Vaccine patent waivers: A roadblock on the path to normalcy
Employers relying on the promise of the vaccines to fully reopen will need to be ready to do what they can to keep our progress on track.
The world is beginning to feel like it is returning to something approximating normalcy. In the US, all adults are now eligible to receive the COVID-19 vaccine, and nearly 150 million have. The Biden administration blew past its prior inoculation targets (100, then 200 million doses in his first 100 days) and has called an even more ambitious shot for this summer: 70% of all adults receiving one shot by July 4th.
That goal may be well within reach, with the Centers for Disease Control and Prevention (CDC) putting the US vaccination rate at about 60% of adults so far. What’s more, Pfizer’s vaccine is looking to be just as safe for citizens in the 12-15 age group as it has proven to be for the everyone else so far, bringing the percentage of the US population eligible to receive a vaccine upwards of 85%. This is a whole new cohort that can be protected against future infections, further reducing the threat of COVID-19.
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With the dramatic increase in the pace of vaccinations, nearly all other metrics around the pandemic are trending in the right direction here in the US – infection rates and case numbers are the lowest they’ve been since last September, and parts of the country are tentatively opening back up for business and travel. Perhaps most excitingly, the CDC revised its masking recommendations to announce that fully vaccinated people should be safe to go mask-less indoors (with a few exceptions, like riding public transit or visiting a nursing home).
That’s not to say that we are on a glide path to full normalcy. The CDC and the Biden administration couched this announcement as something of an enticement to encourage the remaining percentage of the population to get their shots, and with good reason. Though cases are on the decline, parts of the US are still seeing thousands of cases per day. Surveys indicate that somewhere between 20-30% of the US population is unlikely to get vaccinated at all. This vaccine hesitancy may be the final significant obstacle to the US putting the pandemic fully in its rearview mirror.
In other parts of the world, the pandemic is looking even further from over. With vaccine administration limited by hesitant individuals, logistical struggles, or simply deficiencies in supply, countries like India, Brazil, Egypt, and Turkey have become surging hot spots for the virus, continuing to struggle in the grip of the pandemic.
One proposed solution to the insufficient supply of vaccines in some of these struggling countries has sparked controversy, both domestically and between the US and some of our European allies: patent waivers. This proposal has inflamed the rhetoric of its proponents and its detractors, and the potential knock-on effects of patent waivers could further disrupt our strident efforts towards full vaccination here in the US. Employers relying on the promise of the vaccines to fully reopen and get back to business as usual will need to be aware of this potential roadblock and be ready to do what they can to keep our progress towards full vaccination on track.
Patents and patent waivers
The US has built up a fairly robust system of intellectual property protections, a main pillar of which are patent rights. This is arguably one of the primary engines of our culture of innovation. Essentially, patent rights are a trade-off between inventor and the public: the inventor discloses and explains precisely what they have newly invented, and the government will grant the inventor a limited monopoly to make and sell their invention. Currently, this monopoly, the right to exclude, lasts for about twenty years in the US
Patents are one of the key factors in a new product’s marketability (a single episode of Shark Tank can attest to that), but the patent system is not universally loved. Indeed, pharmaceutical patents can be particularly controversial, as they are often seen as a way of preventing the development of cheaper generic drugs. Famously, the inventor who discovered insulin refused to put his name on the patent, feeling it was unethical to profit off his life-saving discovery. Nonetheless, our robust patent system is widely considered one of the primary forces spurring the investment and research necessary to development new pharmaceuticals like the (literally world-saving) COVID-19 vaccines.
One of the key limitations of patents, however, is that their power stops at the border of the country that issued them. On the international stage, American patent rights are partially enforced through mutual participation at the World Trade Organization (WTO), where members agree to respect each other’s intellectual property rights.
In the case of the Pfizer and Moderna vaccines, two members of the WTO, India and South Africa, proposed a waiver on behalf of countries with little or no access to vaccines. Essentially, the waiver would allow members of the WTO to stop enforcing intellectual property rights, including patents, for coronavirus vaccines, diagnostics, and treatments. Importantly, this waiver would not force companies like Pfizer or Moderna to divulge every aspect of their vaccine manufacturing process. Those companies would suddenly find themselves bereft of any mechanism to enforce their “right to exclude” against any overseas companies from using the information disclosed in their patent documentation and attempting to replicate the Pfizer or Moderna vaccines.
The debate around this vaccine patent waiver has been simmering slowly at the WTO since India and South Africa submitted their request in October 2020, but the debate has been heating up since President Biden announced on May 5, 2021, that the US would support the patent waiver. The US trade representative to the WTO cited the extraordinary circumstances of the global health crisis in announcing the decision, much to the elation of global health activists and furor of the pharmaceutical industry.
Arguments for and against
The arguments on both sides of the patent waiver debate tend toward the hyperbolic, but both sides do have some valid points worth considering.
Those in favor of the waiver argue that any steps that increase the availability of vaccines are necessary at this critical time. Patent protections increase the time and expense of manufacturing sufficient supplies of vaccines, and those impediments are exacerbating the impact of the pandemic in countries like India. They argue further that the manufacturers of these vaccines have already profited mightily from their vaccines, and they will have a guaranteed market for their vaccines going forward. They also point out the inherent inequity of the vaccines, arguing that wealthier nations were able to quickly develop or purchase all the available supply of vaccines, leaving less affluent nations to fend for themselves.
The pharmaceutical industry counters with a slippery slope argument: once we start weakening intellectual property rights, where does it stop? They also fear that a waiver here could set a precedent for other waivers in the future, undermining the incentives that lead to the inventive products that save lives and ease suffering around the world.
Their stronger arguments point out that waiving these patent rights will do little on its own to increase vaccine supplies, and could actually harm current vaccination efforts by allowing new manufactures to eat up that already scant supply of raw materials necessary to create the vaccines. Additionally, the waivers could lead to a glut of vaccinations that are less safe or less effective, further entrenching the vaccine hesitant in their mistrust of these lifesaving technologies.
Proponents of the waivers are correct, vaccine patent waivers have the potential to allow more manufacturers to begin producing doses and that could help alleviate the impact the resurgent virus is having in parts of the world. That said, those new manufacturers would likely be a long way from production, even if the patent waiver is agreed to at the WTO (a process that requires unanimous consent and negotiations that would be a month’s long process at best).
Meanwhile, the patent waiver issue has become something of an odd geopolitical wedge. After announcing its support, the US was quickly rebuked by France and Germany (home of a number of large pharmaceutical companies), two prominent members of the WTO and close European allies. Meanwhile China, publicly accused last August by the US Department of Justice of intellectual property theft, appears to be aligned with the US on this issue, announcing its own support for the patent waiver proposal.
The practical reality
Realistically, a patent waiver granted in the midst of an epoch-defining global health crisis appears unlikely to set the dangerous precedent feared by the pharmaceutical industry. Even so, it far from clear that vaccine patents are actually inhibiting the march towards global vaccination. India is home to one of the world’s largest vaccine manufactures who is currently struggling to escalate production of desperately needed doses, not due to any intellectual property concerns but because global stocks of filters, vials, and reagents – the requisite raw materials of vaccine manufacture – are themselves running low. Additionally, each country’s import and export limitations undercut the financial feasibility of some manufacturers, further bottlenecking production.
Even if more doses could be physically manufactured, there are still logistical hurdles around the storage and transportation of that many doses for which a patent waiver provides no answer.
The major hurdle in the US to full vaccination appears to be the simple hesitation, or outright recalcitrance, of a significant number of citizens toward vaccinations. The very speed at which the vaccines were developed, dubious online information, and the ever-evolving guidance from experts like the CDC may be making these individuals wary. And any report hinting that the vaccines on offer are even marginally less effective or less safe would be all the excuse some of these individuals need to turn down the one silver bullet we have against the coronavirus.
Rather than relying on a patent waiver and taking even a few steps down the path of weakening enforcement of intellectual property rights, the US should take steps to ramp up its own vaccine production and do what it can to assist other countries more gravely afflicted by the pandemic. For employers here in the states, this means doing everything possible to encourage employees to get vaccinated as quickly as possible. Once the domestic population is fully protected, manufacturers like Pfizer and Moderna can turn their focus to helping the rest of the world.
In a global society facing a global pandemic, nowhere is truly safe until everywhere is safe. Employers can take steps to educate their employee population on the benefits of the vaccines, and the impact the virus is currently wreaking in other countries. They can help them understand that every new infection is an opportunity for the virus to mutate and evolve, leading to new variants that are potentially more virulent and more deadly. Every new case of the virus threatens to undermine all our collective effort and sacrifice up to this point.
Company leaders can set the example, talking about their experiences getting vaccinated and assuaging the fears of the hesitant. The greater the percentage of the world population we get vaccinated and the more quickly we can do it, the sooner we can all get back to the office, to our friends and coworkers, the sooner we can return to normal and be open for business without fear.
Nicholas Bonds, Esq., joined The Phia Group, LLC as an attorney in the winter of 2018. He is a member of Phia Group Consulting’s Independent Consultation & Evaluation (ICE) team, working on consultation, plan document review, and regulatory compliance with state and federal laws including ERISA, ACA, HIPAA, COBRA, FMLA and more.
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