected or laboratory-confirmed COVID-19 in adults and children hospitalized with severe disease.
By taking the Voluntary Licensing path, Merck, Pfizer, and Gilead were likely successful in diluting most (if not all) reasons that may give the Central Government an occasion to push these companies to license their drugs since they made voluntary attempts to increase global access to treatments.
Recent development in COVID-19 drugs:
Remdesivir is now the first COVID-19 treatment fully approved for kids younger than 12 years old
- In May 2022, the FDA approved Olumiant (Baricitinib) to treat certain adults hospitalized with COVID-19. It is the second medication that’s fully approved for COVID-19.
- In June 2022, Pfizer stated that it plans to submit an application for Paxlovid’s full FDA approval in people at high risk for developing severe COVID-19. It is currently only authorized for emergency use.
- Bebtelovimab is another option that can treat certain non-hospitalized people ages 12 and older with mild-to-moderate COVID-19 at high risk for severe COVID-19.
- Early data suggests that Sabizabulin can lower the risk of death by about 55% in people hospitalized with moderate-to-severe COVID-19.
- A critical study suggests that Ensovibep can lower the risk of hospitalization, ER visits, or death from COVID-19 by almost 80%.
To conclude, the COVID-19 circumstances were dire enough to consider all legislative provisions that could have improved the supply of medical devices such as masks, ventilators, PPE, and medicinal treatments. As the science surrounding treating & preventing COVID remains fluid, so do relevant IP laws & regulations. Proactive Voluntary Licensing appears to be the most effective approach for patent owners to ensure they are fairly compensated for their R&D efforts while still serving the best interests of the global population.
