Patents: Pharma has limited legal options
A potential World Trade Organization waiver of patent and trade secret protections for Covid-19 vaccines would leave pharmaceutical companies with limited legal avenues to recover costs.
The US on Wednesday expressed support for a temporary waiver, sending shares in several vaccine makers down the next day. The issue now faces thorny negotiations at the WTO, where several members, including Germany, have opposed efforts to skirt intellectual property rights. They say it would complicate production and make companies less likely to respond in the future.
The proposed waiver is intended to ramp up the production and export of vaccines and medicines to stem the pandemic's surge in the developing world. It would let countries obtain know-how and forge compulsory licenses without facing blowback in the form of trade complaints and sanctions from other nations.
Still, some vaccine producers, like Moderna Inc and Pfizer Inc, might sue the US to recoup some of their losses, said Matthew Howell, an intellectual property attorney at Alston & Bird in Atlanta. If the manufacture of the vaccine is done in the US, under the government's authorisation, there are avenues for compensation in American courts.
That's not always the case in other countries, particularly
in nations.
"Under the law they can get just and reasonable compensation for the use of their patented inventions" by another company in the US. However, when trying to make up for losses from an international manufacturer producing the vaccine overseas, the lawsuit avenue isn't available.
"A lot of conduct outside the country wouldn't be covered," Howell said.
Drugmakers such as AstraZeneca Plc have pledged not to profit from
less
developed
their vaccines for the length of the pandemic, while Moderna has said it won't enforce its patents during the pandemic. The companies have contracts with governments around the world to deliver vaccines at a set price.
The US may seek to limit the waiver to just the rights to produce the vaccine, but some WTO members, like India, also want access to manufacturing and distribution developments spawned by the rush to develop and deliver vaccines.
"The pharmaceutical industry has legitimate concerns about India's proposal, because the manufacturing and distribution innovations aren't just limited to producing the Covid vaccine," said Polk Wagner, a professor of intellectual property at the University of Pennsylvania.
"I don't know how they would legally stop this moving forward, because it just becomes a decision by the WTO,” said Ellen 't Hoen, director of Medicines Law & Policy, a legal research group in the Netherlands.