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The European Commission’s compulsory licensing proposals are sensible but do not go far enough

By
Ellen 't Hoen
-

An earlier version of this comment was published in Barron’s on 21 July 2023. A Spanish translation of it is also available from El Confidencial here.

The European Commission has invited feed back on its proposal for a EU-wide compulsory licensing mechanism, which indicates there is room for improvement of the proposed legislation. We have responded to this invitation and made some proposals for change. One key proposal we made is to ensure that the mechanism can be used to protect public health in all situations, not only in health emergencies.

If government-granted monopolies in the form of patents cannot be lifted when the public interest requires it, abuse is around the corner. Newly proposed legislation in the European Union has the potential to counter such abuse but is currently limited to crisis situations. To truly protect public health, it must go further.

The Covid-19 pandemic has rekindled interest in compulsory licensing of patents of health technologies. Compulsory licensing is a mechanism a government can deploy to authorise the use of a patented product or process without the consent of the patent holder. The World Trade Organization Ministerial Conference in 2001 adopted a declaration that clarified that this flexibility of patent law is consistent with global trade rules and can be used to the fullest to protect public health. Compulsory licensing became popular in global health in the early 2000s to ensure low-priced HIV medicines could circulate in global trade.

Since 2020, initiatives for compulsory licensing of Covid-19 therapeutics have been taken in nine countries leading to six granted compulsory licences. Several countries updated their patent laws to enable swift compulsory licensing during the pandemic. For example, in March 2020, Germany adopted legislation that empowered the minister of health to direct the compulsory licensing for government use of patents for a range of products needed during the pandemic. The U.S. authorised the use of patents without the consent of the patent owner to accelerate research and development of pandemic countermeasures. Research group Knowledge Ecology International reported 62 Covid-19 pandemic-related government contracts that authorised the use of patented inventions to ensure that patent litigation would not hold up the development of Covid-19 vaccines. These actions were seen—rightly—as essential to protect the public at a moment when timely access to pandemic countermeasures was a matter of life or death. 

Unfortunately, it is neither easy nor straightforward to deploy these tools in the face of public need. The European Commission recently identified a number of problems with the current EU system for compulsory licensing. They include: the lack of coherence between national compulsory licences in the EU, the limited territorial effect of these licences, the burdensome and lengthy administrative procedures, and the lack of a Single Market for products subject to compulsory licensing. Further, compulsory licensing generally applies to patents and “supplementary protection certificates,” which extend patent protection to account for long regulatory approval times. But with the exception of Spanish law, compulsory licensing rules in the EU do not provide for the transfer of trade secrets, test data, or know-how that may be required to be able to produce the product. 

Intellectual property protection is increasingly harmonised in the EU, but the mechanisms to protect the public interest—part and parcel of any balanced IP system—are not. For example, a new unitary patent system recently went into effect across much of the EU, but it does not provide for compulsory licences. Such licences remain governed by the laws of the participating member states. To quote the Commission’s report on the subject: “purely national compulsory licensing systems and their resulting divergences would conflict with the increasing European integration of patent law.” 

This situation further strengthens the market position of pharmaceutical companies. It is no secret how companies leverage that market power. A white paper published in 2020 by the European generics industry titled “Anatomy of a Failure to Launch” offers a sobering overview of a wide range of monopoly-extending tactics the pharmaceutical industry deploys to keep competitors at bay for as long as possible, no matter the cost to public health. 

Further barriers to the effective use of compulsory licensing in the EU can be found in the Union’s medicines regulation, which offers data and market exclusivities for medicines registered in the EU. These non patent-related market monopolies seriously hamper the effective use of compulsory licensing. To register and then sell a generic medicine in the EU, manufacturers must show that the product is equivalent to the originator product already registered. Data exclusivity delays generic entry by restricting generic manufacturer access to clinical trial information to be able to demonstrate equivalency. 

There is no equivalent to a compulsory licence for monopolies granted through the medicines regulatory system. In the EU, data and market exclusivity cannot be waived. As a result, compulsory licensing becomes a mute measure because the generic product to be produced or imported under the compulsory licence cannot be registered and thus cannot enter the market. 

This is not a hypothetical issue: Data exclusivity was one of the main barriers in 2015 when Romania considered issuing a compulsory licence for the importation of generic sofosbuvir,  an antiviral for the treatment of hepatitis C.

Even in case of a public health emergency, the regulatory exclusivities cannot be lawfully lifted. This became apparent for the first time in 2006. The European Generic Medicines Association (since then renamed Medicines for Europe) sought clarification on whether data exclusivity would apply in case of an emergency compulsory licence for the flu medicine oseltamivir (sold by Roche under the brand name Tamiflu) within the European Union. Because of the H5N1 bird flu outbreak, countries had built stockpiles of oseltamivir, leading to shortages of the product. Nevertheless, the European Commission informed the generic companies that the body of European Community law on pharmaceuticals “does not currently contain any provision allowing a waiver of the rules on data exclusivity and marketing protection periods.”

Seventeen years and another pandemic later, this is finally set to change. The European Commission is proposing new legislation for an EU-wide compulsory licensing mechanism and for data and market exclusivity waivers. 

The Commission proposed a regulation on compulsory licensing for crisis management that, if adopted, will establish a single procedure to grant a Union compulsory licence that covers the entire EU and can be granted by filing a single application. The Union compulsory licence will be available for “crisis-relevant products and processes.” The Union compulsory licence may be applied to granted patents, published patent applications for national and European patents, and supplementary protection certificates. The newly proposed pharmaceutical directive provides for the suspension of data exclusivity and market protection in the case of a compulsory licence to address a public health emergency. 

These are sensible and overdue proposals, but the catch is that they are limited to crisis situations. This is shortsighted. 

For example, a compulsory licence may be needed to ensure access to technology to prevent a crisis from happening. Compulsory licensing should also be an effective remedy to anti-competitive practices at the EU level. Further, developing the European Health Union will require more robust means to address the high prices of novel treatments. Today, member states have great difficulty in achieving good results in price negotiation with monopoly-holding pharmaceutical companies, leading to delays in access to medicines and inequitable access to novel medicines in the EU. The European Commission has committed to supporting member states in addressing high medicine prices. An effective compulsory licensing mechanism would provide such support by bolstering the position of governments in price negotiations. 

Once in a while, a government should be able to bang a fist on the table, but that is hard to do without sacrificing patients’ health if the pharmaceutical monopoly can never be lifted.

It is important to expand the EU-wide compulsory licensing mechanism beyond crisis situations so it can also be deployed on other public interest grounds when needed. To ensure the effective use of the compulsory licensing, data- and market exclusivity waivers should be available in all situations the Commission or a member state issues a compulsory licence related to a medical product. The new rules should also provide for the possibility to include an obligation on the patent holder to transfer know-how to the beneficiary of a compulsory licence.

Submission to the US International Trade Commission

By
Ellen 't Hoen
-
WTO building in Geneva, Switzerland by E. Murray; used under Creative Commons.

On 17 June 2022, World Trade Organization (WTO) Members adopted a Ministerial Decision outlining flexibilities in the WTO’s Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement that countries could use to access Covid-19 vaccines. A decision on whether and how to extend the scope of the Decision was tabled for 17 December 2023 but subsequently postponed to a later date.

As part of its decision-making process, the US Trade Representative has commissioned a study to determine the case for extending the Decision and invited submissions by interested parties.

Read the full submission by Medicines Law & Policy to the USITC. Below is a summary of the submission.

Medicines Law & Policy recommends an extension to the Decision:

• Ensure access to all pandemic countermeasures including vaccines, diagnostics, therapeutics and any other health technologies needed to prevent, address and/or recover from a health crisis.

• Ensure preparedness for future pandemics by making the Ministerial Decision applicable to any emerging or declared health emergency in the future.

• Ensure an easy pathway for countries to opt back into TRIPS Art. 31bis. In 2003, many countries opted out of using Art. 31bis (compulsory licensing for export). With increasing concentration of pharmaceutical manufacturing, those countries may find themselves in need of this provision, in particular in a crisis situation.

• Ensure waivers on market and data exclusivity are available so that effective implementation of a compulsory licence is not delayed by lack of access to information needed for regulatory purposes. 

Since 2001, ML&P has been tracking the use of TRIPS flexibilities for public health in our TRIPS Flexibilities Database (TFD). We see that TRIPS Flexibilities are:

• Widely used. The TFD currently documents 172 instances, of which 122 concern compulsory licensing, 3 exceptions to patent rights, 46 the least developed country (LDC) extension and 1 parallel import.

• Effective even when not executed. The TFD notes 27 instances between 2001 and 2023 where compulsory licences were proposed but not executed. Of those,16 resulted in an access measure by a company – either a voluntary licence, a price decrease, or a declaration not to enforce rights.

• Useful in a pandemic. The TFD shows that since 2020 there have been 10 instances of compulsory licensing that concerned products needed to prevent or treat Covid-19. Five of these instances were in high-income countries and four were executed.

• Useful in high-income countries. Of 122 compulsory licence instances in the databases, 23 were for the use in high-income countries.  

TRIPS flexibilities have an important role in ensuring access to medicines in general, and access to countermeasures in the case of public health emergencies in particular. The Ministerial Decision has the opportunity to ease their use to ensure a more effective response to Covid-19 and future pandemics. WTO Members should take the recommendations above to extend the Ministerial Decision and work to incorporate TRIPS flexibilities into their national legislation. They should also seek to avoid actions that make it more difficult to use TRIPS flexibilities, including opting out of Art. 31bis, agreeing to or demanding so-called ‘TRIPS-plus’ provisions, or engaging in political pressure against the use of TRIPS flexibilities. 

Read Medicines Law & Policy’s full submission to the USITC.

The European Commission’s proposal for an EU wide compulsory licensing mechanism

By
Ellen 't Hoen
-

In 2006 the European Generics Association was seeking clarification from the European Commission on whether generic versions of oseltamivir (Tamiflu) could be supplied to respond to the growing demand for the product. A H5N1 bird flu outbreak had led to countries building stockpiles of oseltamivir, sold by Roche, leading to shortages of the product. The European Commission responded to the generics industry that EU rules were not commensurate with the use of compulsory licensing because it did not yet provide for a waiver of data and marketing exclusivity. This meant that even though individual EU member states could issue a compulsory licence for oseltamivir, the generic product could not be registered and approved for sale in the EU.

It took another global health emergency, COVID-19, to finally change this. Today the European Commission has published its plans for EU-wide harmonisation of compulsory licensing, including the possibility of suspending data and market exclusivity to enable the registration and sale of products produced under a compulsory licence in the EU.

Individual EU member states have rules and regulations for compulsory licensing but those are diverse and export of products produced under a compulsory licence to other EU countries can only take place in limited quantities. Further, the EU’s pharmaceutical legislation which provides data and market exclusivity during which periods no generics can enter the market seriously hampers the effective use of compulsory licensing by EU member states. The proposed Regulation on compulsory licensing for crisis management will change this. 

The Commission proposes a single procedure to grant a Union compulsory licence that covers the entire EU and can be granted by filing a single application. The Union compulsory licence will be available for “crisis-relevant products and processes”. The Union compulsory licence applies to granted patents and published patent applications for national and European patents. It is important that applications are included to enable swift action in times of crisis when often newly developed products such as vaccines are deployed. Such products may have patent applications pending. The Union CL also covers Supplementary Protection Certificates, which is the EU’s version of medicines patent extensions to make up for time lost in applying for regulatory approval. For more on these, see here.

Data and market exclusivity may seriously hamper the effective use of a compulsory licensing if no waivers are available. To register a generic medicine in the EU, manufacturers must show that the product is equivalent to the originator product already registered. Data exclusivity delays generic entry by restricting generic manufacturer access to clinical trial information to be able to demonstrate equivalency. 

This issue is recognised in the newly proposed pharmaceutical regulation which provides for the suspension of data exclusivity and market protection in the case of a compulsory licence to address a public health emergency.

The European Commission will be the body to grant the EU compulsory licence and will be assisted by an advisory body. The rights holder will be heard and given the possibility to offer a voluntary licence. The regulation foresees royalty payments of no more than 4% of the total gross revenue generated by the licensee through the acts under the Union compulsory licence.

The Union compulsory licence is meant for the supply of the European Union market only. Since 2006 the EU has had a separate regulation that provides for compulsory licences for export to third countries with public health problems, consistent with the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) article 31bis. 

The EU compulsory licence regulation signifies very important progress in dealing with market monopolies that create supply and access problems in crisis situations and is consistent with the EU’s position in international trade negotiations on this topic. It would however be important to make the use of compulsory licensing generally more effective, even in non-crisis situations. For example, to address high medicines prices and give member states an effective tool in price negotiations.

The blog was amended on 28 April to clarify that under then current system individual EU member states may export products produced under a compulsory licence to other EU members but only in limited quantities.

Updated TRIPS Flexibilities Database

By
Ellen 't Hoen
-

In January 2023, a number of cystic-fibrosis patient organisations asked the governments of Brazil, India, South Africa and Ukraine to invoke compulsory licensing and to allow the supply of generic versions of cystic fibrosis treatments. These cases are now documented in our newly updated TRIPS Flexibilities Database, and we will continue to monitor the outcome of the requests. 

The TRIPS Flexibilities Database tracks the use of certain provisions of the World Trade Organization’s Trade-Related Aspects of Intellectual Property (TRIPS) Agreement for the purpose of promoting and protecting public health and in particular access to medicine. The TRIPS provisions we track include compulsory licensing (Article 31 and Article 31 bis), the use of transition provisions for least developed country members of the WTO that allows them not to grant or enforce pharmaceutical patents until 1 January 2033 (Doha Declaration par. 7), and exceptions to patents (Art. 30). The flexibility that TRIPS offers is broader than these articles but the provisions we track are the ones that can and are being used in the procurement of medicines.

The new cystic fibrosis compulsory licences requests are not the first time TRIPS flexibilities have been invoked to circumvent sky-high prices for treatments of the disease, which affects the lungs. In 2019 UK cystic fibrosis patients groups started a campaign to persuade the government of the United Kingdom (UK) to invoke Crown Use of patents for the purpose of accessing more affordable lumacaftor-ivacaftor (brand name Orkambi) for the treatment of cystic fibrosis. The list price in the UK for Orkambi is £104,000 per patient per year. A price too high for the National Health Service (NHS). NHS England offered a £500 million payment for a five-year period for Vertex’s cystic fibrosis medicines. But Vertex, which holds the monopoly over cystic-fibrosis medicines, refused the NHS offer. Parents of children suffering from the disease then asked the government to use compulsory licensing (Crown use) to enable the importation of lower-priced treatments. The Crown use did not happen but it did prompt Vertex to offer a better price and lumacaftor-ivacaftor is now available through NHS England.

But this is not the case in most developing countries that are also dependent on Vertex’s cystic fibrosis treatments and Vertex’s pricing policy, and as a result, many children with cystic fibrosis do not have access to this crucial treatment. It is this that prompted UK-based public health advocacy group Just Treatment in cooperation with the parents of children suffering from cystic fibrosis to launch this new initiative.

TRIPS flexibilities have been successfully used in the past for the importation and supply of generic HIV medicines. For an overview see this article in the WHO Bulletin from 2018 which offered the first report on the TRIPS Flexibilities database. In more recent years, we have seen the TRIPS flexibilities being proposed and used for cancer medication and treatments for Covid-19. 

TRIPS flexibilities remain important and form the core of the June 17 2022 WTO Ministerial Decision on the TRIPS Agreement which focussed on access to Covid-19 vaccines and the ongoing debate on whether the decision should be extended to Covid-19 therapeutics. On 11 April,  the WHO, together with UNITAID published a guide for countries on how to use the TRIPS flexibilities when they are excluded from the territory of Medicines Patent Pool licences for Covid-19 therapeutics.

How not to solve a crisis: The European Commission’s Plan for Transferable Data Exclusivity Vouchers

By
Ellen 't Hoen
-

Drug-resistant infections, sometimes called “superbugs,” killed an estimated 1.27 million people in 2019, a number set to rise to 50 million by 2050. It is a global health crisis that has been quietly in the works for years. And despite the hefty death toll, it is a crisis that is not receiving enough attention. 

Antimicrobial-resistant infections result from overuse and inappropriate use of antibiotics in medicine, for example, treating a viral infection with an antibiotic and from overuse in agriculture, where antibiotics are often used as growth stimulants in animals. AMR risks eroding the important progress made in medicine since the first synthetic antibiotic was used in 1910. As part of a comprehensive package of measures to combat antimicrobial resistance, it is paramount that new classes of effective antibiotics are developed. The last new class of antibiotics that made it to the market was discovered in 1984 and development pipelines for truly new classes of antibiotics are all but empty.

Antibiotics are a special class of pharmaceuticals that do not fit the industry’s standard business model. This pharma business model is based on selling as much as possible for as long as possible and at the highest price the market will bear. New antibiotics, however, need to be reserved and used cautiously while assuring their availability for patients who need them. In other words, the pharma industry would have to be persuaded to leave the new antibiotic drugs mostly on the shelf to be used sparingly. 

The industry will not invest in developing health products they cannot sell, and therefore large pharmaceutical companies have abandoned the search for new antibiotics. Smaller companies have entered the field but struggle with raising the cash because the mega-profit prospect isn’t there. 

The lack of incentives for new antibiotic drug development has been recognised for years and has been the subject of numerous reports and proposals, including a U.K. government-commissioned report by the economist Jim O’Neill published in 2016. Central to his proposal to encourage the development of new antibiotics are so-called market-entry rewards. O’Neill recommended an award of around US$1 billion each to the developers of successful new drugs, subject to certain conditions to ensure that the new antibiotic drugs are not “overmarketed” and yet are available to patients who need them wherever they live. That was the carrot. He also proposed a stick in the form of a “play or pay” funding scheme in which companies must pay a modest levy on the sale of their existing medicines into an international or regional fund unless they can demonstrate they are investing an equivalent amount in antibiotic R&D. 

The O’Neill recommendations for R&D have been largely ignored. The European Commission is now pursuing an entirely different route, and it is one O’Neill did not favour. In the recently leaked draft of the revision of the EU’s pharmaceutical legislation (Articles 40-42), the Commission proposes so-called transferable data exclusivity vouchers to incentivize antibiotic drug development. A company that applies for marketing authorization with the European Medicines Agency for a “priority antimicrobial” can obtain a transferable data-exclusivity voucher. Such a voucher provides an extra year of data exclusivity, which amounts to one year of extra market monopoly either for the antibiotic registered or another product authorized for use in the EU. The company applying for the voucher needs to demonstrate its ability to supply the EU market in sufficient quantities and provide information on all funding received related to the development of the antimicrobial. The voucher can be transferred (sold) to another company and be transferred an unlimited number of times. The EU voucher scheme would be in force for 15 years, during which period a maximum of 10 vouchers may be granted (subject to extension upon proposal by the Commission). 

So far, this is only a proposal (that the Commission has not made public yet), and many do not like it.

The European pharmaceutical industry, however, is lobbying hard for the voucher scheme. Not because they are keen to get back into the antibiotic research field but because they hope to extend the monopolies on some of their blockbuster drugs by buying vouchers. The vouchers, after all, are tradable. In practice, this would mean that generic competition for the product to which the voucher is applied will be delayed for the duration of the extended exclusivity period of one year. Needless to say, the generic industry is not keen on the proposal. They point out that it will dramatically increase the cost to health care systems. For example, extending the exclusivity period for adalimumab (Abbvie’s Humira), a product used to treat arthritis, would have meant an additional cost of US$1.1 billion for the EU’s healthcare systems. It would also introduce uncertainty for the generic industry as to when they can enter the market with generic or biogeneric versions of a product when such a product may be subject to an extended period of market monopoly. 

O’Neill addressed these problems in his 2016 report: “[Vouchers] push the cost of antibiotic development onto an arbitrary set of payers and patients (those who use the medicines on which the voucher is applied). Secondly, to deliver a similar incentive for new drugs, compared to market entry rewards, these vouchers would cost the healthcare system more in the long-term as they have to reward the innovative drug developer and provide an additional profit margin to the company selling the drug on which the voucher is applied.”

A recent Lancet commentary shared similar concerns, pointing out a 1-year voucher could cost the European healthcare systems up to $3.2 billion and would decrease access to medicines due to delayed market entry of generic medicines. The authors point out that studies have shown that similar incentive mechanisms may have accelerated market entry of products that are already in late-stage development but have done little to enhance R&D in the neglected areas. Vouchers also do not ensure access to new antibiotics because companies may choose not to supply certain markets or seize activity. The draft legislation permits the Commission to revoke the voucher when supply, procurement, or purchase criteria have not been fulfilled, but only before its transfer. The voucher scheme also has no link between the clinical value of the new antibiotic and the reward given, since that is determined by the value of the product to which the voucher is applied. Instead of implementing a voucher scheme, the commentary’s authors propose subscription-style payments at EU level that guarantee income to those who develop antibiotics delinked from the amount of product sold.

Civil society organizations have voiced similar concerns over access to medicines and the financial consequences for European healthcare systems. They have also pointed out that the flexibility that patent law provides to remedy undesirable consequences of a patent monopoly does not exist for data exclusivity. The European Consumer Organization BEUC calls the proposal “bad for consumers.”

In November, 14 EU member states issued a nonpaper objecting to the voucher plan, saying: “Transferable vouchers do not directly incentivise the development of novel antimicrobials, nor do they ensure that products are accessible and available throughout the EU for an agreed upon time period…the costs for national health systems will be high.” The member states instead prefer direct financial incentives such as market entry awards, a subscription payment scheme that guarantees an income regardless of volumes, and R&D incentives such as milestone prices. They see a central role for the recently established European Health Emergency Preparedness Response Authority.

The TDEV scheme will likely not directly benefit the companies and entities that are actually engaged in new antibiotic drug development, including not-for-profit organizations such as the Global Antibiotic Research and Development Partnership. 

Antibiotic drug development lends itself for a delinkage model whereby incentives for innovation are disconnected from the ability to sell at high prices. Opponents of the TDEV plan seem to prefer such an approach as well. Delinkage could be implemented through direct financing and milestone prizes, possibly combined with purchase commitments to secure market prospects. The latter would have to be developed with global equitable access in mind. The new antibiotics need to be global public goods and not just available for the rich. The new health preparedness agency HERA should play a central role in implementing new R&D models, ensuring antibiotic drug development takes place and is appropriately financed. 

It might be worth dusting off O’Neill’s “play or pay” proposal to finance the new innovation models. After all, companies are making huge profits from infectious diseases. Pharma’s Covid-19 revenues amounted to close to US$100 billion in 2022. A new study, Pharma’s Pandemic Profits, published by SOMO on 27 February, describes how these gains are largely due to decades of research funded by public investment, billions in grants for development and production, and tens of billions in Advanced Purchase Agreements (APAs) with governments. It is not an unreasonable proposal to reallocate some of these resources, generated by public spending, to antibiotic drug development. Even a modest skimming would create a meaningful fund for antibiotic drug development.

An earlier version of this blog was published in Barron’s on 14 February 2023.

ML&P’s Comments to the Intergovernmental Negotiating Body (INB) on the Zero Draft of the Pandemic Accord

By
Ellen 't Hoen
-

These remarks were delivered on the occasion of the fourth meeting of the Intergovernmental Negotiating Body to draft and negotiate a WHO convention, agreement or other international instrument on pandemic prevention, preparedness and response, taking place 27 February – 3 March 2023.

Thank you, co-chair, for the opportunity to provide some general comments on the 0 draft.

The 0 draft of the CA+ is a good basis for starting negotiations.

However, a new, legally binding instrument should create new obligations for parties and thus should go beyond ‘best endeavours’, ‘declarations of good intentions’ or agreements on ‘previously agreed upon texts’.

If the new instrument is to improve future pandemic response meaningfully, it needs to contain stronger language, in particular, to achieve equity in access to products needed to respond to a pandemic as well as equity in access to the knowledge needed to produce such products.

We would like to see strong provisions to*:

  • ensure adequate financing for R&D of pandemic products to which all member states should contribute, including during pre/inter-pandemic times;
  • require parties to condition government-funded innovations to ensure the sharing and licensing of intellectual property, data and know-how;
  • mandate sharing of IP, know-how and transfer of technology in the case of a pandemic;
  • a commitment to build and expand regional capacity to manufacture pandemic countermeasures.

Such new legal obligations can be created in compliance with existing international law, including the WTO TRIPS Agreement.

Further, the new instrument should address how essential pandemic countermeasures can be developed, produced and provided as global public goods.

Transparency will be essential for addressing future pandemic risks and implementing the agreement, including monitoring compliance. We suggest that a separate chapter on transparency be included in the agreement.

Thank you for your attention.

*For details see: https://gh.bmj.com/content/7/7/e009709

Pharmaceutical Accountability Foundation is taking AbbVie to court over excessive pricing of Humira – AbbVie overcharged the Dutch health care system by as much as €1.2 billion

By
Ellen 't Hoen
-

On 21 February, the Dutch Pharmaceutical Accountability Foundation (PAF) took the bold step to take AbbVie to court, claiming the company’s pricing policy had harmed the Dutch healthcare system and the people who make use of it. The Foundation has calculated that AbbVie overcharged the health care system by as much as € 1.2 billion for its blockbuster medicine Humira (adalimumab). An English translation of the subpoena is available here.

Humira is a prescription medicine for rheumatoid arthritis and seven other diseases that was first brought to the market in 2003. Humira became the largest selling pharmaceutical product in the world. Until 2022, AbbVie earned US$ 208 billion with Humira globally.

In the Netherlands, in 2003 AbbVie’s price for Humira was € 10,000-12,000 per patient per year. AbbVie maintained this high price even though the number of patients increased more than tenfold, and the number of indications for use was expanded from one (rheumatism) to eight.

AbbVie sold € 2.3 billion worth of Humira in the Netherlands during its market monopoly, which ran from 2004 until 2018. PAF calculated that  € 1.2 billion of the  € 2.3 billion was excessive profit. This amounts to € 68 per Dutch citizen, according to PAF. The excessive profit was calculated by subtracting all R&D costs, as claimed by AbbVie, production and distribution costs (as disclosed in US Congress), and by adding a 25% profit from the drug’s turnover. After patent protection expired, the price of adalimumab dropped by 80%.

Health economists, with whom the Foundation collaborates, have calculated that AbbVie’s excessive profit could have ensured up to 16,300 extra years of healthy life for Dutch citizens.

PAF is bringing civil litigation based on tort (Unlawful act: breach of social duty of care), Human Rights Law (violation of the Right to Life and the Right to Health) and competition law (abuse of a dominant position). The Foundation claims that AbbVie made excessive profits at the health care system’s and its users’ expense and, consequently, violated the Dutch Civil Code (art 6:162). The Foundation is seeking a declaratory judgement that AbbVie acted unlawfully and is not asking for financial damages directly. However, a positive outcome will open the way for others, such as health insurers, to seek compensation.

This is not the first time AbbVie’s Humira pricing and marketing behaviour has been scrutinised.

In 2019 the Dutch competition authority, Authority for Consumers and Markets (ACM), launched an investigation into the discounts AbbVie offered hospitals. By the end of 2018, AbbVie had lost its market monopoly because of patent expiry and sought to obstruct market entry by biosimilars through exclusive contracts with hospitals by which hospitals would only retain discounts if they did not switch any of their patients to a biosimilar. The investigation was closed in 2020 after AbbVie stated it would no longer force hospitals to purchase exclusively from AbbVie.

In May, 2021 AbbVie was investigated by the US Congress as part of in-depth investigations into the pharmaceutical industry’s pricing practices. The price of Humira took centre stage. AbbVie had increased the price of Humira by 470% since its introduction in 2003 in the US. US patients paid US$ 77,586 for a year’s supply. Like in the Netherlands, in the US AbbVie has used monopoly rights to sustain its high prices beyond what is reasonable. The Initiative for Medicines, Access & Knowledge (I-Mak) had found that AbbVie filed for 257 patents for Humira. Ninety percent of these patents were filed after the drug was first approved in 2002, so they had little to do with developing the product but were mainly used for strategic marketing purposes. AbbVie obtained 130 granted patents and 39 years of protection. I-Mak called this AbbVie’s “wall of patents”, meant to keep more affordable biosimilar versions of its product out of the market. And it worked.  Only this year, biosimilars of Humira became available on the US market and prices started to fall.

PAF has successfully taken legal action against a pharmaceutical company’s pricing behaviour. In 2018 PAF submitted an enforcement request with the Dutch competition authority, Authority for Consumers and Markets (ACM) to investigate the pricing by Leadiant Biosciences’ of its product chenodeoxycholic acid (CDCA) a treatment for cerebrotendinous xanthomatosis (CTX), a rare metabolic disease. The company had increased the price of chenodeoxycholic acid (CDCA) 500-fold after it obtained market exclusivity after the European Medicines Agency approved it as an orphan drug. Three years later, in July 2021, the ACM imposed a fine on the company of € 19,5 million.  PAF’s action sparked similar cases elsewhere in Europe. Leadiant has also been fined for excessive pricing and abuse of its dominant position in the market in Spain, Israel and Italy against the company. A similar case brought by the consumer group Test-Aankoop in Belgium is still pending.

Ellen ‘t Hoen is a member of the Expert Advisory Board of the Foundation for Pharmaceutical Accountability.

TRIPS, technology transfer and access to pandemic countermeasures: What the WHO  Pandemic Treaty must do

By
Ellen 't Hoen
-

[A version of the following blog was given as remarks made at a special expert session of the Intergovernmental Negotiating Body (INB) to draft and negotiate a WHO convention, agreement or other international instrument on pandemic prevention, preparedness and response]

The scrambling for access to Covid-19 vaccines by developing countries has reignited the debate on the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement and its effects on public health.

In such debates, the TRIPS Agreement is often cast as “the big evil”. 

There is no denying that the TRIPS Agreement, adopted in 1995, ushered in intellectual property (IP) norms and standards derived from high-income countries that were ill-suited to the needs of developing nations. 

Disputes over access to HIV medicines in the late nineties and early 2000s, and, more recently, over Covid-19 vaccines and therapeutics, may confirm the view that TRIPS does not serve the public interest well.

However, the stated objective of the TRIPS Agreement is oriented toward creating societal benefits for all.

It reads:

The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.

Article 8 acknowledges countries’ rights to take measures to protect the public interest and specifically public health. It further states that measures may be needed to prevent abuse by IP holders and measures against practices that restrain trade or adversely affect technology transfer.

The Doha Declaration on TRIPS and Public Health, adopted by the WTO Ministerial Conference in 2001 confirmed this right and spotlighted compulsory licensing as a means to ensure access to medicines for all. 

A few words about compulsory and voluntary licensing

Our organisation maintains a database of the use of these TRIPS flexibilities for public health. 

The data shows, since 2021, ten new compulsory licensing instances and all concerned products to prevent or treat Covid-19.

Research by Knowledge Ecology International, a non-profit think tank, has found 62 Covid-19 contracts by the US Government containing authorisation of non-voluntary use of third party patents. For example, Moderna is a beneficiary of such CLs, which enabled Moderna to develop their mRNA vaccines without concerns about patent infringement lawsuits.

Our data also shows that compulsory licensing encourages voluntary licensing and collaboration. So a forceful signal from countries (as a number of countries have done early in the Covid-19 outbreak) that they are ready to take non-voluntary measures when needed is important.

There is of course, no need for compulsory measures when voluntary mechanisms are in place and effective. Such as the WHO Covid-19 Technology Access Pool (C-TAP) and the Medicines Patent Pool. But the uptake of the voluntary IP sharing mechanism has been very limited and for vaccines not happened at all.

Limitations to compulsory licence include:

  • It is a country by country, case by case, patent by patent measure which ignores the importance of providing swift legal certainty for producers that are likely to operate globally.
  • Countries that grant data and market exclusivity when registering a new drug may have difficulty providing regulatory approval for products produced or imported under a compulsory licence may be a problem if no exclusivity waiver is in place;
  • Compulsory licensing concerns patents and does not extend to forms of IP that may be needed such as, know-how,  trade secrets, cell-lines, regulatory filings.

So how can the pandemic treaty address IP issues?

In October 2021 we held an expert working group meeting that formulated the following recommendations IP and knowledge management for pandemic preparedness and response:

Download the above infographic as a pdf by clicking here.

These measures can be agreed upon in coherence with existing international agreements on intellectual property. 

The TRIPS Agreement in articles 7, 8, and 30, 31, 31bis, 44.2 and 73(b)iii offers ample scope for states to intervene in private IP rights in the public interest and to respond to a crisis and does not have to stand in the way of implementing above recommendations.

But these mechanisms may need to be applied in a coordinated manner and some of them triggered automatically through provisions in the pandemic treaty. 

It may be useful to look at agreements that have dealt with limitations and exceptions to IP, such as the WIPO Treaty for the blind which created a mandatory obligation for member states to implement copyright exceptions for the creation of materials for visually impaired persons.

And agreements that dealt with technology transfer such as the Multilateral Fund (or Montreal Protocol), a successful international agreement to phase out ozone-depleting substances. The Multilateral Fund is explicitly intended to support technology transfer relating to the manufacture and use of substitutes for ozone-depleting substances.

The Pandemic Treaty offers an opportunity to coordinate the management and sharing of IP, know-how and data needed for equitable access to pandemic countermeasures. It is up to negotiators to make sure that it does so, so the world does not repeat the mistakes of Covid-19.  

WTO Covid-19 TRIPS Decision: Some observations

By
Ellen 't Hoen
-
The sun rises over lake Geneva as diplomats finalised their compromise decision.

This morning, 17 June at 5 AM the 12th World Trade Organization (WTO) Ministerial Conference (MC12) approved a package of decisions and declarations. The Ministerial Conference took place in Geneva, Switzerland 12-16 June; negotiations were extended a day to allow more time to come to an agreement. The agreed package includes a Ministerial decision on the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement aka the “TRIPS Waiver”. It took a year and a half of intense discussions to reach this result on the TRIPS issues.

This Decision is no longer a TRIPS waiver in the sense it was proposed by South Africa and India in October 2020, which was a more comprehensive waiver of TRIPS obligations to be able to produce and access Covid-19 countermeasures. The broad waiver characteristics were lost when the EU’s counter-proposal from October 2021, which was centred around using the existing TRIPS flexibility of compulsory licensing, became the core of the draft that was put in front of the ministers to work with this week. We commented on that draft here.

The Decision that is now adopted allows an eligible Member of the WTO to use a patent related to vaccine technology without the consent of the right holder (compulsory licence), using any national legal mechanism such as an executive order, emergency decree, government use authorisation or judicial or administrative orders. This may make the issuing of a compulsory licence easy and swift and will help the few countries that currently do not have workable compulsory licensing mechanisms, but it does not substantively expand the legal space countries already have under TRIPS.

The following issues were still up in the air at the start of the MC12 and are now resolved:

Eligibility

Footnote 1 clarifies that developing country Members of the WTO are eligible to use the Decision, but strangely enough, also aims at excluding countries with “existing” production capacity by encouraging them to make “a binding commitment not to avail themselves of this Decision”. Those are the countries that are most likely to be able to put the decision to work, including those working with the World Health Organization (WHO) mRNA vaccine technology transfer hub. The consequences of this limitation could even be more serious if and when the decision is expanded to include therapeutics and diagnostics. This raises the question: Will the extension to treatments and diagnostics be subject to “binding commitments” of countries with existing capacity to manufacture not to avail themselves of the Decision? The consequence of that could be far-reaching. From a public health point of view, the ideal is that the countries with production capacity would make full use of the new mechanism (and any other TRIPS flexibility) and be able to swiftly manufacture and export pandemic countermeasures.

Subject matter of a patent

Footnote 2 offers a useful improvement because it specifies that the subject matter of a patent for the purpose of this decision includes ingredients and processes.

Waiving TRIPS Art. 31(f)

Paragraph 3 (b) is the tiny bright light of the Decision, waiving the requirement that production under the Decision has to be predominantly for the domestic market. It is important that this export restriction is dropped without having to use the unworkable Article 31(bis).

Re-exportation

Par 3(c) discourages the re-exportation of products that have been supplied under this decision. This is not helpful in efforts to combat a pandemic and where regularly vaccines are sent from one place to another.

Remuneration 

In contrast, the remuneration paragraph 3(d) does refer to the humanitarian and not-for-profit nature of vaccine supply and leaves flexibility to determine the level of royalties payable. It is useful that footnote 4 directs Members to the WHO/United Nations Development Programme (UNDP) remuneration guidelines for that purpose.

Data

Paragraph 4 states the obvious, namely that TRIPS Article 39.3 does not contain an obligation on Members to instate a data exclusivity regime whereby the originator company is granted monopoly use of registration data for a certain period of time. While it does not change anything in the status quo it is helpful to remind Members of it. 

Duration

Paragraph 6 specifies that the duration of the mechanism may be applied for the next 5 years. For mounting vaccine production facilities, this is still a relatively short period. This term will be reviewed and may be reviewed by the General Council annually.

Applicability

The Decision as it stands only concerns vaccines, while it would have been most useful for therapeutics and other health technologies. Waiving IP rights on vaccines is unlikely to be all that is needed to facilitate their development and production; know-how transfer is also necessary. Other health technologies are still excluded from this Decision, but Members made a commitment in Paragraph 8 to decide within the next six months whether to extend its scope to include the production and supply of therapeutics and diagnostics. Therefore, it will be important for eligible countries with production capacity to avoid committing to not avail themselves of the Decision as they are encouraged to do in footnote 1.

Let’s not forget that the waiver discussions at the WTO have their origins in the refusal of companies such as Pfizer and Moderna to share their Covid-19 vaccine manufacturing IP, technology, and know-how, including with technology sharing platforms such as the WHO Covid-19 Technology Access Pool and the Vaccine Technology Transfer Hub. 

DG Ngozi Okonjo-Iweala said at the closing press conference when commenting on the TRIPS Decision: “Now we have something in hand. Exciting to now be able to go to those factories that are being set up all over the developing world and to work with them and to see how this can actually be made real.”

If the TRIPS Decision contributes to nudging the companies to share the IP and manufacturing know-how in the future necessary to produce important medicines and vaccines it may not all have been in vain. But we are scraping the barrel now.

Wrapping up 2021 – some noteworthy medicines law and policy events

By
Ellen 't Hoen
-

Welcome to the annual end of the year blog, our highly biased overview of noteworthy events in the field of medicines law and policy. It will not come as a surprise that 2021 was also dominated by the Covid-19 pandemic and the severe inequity in access to pandemic countermeasures, in particular Covid-19 vaccines and tests. While rich countries are rolling out child vaccination and booster campaigns, in low-income nations vaccination rates hover around 7%. Also the manufacturing know-how remains firmly in the hands of multinational vaccine corporations. Inequity in access to Covid-19 counter-measures reflects the concentration of manufacturing capacity in the hands of too few companies. None of the vaccine manufacturers is working with the WHO Covid-19 Technology Access Pool (C-TAP). The TRIPS Waiver, proposed in October 2020 by India and South Africa to help overcome hurdles of intellectual property protection to the scale-up of production, remains in limbo. 

While Covid-19 dominated global medicines law and policy developments, there are of course other issues that need attention. The high price of medicines, in particular those needed to treat cancer, is one such area as is evidenced by the WHO Essential Medicines Committee’s comments when it considered applications for essential but highly-priced cancer medicines for inclusion in the list.  

January

At the World Health Organization’s Executive Board meeting 19-26 January, WHO Director-General Dr Tedros raised the alarm about the lack of equity in the distribution of Covid-19 vaccines. Quoting disturbing statistics he said: “More than 39 million doses of vaccine have now been administered in at least 49 higher-income countries. Just 25 doses have been given in one lowest-income country. Not 25 million; not 25 thousand; just 25.” He added: “I need to be blunt: the world is on the brink of a catastrophic moral failure – and the price of this failure will be paid with lives and livelihoods in the world’s poorest countries.”

After the new Biden-Harris administration was sworn in on 20 January 2021, the US re-joined the WHO. Dr Fauci represented the US at the WHO Executive Board in January and outlined the country’s priorities for global health.  

February

On 15 February, Ngozi Okonjo-Iweala was appointed director-general of the World Trade Organization. She is the first woman and the first African to lead the organisation. Having been the chair of the GAVI board – a public-private partnership for vaccine access and the group running the Covax facility, which was created for facilitating equitable Covid-19 vaccine distribution – it did not come as a surprise that she made ending the Covid-19 pandemic and equitable access to affordable vaccines her priorities. In her first speech to the WTO Members she said, ”For the global economy to return to sustained growth, the global community will need to get a tight grip on the pandemic by intensifying cooperation to make equitable and affordable access to vaccines, therapeutics, and diagnostics a key plank of the recovery.” She further urged Members to refrain from vaccine nationalism and protectionism and said that it was important to “intensify cooperation on promising new vaccines, therapeutics, and diagnostics.” She added, “There should be a “third way” to broaden access through facilitating technology transfer within the framework of multilateral rules, so as to encourage research and innovation while at the same time allowing licensing agreements that help scale up manufacturing of medical products.” 

Also in February, the European Commission published an emergency plan which was labelled the “vanguard for the European Health Emergency Preparedness and Response Authority (HERA)”. HERA was announced in November 2020. The Commission’s plan includes the following elements: Rapid detection of variants; (2) Swift adaptation of vaccines; (3) Setting up a European Clinical Trials Network; (4) Fast-tracking regulatory approval of updated vaccines and new or repurposed manufacturing infrastructures; and 5) Enable upscaling of production of existing, adapted or novel COVID-19 vaccines.

March

The Canadian pharma company, Biolyse decided to apply for compulsory licences to be able to produce and distribute Covid-19 vaccines in developing countries. It did so after it failed to obtain voluntary licences from AstraZeneca and Johnson & Johnson.

The Dutch National Health Care Institute (responsible for advising the government about the coverage of health care interventions) prevented the drug company Lupin from exploiting its dominant position in the market after it obtained an orphan drug designation for the use of mexiletine for the treatment of non-dystrophic myotonia. The company had increased the price 100 fold. The Dutch institute rejected it for inclusion in the basic care package. Companies that abuse orphan drug regulation to obtain market monopolies primarily to exploit them to demand high prices are often called ‘medicines pirates’.

April

India banned exports of Covid-19 vaccines in a drive to expand vaccination of its own population during a severe second Covid-19 wave. The ban affected Covax’s distribution plans, which, at the time, was largely dependent on the Serum Institute India’s (SII) production of Covishield for the supply of vaccines to low-income countries. The export ban was lifted in October 2021 and SII resumed supply to Covax in November 2021.

The WHO announced the establishment of technology transfer hubs to expand mRNA vaccine production capacity in low and middle-income countries. The WHO calls for owners of technology and intellectual property (IP) to contribute to the initiative. For the time being, the WHO moves ahead without the collaboration of the corporations that hold the technology and accompanying IP of these products. 

May

On May 5th, the US took everyone by surprise by expressing support for a temporary TRIPS Waiver for Covid-19 vaccines, which would exclude therapeutics or other tools such as diagnostics. The EU remains the firmest opponent to any TRIPS rules waiver.

On 12 May, the Independent Panel for Pandemic Preparedness & response (IPPPR) presented its report with recommendations for action to curb the Covid-19 pandemic and to prevent any future outbreaks from turning into catastrophes. The Medicines Law & Policy team wrote one of the background documents about the legal challenges of scaling up vaccine production capacity.

June

In June the WHO Expert Committee on the Selection and Use of Essential Medicines met for two weeks to consider applications for 40 new medicines and 16 new indications for inclusion in the Model List of Essential Medicines. Updated roughly every two years, these lists guide countries around the world in selecting the highest priority medicines that should be available and affordable for their populations and thus represent critical expert guidance for health systems serving an estimated 5 billion people globally.

The Drugs for Neglected Diseases Initiative (DNDi) announced that the Malaysian medicines regulatory agency had granted conditional registration for a hepatitis C (HCV) treatment developed by a partnership of the Malaysian Ministry of Health, the DNDi, the Egyptian pharmaceutical company Pharco, Malaysian pharmaceutical company Pharmaniaga Berhad, and Médecins Sans Frontières/Doctors Without Borders (MSF). This signals the first HCV drug developed through South-South collaboration and with funding and clinical support from non-profit organizations. The partnership decided to develop the HCV treatment to respond to the lack of access to affordable direct-acting antivirals (DAAs), a newer generation of powerful HCV treatments that can cure patients in three to six months.

July

The Left in the European Parliament published the study “Advanced Purchase Agreements for Covid-19 vaccines. Analysis and Comments” carried out by researchers of Medicines Law & Policy. The report examines the texts of several Advanced Purchase Agreements the European Commission entered into with pharmaceutical companies for the purchase of Covid vaccines, to determine if the terms and conditions of the contracts promote vaccines as global public goods, which was a stated objective of the European Commission. A stated objective is all it turned out to be. As far as possible to determine – after all, the published agreements are heavily redacted – the APAs did not reflect this objective.

On 19 July, the Dutch competition authority, Netherlands Authority for Consumers and Markets (ACM), imposed a fine of nearly 20 million Euro on the manufacturer Leadiant for abuse of its dominant position in the market by charging an excessive price for the prescription medicine CDCA. CDCA is an orphan medicine used to treat a rare metabolic disease in children. The company, after securing a monopoly in the market, raised the price of the product 500 fold. The case was brought by the Foundation for Pharmaceutical Accountability, a Dutch NGO working to encourage a more responsible and human rights oriented pharma industry.

BioNTech, which holds the original technology for the Pfizer/BioNTech mRNA Covid-19vaccine, began exploring the possibility of establishing Covid-19 vaccine manufacturing capabilities in Rwanda and Senegal.

Reuters reported that Cuba will provide Covid-19 vaccines the country developed as well as the know-how to produce them to Vietnam.

August

The World Health Organization Europe published a Health Evidence Network synthesis report entitled “What is the evidence on legal measures to improve the transparency of markets for medicines, vaccines and other health products (World Health Assembly resolution WHA72.8)?” carried out by Medicines Law & Policy researchers. The report was an examination of what actions governments had taken following a 2019 World Health Assembly resolution 72.8 to improve transparency in medicines markets, including on research and development costs. The report found several initiatives that can support greater transparency of pharmaceutical price components, ranging from legal reform (e.g. requiring manufacturers to disclose the public subsidies it received towards the cost of R&D for medicines that will be reimbursed in France and Italy), to government websites disclosing rebates (e.g. Switzerland), to private clearinghouses where buyers share confidential (net) price information (e.g. Dutch Hospital Benchmark initiative). 

September

The DNDi announced that the COVID Moonshot, a non-profit, open-science consortium of scientists from around the world dedicated to the discovery of globally affordable and easily-manufactured antiviral drugs against COVID-19 and future viral pandemics, received key funding of £8 million from the Wellcome Trust, on behalf of the Covid-19 Therapeutics Accelerator.

The European Commission settled its dispute with AstraZeneca over vaccine supply issues in the European Union.

October

The WHO published the 22nd Model List of Essential Medicines (EML) and Essential Medicines for Children (EMLc) drawn up by the Expert Committee on the Selection and Use of Essential Medicines. Overall, 20 new medicines were added to the EML and 17 to the EMLc this year. Diabetes was a particular focus, in the wake of insulin shortages and backbreaking prices when it is available. Several new treatments for cancers were added to the lists. The unsustainable prices of important medicines – both promising new ones as well as older treatments – was a key concern of the Expert Committee. The “trend of continually increasing prices of new medicines over time, particularly in the areas of cancer, autoimmune diseases, infectious diseases and rare diseases” has delayed or prevented the addition of potentially helpful medicines to the Model Lists as they cost “multiples of median annual household incomes making them unaffordable even in high-income countries,” the Committee noted. It recommended establishing a standing EML Working Group to support the Expert Committee to provide advice to WHO on policies and rules to make high priced essential medicines more affordable and accessible and a larger role for the Medicines Patent Pool. 

The Medicines Patent Pool, on 27 October announced its first agreement on a Covid-19 therapy with Merck Sharp & Dohme (MSD) for molnupiravir. A second agreement for a Covid therapeutic followed in November when the MPP signed a licence with Pfizer for its oral antiviral treatment Paxlovid.

Cameroon’s ratification on 5 October of the 2019 treaty to set up the African Medicines Agency has triggered a 30 day period during which the African Union must start operating the Agency, the Lancet reported. The AMA will be fully operational by 2022. This is an important step forward in regional cooperation on medicines registration in Africa.

Besides the EU’s external trade and aid agendas, the EU’s internal medicines regulation also has global ‘side effects’ on access to medicines in low- and middle-income countries, according to new research published in the Lancet Regional Health – Europe, and led by a Medicines Law & Policy researcher. These findings point to the need for principles for global equitable access to medicines to guide EU pharma policy, especially now that the European Commission is solidifying and expanding its work on medicines.

Medicines Law & Policy, Knowledge Ecology International and the Menorca School of Public Health hosted an expert working group to discuss how IP issues and sharing of know-how and technology should be addressed in a pandemic treaty. In preparation for the meeting ML&P published a background document on Lessons for a pandemic preparedness treaty from previous successes and failures with treaty-based technology transfer.

November

On the 14th of November, the WTO Doha Declaration on the TRIPS Agreement and Public Health had its 20th anniversary.

On 23 November, the Covid-19 Technology Access Pool (C-TAP) announced its first licence on a diagnostic technology that detects anti-SARS-CoV-2 antibodies and measures adaptive immune responses that can indicate a previous or recent infection. The technology was licensed from the Spanish Research Institute (CSIC), which had originally announced its intention to do so in May 2021 at a one-year anniversary event for C-TAP. “Just like the virus, science knows no frontiers,” said Spain’s minister for science and technology, Diana Morant, at the licence signing ceremony on 23 November. 

The Medicines Patent Pool (MPP) revealed it is in talks with Moderna for licensing of its Covid-19 vaccine IP to enable the mRNA technology transfer hub the MPP is involved in. The mRNA technology transfer hub is established with the support of the Government of South Africa, the African CDC and the WHO.

The Israel Competition Authority announced it has opened enforcement proceedings and that it is considering a financial sanction of €2.2 million against MBI Pharma, and 2 fines of €172,000 to its directors for abuse of its monopoly position to charge unjust prices for CDCA. According to Lexology this is the first time the Israel Competition Authority has opened enforcement proceedings against a monopolist for charging an unfairly high price. In June of this year, the Dutch competition authority had fined Leadiant, which markets CDCA in the Netherlands for the same reason. MBI Pharma markets CDCA Leadiant in Israel. Similar competition cases against Laediant are pending in Belgium, Italy and Spain.

The World Trade Organization’s 12th Ministerial Conference (MC12), which was scheduled to take place from 30 November to 3 December was cancelled because of concerns about the new Covid-19 variant omicron. MC12 would have coincided with the World Health Assembly which led us to ponder the question ‘what if the health and trade ministers would meet in the same room’?

December

On Friday, December 3, 2021, KEI requested an open public interest licence to allow the exploitation of PF-07321332 (marketed in combination with ritonavir under the brand Paxlovid) in the Dominican Republic.

The Special Session of the World Health Assembly decided to commence negotiations for a new legal instrument for pandemic preparedness.

The WHO listed the 9th Covid-19 vaccine for emergency use. See here for the complete WHO Emergency Use Listing of Covid-19 vaccines.

On 28 December the Texas Children’s Hospital and Baylor College of Medicine announced that their protein sub-unit Covid-19 vaccine Corbevax, whose technology was created and engineered at its Center for Vaccine Development (CVD), had received Emergency Use Authorization from the Drugs Controller General of India to launch in India with other underserved countries to follow. According to the Washington Post, “Unlike the vaccines of big-name manufacturers such as Pfizer-BioNTech and Moderna, the Texas Children’s Hospital vaccine, which is called Corbevax, is being shared patent-free.” The developers Dr Peter Hotez and Dr Maria Elena Bottazzi are also in talks with the World Health Organization to see how they can share the vaccine globally. They are taking their ambition to develop and offer a People’s Vaccine seriously.

On 29 December the Cuban biotechnology organisation BioCubaFarma announced that it had obtained emergency use authorisation in Mexico for its Covid-19 vaccine Soberana. The Soberana 02 (FINLAY-FR-2) Covid-19 vaccine is a conjugate vaccine in which the virus antigen, the receptor-binding domain (RBD), is chemically bound to the tetanus toxoid. In September, the Lancet published this study showing efficacy and safety.

Looking towards 2022

As the end of 2021 is getting near, there is still no progress in talks on a WTO TRIPS waiver nor are there other new solutions on the horizon at the WTO to ensure that IP and know-how related to Covid-19 technologies is shared for the wider public good. WTO Members will continue their discussions on IP and the pandemic.

In the meantime, the Omicron variant is gaining ground which makes the need for rapid and expanded vaccinations worldwide only stronger. For some, this will be the first shot; for others, their second or third shot. The inequity in access remains.

Covid-19 vaccines have become a huge commercial success for the pharmaceutical industry in 2021. For 2022, projections stand at US$124 billion in Covid-19 vaccine sales of which US$93.2 billion is in sales for Pfizer and Moderna alone.

For anyone looking for holiday reading recommendations, we suggest downloading the new South Centre / Max Plank Institute open access publication “Access to Medicines and Vaccines. Implementing Flexibilities Under Intellectual Property Law”.

Happy New Year!

This blog was updated on 31 December with some Covid-19 vaccine developments that took place in late December.

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Medicines Law & Policy

Medicines Law & Policy releases analysis, policy recommendations and tools to aid practitioners working on universal access to medicines. We strive to provide information that is as accurate as possible, and we welcome and encourage feedback. For comments or questions contact us at: office@medicineslawandpolicy.net.

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