WTO: Don't Make A Bad Situation Worse By Granting Intellectual Property Waivers For Covid-19 Therapeutics And Diagnostics

The World Trade Organization recently agreed to suspend patent protections for Covid-19 vaccines. The trade body is now considering going one step further: extending the intellectual property waiver to Covid-19 therapeutics and diagnostics. That misguided idea would have disastrous consequences: further eroding intellectual property protections will discourage research and development and make it even harder to fight deadly diseases and future pandemics.

South Africa and India first proposed an intellectual property waiver nearly two years ago. They claimed that suspending patents would allow manufacturers in developing countries to produce generic versions of vaccines and therapeutics without paying royalties to the companies that developed them, which was necessary to curb the pandemic and vaccinate people around the world.

Even then the argument was a stretch. But now, at a time when the global vaccine market is glutted and drug companies have formed countless voluntary partnerships with manufacturers in developing countries, the original logic behind the waiver has proven patently false.

Consider Aspen, a South African manufacturer that inked a licensing deal to produce Johnson & Johnson's vaccine late last year. As of mid-May, after two months of production, Aspen hadn't received a single order for its version of the J&J shot. Other manufacturers are reporting similar stories. The Serum Institute of India, the world's largest vaccine manufacturer, halted production of Covid-19 vaccines in April after accumulating 200 million unused shots. Hundreds of millions of the country's excess doses are expected to expire in September.

Simply put, vaccine supply isn't the problem. The true barriers to global vaccination have been, and remain, vaccine hesitancy, logistical problems, and trade barriers. No number of doses or licensing deals — either voluntary or coerced — can overcome those administrative and cultural hurdles.

That hasn't stopped WTO members from latching onto the erroneous idea that patents are the culprit for lagging global vaccination efforts and the prolonged fight against Covid-19. The recently-agreed-upon vaccine waiver resulted from months of closed-door negotiations between South Africa, India, the EU, and the United States.

The WTO has pledged to consider expanding the waiver to Covid-19 therapeutics within six months — despite the fact that the manufacturers of those therapeutics, like vaccine manufacturers, have already made voluntary agreements to help get the medications to those who need them across the globe.

In May 2020, Gilead Sciences established a voluntary licensing program for remdesivir, an antiviral initially developed for hepatitis and Ebola that proved somewhat effective against Covid-19. The company reported in April 2021 that more than 2.3 million people in more than 60 low- and middle-income countries had access to the drug because of its licensing agreements with generics manufacturers.

In October 2021, Merck agreed to a deal with the United Nations' Medicines Patent Pool that allows manufacturers in more than 100 countries to make molnupiravir, its Covid-19 antiviral medication. A few weeks later, Pfizer made a similar agreement with the UN organization for Paxlovid, its antiviral pill. As of March, 35 generics companies had signed up to begin manufacturing Pfizer's pill.

In other words, patents aren't preventing generics manufacturers in low-income countries from licensing and producing Covid-19 therapies, so waiving patent protections wouldn't increase the availability of those drugs. It would simply force companies like Gilead, Merck, and Pfizer to give up their intellectual property without earning any royalties from it.

That would set a dangerous precedent, one that could have disastrous long-term consequences for future innovation — and people who are hoping for better treatments and cures.

It takes roughly $2 billion to bring a drug to market. Exclusive patent rights give biotech investors confidence that they'll be able to generate adequate returns if they're lucky enough to get their experimental medicines through the regulatory approval process and onto pharmacy shelves.

Knowing that the WTO could invalidate those patent protections would cause investors to hesitate backing the next groundbreaking treatments, both for Covid-19 and other future health crises.

That will make the development of drugs like Paxlovid — which reduces risk of Covid-19 hospitalization or death by 51% — increasingly unlikely. It will make it harder for companies like Gilead to ramp up manufacturing and delivery of stockpiled drugs to combat new threats. And it will cause drugmakers to think twice before researching and developing treatments for deadly diseases ranging from cancer to Alzheimer's.

Anyone looking for future cures can only hope the WTO declines to further weaken protection for intellectual property.