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Waiving patent and intellectual property protections is not a panacea for global vaccine distribution

Monica de Bolle (PIIE) and Maurice Obstfeld (PIIE)

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The Biden administration's decision in early May 2021 to support temporary waivers of intellectual property rights (IPRs) on COVID-19 vaccines produced by the world's largest pharmaceutical companies is a welcome step intended to help countries with low access to vaccines. Unfortunately, however, the waivers by themselves will do little to aid global vaccination in the near term. In fact, these actions could be counterproductive if governments become complacent and fail to finance and organize vaccine supply chains worldwide, without which vaccines will not get to those who need them.

As the pandemic has exploded in India and fears for Africa have intensified, the pressure on the United States, the European Union, and other advanced vaccine-producing countries to relax IP protections in World Trade Organization (WTO) agreements has intensified. Policymakers have also increasingly understood that no one is safe from COVID-19 until everyone is safe. Led by India and South Africa, the developing world has been arguing on moral and practical grounds that IP waivers are essential to accelerating vaccine distribution and containing the pandemic worldwide. Absent widespread vaccination in less prosperous countries, experts say, all countries, even those with high vaccination rates, would remain vulnerable. But IP waivers alone will not necessarily accomplish that goal. Among the obstacles to getting wide distribution of vaccines are bureaucratic hurdles within the WTO, the difficulty for many poor countries of producing vaccines even if they have the legal right to do so, and  the fact that vaccine production depends on global supply chains that cannot quickly be mobilized to deliver shots to low- and middle-income countries.

Three Key Challenges

Navigating the procedural obstacles to get WTO agreement on a streamlined mechanism for suspending IP protections is not as easy as it would seem. It is already possible to waive protections in the 1994 WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). But the WTO's track record suggests that roadblocks may lie ahead in expanding the scope of its waiver procedure.

Since August 2003, the WTO has explicitly allowed emergency departures from the TRIPS agreement, enabling countries with manufacturing capacity to suspend IP protections to produce life-saving drugs and vaccines, not just for domestic use but also for export to countries that lack manufacturing capacity of their own. However, the process of negotiating the August 2003 decision—which created a temporary procedure for export waivers—took 14 months, and it was not until January 2017 that two-thirds of WTO members had ratified it as a formal amendment to the TRIPS agreement.

Because of this painful negotiation process, the bureaucratic procedures for exercising IP flexibility are so cumbersome that there are very few instances of its use. The best known (though not very successful) example occurred with Canadian exports of an AIDS treatment to Rwanda in 2007. Complicating matters further has been the opposition of some major countries to revisiting the issue, as well as the likely need for WTO members to revise their domestic legal frameworks to accommodate patent waivers. These factors make it clear that renewed negotiations within the WTO are unlikely to yield results with the speed that the current health emergency demands or result in a meaningfully better framework. Recognizing the likely difficulty of negotiations, WTO Director-General Ngozi Okonjo-Iweala has suggested a December 3, 2021 deadline for completion—but like past initial deadlines in this space, this one could well prove overoptimistic.

The second, and arguably more intractable, challenge is technical: Even if they overcome IP obstacles and get permission to produce vaccines, less prosperous countries lack the know-how, facilities, and trained personnel to produce them. Despite the abysmal decades-long record of vaccine distribution in those countries, existing TRIPS flexibilities have done nothing to improve the situation. A smoother IP waiver process might help, but only as a component of a broader effort.

True, patent protection is the main obstacle to creation of generic small-molecule drugs, which chemists can synthesize. But other major obstacles exist for vaccines, which are biologics. For the latter category of drugs, an identical product requires an identical production technology, with most steps categorized as hard-to-replicate trade secrets rather than patentable innovations. Thus, Moderna announced in October 2020 that it would not enforce its COVID-19-related patents during the pandemic. But this step, however laudable, is of limited immediate help to would-be producers of a "generic" version of the Moderna vaccine. Without precisely replicating all steps of Moderna's production process, including the many quality controls, a generic version would have untested immunogenicity (the ability to induce the body to generate an immune response) and thus would require extensive clinical trials before release. Production glitches—such as those that afflicted the Janssen/Johnson & Johnson vaccine in the United States—could prompt widespread vaccine skepticism, damaging pandemic control efforts.

The replication hurdle is especially high for the new and more sophisticated messenger ribonucleic acid (mRNA) vaccines, which have proven most effective against SARS-CoV-2 (the virus that causes COVID-19) and which are likely to provide the most adaptable platforms for the vaccines of the future. The genetic vaccines produced by Pfizer-BioNTech and Moderna require considerable technical knowledge and sophisticated techniques to generate a version of the viral spike protein that elicits a strong immune response.1 Therefore, from a biological standpoint, patent and IP waivers alone cannot resolve the existing lack of capacity in most countries to produce genetic vaccines at scale locally.

A final challenge is that vaccine supply chains are intricate and global in scope. Different stages of vaccine manufacturing are spread across different parts of the globe, with various countries supplying key inputs and equipment. Patent and IP waivers cannot resolve export restrictions that these countries may decide to impose—and in fact have imposed—throughout the pandemic. Nor can poor countries with production waivers easily integrate into global supply chains. At the moment, current production capacity and quality standards continue to constrain global supply.

Short- and Long-Term Priorities

A streamlined mechanism for IP waivers can be useful, but the back and forth of waiver negotiations within the WTO will prove counterproductive if it distracts from necessary immediate and longer-term measures to contain the pandemic and prepare for future threats.

In the short run, global vaccine production by existing producers should be ramped up with more global sharing, and at subsidized prices for poor countries. All countries can start by renouncing export restrictions that threaten global supply chains. Rich countries must also step up to provide financial support for vaccine purchases and immunization programs and also to directly share vaccine doses that are now in oversupply. Political leaders in the rich countries should explain to their citizens that aiding poor countries is in their own interest. That is because the pandemic is producing potentially more transmissible and deadlier variants that will inevitably spread worldwide.

Over the long run, the global community needs to build a cooperative infrastructure to address the likelihood of the current pandemic lasting a long time, while preparing for future pandemics that could arrive with increasing frequency. In February 2021, the Group of Seven nations proposed a global health treaty that would help create a framework for more effective and coordinated pandemic response. Systematic worldwide genomic surveillance of current and potential pathogens is one aspect of such a treaty that would be imperative in order to inform public health policymakers and guide rapid vaccine development. Another useful step could be a vaccine investment and trade agreement, as suggested by Thomas J. Bollyky and Chad P. Bown, which would enable countries to coordinate vaccine development, supply chains, and production to eliminate beggar-thy-neighbor policies and speed vaccine development and deployment worldwide. The public-private partnerships underlying such an agreement might incorporate reform of the TRIPS patent and IP flexibilities acceptable to all parties.

Unfortunately, finance ministers and central bank governors did little more than rehearse broad principles at their April 2021 Group of Twenty (G20) meeting, even as the COVID-19 outlook has deteriorated in India and elsewhere. Italy will host the next important international public health meeting on May 21, 2021 at a Global Health Summit in Rome. Participants may consider proposals by the High Level Independent Panel on Financing the Global Commons for Pandemic Preparedness and Response, which the G20 established in January 2021 and which Dr. Okonjo-Iweala co-chairs.

International engagement over patents and other IP protections will be immensely more beneficial as a component of much broader commitments to speed vaccine deployment in the near term and build a robust cooperative framework for ongoing pandemic response. By the time of their October leaders' meeting, G20 countries should be well along in implementing an ambitious global public health framework rather than squabbling over the narrower issue of IP protections.

We acknowledge with thanks helpful comments from Chad P. Bown.

Note

1. Sophisticated techniques are used to stabilize the viral spike protein, as well as to protect the mRNA molecule, which degrades rapidly outside of a cell. The SARS-CoV-2 spike protein responsible for viral entry into our cells is naturally unstable: Its shape-shifting capacity allows the virus to hide portions of the protein that our immune systems are readily able to recognize. By stabilizing the protein in a state known as the prefusion state, all portions are preserved and highly visible, eliciting a strong immune response. Achieving this stabilization thus requires technical knowledge and sophisticated laboratory equipment that most countries lack. Encapsulating the mRNA molecule associated with the stabilized conformation of spike in a lipid—a fatty particle—also entails significant scientific sophistication.

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