More pandemic-style price fixing won’t help global health

This week, 19 members of the House Ways and Means Committee appeared. wrote on President Biden opposes policy expansion Pandemic-era exemptions Regarding intellectual property protection for the new coronavirus infectious disease vaccine. Despite evidence that this exemption fails to facilitate developing countries’ access to these vaccines, and serious supply chain deficits remain unresolved, threatening future drug development and innovation. Biden administration and world trade organization I’m considering extending it to include Diagnostic tools and treatments for COVID-19.

weakened pharmaceutical They blame giant corporations for excessive profits from patented medicines, even though these companies are benefiting. Billions of dollars in public contracts and Government-approved liability exemption —It has a lot of populist appeal. Unfortunately, pegging the price of intellectual property at zero would impede the development and market launch of new U.S. medicines, jeopardizing the nation’s critical leadership in global public health innovation.

In June 2022, the WTO exempted all member countries from certain parts of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). After lobbying by Developing countries and withdrawal US initial opposition.

While this move hurt U.S. drug companies, it benefited the large generic drug industries in India and South Africa. Countries India and South Africa had been lobbying for pandemic exemptions and loosening intellectual property protections for decades before that.That’s what I was told it will be so Increase the availability of critical vaccines by allowing generic manufacturers to scale up production and reduce costs without paying royalties.

These claims were greatly exaggerated. Low vaccination coverage and poor access in many developing countries persist for very different reasons, including: Misinformation about the new coronavirus infection Logistics and supply chain constraints Transportation and infrastructure challengesshortage Proper storage locationlack of access to raw materials Due to factors such as trade barriers and the technical challenges of manufacturing complex drugs and biologics.

Waivers of patents were of little help. Of the 635 million vaccine doses procured through World Bank loans, only 503 million were distributed by mid-2023.Vaccination coverage in low-income countries Approximately 30% remainedtwo years behind the United States.

This is not surprising. Even before the TRIPS exemption, commercial contract Between vaccine patent holders and manufacturers across developing and developed countries, sufficient quantities of vaccines are available. 70% or more The human population is expected to arrive by November 2021, and there is no more untapped manufacturing capacity left.

For example, AstraZeneca and other drug companies had a deal with the Serum Institute to manufacture millions of doses of the vaccine in India. 12 billion doses The TRIPS exemption was in effect worldwide before it was actually ratified in mid-2022.

This is different from the TRIPS waiver of intellectual property protection. Any manufacturer As of late 2023, commercial license agreements have facilitated the transfer of technical manufacturing know-how and quality standards needed to manufacture and deploy effective vaccines.

Conversely, abandoning IP for short-term low prices, or warning that IP protection may quickly be eroded, will hinder the development and approval process of future pharmaceutical and biotech innovations. , which takes away some of the incentive to invest in deployment.

It’s true that it’s over $31.9 billion The total amount of U.S. public investment was critical to the development of what would become the COVID-19 mRNA vaccine.But they wouldn’t have made it to the market without private investment. Most of the public funds went toward securing orders for 2 billion doses, subject to an effective vaccine.

However, billions of additional private funds were poured into the drug’s research, development, launch, and securing the necessary regulatory approvals.The development process for these specific vaccines started decades agofunded by high-risk, high-risk investments in research and development, to reduce these costs. Unique patent rights.

These patent rights will eventually enable the manufacture of generic drugs. With predictable expiration dates, generic manufacturers people who don’t face For about the same initial cost, you can take advantage of innovations that wouldn’t exist otherwise.Generic drugs are usually expensive to manufacture millions of dollars. In contrast, the average cost of bringing a single FDA-approved drug to market is $1.3 billionincludes out-of-pocket costs, capital costs, and sunk costs of failed attempts.

Infringing intellectual property rights not only prevents an unknown number of future innovations from reaching the market, but also potentially diverts U.S. research investment to competing countries such as China, where intellectual property is well protected. . has been strengthened To attract inventors to patent their technology.

New lipid nanoparticles This vaccine is easier to supply mRNA to cells than current vaccines, can be stored at high temperatures, and has fewer side effects. already developed. Extending pandemic-era intellectual property exemptions would send a negative signal to these efforts and future efforts to deliver immense public health benefits to the world’s population.

Since COVID-19 is no longer the public health emergency it once was, now is a good time to revoke the TRIPS exemption.

Sathya Maral He is a Visiting Graduate Fellow at George Mason University’s Mercatus Center, specializing in competition law, innovation, and governance.