Compulsory licensing of a COVID-19 vaccine: Ensuring global access

A selection of recent media articles about the development of and access to a vaccine for COVID-19.

Gabriela Sánchez Escamilla is a law student at Universidad de los Andes in Bogotá, Colombia. 

We are facing a historic moment. In less than 4 months, COVID-19 has become a pandemic of proportions nobody could have imagined. Right now, news about research for the development of a vaccine or other medical treatment to contain and mitigate the effects of the COVID-19 is encouraging. Indeed, as the world is fighting the effects of this virus, there is a critical need for personal protective equipment, pharmaceuticals, diagnostics and ventilators, which may be in short supply both in high-income and low-income countries. For this reason, concerns have been raised about the difficulties for the production and distribution of a future vaccine, as well as its possible high cost. This is because the protection of intellectual property rights, especially in the case of pharmaceuticals, can be a potential barrier to public health protection.

On this scenario, compulsory licenses can be used to face these challenges. Compulsory licensing is a powerful tool that lets governments make medical equipment and potentially life-saving pharmaceuticals rapidly available. It occurs when a government allows someone else to produce a patented product or process without the consent of the patent owner. It is one of the flexibilities that exist in patent law when welfare and public health are at stake. In fact, the World Trade Organization's (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) provides for compulsory licensing in Article 31, subject to certain conditions. 

Many domestic jurisdictions contemplate compulsory licensing (or similar tools) in their patent laws, and in some of these countries research on a COVID-19 vaccine is taking place. In the UK, for example, Patents Act of 1977 (specifically Sections 54 to 59) provides for “Crown Use,” under which any government entity can sell or offer for sale a patented product in the context of a period of emergency for “securing a sufficiency of supplies and services essential to the well-being of the community.” In addition, there is a compulsory licensing regime according to which an applicant can request the UK Intellectual Property Office for a license (subject to reasonable compensation) when a patented invention is not being made available in the UK to the fullest extent reasonably practicable and after unsuccessful efforts to obtain the license from the patentee.

Another example is the United States. Even though there is not a compulsory licensing regime as such, similar tools are available. First, there is 28 U.S. Code sec. 1498 (a), which entitles the government to use or make any invention without the patentee’s permission. Although this statute provides for reasonable compensation for the patent owner, this might not be the case with COVID-19, since it carves out this option when the adjudicating court finds that the position of the government was “substantially justified.” In addition, there is the Bayh-Dole Act (35 U.S.C. § 203(c)(4) and 35 U.S.C. § 203(a)), which gives“march-in-rights” to the government to require a patentee of a patent created with federal funding to grant a license to a third party when “health or safety needs” are not being “reasonably satisfied” by the patent holder.

This kind of regime seems promising to the objective of making a future COVID-19 vaccine widely and rapidly available, atleast within each country. However, what would the  situation be  in a country with insufficient research and production capacity for the development of pharmaceuticals? Does compulsory licensing offer any solution?

The WTO’s Doha Declaration on the TRIPS Agreement and Public Health (2001) addressed this issue, as it recognized that WTO Members with insufficient or no manufacturing capacities in the pharmaceutical sector could face difficulties in making effective use of compulsory licensing. Therefore, Paragraph 6 of the Declaration created a new form of compulsory license specifically for the export of medicines, under which these countries can obtain cheaper copies produced under compulsory licenses elsewhere if necessary. This amendment to the TRIPS Agreement came into force on January 23, 2017.

According to the Decision on the Implementation of Paragraph 6, this mechanism works as follows. First, an eligible importing Member must make a notification to the Council of TRIPS specifying the names and expected quantities of the products needed. Second, an exporting Member will issue a compulsory license to produce only the amounts necessary to meet the needs of the importing Member. Third, before shipping, the products shall be clearly identified, and measures must be implemented to prevent trade diversion or re-exportation. Finally, adequate remuneration shall be paid in the exporting Member. 

To date, the Doha Declaration solution has been used only once. In 2007, Rwanda notified that it intended to import a fixed dose combination of antiretroviral drug manufactured by the Canadian pharmaceutical manufacturer Apotex. After Canadian authorities issued the compulsory license, Apotex exported three batches of the antiretroviral medicine between 2008 and 2010. This system, however, has been subject to criticism due to its bureaucratic and unprofitable character. Nonetheless, compulsory licenses are a powerful tool in the hands of governments, which have shown its effectiveness even by the mere threat of its use, both for obtaining voluntary licenses and for lowering prices.

We are facing a historic moment. Compulsory licenses, and in particular those issued  under the Doha Declaration solution, might prove more important than ever. Nonetheless, as shown above, the system is not flawless. Luckily, many companies are being responsive to this situation and have reoriented their behavior towards flexibility with their intellectual property rights. For example, American pharmaceutical AbbVie dropped its license on its antiviral drug Kaltura, which is undergoing trials for use against COVID-19. In addition, an initiative called Open COVID Pledge has emerged, with the aim of convincing and helpingcompanies and institutions to give free licenses to their patents, copyrights, and other property rights to anyone that is developing technologies for the diagnosis, prevention, or treatment of COVID-19. These types of initiatives are certainly encouraging. Still, compulsory licensing is a tool that should not be underestimated and should be seriously and responsibly considered whengovernments are faced with the challenge of guaranteeing global access to COVID-19 treatments.