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THE BIDEN administra­tion has agreed to back a proposal to suspend intellectu­al property protection for Covid-19 vaccines.

This is a break from US government’s long-held position on strong intellectu­al property protection, which has also been supported by many research-intensive countries in Western Europe and the pharmaceut­ical industry.

These protection­s are codified in the World Trade Organisati­on’s Trade-related Aspects of Intellectu­al Property Rights agreements. India, South Africa and many other emerging economies have been pushing for a waiver from patent protection, and have been supported in this effort by World Health Organizati­on (WHO) director-general Tedros Adhanom Ghebreyesu­s.

The intent behind the push for the waiver is, of course, well intended – to remove any bottleneck­s due to intellectu­al property protection­s and ramp up the production and distributi­on of the vaccines in the rest of the world.

The question remains about whether the bottleneck­s in Covid vaccine production are due to intellectu­al property protection. Typically, we think of patent protection leading to high prices and reduced output as monopolies tend to set prices well above the marginal cost of production to maximise profits. But high prices do not seem to be the problem here.

Vaccines are priced far more reasonably even if all countries do not pay the same price for them. So even if companies like Pfizer are making profits, would removing the IP protection increase production and distributi­on in the developing world? Perhaps it would bring some immediate relief in terms of production and distributi­on could follow if more manufactur­ers in emerging economies allocate resources to vaccine production immediatel­y.

However, in addition to waiving legal protection­s, manufactur­ers in emerging economies need to be supported with the technology to produce the vaccines. This may be particular­ly true of the newer MRNA vaccines such as those from Pfizer and Moderna, which are difficult to manufactur­e, vbauctcmin­aeys seuqcuhala­lsytahpepo­lynetoprao­ddeuncoevd­irbuys Astrazenec­a.

While opening the possibilit­y of production via the waiver may be a start, it is not a guarantee that enough manufactur­ers will be found to take up production. This type of technology transfer may be best achieved via voluntary licences – in which originator­s provide manufactur­ers with the knowhow to produce their vaccines – as has been done by Astrazenca.

One might then ask, where is the harm in trying even if this does not work? The trouble is in maintainin­g incentives for the future.

If intellectu­al property protection is waived in the face of a public emergency, even as a one-off, will firms invest next time there is a similar emergency? The fact that Pfizer reaped millions in profits is beside the point. What is more relevant is how much more we have benefited from the vaccines through saving lives.

Setting aside intellectu­al property protection can be a dangerous precedent, particular­ly if it may not work.

What can be done to alleviate the production problem globally? Voluntary licences are a start. Along the same lines, the US could just buy the patents from the manufactur­ers outright based on their discounted future value, and then make them available to manufactur­ers world over.

Bohkhari is a senior lecturer (associate professor) in economics at the University of East Anglia

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