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U.S. Call to Waive Vaccine Patents Said to Snarl Immunity Effort

May 6, 2021, 5:26 PM

The success of an international waiver of patent protections on Covid-19 vaccines largely hangs on whether the U.S. forces its companies to share manufacturing specifications and may not be the harbinger of global immunization it’s cracked up to be, critics say.

Patent industry participants were caught off guard by U.S. Trade Representative Katherine Tai’s announcement Wednesday that the Biden administration supports waiving international intellectual property protections on Covid-19 vaccines. Stocks for vaccine producers Pfizer, BioNtech, Moderna, and Johnson & Johnson dropped after news of the administration’s position came out.

The proposal is now before the World Trade Organization for consideration as IP proponents ready their arguments—and lobbying heft—for maintaining the protections.

It’s not just patents that drive vaccine production, IP and health professionals say. To be successful, the makers need manufacturing “know-how” in the form of trade secrets and other instructional demonstrations. Manufacturing and distribution capabilities are major hurdles to worldwide Covid-19 immunity.

What’s more, they add, IP rights have accelerated rather than blocked the immunization drive as pharmaceutical companies lean on those protections to build vaccines rather than suing their competitors. Weakening rights, the argument goes, welcomes competing countries to overtake the U.S. in innovation.

“This is a dangerous decision,” said Andrei Iancu, an Irell & Manella IP attorney who led the U.S. Patent and Trademark Office in the Trump administration. “We really all want to make as many vaccines as possible and distribute them to as many people around the world as possible, and waiving intellectual property rights will only hurt that goal.”

Waiving IP rights “will make it more difficult for companies to collaborate around the world. It will make it more difficult to create safe vaccines with high efficacy rates. And it will make it more difficult to concentrate on the real issues that need to be addressed,” he said.

Proponents of the waiver are pointing to the diplomatic upsides, saying it would help build consensus among leaders of wealthier nations to get more vaccine doses to poorer nations. It would also set the stage to ramp up production capabilities in developing nations struggling to safeguard their populations against Covid-19.

“Combined with a robust manufacturing program and effort to rapidly share technology, this could end the pandemic on a much faster timeline,” said Zain Rizvi, a law and policy researcher at Public Citizen.

International Standing

Vaccine manufacturers balk at calls to share their intellectual property on the global stage. In late April, IP leaders from Pfizer Inc. and Johnson & Johnson said IP rights allowed mass distribution of their Covid-19 vaccines in a relatively short time frame.

International manufacturers can’t simply copy their vaccine recipes with success, they said.

“The impact may differ greatly depending on the type of vaccine we are talking about,” said Arti Rai, a professor at Duke University School of Law who led the policy analysis on an Obama-era overhaul of patent law. The one-dose J&J vaccine is easier to produce than the two-dose Pfizer and Moderna versions, which use a new genetic technology through people’s messenger RNA.

Nevertheless, Democratic lawmakers in recent weeks amped up pressure on the Biden administration to back an international IP waiver. Over 100 House Democrats, led by Rep. Jan Schakowsky (D-Ill.), signed a letter urging the president to take action, a move that was quickly rebuked by Republicans on the House Judiciary Committee.

The move, according to Boston University Global Policy Center Director Kevin Gallagher, helps the U.S. “gain some standing” on the international stage lost during the Trump administration. “It gives the rest of the Western powers the space to be bold,” he said.

Western powers and other developed nations need to be on the same page for the waiver to move through. Waiving international IP enforcement is a World Trade Organization effort, where decisions are normally made by consensus.

At the WTO, the U.S. isn’t the “800-pound gorilla” it is in other policy contexts, said Nicholson Price, a University of Michigan law professor focusing on biomedical innovation. Still, “when the administration says ‘we’re on board,’ that’s going to potentially shake things.”

China and the European Union have signaled a willingness to partake in the debate after the Biden announcement. Yet German Chancellor Angela Merkel is against Biden’s proposed waiver.

“There’s going to be a lot of pressure on the WTO to go along with this,” said Jeff Hauser, executive director of the Revolving Door Project, a watchdog of executive branch appointments. Holdouts would be “standing up as an unpopular minority” while “calling into question” the WTO as an institution.

To contact the reporter on this story: Ian Lopez in Washington at ilopez@bloomberglaw.com

To contact the editor responsible for this story: Fawn Johnson at fjohnson@bloombergindustry.com

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