Continuing to ignore the problem of the know-how gap won’t make it go away.

[Image above courtesy of KM Gopakumar]

The Covid-19 pandemic was a wake-up call for a variety of issues in access to medicines, one of which was finding a solution to the problem of the know-how gap. We first raised attention to this problem in 2020 (here), pointing out that without finding a workable solution, compulsory patent licensing (or even a waiver of patent rights) could be ineffective in enabling widespread production of some vital pandemic-related health products in a future emergency.

We have recently been reviewing a series of patent policy discussions stretching back across the twentieth century in the UK and have been struck that this same problem has been explicitly recognised and discussed for at least eighty years. (We have found discussion of a closely related problem from a hundred years ago and no doubt there are many more examples to be found.) In the context of the negotiations on the draft World Health Organisation (WHO) Pandemic Accord, it is perhaps helpful to examine two examples.

As in many countries, the British Government periodically appoints Committees to examine the operation of the patent system and make recommendations as to improvements. Such a Committee, chaired by Sir Kenneth Swan, was appointed toward the end of the Second World War in April 1944. The Committee explicitly recognised the problem of the know-how gap as follows:

“…full disclosure of an invention in a patent specification does not necessarily provide the technical knowledge and experience for working it in the most successful and economic manner (often referred to as the “know-how”). Frequently this “know-how,” much of which may not be patentable, is as important as the invention itself for satisfactory working. A compulsory licence would be of no advantage in this respect, since its terms could not compel an unwilling patentee to disclose the “know-how ” to the licensee.” (Second Interim Report, para. 45)

Having recognised the problem, the Committee proposed a solution. They recommended modifying a lesser type of patent – a so-called ‘patent of addition’, introduced under the Patents Act 1909 – so that it would effectively extend the protection afforded by an ordinary patent to cover relatively straightforward (novel but not inventive) improvements or modifications. Thus:

“We feel that by permitting patentees to obtain patents of addition of this character, the public will have the advantage of a fuller disclosure of the best means of carrying out the invention, and that the disclosure of improvements and developments, and what is sometimes called the “know how ” in the carrying out of the invention, however slight the subject-matter may be from the patent point of view, may be a valuable addition, to public knowledge.” (Final Report, para. 216)

The problem with this proposed solution is that it effectively only offers a little more of the same incentive – patent protection – whereas keeping know-how secret can sometimes offer an entirely different type of incentive. Consider a case where an invention has been made and know-how is subsequently developed which is vital for commercially effective manufacture. An advantageous strategy could then be to seek patent protection for the invention, with the legal security that offers, while trying to keep the know-how a secret as and when it is later developed. Even if a competitor later obtained a compulsory licence for the patent, they would therefore lack the know-how to make the patented product in a commercially effective way unless they managed to re-create it themself. As the Swan Committee intimated, keeping the know-how secret might therefore effectively immunise the patent holder against the threat of compulsory licensing.

Although such patents of addition were introduced into UK law by the Patents Act 1949, they were abolished by the next Patents Act, in 1977. They did not provide a meaningful solution to the know-how gap problem. Davenport (1979) suggests that their administration was also economically disadvantageous for the patent office as they were just as expensive to process as ordinary patent applications but, as an additional incentive, did not require the payment of equivalent fees. It is also true to say that patents of addition were more or less simultaneously abolished in, for example, the Netherlands and Switzerland.

Subsequent Committees did no better in finding alternative solutions to the problem. In fact, although both the Sainsbury Committee (1967) and the Banks Committee (1970) investigated various aspects of the patent system and its operation, neither were tasked with considering know-how from this perspective at all. An alternative solution was, however, touched on by one of the members of the Banks Committee who undertook a parallel study of economic aspects of the patent system and its operation, published as “The Economic Impact of the Patent System: the British Experience”, Taylor and Silberston, 1973.

An important focus of this study was to consider the impact of an alternative to the traditional monopoly-based patent system: what would happen in a world where patents only provided a right to remuneration, i.e. effectively a world of generalised compulsory licensing? Data was gathered from forty industrial firms including in the pharmaceutical, chemical and electronic sectors, as to their intellectual property-related practices and outlooks. The problem of the know-how gap was most explicitly reflected in the responses from firms involved in chemical process technologies:

“We were assured that in many cases know-how is a vital ingredient in licence agreements in this field, and this would be no more readily obtainable under a compulsory licensing system than it is under the present arrangements. (To envisage, as an alternative to the existing patent system, a system that required the compulsory licensing of know-how as well as patents would take us far beyond an assessment of the patent system.)…It therefore seems fair to argue that, in chemical process technology at least, the ability of a firm to monopolise its inventions depends at least as much on secret know-how as on its patents, and that the former would continue to offer a comparatively effective means of controlling the spread of technology in a world of compulsory licensing.”

What was true in the early 1970’s remains true today. Of course, compulsory patent licensing has been successfully used for small molecule pharmaceuticals for many years (see our TRIPS Flexibilities Database here) but it may be much more challenging for health technologies where manufacturing processes are more complex and less widely understood. The Covid-19 pandemic has provided a vivid example. A WHO mRNA Technology Transfer Hub was set up in South Africa in June 2021 to support more equitable vaccine manufacture. Although the Hub had access to published patent specifications, neither Pfizer nor Moderna (the two leading manufacturers of mRNA vaccines) would share their additional manufacturing know-how. The phased operationalisation of the Hub was therefore delayed by two years till Afrigen, a South African pharmaceutical firm, independently re-created suitable manufacturing know-how for at least the trial stages of vaccine manufacture (announced in April 2023, here).

It is striking that although Taylor and Silberston (1973) touched on the solution to this problem, they did not explore it further: the compulsory licensing of know-how, in an analogous fashion to the compulsory licensing of patents. They indicated that consideration of the compulsory licensing of know-how “…would take us far beyond an assessment of the patent system”. We disagree. We suggest that the know-how gap problem is properly regarded as a systemic issue at the heart of the patent system because, at least in those cases where such know-how is vital for the effective commercial manufacture of patented inventions, a failure to share that know-how is likely to prevent compulsory patent licensing (or even a waiver of patent rights) from being used as an effective safeguard (TRIPS flexibility) in the way that policy makers may be relying on. Given that this problem has now been recognised for at least eighty years, it is well beyond time to find and implement an effective solution.

As we and others have explained, despite its practical difficulties, the compulsory licensing of know-how can be undertaken and is consistent with the World Trade Organisation (WTO) Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement (for example, see here and here). Indeed, it is not surprising that the institutions of the European Union have now recognised the same and have explicitly included appropriate measures in their draft instrument on compulsory licensing in the EU during a crisis (see here). We have therefore proposed that a suitable provision to solve the problem of the know-how gap be included in the draft WHO Pandemic Accord, most recently in the following form:

“…ensure that manufacturers within its jurisdiction share information relating to the production of pandemic-related health products with appropriate third parties, subject to the protection of their legitimate interests, when the withholding of such information prevents or hinders urgent manufacture of such products which are necessary to respond to a pandemic.

The ’ensuring’ can be done with carrots and/or sticks that should be persuasive enough so that in a future pandemic, when the need arises, the vital manufacturing know-how is available. The problem of the know-how gap and its impact on the effectiveness of compulsory patent licensing is too important to ignore and the negotiators of the draft WHO Pandemic Accord should use the extended time for negotiations (this week) to reach a workable solution.

Christopher Garrison
Christopher Garrison
Christopher Garrison, MA LLM MA PhD, is a legal advisor with over 20 years of experience on intellectual property issues.

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