By Ana Santos Rutschman and Julia Barnes-Weise
As the toll of COVID-19 continues to increase in many countries in the Global South, there has been a renewed push to address the problem of vaccine scarcity through a waiver of patent rights. Calls for waivers have been recurring throughout the pandemic, from formal proposals introduced in 2020 by some of the larger developing economies (India and South Africa), to op-eds in mainstream media, and editorials in scientific publications, such as Nature. This push gained momentum in early May 2021, just before the meeting of the World Trade Organization’s General Council.
Waiver proposals have attracted the support of prominent names in public health. Dr. Tedros Adhanom Ghebreyesus, the Director-General of the World Health Organization, endorsed patent waivers as a tool to address the current vaccine scarcity problem in an article titled Waive Covid Vaccine Patents to Put World on “War Footing.” Others — including, most recently, Dr. Anthony Fauci — have been critical of waiver proposals.
In this piece, we explain the mechanics of patent waivers and argue that waivers alone are the wrong policy tool in the context of the COVID-19 pandemic. We agree with supporters of the waivers in their ultimate goal — that of scaling up the manufacturing of COVID-19 vaccines, and then distributing them according to more equitable models than the ones adopted thus far. However, we doubt that the particular types of goods at stake here can be easily replicated and produced in substantially larger quantities simply through a waiver of intellectual property rights.
Vaccines and Intellectual Property: The Informational Function of Patents
Intellectual property rights, and especially patent rights, are governmental grants embedded into national legal systems across the world for utilitarian reasons: longstanding intellectual property theory and policy rests on the idea that the prospect of obtaining a patent will incentivize players in research and development (R&D) to invest in areas that might be otherwise underfunded. While a vast body of research demonstrates that this utilitarian approach is not universally applicable to all types of goods (and especially to certain types of health goods), it remains the main driver of modern patent regimes.
In exchange for getting this particular type of intellectual property rights, patentees disclose critical information about the invention covered by the patent. On the one hand, a patent gives the patentee lead time on the market for a relatively lengthy period of time (formally 20 years, in practice less than that, especially for products like vaccines that must undergo review and approval by drug regulators). On the other hand, by requiring that the patent applicant share information about the invention that is subsequently published by the patent office, the patent system promotes the flow of scientific and technical information that can be used by other innovators in the field.
It is well known by now that existing COVID-19 vaccines — including the ones that represent the application of a new type of vaccine technology, mRNA vaccines — are covered by multiple layers of patent rights. Proponents of a patent waiver for COVID-19 vaccine emphasize the problems created by the exclusivity created by intellectual property rights, and they are correct in their diagnosis.
Having adopted a legal regime that grants patent rights to any inventions meeting the substantive criteria set forth in international and national patent laws (a threshold that many of the current patent applications on COVID-19 will, in all likelihood, clear), we now face the logical consequences of such a regime: absent some kind of intervention, vaccine patent holders have the ability to refuse licensing their technology to others, even against a backdrop of vaccine scarcity.
A waiver is thus portrayed as a mechanism to overcome this exclusionary ability that traditionally inheres to a patent: in light of the tragic proportions of our shared public health problem, let us do away with the exclusionary right for a certain period of time and other companies will be able to 1) replicate existing vaccines and 2) manufacture at scale so that considerably more doses of vaccine will start flowing towards populations in the Global South.
These two propositions would be accurate if the information disclosed in patents were enough to increase the supply of COVID-19 vaccines. Unfortunately, it is not.
A Mismatch Problem: The Informational Limitations of Patents
Patents cover both processes and products. In the case of vaccines, the former category includes methods of vaccine production, while the latter covers a myriad of vaccine components, from antigens (substances used to elicit a reaction from the immune system), to inactive ingredients, such as adjuvants (substances that help enhance the immune response, like oil-in-water emulsions) and stabilizers (substances that help maintain the potency of the vaccine, like sugars), to the vaccine delivery mechanism.
In order to understand the practical limitations of a waiver of intellectual property rights when a vaccine is involved, it may be useful to think of patents as informational mechanisms akin to the information and tools needed to turn a recipe into an edible product. One or more patents will provide a recipe for a process or a component needed to produce a vaccine. But, just as with a culinary recipe, the informational power of a patent does not cover any tips or instructions that have not been memorialized in writing, nor does it provide any access to the raw materials needed to put a vaccine together. Waivers, therefore, temporarily remove exclusionary rights, but do not address two fundamental sources of the current vaccine scarcity problem.
First, we are still left with a significant informational problem: as many commentators have remarked, knowledge disclosed through patents alone is often insufficient for a third party to actually be able to replicate a vaccine.
From a scientific perspective, vaccines are biological products, and, as such, their relative complexity makes them highly dependent on specific manufacturing processes and practices, many of which are not disclosed in a patent — think of it as the unwritten tips or instructions for a particular recipe. Some of this information may be kept secret by a company for competitive reasons; in these cases, lifting patent rights will not result in increased informational disclosure, unless the patent holders themselves are willing to collaborate. A waiver thus solves the exclusivity problem, but not the information problem that undergirds competition in vaccine manufacturing. To revisit the analogy introduced above, a waiver allows third parties to freely use the recipe. It does not, however, provide all the information that may be needed to manufacture the desired good, nor does it provide manufacturers with the tacit knowledge that only the original manufacturer possesses and is not disclosed elsewhere.
Second, even if all types of legal restrictions on the use of vaccine technology were lifted — or had never existed in the first place — there is simply not enough infrastructure (manufacturing facilities and equipment) nor raw materials (the components needed to manufacture and deliver vaccines) to produce and distribute COVID-19 vaccines as predicted under current waiver proposals. We have long faced a global vaccine manufacturing problem that will not be fully resolved during the current pandemic. In the case of vaccines that need to be kept at ultra-cold temperatures, these problems intensify.
One of us (Barnes-Weise) has been involved in the contractual negotiations for the development, manufacturing and transfer of technology related to COVID-19 vaccines. In addition to the informational gaps described above, COVID-19 vaccine manufacturers are most concerned about how well the recipients of the technology transfer will understand and be able to implement such knowledge in making vaccines of the necessary quality. Shortages do not merely affect materials necessary to manufacture vaccines and facilities adequate to manufacture the vaccines; they also affect the availability of personnel qualified to instruct the licensee and recipient of this information. Sending an employee of this caliber out of the original manufacturing site to a partner site risks reducing the capacity of the first site. And remote instruction, necessitated by the pandemic, has its own shortcomings.
In relation to the patents on the vaccines themselves, most of the concerns that the vaccine manufacturers express are around the protection of their vaccine platforms for the purposes of making future or non-COVID-19 vaccines. Moderna shared information about its patents in summer 2020. The manufacturers, as evidenced by the number of licenses to manufacture granted to date, are eager to find partners with the capabilities to expand production. It is not to their benefit to produce an inadequate supply of a highly sought-after vaccine. However, even willingness to transfer patented vaccine technology has faced numerous practical hurdles to date: 1) infrastructural limitations; 2) scarcity of raw materials; 3) concerns about licensees having the ability to actually manufacture effective vaccines in light of the infrastructural and product scarcity, even in situations in which there might be no informational gaps.
A patent waiver would not address any of the practical concerns currently at the root of tech transfer negotiations involving COVID-19 vaccine technology. Compounding these problems is the fact that, should a waiver be issued, there is no legal mechanism that can compel the transfer of certain types of know-how or trade secrets should a company be unwilling to license its intellectual property — which, again, at this point in the pandemic, is not a problem we have observed.
Finally, it is important to keep in mind that a waiver would be temporary: supporters of current waiver proposals should consider what will happen once demand for vaccines begins diminishing and fewer manufacturers remain on the market. Moreover, they should consider the legal and practical uncertainty that a waiver would introduce, as it is unclear how technology transfer between companies would cease (or continue) once the waiver expires.
Vaccines and the Long-Term Intellectual Property Game: Why Waivers Are Not the Right Tool
Countries in the Global South have had to implement intellectual property regimes that largely codify the commercial interests of the Global North. It is in their best interest to use all legal and policy mechanisms available to minimize the skewed allocative effects produced by the current patent culture — especially when patent rights cover goods that are critically needed for public health reasons.
In the past, some of these countries have used legal tools in highly effective ways. The TRIPS Agreement — the main legal international intellectual property framework, now implemented by virtually all countries — allows for the compulsory licensing of patented products in situations that include public health crises such as a pandemic or epidemic. Compulsory licensing does not extinguish or suspend patent rights, but rather consists in the governmental granting of licenses to third parties against the wishes of the patent holder. The licensee is then able to use the patent-protected technology against the payment of a royalty.
Many countries in the Global South issued compulsory licenses throughout the first decade of the twenty-first century on drugs needed for the treatment of HIV/AIDS. Just to list a few examples, Malaysia issued a compulsory license in 2004 for HIV/AIDS drugs patented by the pharmaceutical companies GlaxoSmithKline and Bristol-Myers Squibb; Thailand issued a compulsory license in 2007 for an HIV/AIDS drug patented by Abbot. Several other lower-income countries resorted to this mechanism, succeeding in having these drugs produced and sold in their markets at low cost. Brazil famously and wisely used the threat of compulsory licensing as a bargaining tool when negotiating the price of an HIV/AIDS patented by Merck.
The critical difference between the compulsory licensing dynamics in the context of HIV/AIDS and the present situation is that compulsory licensing helped solve the problem faced by populations in these countries: critical drugs were being provided at unaffordable prices; compulsory licenses dislodged exclusivity problems; and third parties were able to manufacture the relevant drugs once a license was issued, bringing prices down.
Unlike vaccines, the drugs at stake then were much less difficult to replicate, and third parties availing themselves of a compulsory license faced no significant knowledge deficit. Moreover, there was sufficient production capacity and the necessary raw materials for these drugs to be produced and distributed. Compulsory licensing was thus the right tool for this particular public health problem.
By contrast, a waiver of COVID-19 vaccine patents is the wrong legal and policy tool because it does not address the lack of knowledge sharing nor the shortage of raw materials and manufacturing capacity. Furthermore, the use of a waiver is politically fraught — as was the use of compulsory licenses in the context of HIV/AIDS. We submit that battles of the political economy are best fought when prevailing on the use of a legal tool that actually solves the underlying practical problems. For the reasons stated above, that is not the case with waivers.
It can be appealing to see a patent waiver as an attractive short-term solution. Yet, even the short-term needs are too intense and the challenges too complex for waivers to fully address the infrastructural and knowledge gaps, as well as the additional problem of inequitable distribution of existing vaccines.
We Have Contractual and Infrastructural Problems, Not an Intellectual Property Problem
We agree that it is accurate to say that we have an intellectual property problem if talking about the patent system at a more fundamental level — as the main legal regime designed to encourage investment in biopharmaceutical R&D. Most vaccines needed for the prevention or response to epidemics and pandemic fare poorly under predominantly market-driven R&D funding models, as one of us (Rutschman) has discussed in other venues. In this specific sense, we may question the excessive reliance on current legal regimes designed to spur innovation, which subject vaccine R&D to the same utilitarian principles that apply to vastly different types of goods.
However, in a more immediate sense — and in the context of the COVID-19 pandemic — the real problems are infrastructural and contractual. It is imperative that we address the current limitations on vaccine production capacity ahead of future pandemics — a problem that several countries have already turned to by investing or planning to invest in the construction of infrastructure for vaccine manufacturing.
It is also imperative that, against the current backdrop of vaccine scarcity, we address the allocation problems that the world has experienced so far, which have resulted in most available doses being given to populations in the Global North. We regard this as a contractual problem: currently, there is no legal mechanism that prevents two parties — a country and a vaccine manufacturer — from subjecting negotiations involving pandemic vaccines to the same bargaining and contractual dynamics that govern the production and allocation of most other commodifiable goods.
Setting aside cases of voluntarism, there are no enforceable legal requirements compelling higher-income countries able to appropriate large amounts of vaccine doses to share them with other countries. This is a problem worth deep discussion ahead of the next pandemic.
But it also the area in which immediate policy efforts are presently best deployed. Instead of advocating for a waiver, countries in the Global South, international organizations, activists, commentators and other interested parties should concentrate their efforts on mitigating the unbridled effects of existing contractual frameworks by nudging governments in the Global North to adopt more equitable approaches to the global sharing of vaccine doses. And this is also an area in which the United States, with its regained commitment to international cooperation, should have started to lead by example earlier in the pandemic.
Ana Santos Rutschman is an Assistant Professor of Law at Saint Louis University School of Law.
Julia Barnes-Weise is Executive Director of the Global Healthcare Innovation Alliance Accelerator.