' Waive or enforce? The Debate over Intellectual Property Issues in Covid-19 Vaccines | MTLR

Waive or enforce? The Debate over Intellectual Property Issues in Covid-19 Vaccines

In December of 2020, the long-awaited coronavirus vaccines began to slowly roll out across the world. The vaccines give people some hope of taming the virus, but the logistical hurdles of the vaccines seem worrisome. The daunting task of manufacturing, delivering, and administering massive quantities of vaccines on a global scale has highlighted many intellectual property issues in the drug industry. Recently, there has been a contentious debate, with the central issue concerning how intellectual property rules will influence the availability of the Covid-19 vaccines.

At the meeting of the World Trade Organization in October, South Africa, India, and many other developing countries, proposed that intellectual property rules’ application to the vaccines be waived. Specifically, the basic position of these countries is that the exceptional circumstances created by the pandemic should warrant the “exemption of member countries from enforcing some patent, trade secrets or pharmaceutical monopolies” under the organization’s trade-related intellectual property agreements. This would allow drug companies in developing countries to manufacture generic versions of the Covid vaccines. The wealthier countries, namely – the United States, the European Union, Britain, Norway, Switzerland, Japan, Canada, Australia and Brazil – opposed the proposal by suggesting that doing so would upend the “incentives for innovation and competition.” This disagreement raises a big question: will the waiver subvert the purposes of the intellectual property laws by disincentivizing innovation or will it lead to a win-win situation for all by massively increasing access to and affordability of the Covid vaccines while allowing investors and the pharmaceutical industry to get a sufficient return on the research investment?

As part of coming up with a solution to this problem, several additional factors warrant consideration. First, the debate over increasing the production of vaccines in exchange for relaxing intellectual property rights illustrates merely one aspect of the flaws inherent in current intellectual property regimes. This debate highlights the tension between market forces and public health imperatives that are part of intellectual property laws. At their core, intellectual property rules promote innovation by giving varying levels of protection to inventors that create technology, processes, or products that have novel value. Intellectual property laws as they currently exist incentivize large pharmaceutical companies and other private sector investors to develop and commercialize new vaccines, but the laws often fail to achieve that goal. Previous instances of delayed vaccine development including Ebola, Zika, and the AIDS virus demonstrate this problem. For example, a candidate for the Ebola vaccine was created at least as early as 2004, but it sat idle in storage until the dire 2014-16 outbreak because it failed to attract private sector investors. Until then, there was little commercial interest in this vaccine candidate because Ebola is a disease not traditionally rampant in wealthy western countries— there was never a big market for Ebola vaccines from which investors can expect a big return on their investment.

Second, there is plausible argument that the rapid development of the Covid vaccines has been possible with investment from not only private investors, but also taxpayer money through the government’s involvement. For example, the United States government has given pharmaceutical companies billions of dollars in support of their vaccine research. This has led some people to argue that big pharmaceutical companies should be prevented from claiming that all intellectual property associated with the vaccine research are solely theirs. They claim that such intellectual property is a public good.

Lastly, it seems that the pandemic’s unprecedented nature, devastating impact on the economy, and the utmost importance of public health on a global scale are overwhelming justifications for allowing at least some form of a temporary relaxing of intellectual property rules. However, many of these issues are not unique to the pandemic. Intellectual property regimes seek to incentivize the creation of vaccines, because vaccines benefit society. This is especially true when they are widely available, but the limited monopoly conferred by intellectual property rights can create a perverse incentive for pharmaceutical companies to sell a smaller amount of vaccines at a much higher price in order to turn a bigger profit than they would receive from a more widespread distribution at a lower price. It’s unclear exactly how much or what kind of long-term changes would be ideal, but it is nonetheless clear that the intellectual property regime needs reform— reform that better strikes a balance between incentivizing development of new drugs and vaccines while making them accessible and affordable. The reforms would need to mitigate the barriers that vaccines pose as unappealing investments due to their single-use and long-lasting nature, efficacy in prevention of diseases, and the need to price them relatively low to allow a large portion of the public to receive them.

* Lisa Koo is a Contributing Editor on the Michigan Technology Law Review.

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