In times of crisis, such as pandemic, the traditional model of patent protection can present significant barriers to the rapid development of essential medical technologies such as vaccines, diagnostics and treatments. Patents, while on one hand are crucial for monetizing innovations, but it can also create monopolies that hinder widespread access to treatments, vaccines, diagnostics etc. This in turn is problematic in the context of ever-evolving infectious diseases, whereby immediate actions are to be taken to contain outbreak of such diseases and save lives. Patent pooling and cross licensing emerge as important strategies to manage intellectual property rights and accelerate innovation during such global health crises. By pooling patents or entering into cross licensing agreements related to specific treatment or technology, multiple entities can collectively license and share intellectual property rights. By enabling collaboration and reducing the legal and financial obstacles, these strategies enhance global preparedness and response to the pandemic, ultimately saving the lives and mitigating the socioeconomic impact of such crisis. This article delves into what is patent pooling and cross licensing? The role of patent pooling and cross licensing in pandemic and the benefits of it.
What is Patent Pooling?
Patent Pooling involves consolidating patents from multiple entities into a single depository, thereby allowing participants to access and use the patents without individual negotiation. For more information refer to: Navigating Innovation: The Ins and Outs of Patent Pools
What is Cross Licensing?
Cross licensing involves mutual agreement whereby two or more parties grant each other the right to use their patent. This strategy not only avoids litigation cost over patent infringements but also promote the sharing of essential technologies.
Role of Patent Pooling and Cross Licensing in Managing Pandemic
Although the concepts of patent pool and cross licensing have not been very active in the healthcare industry as compared to other industries such as oil refining, aircraft, digital media etc., there have been instances where the patent pool has been created and licenses have been issued to reduce the cost of live saving drugs in the developing and underdeveloped countries. Following are some instances:
- Medicine Patent Pool
The Medicines Patent Pool (MPP) has been actively involved in creating pools to ensure access of medicines in developing and under developing countries. MPP is a United Nations International Organization which was founded in July, 2010, by Unitaid. MPP enters into licensing agreements with several medicine developers to allow generic manufacturer's to develop and sell generic versions of the medicine in poor countries.MPP has developed online database like MedsPal which contains information regarding intellectual property status of patented essential medicines, COVID-19 vaccines. - COVID-19 Technology Access Pool (C-TAP)
The COVID-19 pandemic has highlighted the importance of collaborative research. Article 31 of the Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement1, allows the countries to grant compulsory licenses to the companies to manufacture patented products in cases of emergencies. In 73rd World Health Assembly which was held virtually on 18th & 19th May, 2020, the Costa Rica proposed pooling patent rights to manage the pandemic through free or affordable licensing enabling the countries with limited resources to utilize the outcome of these efforts. This proposal gained global recognition, except countries like United States and United Kingdom. In furtherance to this, the WHO in collaboration with the Costa Rica launched a voluntary patent pool known as COVID-19 technology access pool (C-TAP).2C-TAP provides a unified global platform where developers of COVID-19 vaccines, diagnostics and other health products can share their intellectual property, knowledge and data with the certified manufacturers. It also supports technology transfer agreements. By using voluntary licensing and patent pooling, patent holders can have access to new markets and expand production, while ensuring they receive appropriate royalties. - Serum Institute of India and AstraZeneca
In early 2020, as the COVID-19 pandemic disrupted lives globally, the researchers of the Oxford University in collaboration with AstraZeneca developed the COVID-19 vaccine. The AstraZeneca cross licensed it to Serum Institute of India for its manufacturing and distribution in India. - Pfizer and BioNTech
Pfizer, a US pharmaceutical company and BioNTech, a German biotech firm collaborated to announce the COVID-19 vaccine. The development of the vaccine involved multiple patents. BioNTech supplied the mRNA technology, while the vaccine also utilized protein technology which was reportedly developed by the researchers at the National Institute of Health (NIH) in the USA.
Benefits of Patent Pooling and Cross Licensing in Healthcare Sector
In the healthcare sector, the patent pooling and cross licensing offers several benefits that addresses many of the industry's most pressing challenges. Some of them are as follows:
- Accelerated Medicine Development: Patent Pooling and Cross Licensing facilitates the sharing of essential patents assisting in development of new medicines.
- Enhanced Production Capacity: An important benefit of the patent pooling and cross licensing is the increased production capacity for all the parties involved. By granting large scale manufacturers access to new technologies, pharmaceutical companies can ensure adequate supply of the medicines in the market.
- Affordable Healthcare Solutions: Patent Pooling and cross licensing significantly contribute to making healthcare sector more affordable. When pool members launch a new products, competitors lower their prices to retain or attract consumers, fostering healthy competition and keeping prices within a competitive range.
- Cost effective: Patent pooling and cross licensing facilitates patent monetization as it allows the patent holder to have access to variety of patents from multiple patent holders, thereby reducing the transaction cost as they only need to enter into a single agreement rather than negotiating individuals agreements with each business and also minimizes the litigation cost associated with the infringement lawsuits.
- Time is Money: In the healthcare sector, patent pooling and cross licensing aids in saving significant time and resources. By pooling patents and cross licensing, companies can have access to wide range of technologies without needing to individually negotiate licenses, ultimately speeding up the process of bringing innovative healthcare solutions to the market.
- Noble Recognition: By pooling patents and entering into licensing agreement, companies showcase their commitment to advancing healthcare sector for a noble cause rather than individual profits. This collaborative approach assists the organizations to get recognition from their peers, stakeholders and the public, ultimately enhancing the reputation of participating companies as global leaders in promoting social welfare.
Conclusion
In conclusion, patent pooling and cross-licensing play a crucial role in managing pandemic by fostering collaboration and accelerating the development and distribution of essential medicines. Initiatives such as C-TAP and MPP showcases the benefits of these strategies. C-TAP, led by WHO and Costa Rica and MPP established by the Unitaid, facilitate the pooling of IPR to reduce the transaction cost and eliminate legal barriers. These efforts ensure that vital medical innovations such as vaccines, diagnostics and treatments are made accessible to countries with limited resources, enhancing global response capabilities. By streamlining the patent access and encouraging collective problem-solving, patent pooling and cross licensing significantly contribute to the rapid and equitable distribution of the lifesaving drugs during pandemic.
Ritvik Kashyap, Associate Advocate at S.S. Rana & Co. has assisted in the research of this article.
Footnotes
1 Available at: https://www.wto.org/english/res_e/publications_e/ai17_e/trips_art31_oth.pdf
2 Available at: https://www.who.int/initiatives/covid-19-technology-access-pool
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