Intellectual property rights are under assault overseas — and here at home. These attacks could prevent the creation of dozens of lifesaving medicines. That should worry every American.
Consider a few of the latest threats. India and South Africa are petitioning the World Trade Organization to waive patent rights on COVID-19 vaccines, claiming this unprecedented move would boost low-income countries’ access to the shots.
Several members of Congress have vocally supported that petition, and the Biden administration is reportedly considering endorsing it.
Many other lawmakers are pushing for a domestic version of that proposal. They’re advocating using a four-decade-old law to “march-in” and seize the patents on COVID-19 treatments. Sen. Bernie Sanders recently introduced an even more sweeping measure that would allow the government to effectively nullify patents on any medicines it deems to be “excessively priced.”
Proponents of these measures mostly have good intentions; they want to make medicines more affordable, and thus more accessible, to patients. But their proposals would backfire.
Drug development simply wouldn’t be possible without IP protections. That’s because of this industry’s unique business model and government regulatory hurdles that must be overcome.
Biotech companies face enormous up-front costs. Most experimental compounds never make it out of the lab. Of those that do, nearly nine in 10 don’t make it through clinical trials.
After accounting for these failures, it costs over $2 billion, on average, to bring a single new medicine to market. Drug companies and their investors need to generate enough revenue from their few successful medicines to cover the costs of their many failures.
This business model only works because of patents, which empower research companies to stop rivals from freeloading off their work, copying their drug formulas, and selling the same product for far less. Without these IP protections, it’d be virtually impossible for firms to recoup their up-front costs — so they wouldn’t invest in R&D in the first place.
That doesn’t mean drug companies are keeping their vaccine formulas under lock and key. To the contrary, many have voluntarily shared their IP far and wide. Moderna isn’t enforcing its COVID-19 related patents during the pandemic — and has already pledged to license its COVID-19 vaccine IP in the post-pandemic period.
Johnson & Johnson licensed its technology to its competitor, Merck, to maximize vaccine production. Novartis and Sanofi have similar contracts with Pfizer-BioNTech. Several generic manufacturers in India have licenses to produce vaccines from AstraZeneca and others.
Intellectual property makes this collaboration possible. Only because IP rights are secure do companies have the confidence that they’ll still own their underlying data and research, even if that data and research is widely shared.
Every vaccine manufacturing facility on earth is producing shots as fast as possible. Weakening IP protections won’t accelerate that process. As the CEO of the Serum Institute of India — one of the world’s largest vaccine manufacturers — recently told The Guardian, “it just takes time to scale up” production and the delays don’t stem from a reluctance to license IP.
Intellectual property rights don’t impede access to lifesaving drugs and vaccines. They facilitate the creation of those drugs in the first place.
Those seeking to weaken patent protections could inadvertently harm the very patients they’re trying to help.
Jon Soderstrom is managing director of the Office of Cooperative Research at Yale University.