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Post-Pandemic Fights Loom Over Ownership of Covid-19 Technology

Dec. 9, 2020, 10:56 AM

Drug manufacturers haven’t spent time fighting over their technology as they race to find a vaccine for the coronavirus: After all, the optics of suing in the middle of a pandemic aren’t good.

But as medicines begin hitting the market, and breakthrough technologies are applied to other types of vaccines or treatments for cancer and other diseases, patent disputes could emerge in an industry that is known for closely guarding its intellectual property.

One example: While Moderna Inc., a front-runner in the race for a Covid-19 vaccine, has promised not to enforce related patents during the pandemic, it did mount challenges before the outbreak to three patents related to two of the leading vaccine candidates. One of them remains on appeal.

“I think we’re going to have a big patent fight” when “the Covid crisis is a little bit in the rear-view mirror and we know how the market shook out,” said Sarah Chapin Columbia, an attorney at McDermott Will & Emery LLP in Boston.

Pharmaceutical companies have struck a cooperative tone during the health crisis, creating partnerships and collaborating to find vaccines and treatments. But while they generally haven’t been enforcing patent rights, “they are amassing them,” Columbia said.

Labrador Diagnostic LLC in March sued bioMerieux SA, a French company developing coronavirus tests. Labrador, however, later said the lawsuit was over diagnostic tests that predated the virus and offered its patents royalty-free for companies developing a Covid-19 test.

More recently, Allele Biotechnology and Pharmaceuticals Inc. sued Regeneron Pharmaceuticals Inc. and Pfizer Inc. over the use of a marking protein used in the development of the companies’ Covid-19 medicines. Allele didn’t ask for an injunction in either case.

Amassing Patents

It typically takes 18 months for patent applications filed with the U.S. Patent and Trademark Office to become public, making it difficult to know exactly how many patents have been filed on technologies developed during the pandemic, or who is filing applications.

But there are some general indications of activity. The PTO, for example, has reported receiving over 400 requests under a pilot program that fast-tracks patent applications for inventions related to Covid-19 that are filed by small businesses, universities, and non-profit groups. Companies with more than 500 employees aren’t eligible for the pilot.

Attorneys expect competitors with patents—and perhaps some non-practicing entities—may come knocking for royalties once it becomes clear which companies won the race to find cures.

“I think you’ll see a proliferation of technologies that were developed during Covid being used for non-Covid purposes and then a lot of litigation stemming from that,” said Matthew Howell, an Atlanta-based attorney at Alston & Bird LLP.

“Where we’re really going to see the development of new IP” is around platforms used to deliver the vaccine, Howell said.

New IP

This includes platforms to deliver messenger RNA, or mRNA. Moderna has become known for the technology, but other researchers and companies, including Pfizer, are pursuing Covid-19 vaccines based on mRNA.

There aren’t currently any approved mRNA vaccines, although the concept has been around for decades, according to the federal government. Now, the tech is in the spotlight—and scientists believe it could have an increasingly important role in the development of future vaccines.

In a September article published in the International Journal of Molecular Sciences, researchers at Fudan University in China said the field of mRNA vaccines wasn’t fully mature but “its potential to be the preferred vaccine pattern has been fully shown.”

If the platform is widely accepted, “all sorts of indications are going to come into play,” including oncology, said Aydin Harston, an attorney at Rothwell Figg Ernst & Manbeck PC in Washington.

Moderna, for example, is creating mRNA-based cancer vaccines. BioNTech SE, the German company working with Pfizer on its Covid-19 vaccine, is also pursuing mRNA therapies for melanoma and other kinds of cancer.

The potential for litigation in this space post-pandemic, especially, is certainly real,” Daniel Shores, a Rothwell attorney in Boston, said.

Patent Pledge, Legal Fights

For now, attorneys said, the hands-off approach by Moderna on enforcing its patents related to Covid-19 could help accelerate the infusion of the technology and address some of its potential challenges.

The mRNA vaccines, for example, must be kept extremely cold—Pfizer’s Covid-19 vaccine requires storage at negative 70 degrees Celsius. This isn’t a problem for many hospitals, but Harston said the infrastructure isn’t there yet on a global scale.

He drew parallels between Moderna’s pledge and Elon Musk’s famous 2014 promise, which is still in place, not to sue over Tesla Inc.’s electric vehicle patents. Tesla at the time needed charging infrastructure to be built out so people would feel comfortable driving electric cars, Harston said.

Similarly, drug makers “need other companies to do these kinds of things to grow and expand so that you can actually deliver these drugs to people,” Harston said.

Moderna didn’t immediately respond to a request for comment. But in 2018 and 2019 the company challenged the validity of three Arbutus Biopharma Corp. patents related to delivery systems for mRNA molecules at the Patent Trial and Appeal Board. The board axed at least some claims in two of the patents. One of the decisions is on appeal.

While Moderna has expressed a willingness to license its patents after the pandemic ends, attorneys said the potential for fights remains.

“Saying that you’ll license to someone else is a good sentiment but in practice if Moderna wants a certain amount of money and the company seeking to license it doesn’t want to pay that, that’s going to cause a dispute right there,” Howell said.

To contact the reporter on this story: Matthew Bultman in New York at mbultman@correspondent.bloomberglaw.com

To contact the editors responsible for this story: Bernard Kohn at bkohn@bloomberglaw.com; Keith Perine at kperine@bloomberglaw.com

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