Will patent waiver really deliver Covid vaccine worldwide?

Cantillon: Balancing costs of research and needs of poorer countries is a challenge

US president Joe Biden in the East Room of the White House on Monday. He has backed calls to waive patents on Covid-19 vaccines. Photograph: Nicholas Kamm/AFP via Getty Images

US president Joe Biden in the East Room of the White House on Monday. He has backed calls to waive patents on Covid-19 vaccines. Photograph: Nicholas Kamm/AFP via Getty Images

 

Following US president Joe Biden’s backing for calls to waive patents on Covid vaccines, the World Trade Organisation said on Monday it hoped to reach a “pragmatic” solution on the issue by December.

Arguments about patents are emotive but they generally revolve around two issues: price and supply.

Pharma companies argue that they need to make a profit in what they see as the relatively short lifetime of patent protection to meet their wider research and development costs and deliver sufficient profit to incentivise a high-risk process.

Those looking for wider access to medicines say that imposing such prices on markets in low- and middle-income countries effectively deprives them of supply as they cannot afford to pay them on local earnings.

On supply, the opposing sides argue variously that patents choke supply by shutting generic players out of the market and that supply is constrained by the pace at which companies can actually physically build and get manufacturing infrastructure cleared. Then there is suspicion that manufacturing supply is deliberately kept tight to support prices.

On Covid, how do these factors play?

Cost price

In price terms, AstraZeneca’s vaccine is being sold at cost for the duration of the crisis. And Pfizer chief executive Albert Bourla says low-income countries are being offered its vaccine at cost price under a tiered pricing structure pioneered worldwide by Gilead for HIV medication.

On supply, as of now, it appears vaccine manufacturers are churning out doses as fast as they can secure manufacturing capacity and raw materials. Unprecedented manufacturing agency deals have been struck with direct rivals precisely to accelerate production within those constraints.

And this remains a very new line of vaccines. AstraZeneca, Johnson & Johnson and Pfizer have all suffered blips in the manufacturing they control.

It remains unclear if bypassing patent protection will actually speed up delivery of vaccines worldwide, especially as Pfizer and others are confident they can match global demand by next year.

Meantime, as AstraZeneca made clear to US authorities, the fastest way Biden’s administration can help developing countries is to release its own stockpile of vaccines, including the tens of millions of doses of AstraZeneca’s two-shot regimen, which have yet to be authorised for use in the US market.

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