Patent pools: should rights owners give up their IP?

Health systems on almost every continent are threatened with being overrun by COVID-19, and face acute shortages of essential, life-saving equipment. Governments have responded with a call to arms, taking steps to facilitate the mass production of ventilators in an effort to up the capacity of intensive care units.

Those working in IP have quickly spotted the potential for patent rights to be an obstacle to this retooling effort. Governments and civil society have recognised this too, and several different remedies have been proposed in order to ensure that IP is not an impediment to the world’s COVID-19 response.

One approach that has gained traction in recent weeks is patent pools. Pressure is now building on companies with IP that could be valuable to voluntarily license it, on an open-access basis.

This could cover a wide range of technologies, including diagnostic tests, medicines, personal protective equipment, or medical devices like ventilators.

Last month, the  government of Costa Rica asked the World Health Organization (WHO) to oversee the creation of a patent pool for any technologies that could help beat the virus. The call has received support from groups like the International Law Association.

Meanwhile,  Francis Gurry, director of the World Intellectual Property Organization (WIPO), has been urged to use his leadership position to ensure that IP is a “support and not a hindrance”.

Those were the words of groups including Creative Commons, Wikimedia, and the Institute for Intellectual Property and Social Justice, in an open letter to the outgoing WIPO chief.

Part of the solution or the problem?

They go to the heart of the problem for IP owners and the IP industry in general. IP owners are now expected to make a sacrifice; to give up exclusivity and the profits associated with it.

If they do not, then they, and possibly IP itself, will be seen very much as part of the problem, rather than the solution. Who is to say that kind of reputational damage could be quickly repaired once the pandemic is over?

As an IP professional seeing news reports about calls for mass ventilator and test kit production, Frank Tietze quickly spotted the potential for things to go wrong.

Tietze is a lecturer in technology and innovation management at the University of Cambridge’s Institute for Manufacturing. He is part of the team behind the Open COVID Pledge, which invites IP owners to grant free and temporary licences to their patent and copyright-protected technology.

“I became increasingly concerned that there might be underlying IP issues that would only surface later,” Tietze says. For example, had companies offering up their factories for ventilator manufacture, done freedom to operate analyses, or investigated the potential IP ramifications?

“There could be a real risk for infringement claims that may only be raised much later, for instance, in relation to open source ventilator designs that then have then become widely adopted and manufactured by large organisations,” Tietze says.

These issues might not necessarily arise immediately. Not many companies would want to take on the reputational damage of being seen to block the production of essential equipment during a pandemic. But if unresolved, these IP issues could result in costly litigation down the line.

That’s not to mention the risk of IP litigation acting as a deterrent for those companies that had done their homework, and were aware of potential licensing issues.

“IP should not delay the fight against the pandemic,” warns Tietze. “We decided this pledge could potentially be an important instrument for the IP community to contribute and avoid holding back innovative efforts to fight the virus,” he adds.

The pledge is starting to gain momentum, with a consortium of big tech companies  announcing yesterday, April 20, that they had signed on to donate their IP.

The group, which includes Amazon, Facebook, Hewlett-Packard, Microsoft and IBM, are the first major corporations to join the pledge apart from founding sponsor Intel.

“The patent system was created to promote progress, and we don’t believe that patents should ever be used to exploit innovation at the expense of the people it was meant to serve,” said Jeremiah Chan, Facebook’s associate general counsel and head of patents.

Jennifer Yokohama, chief IP counsel at Microsoft, added that “pledges and open licensing like this effort can help spur innovation, especially in a crisis”.

According to Yokohama, “researchers, scientists, and others working against the virus should be able to develop and deploy effective solutions at scale without needing to worry about the threat of patent litigation”.

There seems to be growing acceptance that, in the face of such a crisis, companies having exclusive rights to socially valuable technology is a decidedly bad thing.

One problem this raises for IP owners is: if this is true in a crisis, why is it not true all the time? How important is it for patent owners to enjoy exclusive protection over certain technologies if these rights are to be set aside when things get serious?

Chan’s statement that patents should ‘never be used to exploit innovation at the expense of the people it was meant to serve’ is a rallying cry that could be easily taken up by those campaigning for Gilead’s patent rights for HIV drugs to be cancelled.

This seems to be a particular problem for Big Pharma. As we have seen during the present crisis, few things elicit a strong emotional response quite like a health crisis. We can see proof of this in the US and UK, where equitable access to healthcare and medicines has been a defining issue in politics over the past few years.

And should Gilead’s experimental antiviral remdesivir proves to be safe and effective for treating COVID-19 in clinical trials, this is a prime example of the kind of IP that campaigners would like to see given up, at least temporarily. Indeed, the company has already faced  extensive public criticism over its perceived efforts to try and secure a monopoly on the drug.

Medicines Patent Pool

Drug companies may prefer to be proactive in joining voluntary licensing projects, to try and prevent any longer-lasting reputational damage should they be seen to be profiteering.

There are several projects underway to try and encourage drug companies in this direction. Costa Rica, as we have seen, has asked the WHO to take the lead. Elsewhere, the Medicines Patent Pool (MPP), a United Nations-backed initiative, has broadened its focus to include the current pandemic.

The MPP has used voluntary licensing mechanisms in order to improve access to technologies in the fight against HIV and other viruses. MPP has now expanded its mandate to include any health technology that could contribute to the global response.

“From the outset of the COVID-19 outbreak, we realised that equitable access to medicines and treatments would be essential,” says Gelise McCullough, head of communications at MPP.

Could an MPP-style approach to the pandemic be a gamechanger in ensuring access to life-saving drugs and medical devices?

“Patent pooling could well be one of the pieces of the puzzle,” says Nicole Jadeja, partner at Pinsent Masons.

“But it is unlikely to be the only piece in a very complex picture looking at diagnostics, treatments and vaccines,” she says, pointing out that we have already seen “unprecedented levels of collaboration across the life sciences industry”.

While there could be a role for patent pools, Jadeja says, there are still “numerous challenges which have nothing to do with patents—for example, overcoming the tension between the need to get a vaccine to people quickly, and the need to deliver a vaccine which has the confidence of regulators”.

Jadeja agrees that the MPP model could be of great value. “The MPP model has certainly been successful in improving access to medicines in low and middle-income countries, particularly in relation to HIV, Hepatitis C, and TB,” Jadeja says.

Whether it’s in the form of a patent pool, as Costa Rica has argued, or an open pledge, pressure is now building on IP owners to voluntarily grant open access to their normally exclusive technology.

The news that big tech has signed on is only likely to add to this pressure. Companies with valuable IP now face either offering it up for free, or risk being asked difficult questions.

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