What has happened?
Following the ongoing debate over the US’ proposal to introduce a temporary waiver of COVID-19 vaccine patent requirements,[1] the introduction of compulsory licensing measures has been put forward by the World Trade Organization (WTO) as a solution to the potential problems a waiver could cause.[2]
What does this mean?
Compulsory licensing is when a government allows someone else to produce a patented product or process without the consent of the patent owner or plans to use the patent-protected invention itself. It is one of the flexibilities in the field of patent protection included in the WTO’s agreement on intellectual property — the TRIPS (Trade-Related Aspects of Intellectual Property Rights) Agreement. Therefore, generic copies can be produced mainly for the domestic market, not for export.[3] In the context of the COVID-19 vaccine, this would mean that each sovereign state would be able to produce its own vaccines for national rollout, without having to import from abroad, pay high import fees or have vaccination rollout schemes impeded by intellectual property embargos and other legal obstacles.
What does this mean for the legal sector?
Additional benefits to compulsory licensing worldwide would be that there would be no need to temporarily suspend vaccine patents (which could compromise product quality) and the patent owner would still have rights over the patent, including a right to be paid compensation for copies of the products made under the compulsory licence.[4] It is proposed that this compensation would be funded by individual nation states.[5]
This mechanism is generally argued for when there are reasons of public interest. It could be argued that the Covid-19 pandemic is the perfect example of a global health crisis that would qualify as such.[6] But aside from the public benefit of increased vaccine distribution, the further aims of compulsory patent licensing schemes are to help keep markets competitive, encourage innovation and scientific progress and to ensure supply to the global market, while making sure the corresponding compensation for the patent holder receives adequate compensation.[7]
Problems start to occur, however, when considering the countries that have no resources at all for vaccine production and cannot afford to pay the patent holding companies. In these cases, the WTO has stated that the WHO would have to play a fundamental role, which would come into play through the corresponding diplomatic tools, to create funds to compensate the patent holders, and in the same way, to supply all those who do not have the means or resources to produce and/or acquire the vaccine.[8]
An example of action that the WHO has already taken is the WHO-led Covid-19 Global Access Mechanism (COVAX), a global initiative (involving more than 100 countries) to work with vaccine manufacturers to ensure that countries around the world (including low-income countries) have equitable access to safe and effective vaccines once they have been licensed and authorised.[9]
Written By Hannah Phelvin
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References:
[1] Hannah Phelvin, 'The Covid vaccine patent waiver: A real solution to vaccine shortage in developing nations?' (Law Miracle, 24 May 2021) <https://www.thelawmiracle.com/commercial-awareness-articles/coporate-lawyer/the-covid-vaccine-patent-waiver-a-real-solution-to-the-vaccine-shortage-in-developing-nations>
[2] Dharshini David, 'Covid: The Vaccine patent row explained' (BBC News, 7 May 2021)
[3] World Trade Organization, 'Compulsory licensing of pharmaceuticals and TRIPS' <https://www.wto.org/english/tratop_e/trips_e/public_health_faq_e.htm> <accessed 29 June 2021>
[4] ibid
[5] Giro Martinez, 'Compulsory licensing: A solution to the current debate on anti-covid vaccines' (Lexology, May 2021) <https://www.giromartinez.com/news/compulsory-licensing-a-solution-to-the-current-debate-on-anti-covid-vaccines/> <accessed 29 June 2021>
[6] World Trade Organization, 'Compulsory licensing of pharmaceuticals and TRIPS' <https://www.wto.org/english/tratop_e/trips_e/public_health_faq_e.htm> <accessed 29 June 2021>
[7] ibid
[8] ibid
[9] ibid
Disclaimer: This article (and any information accessed through links in this article) is provided for information purposes only and does not constitute legal advice.