Synopsis of key findings from essay written in Foreign Affairs May 2020
Jennifer Hillman: Professor of Practice at the Georgetown University Law Center having previously served as a Commissioner on the U.S. International Trade Commission and one of 7 judges on the World Trade Organization’s (WTO) Appellate Body.
Race For A Cure
- COVID-19 will be the largest vaccine and anti-viral drug deployment in human history. The world cannot fully emerge from lockdown until billions of people have access to both vaccines and anti-virals. Vaccines provide immunity and prevent future infections, while anti-virals treat already sick patients by halting viral replication.
- Eight vaccine candidates have reached or are approaching clinical trial stage, and more than 70 anti-viral medication trials are underway. The leading vaccines are from Oxford University & Boston biotech firm Moderna, but will likely not be available to the public for another 18 months. The anti-viral drug remdesivir from Gilead has just recently been approved for public use now.
Barriers To Global Distribution
- Individual countries can, and have, engaged in export bans and hoarding of medical stockpiles. With COVID, the U.S. and EU banned export of PPE and other medical supplies. During the H1N1 pandemic, a number of countries placed large orders for the vaccine before it became available, effectively leaving none for the rest of the world.
- Intellectual property (IP) protections can make drugs inaccessible due to high prices. Patents bestow monopoly rights to the inventor to be the sole producer, distributer, and price-setter of a drug as a reward for the high costs of R&D. During a health crisis, if other producers can make the drug more cheaply then there’s a tension between honoring the IP and maximizing access.
Lessons From The AIDS Crisis
- AIDS medication in the 1990s-2000s was wildly expensive because of IP enforcement. The 3-drug treatment for AIDS cost more than $10,000/person per year. Brazil and South Africa attempted to deny the patent rights and allow local, low-cost production of generic drugs. They faced lawsuits from 41 pharmaceutical companies.
- The WTO had to step in to provide “compulsory licenses” enabling local companies to produce patented drugs without the owner’s consent. The Trade-Related Aspects of Intellectual Property Rights (TRIPS) was amended to loosen IP protections during global public health emergencies. As a result, the cost of AIDS treatment came down to $100/person per year.
Incentivizing A Low-Cost Cure
- Producers should be substantially rewarded for the invention of a cure to incentivize them to forgo their patent rights to production and distribution. Bringing a new drug to market costs more than $1 billion. A prize system could give them a substantial reward for the discovery, in exchange for other companies who produce and distribute at a much lower cost to be given the IP.
- If drug-makers don’t give up their production and distribution rights then poorer countries may have to resort to WTO “compulsory licenses” as a last resort. The TRIPS mechanism acts as a global guarantee for poor countries to gain access. But there are drawbacks like potential safety issues if local producers don’t meet quality standards.
Ensuring Distribution Equity
- Bring international organizations, governments, private companies, research institutions, and NGOs into cooperative relationships. One effort known as the Open COVID Pledge encourages companies and research institutions to make their IP temporarily available for free until a year after the WHO declares the pandemic to be over, at which point they can go back to owning commercial licenses for their intellectual property.
- Governments will have to overcome steep challenges to ensure access. Even under normal conditions transport and supply chain issues, civil unrest, and natural disasters can undermine drug delivery. In the midst of a global crisis, the logistical hurdles will be even more daunting.
About The Author
Chetan Hebbale is currently a graduate student at the Johns Hopkins School of Advanced International Studies (SAIS) in Washington, D.C. focused on international economics, climate change, and sustainability.
Prior to this, he spent over 4 years at Deloitte Consulting working on technology and strategy projects at the CDC and U.S. Treasury Department.
He is a native of Atlanta, GA and attended the University of Georgia.