The case for compulsory licensing of Covid vaccine

Compulsory licensing refers to the use of a patent without the authorisation of patent holder. The TRIPS Agreement gives govts flexibility in managing patents for public goods such as pharmaceuticals

The case for compulsory licensing of Covid vaccine

V Venkateswara Rao

Until last week, about 118 million people have received at least one dose of the vaccine in India, which is only about a tenth of the 1.35 billion population. To vaccinate three in five Indians, the standard set by WHO to reach herd immunity, the country needs 150 to160 crore doses of vaccine.

India is currently producing only 65 million doses every month. Bharat Biotech makes only 5 million doses of Covaxin per month. Serum Institute of India (SII) rolls out 60 million doses of Covishield per month.

Though India has a targeted average vaccination rate of around 4 million a day, the country needs to increase the vaccination target to at least 10 million per day. Professor Giridhar Babu, head of life course epidemiology at the PHFI, told media in the second week of April, that India needed to give between 7 million and 10 million vaccine doses per day “if we want to make a dent in terms of reducing mortality”.

Considering an ideal vaccination rate of 10 million doses per day, India needs about 330 doses of vaccine (including a 10% possible wastage) per month. This requirement will be five times more than the current production rate of 65 million doses per month. India is already considering the option of import of foreign vaccines. But considering the fact that the world is short of vaccines, India cannot expect to import huge quantities of foreign vaccines.

This makes a crying need for the compulsory licensing of vaccines. Granting compulsory license to Indian pharma companies for manufacture of foreign vaccines, though permissible under Doha Declaration, could be a tricky issue with some reluctant foreign patent holders.

Compulsory licensing refers to the use of a patent without the authorisation of the patent holder. Signed concurrently with the establishment of the World Trade Organization (WTO) in 1994, the TRIPS Agreement sought to create a global intellectual property rights regime that would harmonize legal standards across WTO member states. Prior to the TRIPS Agreement, many countries excluded pharmaceutical products from patentability in order to ensure that drug prices were affordable.

India and Brazil, for example, had prior to TRIPS Agreement, allowed only process patents and not product patents. This permitted domestic generic pharmaceutical companies to reverse-engineer and produce bioequivalent drugs at affordable prices.

The TRIPS Agreement, however, provides governments with some flexibility in managing patents for public goods such as pharmaceuticals. In particular, the Doha Declaration on the TRIPS Agreement and Public Health issued in November 2001 clarifies a key flexibility afforded to countries under Article 31 of the TRIPS agreement - the right to grant compulsory licenses. Clause 5(c) provided that: “public health crises, including those relating to HIV/AIDS, tuberculosis, malaria and other epidemics” can constitute “a national emergency or other circumstances of extreme urgency.”

There can be no bigger crisis than the present Covid second wave sweeping India, that qualifies as a “national emergency”. The Controller of Patents would be morally and legally justified to suo motu grant the compulsory license of vaccines to competent public and private sector companies, in order to boost up the production manifold.

Some foreign drug companies like Moderna have made it clear last year that they would not enforce the Covid-19 related patents against vaccine producers and would also offer voluntary licenses.

There are also past precedents - 'Big Pharma' companies like Gilead and Merck have granted voluntary patent licences to Indian pharmaceutical companies for their patented drugs for diseases ranging from HIV to hepatitis to diabetes. It depends on the Indian Government's negotiation skills to convince the foreign patent holders.

Covaxin is the only vaccine developed under the "Indian" Intellectual Property (‘IP’) rights regime. Covishield, is the IP of AstraZeneca sub-licensed by SII. AstraZeneca is a British-Swedish company that itself has an exclusive license of the IP from Oxford University.

Even though it may take some time for the production facilities to be set up and scaled up by the new manufacturers - it would a risk mitigation tool for the Indian Government to grant the compulsory licensing for the indigenously developed Covaxin and also for all possible foreign vaccines.

(V. Venkateswara Rao is an alumnus of IIM, Ahmedabad and a retired corporate professional. Views expressed are personal)

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