Patent waivers are among the least effective, it makes great sense to build more regional vaccine production facilities around the world
By Anil Madan
The continuing Covid-19 pandemic and the stark rise of infections and deaths around the world, the horror of it most strikingly raging in India, have prompted calls for pharma companies to waive their patents on vaccine production. Indeed, there have been calls for the World Trade Organization (WTO) to waive intellectual property (IP) constraints on all products related to Covid-19 containment, treatment, and immunization. With each voice proclaiming that getting Covid vaccines to the world is a moral imperative—and, of course, it is—one is tempted to think that where there is so much smoke, there must be fire. However, a puff of white smoke over the Vatican when Pope Francis joined the chorus of calls for patent waivers, suggests more steam or smoke than fire.
A closer look suggests that this cacophony of drum-beaters is indeed pretty much all smoke and noise. The practical imperative for addressing the moral imperative of worldwide vaccine distribution is that it be done in an intelligent and effective way. The world can ill afford foolishness that trips us up. Even a superficial level of scrutiny suggests that patent waivers are among the least effective, and perhaps most dangerous steps we can take at this time. A deeper dive suggests that the problem is exaggerated and that there are better solutions. Certainly, as a long-term approach to preparedness for future pandemics and the ongoing management of Covid-19, it makes great sense to build more regional vaccine production facilities around the world. Patent waivers are not the best way to get there. Let us explore.
The WTO protocols include the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). This 1994 agreement requires almost all the 164 member nations to honour and enforce each other’s IP rights. If the holders of patents on the processes for making the Pfizer, Moderna, or Oxford Astrazeneca vaccines make appropriate filings and pay applicable fees in other WTO countries, their rights will be protected.
Without unanimity, no waiver
However, the WTO also allows its signatories to waive patent protection but this requires unanimous agreement of its 164 members. Although the US has recently indicated a willingness to go along with patent waivers at least for vaccines, Germany is opposed. Without unanimity, there will be no waiver. Pfizer is opposed to patent waivers and so is Oxford.
It will undoubtedly come as a surprise to most people that Moderna has already declared its own version of a patent waiver. In a statement released last October, Moderna stated: “Beyond Moderna’s vaccine, there are other Covid-19 vaccines in development that may use Moderna-patented technologies. We feel a special obligation under the current circumstances to use our resources to bring this pandemic to an end as quickly as possible. Accordingly, while the pandemic continues, Moderna will not enforce our Covid-19 related patents against those making vaccines intended to combat the pandemic. Further, to eliminate any perceived IP barriers to vaccine development during the pandemic period, upon request we are also willing to license our intellectual property for Covid-19 vaccines to others for the post pandemic period.”
So far, not a single company has taken Moderna up on its offer. So much for patent waivers. What is not clear is how Moderna defines “while the pandemic continues” and what its licensing terms are for the post pandemic period whenever that starts. Even if Moderna’s licensing terms were acceptable to a licensee and the investment in plant and equipment is made, the manufacture of vaccines involves much, much more than patent rights.
Vaccine manufacturing is a complex process requiring sophisticated equipment in a suitable physical plant, a skilled and trained workforce, knowledgeable scientists, and meticulous management of the supply chain. An error in managing the supply chain, a missing ingredient, or a production misstep can ruin batches of vaccines that have been in production for months.
Aside from errors or missteps, on-time input supply delivery for more than 100 components: as vaccine manufacturing must run 24/7 and is time-sensitive, all input materials and consumables need to be available when required. Lack of availability of a single component could halt the entire production process and may force the scrapping of a batch that might already have been in production for several weeks.
A company seeking to make the Pfizer, Moderna, Astrazeneca, or any other vaccine, would most likely need access to trade secrets, process knowhow, and supply chain management. None of these aspects are customarily included in patent applications. An agreement with any of these companies would cover matters well beyond just patents.
As for Moderna’s self-declared waiver on enforcement of its patents during the pandemic, it simply makes no economic sense for a plant to gear up just for a short run of vaccine production. Sure, such a plant might be adapted to making other vaccines, but that is speculative.
Nor would a reputable vaccine manufacturer want to license its product to be marketed under its brand name without stringent quality controls. A production error that generates unwanted side effects or illnesses in vaccine recipients could lead to vaccine hesitancy or rejection and ruin the reputation of a vaccine or its principal manufacturer.
Good manufacturing practices
Setting up a vaccine manufacturing operation is not something that can be done overnight. For example, Dr Drew Weissman of the University of Pennsylvania, one of the researchers who pioneered mRNA vaccine technologies stated during a May 7 interview on NPR that, since the spring of 2020, he has been working with the government of Thailand to build a GMP (good manufacturing practices) site for the production of vaccines. Although advocating for setting up more vaccine production facilities in Asia, Africa, and Latin America, he points out that a critical difficulty is the acquisition of raw materials—enzymes, nucleotides, and lipids—needed to produce the vaccines.
Whereas Pfizer has licensed the production of its vaccines, for example to Merck in the US, its CEO, Albert Bourla is opposed to patent waivers. Even if we take his comments with a grain of salt given his vested interest in the integrity of Pfizer’s patent portfolio, what he says makes sense.
Bourla warns that if patent waivers bring many would-be vaccine manufacturers, this would set off a worldwide race for raw materials that would threaten the safe and efficient manufacturing of Covid vaccines. Bourla wrote: “Currently, infrastructure is not the bottleneck for us manufacturing faster. The restriction is the scarcity of highly specialized raw materials needed to produce our vaccine.”
Pfizer’s vaccine requires 280 different materials and components that are sourced from 19 countries around the world, Bourla said. His concern is that without patent protections, entities with much less experienced than Pfizer at manufacturing vaccines will start competing for the same ingredients.
“Right now, virtually every single gram of raw material produced is shipped immediately into our manufacturing facilities and is converted immediately and reliably to vaccines that are shipped immediately around the world,” Bourla wrote.
Even if we assume that such concerns are merely self-serving or worse, ill-founded, the problem of a vaccine shortage does not seem to be curable by way of patent waivers. The contention that there is a production shortfall may itself be false. A discussion document released on March 9, 2021 by IFPMA (International Federation of Pharmaceutical Manufacturers and Associations) and co-authored by representatives from that organization as well as CEPI (Coalition for Epidemic Preparedness), and DCVMN (Developing Countries Vaccine Manufacturers Network) provides a detailed look at the challenges involved in vaccine manufacture and distribution.
The IFPMA document noted that “11 vaccines are already in clinical use in the countries where they obtained approval (often with emergency/limited authorisation), more than 80 additional candidates are in clinical trials, and hundreds of candidates are in the pre-clinical phase. At the same time, vaccine manufacturers and suppliers of vaccine components are scaling up for Covid-19 vaccine production from zero to billions of doses, with an announced cumulative supply target of up to 14 billion doses by the end of 2021.”
If the world is truly on pace to produce 14 billion doses by the end of 2021, that should put an end to discussion of patent waivers to meet the current crisis. No existing or new facility could produce any vaccines by the end of 2021, let alone producing enough to make a difference. Of course, it is one thing to have a supply target, quite another to meet it.
The world’s largest manufacturer Serum Institute (SII) of India has experienced production problems. In addition, India’s pressing need for vaccines to address the crisis at home caused SII to prioritize domestic needs and delay shipment of 90 million doses to Covax, the UN-backed program for worldwide vaccine distribution.
SII’s CEO confirmed that Astrazeneca has sent SII a “legal notice” to SII about delays in promised shipments. SII promises to resume shipments to Covax by June if infections in India subside. And if the infections don’t subside, SII’s CEO said: “I am scared of what… we will have to do, and what will happen.”
Production problems have occurred at a US contract manufacturing plant that ruined 15 million doses of the Johnson & Johnson vaccine and some 20 million doses of the Astrazeneca vaccine and the US government has banned Astrazeneca from using that facility which is now being run by Pfizer. The move is intended to prevent the conflating of the two vaccines. Astrazeneca is looking for an alternate US site.
The IFPMA document provides interesting perspectives. They say that it usually takes more than five years to build manufacturing capacity and 18-30 months to transfer production to other sites or manufacturers. The companies making the mRNA vaccines formed more than 150 partnerships with contract development and manufacturing organisations (CDMOs) and other multinational biopharmaceutical companies to transfer their technology and increase their overall production. Notwithstanding these efforts, the strain on manufacturing capacities and capabilities is very high, in light of the immediacy and scale of the demand, which may be exacerbated further if a broader coverage of the population is needed and if boosters are needed due to waning efficacy and need to protect from new variants.
Many Covid-19 vaccine supplies of raw and packaging materials, consumables and equipment are in short supply. As a result existing Covid-19 vaccine manufacturers will likely be unable to meet their current vaccine manufacturing commitments. The IFPMA document states that mechanisms to ensure input supplies for current and increased manufacturing capacity intent need to be put in place with short, medium and long term solutions.
In short, patent waivers that invite unskilled and inexperienced entrants hoping to cash in on what is seemingly insatiable demand for vaccines may actually make the problem worse. It is entirely possible that the use of Pfizer’s or Moderna’s patents without the relevant manufacturer’s trade secrets and know-how will result in the production of vaccines that require testing and proof of efficacy. In effect, these may well be unapproved vaccines that have to go through clinical trials.
A far more sensible solution is to incentivize those manufacturers producing the most effective vaccines to set up additional manufacturing capacity, backed by their know-how, experience-based knowledge, and trade secrets, in locations around the world so that production can be ramped up and delivered expeditiously. The cost of setting up new vaccine production facilities are likely similar for existing as well as new manufacturers although experience with existing plants may generate knowledge-based cost savings. Similarly, the cost of recruiting and training personnel is likely to favour an existing manufacturer since transferring knowledge from its existing plants to its new plants will be of well-defined processes and methods and less susceptible to the vagaries of trial and error.
As a practical matter, it also makes sense to ramp up capacity in this way so that if variants and mutations demand changes in the vaccines, an existing manufacturer can apply the change across all plants. We are already being told that a third shot of the Pfizer vaccine may be needed as a booster and that Moderna is planning a combination flu and Covid vaccine to be given annually. It does not take a rocket scientist to understand that with immense profits in the offing, vaccine manufacturers would be less than enthusiastic about patent waivers.
One other observation is in order. The clamour for patent waivers is generated in large part by the sense that vaccine distribution around the world has been inequitable and has favoured high income countries. This is true, but it is a reflection of the fact that some countries took the prudent step of pre-ordering large quantities of vaccines in advance of knowing whether they would work. Of course, the high income countries had the resources to do this.
But a side benefit of this process should not be ignored. If the US, for example, had not pre-ordered vaccines that are now surplus to its needs, those vaccines may never have been manufactured as they have been. They are now available for redistribution by the U.S. by way of gift or sale. Indeed, the EU has just ordered 900,000 million doses of the Pfizer vaccine with an option for 900,000 million more. The amounts ordered by the EU exceed its needs.
One must not forget that Ursula von de Leyen was severely criticized for mucking up the EU’s vaccine ordering strategy. The EU even raided Astrazeneca’s facilities and accused the company of favouring other countries outside the EU. Now, von de Leyen is calling on the US to match the EU’s level of vaccine exports. This is political grandstanding. The US will soon be in a position to distribute tens, if not hundreds of millions of vaccine doses.
But it is important to remember that the cold chain storage requirements for maintaining the stability and effectiveness of the Pfizer and Moderna vaccines will make exports from the US a difficult problem. Canada and Mexico bordering the US to the north and south may be the beneficiaries of this happenstance.
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