The Road to Hell Is Paved with What Everybody Knows

McDonnell Boehnen Hulbert & Berghoff LLP

McDonnell Boehnen Hulbert & Berghoff LLP

Everybody knows that the dice are loaded
Everybody rolls with their fingers crossed
Everybody knows the war is over
Everybody knows the good guys lost
Everybody knows the fight was fixed
The poor stay poor, the rich get rich
That's how it goes
Everybody knows

Everybody knows that the boat is leaking
Everybody knows that the captain lied
Everybody got this broken feeling
Like their father or their dog just died
Everybody talking to their pockets
Everybody wants a box of chocolates
And a long-stem rose
Everybody knows

"Everybody Knows," Leonard Cohen

And everybody knows that suspending patent rights is necessary to provide sufficient vaccine to stem the global pandemic caused by the SARS-CoV-2 virus known as COVID-19.  It is always a sign of intellectual weakness and pack animal thinking to believe something is true because "everybody knows"; recently American pathologists reaped the consequences of their "everybody knows" campaign against "gene patenting" in AMP v. Myriad Genetics (see "Schadenfreude Is Not Always An Unpleasant Feeling"), although evidence of this eventuality was available earlier (see "The ACLU, Working for the Man").  Sadly, the true roots of the issues arising over global vaccination have been known for almost a year (see "Latest COVID Conundrum: Accessibility of Vaccines (When They Are Available)"), and the wrong-headedness of proposals for a "patent waiver" have also been recognized (see "Suspending IP Protection: A Bad Idea (That Won't Achieve Its Desired Goals)").  And yet, of course, the Biden Administration, speaking though the U.S. Trade Representative Katherine Tai, issued a press release yesterday supporting the waiver (see "Biden Administration Supports Waiver of IP Protection for COVID-19 Vaccines").

There is no silver lining and no Pollyanna or Professor Pangloss available to contend that this is good policy, but it may be informative to consider the possible outcomes that could arise depending on how any such waiver or suspension is effectuated.

To the extent that the suspension or waiver of rights is limited to patents, the effects could amount to no more than virtue signaling, a political exercise meant to illustrate differences between the prior administration and this one, or to placate voices like Senator Bernie Sanders who maintain that pharmaceutical companies are rapacious predators who place profits over people (with a fervor and rhetoric the prior administration and its supporters reserved for liberals and the well-educated).

But as annoying as this might be, there is a greater danger in other forms of implementation.  The terms of the press release do not say that there should be a waiver of patent protection (which was the original impetus and justification for the waiver as proposed by India and South Africa last October when it was proposed; see "Communication IP/C/W/669, "WAIVER FROM CERTAIN PROVISIONS OF THE TRIPS AGREEMENT FOR THE PREVENTION, CONTAINMENT AND TREATMENT OF COVID-19, 2 October 2020").  The plain language of the press release, and the focus of the waiver that has evolved, is to include all intellectual property.  This would include trade secrets, and that raises a serious issue.  As explicated by Derek Lowe in his article "Myths of Vaccine Manufacturing," the rate-limiting step for COVID vaccine production (at least for the mRNA-based vaccines) involves proprietary machines and methods for making the vaccine that are, more than likely, not covered by patents and never will be.  The technological circumstances surrounding vaccine production involve trade secrets regarding formulation of vaccines that are what can be the bottleneck in the process.  But trade secrets are the type of property the rights to which cannot be suspended; disclosure destroys the secret and thus the property.  It is unlikely that companies will voluntarily give up their valuable trade secrets, and while there might perhaps be some stomach for forcing them to in some jurisdictions, it is unlikely that the U.S. will be one of them.

But this "moveable feast" of policy rationales illustrates the political fact that the aim and goal of this and other proposals by India, South Africa, and other countries is to escape the TRIPS requirement for recognizing and enforcing IP protections, imposed as part of the requirements for WTO membership.  When these facts are considered, the call by these governments (and others) should be understood for what it is:  an attempt to use the pandemic to achieve a goal of status quo ante (prior to the establishment of the GATT/TRIPS/WTO global trade and patent regime), which was imposed upon these and other countries a generation ago.  The COVID pandemic provides the humanitarian reason for a solution that isn't a solution but that resonates with uninformed (albeit generally well-meaning) politicians, humanitarians, and religious and non-governmental organizations.

It is undeniable that there are significant issues regarding availability of drugs in low- and middle-income countries that need to be addressed.  But there are ways to achieve the lofty goals that are at the root of calls for an IP waiver.  This includes cooperation between pharmaceutical companies, as Merck as done with Johnson & Johnson, that can increase the number of doses of the vaccine necessary for global vaccination.  Groups like Gavi, the WHO, and the Coalition for Epidemic Preparedness Innovations (CEPI), can be involved in a concerted effort obtain vaccine supplies for the rest of the world.  Western governments with "excess" vaccine reserves can use the auspices of these groups to send doses to low- and middle-income countries and economies (LMICS) and even some "wealthier" countries having the economic capacity to defray some or all of the costs.  Indeed, the Biden Administration announced it would make available "excess" vaccine doses to countries in need (amounting to 60 million doses).

The motivations for such efforts need not rely exclusively on altruism, either; as has become evident recently the virus has the capacity to mutate in ways that variants of unknown resistance to current vaccines can arise.  Vaccines, particularly the mRNA-base vaccines, may not be effective against these variants (see "Do mRNA-based COVID Vaccines Have an Achilles Heel?").  Thus, it is in everyone's interest to extend vaccination globally (regardless of how daunting that challenge may be) to reduce the probability of such variants arising.

The efforts being applied globally to develop vaccines, treatments, and better tests and technology in response to COVID-19 have been impressive.  We can hope that, ultimately, these efforts will prove to be successful.  Intellectual property protection has an important role to play in these efforts.  Past experience and recent developments suggest that protecting IP for vaccines, therapies, and technologies to fight COVID-19 will have a positive impact, and advance the cause of eradicating, or at least treating, and preventing this disease.  Support for the proposed IP waiver is a foolish and tragic mistake.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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