Why compulsory licensing is a blunt instrument in the post-covid landscape
Earlier this year the Turkish minister of health announced that President Recep Tayyip Erdogan had made a compulsory licence decision about the active ingredient molnupiravir. In line with the fact that the decision was made directly by the president, it was understood that the provision of a compulsory licence due to public interest was applied. However, the patent owner was not notified of the presidential decision nor was it publicly accessible, so the terms, the licensee, the royalty fee and the scope of the decision remained unclear. Crucially, the patent owner himself was not given the opportunity to satisfy public need for molnupiravir under the conditions of the licence.
This is a harsh example of compulsory licensing provisions being used unfairly due to gaps and uncertainties in national law.
The pandemic sparked many discussions on IP rights and compulsory licensing was the first solution that many governments turned to, as it was widely believed that existing patent rights were the only obstacles preventing the world from obtaining a cure for covid. However, the reality was quite different. When the pandemic first hit, there was simply no medicine or vaccine that was being blocked by a patent right because no treatment or vaccine existed.
This mindset meant that innovators and researchers were expected to develop a cure in the shadow of the threat of compulsory licensing. In fact, what happened was that many innovators and pharma companies combined patent tools, opened up their intellectual property and know-how and shared their knowledge for the sake of humanity.
Eventually, BioNTech developed the first covid vaccine, which had an unparalleled global impact. While one might have expected this development to spur governments to start investing in plans and actions to improve and support R&D and innovation against a possible new pandemic, this does not appear to have happened.
There does remain a severe disparity between vaccinated populations in developed countries versus the rest of the world and, as we all agree, no one is safe until everyone is safe. Therefore, governments should work together and, crucially, work diligently on plans and solutions to enable accessibility for all. It is sad to see that certain lessons may not have been learned; when there was no vaccine, many discussions focused on compulsory licensing. Now that we have vaccines, it is IP waivers rather than the need to invest in R&D that are at the heart of talks about ways to extend vaccine access to those who need it.
Just as compulsory licensing was not the solution to developing a cure, waiving IP rights is far from a solution for vaccine access.
The idea to temporarily waive IP protection on covid vaccines was first broached by India and South Africa in October 2020 via a proposal to the World Trade Organisation. While this rightly underlined the importance of global sharing of technology and resources to allow all countries to have access to vaccines, it failed to explain how eliminating IP rights would suddenly enable states to produce said vaccines and inoculate their populations.
One of the fundamental reasons behind why compulsory licensing mechanisms or IP waivers do not result in vaccines is that patent documents provide only limited information, especially with regard to vaccine-related inventions. Patent applications are not required to disclose, for example, how to access the raw materials without which it may be impossible to develop a vaccine. It is crucial to remember that compulsory licences or IP waivers do not (and cannot) create legal mechanisms forcing patent owners to reveal trade secrets or knowledge. This emphasises the importance of voluntary solutions and finding ways to encourage patent owners to collaborate willingly.
Moreover, one cannot help but think that if the intellectual property is truly the only obstacle preventing access to vaccines, why would countries in need not simply adapt their compulsory licence provisions and eliminate IP rights, thus solving the problem at hand?
There are many examples of compulsory licence provisions being used as a threat; in the past they have been weaponised during price negotiations for original drugs by the Turkish Ministry of Health. This is not only a misuse of the provisions, but the uncertainty of the conditions under which they will be applied and the associated rights and responsibilities mean that this mechanism is erratic at best.
Aside from the fact that a compulsory licence is far from being a real solution for many situations, legal ambiguities can create extreme unfairness and ultimately do not serve the interests of the public.
We should keep in mind that the vaccine was developed thanks to R&D being conducted to treat cancer years before the pandemic hit. If there had been no previous research, tests or data – and if there had been no incentive for such expensive R&D – it would have been impossible to find and develop a vaccine within a year.
Therefore, if we want to be prepared against a future pandemic and extend universal access to the vaccine, R&D and invention activities need to be encouraged today. We must have clear and trustworthy legal provisions to frame IP rights. The most powerful tool we can have at our disposable is adequate IP protection, which is not needlessly threatened or misused in every possible crisis. This is the only proper solution if the sincere aim is to find a cure, provide access to vaccines and fight pandemics.
This is an Insight article, written by a selected partner as part of IAM's co-published content. Read more on Insight
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