Contents

Advocates for COVID-19 TRIPS IPR Waivers Failed to Establish That IP Constitutes a Barrier to Access to COVID-19 Vaccines, Diagnostics, or Therapeutics. 2

IP Rights Enable Voluntary Licensing That Has Dramatically Scaled Production of Covid-19 Vaccines and Therapeutics 4

Building Global Health Infrastructure, Not Waiving IPR, Is The Solution to Future Pandemic Challenges. 7

The Importance of Open Global Health Data Flows. 7

Conclusion. 8

Endnotes. 9

The Information Technology and Innovation Foundation (ITIF) herewith submits a response to topics and questions raised by the Department of Health and Human Services’ “Notice and Request for Comment on the Implications of Access and Benefit Sharing (ABS) Commitments/Regimes and Other Proposed Commitments Being Considered Under a WHO Convention, Agreement or Other International Instrument on Pandemic Prevention, Preparedness and Response.” In particular, the comments focus on the request for comments under Article 11, “Transfer of Technology and Know-How” of a possible World Health Organization (WHO) Pandemic Preparedness Agreement (PPA).

Article 11.3 of the PPA would have WHO members “commit to agree upon, within the framework of relevant institutions, time-bound waivers of intellectual property rights to accelerate or scale up the manufacturing of pandemic-related products to the extent necessary to increase the availability and adequacy of affordable pandemic-related products.” But as the experience with the COVID-19 pandemic—the most significant pandemic humanity had encountered for nearly a century—shows, waivers for the intellectual property rights (IPR) underpinning COVID-19 vaccines, therapeutics, and diagnostics were wholly unnecessary, unwarranted, unjustified, and even potentially counterproductive. Just as advocates were never able to mount a serious justification for why COVID-19 IPRs for vaccines, therapeutics, or diagnostics should have been waived during the COVID-19 pandemic, so there is now no justification for the U.S. government to support the inclusion of language in a PPA that would endorse the waiver of IP rights in a possible future pandemic.

There are many reasons why COVID-19 IPR waivers were never merited, and equally why IPR waivers aren’t needed to address a possible future pandemic, but this submission focuses here on the three-most significant reasons for this:

1. The lack of a compelling rationale for COVID-19 IPR waivers in the first instance (pointing to the reality that the COVID experience in no way provides a justification for the waiving of IP rights during future pandemics).

2. The reality that robust IP regimes played an important role in enabling the development of effective COVID-19 vaccines, therapeutics, and diagnostics in the first instance.

3. The reality that—far from being a barrier to access to COVID-19 vaccines, therapeutics, or diagnostics—intellectual property rights have been instrumental in not only their creation but also the ability to manufacture them at scale globally through the responsible use of voluntary licensing agreements (VLAs) to third-party manufacturers.

Advocates for COVID-19 TRIPS IPR Waivers Failed to Establish That IP Constitutes a Barrier to Access to COVID-19 Vaccines, Diagnostics, or Therapeutics

From the very beginning, the case for the need for a waiver on IP rights related to COVID-19 vaccines, diagnostics, and therapeutics has been highly tendentious and speculative. India and South Africa submitted their petition to the World Trade Organization (WTO) Trade-Related Aspects of Intellectual Property (TRIPS) Council in October 2020. As the very petition itself acknowledged, “To date, there is no vaccine or medicine to effectively prevent or treat COVID-19.”[1] Why, then, was there any kind of need to waive IP rights for technologies and innovations that didn’t even exist? It shows that intellectual property rights were and have never been a barrier to the world getting access to needed COVID-19 vaccines, therapeutics, and diagnostics.

Moreover, the waiver petition provided no credible evidence that IP constitutes a barrier to access. The waiver petition vaguely referenced “several reports about intellectual property rights hindering or potentially hindering timely provisioning of affordable medical products to the patients.”[2] The first of two cited instances pertained to Labrador Diagnostic LLC, a patent-licensing firm which—although it did file a suit against a French firm, bioMerieux SA, developing coronavirus tests, in order to ensure that its IP was not infringed—had actually committed to offering its patents royalty-free to any company developing coronavirus tests.[3] (So even the very example the petitioners cited at the very outset unwittingly showed the power of responsible voluntary licensing, vitiating the need for a broad waiver for COVID-related IP.) The second instance simply referenced Kentucky Governor Andy Beshear’s call for 3M to release a patent on N95 respirators.[4] Although, of course, just like with COVID-19 vaccines or therapeutics, IP rights were never the issue with N-95 masks. As Kaitlin Wowak, a supply chain expert and assistant professor at the University of Notre Dame, noted, “how fast products like N95s [can be] made is determined by three primary factors: the complexity of the equipment used to make the product, the availability of raw materials, and the availability of trained workers.”[5] Thus, from the very beginning, advocates for an IP waiver were making such a case in order to perpetuate their specious broader narrative that IP rights constitute a barrier to access to medicines.

But that was it; on those two incredibly thin reeds, with nary any serious evidence whatsoever that IP rights were inhibiting access to COVID-19 treatments—let alone the fact that no COVID-19 vaccines or therapeutics even existed at the time—the petitioners took the radical step to call for a suspension of all IP rights pertinent to COVID-19 technologies throughout the duration of the pandemic. In short, as ITIF has noted, if intellectual property has ever constituted a real problem during the course of the COVID-19 pandemic, it was only that innovative life-sciences companies needed to create the IP—that is the technology, knowledge, and knowhow—required to invent safe, effective, and new-to-the-world COVID-19 vaccines, diagnostics, and therapeutics. Indeed, access to medicines fundamentally depends upon and presupposes the existence of medicines—and the reality is that IP rights are a fundamental enabler of such innovative medicines, not a barrier to their access.

Moreover, even after countries agreed to the COVID-19 IPR vaccines waiver, not a single country, company, or entity has notified the WTO of any intent to avail itself of the vaccine waiver’s provisions. Not only has no country utilized the waiver, no country has even notified the WTO TRIPS Council of any measure taken to implement it. This once again illustrates the futility of the entire enterprise, and once again shows that the real challenge all along in getting COVID-19 vaccines, diagnostics, and therapeutics to the global public (once they could be sufficiently manufactured at scale) has been much more about logistics, distribution, and public healthcare infrastructure challenges, not IP.

Rapidly Inventing Breakthrough COVID-19 Vaccines, Therapeutics, and Diagnostics

The speed with which innovators were able to bring forth effective COVID-19 vaccines (and even therapeutics) was unparalleled in human history. For instance, in 2017, a GlaxoSmithKline representative noted that, “It can take up to $1 billion and 20-50 years to create and fully distribute a vaccine at scale.”[6] Before the pandemic, it took an average of 10 years to develop a new-to-the-world vaccine.[7]

That the Pfizer-BioNTech COVID-19 vaccine arrived a mere 347 days after the virus was first detected is a testament to the tremendous bench strength of the life-sciences industry in countries such as the United States and Germany, countries which have historically recognized that robust IP rights are an essential enabler of life-sciences innovation.[8] But that was just the tip of the response. By May 2023, 10 vaccines had been approved for emergency or full use by at least one stringent regulatory authority recognized by the WHO: Pfizer–BioNTech, Oxford–AstraZeneca, Sinopharm BIBP, Moderna, Janssen, CoronaVac, Covaxin, Novavax, Convidecia, and Sanofi–GSK. Overall, by the end of 2022, more than 30 vaccines had been approved for general or emergency use by nations around the world.[9]

The pace of COVID-19 therapeutics development was likewise exceptional. Gilead Sciences’ COVID-19 therapeutic, remdesivir, received U.S. Food and Drug Administration (FDA) Emergency Use Approval (EUA) a mere 123 days after the virus was first detected in a patient sample; Eli Lilly’s antibody treatment, bamlanivimab, received its EUA within 315 days. By November 2022, 37 COVID-19 treatments were authorized for use somewhere in the world, with over 865 more candidates in clinical development, and at least another 830 in preclinical development.[10] As of May 2023, of those 37 authorized treatments: only remdesivir and baricitinib were fully approved (meaning, approved beyond an emergency use approval) in at least one jurisdiction; 16 were approved in the United States, United Kingdom, or European Union; 21 were approved only in countries other than the United States, United Kingdom, and European Union; and 7 were endorsed by the WHO. For those treatment candidates in clinical development, 415 were in late stage (phase three or later) testing.

Considering health care is not a one-size-fits-all proposition, these myriad innovations provide patients and healthcare providers with a variety of treatment options, including antiviral, monoclonal, or anti-inflammatory treatments; oral, intramuscular injection, or intravenous-infusion delivery; and inpatient or outpatient settings. Furthermore, the therapeutic types include small molecules, antibodies, proteins, nucleic acid-based therapies, cell therapies, and traditional medicines. In other words, these treatments are not all the same. Nor are they simply modified copies of existing options. Just as the variety of COVID-19 vaccines (mRNA, protein subunit, viral vector, Whole-Virion Inactivated Vero Cell-derived platforms, etc.) provided the global population with a range of preventative options, the greater variety of treatments allows healthcare providers to tailor subsequent care to the needs of their patients.[11] This is vital for those with allergy concerns, adverse drug interactions, delivery method limitations, and other healthcare complications. A potential waiver of IP rights for innovative pandemic-treating treatments (whether for COVID-19 or a future pandemic) would deter investment in the wide variety of patient-benefitting treatment approaches and risk diminishing the availability of innovative alternative treatment options should new strains of the coronavirus emerge. Indeed, loss of IP protections on vaccines and treatments could weaken pharmaceutical companies’ incentives to invest in risky technologies in the future. mRNA vaccine technology, for example, took decades to develop, and entailed collaboration among universities, government labs, and small and large firms, efforts incentivized by the security of IP protections. IP waivers could disincentivize innovation and leave the world less prepared to tackle future health challenges, including possible future pandemics.[12] In fact, a 2022 article published in Drug Discovery Today argues that IP waivers reduce innovation incentives, hinder startup firms from securing funding, and result in fewer new drugs and medical innovations. Once a waiver goes into effect, potential imitators can acquire knowledge that they can keep even if IP protection is later restored. In the long term, IP waivers can decrease innovation across many diseases, since, for example, the bases for COVID-19 vaccines, such as mRNA technology, have numerous applications beyond COVID-19.[13]

IP Rights Enable Voluntary Licensing That Has Dramatically Scaled Production of Covid-19 Vaccines and Therapeutics

Once innovative life-sciences companies had conquered the challenge of creating safe and efficacious COVID-19 vaccines and therapeutics, the challenge turned to manufacturing these at scale and distributing them to the global population. While this process took time to ramp up (albeit at a rapid pace), it has positioned the world with a sufficient supply of both vaccines and therapeutics today, with the experience showing that IP rights were an enabler, not an inhibitor, of the massive scaling up of production of COVID-19 vaccines and therapeutics.

For instance, when Serum Institute CEO Adar Poonawalla was asked if vaccine rollout was slowed because vaccine patentholders were licensing too few manufacturers to make them, he responded, “No. There are enough manufacturers, it just takes time to scale up. And by the way, I have been blown away by the cooperation between the public and private sectors in the last year, in developing these vaccines.”[14] Poonawalla actually cited the lack of global regulatory harmonization as a far greater cause of delays in the vaccine rollout.[15] And even Médecins Sans Frontières’ Rose Scourze acknowledged (in a January 20, 2021 BBC interview) that suspending patent rights “wouldn’t produce millions of more vaccines.”

As of January 3, 2024, 13.53 billion COVID-19 vaccine doses have been administered worldwide, with 70.6 percent of the global population having received at least one dose.[16] To be sure, distribution challenges in many developing countries slowed the initial rollout. For instance, in December 2020, developing countries turned away some 100 million COVID-19 vaccines because they were reaching their expiration date.[17] More recently, with 200 million unused doses, AstraZeneca’s COVID-19 vaccine partner Serum Institute halted production in April 2022. As Serum Institute CEO Poonawalla noted at the time, “I have even offered to give free donations to whoever wanted to take it.”[18] Similarly, Aspen’s South Africa COVID-19 vaccine plant has faced closure over a lack of sufficient orders for COVID-19 vaccines.[19] In fact, India and South Africa stopped producing vaccines months before the June 2022 vaccines waiver decision because there was already a surplus global vaccine supply. Indeed, one of the chief advocates for the vaccines waiver, Indian Minister of Commerce and Industry Shri Piyush Goyal, unwittingly admitted to the fundamental unnecessity of it in the first place, noting prior to the decision that “vaccines have already lost relevance.”[20]

The legal certainty that IP rights confer has proven crucial in facilitating the dissemination of the know-how and technology that partners need to manufacture complex COVID-19 vaccines and therapeutics at the production standards required to do so safely and reliably. Indeed, nearly 300 vaccines partnerships and collaborations have been established among manufacturers worldwide, 229 of which have involved tech transfer and know-how sharing. Likewise, today, over 140 collaborations for the production and distribution of COVID therapeutics are in place, over 92 percent of which entail some form of technology transfer.[21] Gilead alone has signed nine VLAs with generic manufacturers for remdesivir, covering 127 countries. Likewise, Pfizer’s 38 VLAs cover 95 countries, and Merck’s 31 VLAs cover 105 countries.

And many of these agreements are royalty-free, as more than 60 generic manufacturers utilize VLAs for COVID-19 therapeutics through bilateral agreements and non-profit organizations such as the United Nations-backed Medicines Patent Pool (MPP). The MPP facilitates development and increases access to life-saving medicines by partnering “with civil society, governments, international organizations, industry, patient groups, and other stakeholders, to prioritize and license needed medicines and pool intellectual property to encourage generic manufacture and the development of new formulations.”[22]

Courtesy of these VLAs, there are now more than 200 production sites for COVID-19 treatments spread across more than 30 countries, including Bangladesh, Brazil, Egypt, India, Indonesia, Kenya, Pakistan, Paraguay, Singapore, and South Africa. (Note: Bangladesh, Egypt, India, Indonesia, Pakistan, and South Africa all voiced support for the extended waiver.) India alone maintains at least 70 of these sites.

Thus, not only is an expanded TRIPS waiver for COVID-19 therapeutics and diagnostics wholly unnecessary given the range of treatment options, but it is also redundant given the overwhelming efforts at global collaboration through voluntary licensing agreements.

Instead of simply being forced to divulge their IP or see it be compulsorily licensed to other manufacturers, in light of the extreme complexity of manufacturing COVID-19 vaccines and therapeutics, companies should have the right to evaluate potential license partners and ensure that they can meet the production standards required to safely and reliably produce vaccines or treatments for pandemic-related diseases before entering into license arrangements with them. Indeed, this is critical for it would be disastrous if defective vaccines or therapeutics were produced at facilities not properly equipped to produce such complex treatments. As Phil Stevens and Mark Schultz have convincingly written, there’s simply no evidence that invalidating IP rights would achieve more than the licensing agreements that were forged between innovators and reputable vaccine manufacturers in countries such as Brazil, India, and beyond.[23]

Not only have life-sciences innovators extensively voluntarily licensed IPRs to produce COVID-19 vaccines and therapeutics, they’ve made extensive donations of vaccines and therapeutics. For instance, by October 2021, Gilead donated over 450,000 vials to India, 10,000 vials to Georgia, 3,000 vials to Armenia, and 100,000 vials to Indonesia, complementing local generic supplies of remdesivir provided through VLAs.[24] In May 2021, Lilly committed donations of baricitinib, bamlanivimab, and etesevimab to Direct Relief.[25] In January 2023, Direct Relief donated enough therapies to treat more than 350,000 patients with mild to moderate COVID infections and over 80,000 for severe infections.[26]

But the key point is that, once effective COVID-19 therapeutics existed, the responsible use of VLAs did enable their production at necessary global scale to combat the pandemic. For instance, November 2022 data from Airfinity indicated a contracted supply of 67.3 million therapeutic treatments, whereas the total production exceeded 81.9 million.[27] In fact, of the more than 35 million doses of COVID-19 treatments purchased by governments and non-governmental organizations (NGOs) for low- and middle-income countries, only 10 million were administered as of September 2022.[28] That more than 70 percent of the therapeutics already paid for by countries went unused suggests that neither their price nor their lack of availability has been a fundamental problem.

It's also important to make the point that, far from inhibiting access to medicines, robust intellectual property rights actually encourage their diffusion. For instance, in their report, “Patents and The Global Diffusion of New Drugs,” Cockburn, Lanjouw, and Schankerman studied 642 new drug launches in 76 countries from 1983 to 2002. They found that the speed/extent of diffusion strongly associated with countries’ patent and price regulation systems. Moreover, they found that moving from a regime of no product patents to long product-patent terms reduces drug launch lags by 55 percent.[29]

Nor are compulsory licenses for innovative medicines the answer. In their report “Compulsory Licensing Often Did Not Produce Lower Prices For Antiretrovirals Compared To International Procurement,” Beall, Kuhn, and Attaran analyzed 30 compulsory licenses of HIV/AIDS retroviral drugs against 673 comparable procurements. They found that “Compulsory licensing often delivered suboptimal value compared to intl. procurement alternatives” and that the prices countries ultimately paid were higher in two-thirds of cases, with a price premium of 25 percent.[30]

Permitting countries to waive IPRs could undermine productive voluntary licensing relationships, not to mention jeopardize the COVID (or other pandemic) therapeutics pipeline by creating disincentives to invest in the further R&D needed to develop clinical trial candidates. Compelling the divulsion of innovative techniques and platform technologies used to produce vaccines and therapeutics could compromise innovators’ efforts to use these tools in developing treatments for other diseases. And a waiver risk putting U.S.-developed biomedical technologies directly in the hands of foreign adversaries—not to mention handing anti-IP advocates a cudgel to brandish as they seek to denigrate IP rights for other forms of technology of global import, from clean technologies to information and communications technology (ICT).

Building Global Health Infrastructure, Not Waiving IPR, Is The Solution to Future Pandemic Challenges

In November 2021, up to one million COVID-19 vaccines were estimated to have expired in Nigeria without being used.[31] This situation was unfortunately repeated across many developing and lower- or middle-income countries. The experience of countries having to destroy vaccines unused shows how logistical and distributional issues have long been a much bigger challenge with getting medicines, whether on-patent or off, to those who need them in the developing world. For instance, in 2014, researchers at the University of Utrecht in the Netherlands found that, on average, essential medicines are available in public sector facilities in developing countries only 40 percent of the time.[32] A 2019 study found that the mean availability of 12 priority essential medicines for women in sub-Saharan African ranged from 22 percent to 40 percent and for children ranged from 28 to 57 percent.[33] If medicines cannot reach remote areas, patients are less able to access them. A 2009 survey of 36 countries found that 15 common generic medicines listed on the WHO Essential Medicines list are frequently unavailable in either the public or private sectors, with regional availability ranging from 29 percent in Africa to 54 percent in the Americas.[34] Indeed, the vast majority of drugs—at least 95 percent—on the WHO’s Essential Medicines list are off-patent, and thus potentially available in generic versions. Whether it comes to essential medicines or COVID-19 vaccines or therapeutics, a far greater challenge than IP rights has been nations’ underdeveloped public health infrastructure and the fact that many people live in rural areas, far from care.

Similarly, a recent conference organized by the African Union Development Agency-NEPA, WHO, and the African Medicines Regulatory Harmonization Program found that some “70% of countries globally have weak national medicines regulatory systems” and that “stronger regulatory systems can increase equitable access to life-saving medicines.” [35] This suggests that weak regulatory systems, rather than IP, prevent access to medicines.

The Importance of Open Global Health Data Flows

The HHS’ request for comment asks about data sharing. ITIF believes ICT can improve the quality and delivery of health care services around the world, particularly in low- and middle-income countries that face staffing and other physical resource constraints. Two decades after the sequencing of the human genome, and during the current rise of data- and artificial intelligence (AI)-driven health services, the world is only just starting to see the true potential of these technologies. The free flow of personal, health, and genomic data is particularly important. Yet, the sad reality is that, even during COVID 19, many nations make it unnecessarily complicated and costly, if not illegal, for health data to cross their borders. In so doing, they are hindering critically needed medical progress.[36]

In the COVID-19 crisis, data analytics powered by artificial intelligence (AI) proved critical to identifying the exact nature of the pandemic and developing effective treatments. The technology can produce powerful insights and innovations, but only if researchers can aggregate and analyze data from populations around the globe. And that requires data to move across borders as part of international research efforts by private firms, universities, and other research institutions. Yet, some countries, most notably China, are stopping the movement of health and genomic data at their borders. Russia requires all personal data, health-related or not, to be stored locally. Australia requires genomic and other data attached to personal electronic health records to be only stored and processed within its borders. Countries also enact de facto barriers to health and genomic data transfers by making it harder and more expensive, if not impractical, for firms to transfer it overseas than to store it locally, such as in Turkey.

As ITIF wrote in its report, “Building a Global Framework for Digital Health Services in the Era of COVID-19,” policymakers need to stop treating health data differently when it comes to cross-border movement, and instead build technical, legal, and ethical protections into both domestic and international data-governance mechanisms, which together allow the responsible sharing and transfer of health and genomic data.[37] This is clearly possible—and needed. In February 2020, leading health researchers called for an international code of conduct for genomic data following the end of their first-of-its-kind international data-driven research project.[38] The project used a purpose-built cloud service that stored 800 terabytes of genomic data on 2,658 cancer genomes across 13 data centers on three continents.[39] The collaboration and use of cloud computing were transformational in enabling large-scale genomic analysis. If policymakers want more international collaboration like this, including around COVID-19 and future pandemics, then they should remove barriers to health data transfers and build a clear and predictable framework to clarify how data protection rules apply. Following the worst pandemic in a century, policymakers should recognize that in the future they would be better off if researchers were able to pool their data and technological capabilities to respond quicker and more effectively to the next international health crisis, never mind more common health conditions.[40]

On a related point, and in response to provisions in Article 12 of the proposed PPA on Access and Benefit Sharing, ITIF believes that widespread access to pathogen samples and genetic sequencing data (GSD) is needed to facilitate the rapid development of safe and effective pandemic-related products. ITIF opposes any language in the WHO PPA that would link access to pathogens and related GSD to the sharing of “benefits” obtained through utilization of those resources.

Conclusion

On October 17, 2023, the U.S. International Trade Commission released a report examining “COVID-19 Diagnostics and Therapeutics: Supply, Demand, and TRIPS Agreement Flexibilities.”[41] The report largely provided background on the role of IP in COVID-19 treatments and access. As one analyst observed, the report “stopped short of making any recommendations, but ultimately did not find any definitive evidence that IP rights present a barrier to access in the context of COVID diagnostics and therapeutics.”[42] And that’s fundamentally because IP rights do not present a barrier to access to medicines, but rather are a fundamental basis for the existence of medicines in the first place.

In conclusion, waiving IP sets a terrible precedent; disrupts and disincentivizes innovation ecosystems; is a barrier to start-ups and small- to- medium-sized enterprises generating capital; reduces R&D; results in fewer new uses and new products; and negatively impacts employment both within the pharmaceutical industry and the broader economy, all while doing nothing to solve the real problems surrounding access to healthcare innovation in developing countries. Waiving IPRs would not increase the number of vaccines or therapeutics, or the global supply thereof, that might be needed to address a future global pandemic. In conclusion, ITIF calls on the U.S. government not to endorse provisions for an IPR waiver in the WHO PPA.

Thank you for your consideration.

Endnotes