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A Generic Solution: Suspension of patent rights for Covid-19 vaccines could save millions of lives

Since the Covid-19 pandemic began in early 2020, Americans have considered vaccines to be their ticket back to normalcy. Pharmaceutical companies like Pfizer, Moderna, and Johnson & Johnson quickly became household names as the entire world followed the top vaccine candidates and their race through clinical trials. By January 2021, just 10 months after Covid-19 was declared a pandemic, widespread inoculation had begun in the United States. For Americans, this signaled the beginning of the end to this difficult and deeply isolating time in our nation’s history, but for dozens of developing countries around the globe, relief is nowhere in sight.

While many wealthy countries are on track to vaccinate large swaths of their citizens by the spring or summer of 2021, some developing countries still do not know if or when they will receive the vaccine. By the end of January, over 90 million vaccine doses had been administered worldwide; only 25 of those doses were administered in sub-Saharan Africa, a region with over 1 billion people. According to research conducted by the People’s Vaccine Alliance, nearly 70 low-income nations will only be able to vaccinate 10 percent of their population in 2021. This unequal distribution of vaccine doses is a moral failing, a public health crisis, and an economic catastrophe. The only way to vaccinate a larger portion of the world on an acceptable timeline is to increase manufacturing across the globe. Luckily, there is a way to do this: Suspend intellectual property rights and allow companies to produce generic vaccines.

In October 2020, South Africa and India put forward a proposal to the World Trade Organization (WTO) to exempt member countries from the obligation to enforce patent rights, trade secrets, and pharmaceutical monopolies under the WTO’s Agreement on Trade-Related Intellectual Property Rights, known as TRIPs. This proposal would allow countries with unused manufacturing capacity to produce vaccines, bringing additional doses to market and into people’s arms more quickly. It received widespread enthusiasm, with over 100 of the 164 member countries in support.

Given that the WTO generally makes decisions on consensus, the proposal failed. It was opposed by the United States, Canada, the European Union, Britain, and others, nearly all of which are wealthy countries with existing and robust contracts with vaccine manufacturers. According to spokespeople from these countries, suspending intellectual property rights to manufacture vaccines and treatments during the pandemic would stifle innovation and undermine existing efforts to combat Covid-19. A representative for the UK mission to the WTO called the proposal “an extreme measure to address an unproven problem.”

What US and UK trade officials fail to understand, though, is that the unequal distribution of vaccines is not just a problem for developing countries. According to researchers at Northeastern University, the widening inoculation gap between developed and developing countries will extend the pandemic for everyone, and the current monopolization of vaccines by rich countries is projected to cause twice as many deaths as a plan for global distribution of vaccines would. If international travel returns to near pre-pandemic levels before every country has vaccinated large portions of their populations, people with Covid-19 from countries with low vaccination rates will inevitably travel to countries like the United States, disrupting progress toward herd immunity. As the media and public health officials love to say: “No one is safe until everyone is safe.”

This risk is even more severe with the emergence of new Covid-19 strains around the world. While the vaccines on the market offer some protection against all of the identified variants currently, recent clinical trial data suggests that most vaccines are less effective against some of the new strains, especially the one originating in South Africa. If the virus is allowed to continue to spread and mutate in developing countries, there is a reasonable chance that eventually a variant will emerge that is resistant to the lauded protection offered by vaccines. In that worst case scenario, the entire global population might have to endure more lockdowns until vaccinations for the new variant become available. Unless the virus is prevented from spreading from person to person—which can only be achieved through widespread, global inoculation—the risks of vaccine-eluding variants arising will remain a concern.

While public health has been and should continue to be the chief concern for governments around the world fighting Covid-19, it is worth considering how unequal vaccine distribution will impact the global economy. According to a recent study from the National Bureau of Academic Research, in a scenario in which wealthy countries are mostly or fully vaccinated by the end of June and poor countries are mostly boxed out, the global economy would suffer losses upward of $9 trillion. While these losses would be felt everywhere, the majority would be felt by wealthy countries. Selva Demiralp, one of the authors of the study and a former economist at the Federal Reserve, echoes the sentiments reflected in the idea that no one is safe until everyone is, stating that “no economy will be fully recovered unless the other economies are recovered.”

While the WTO proposal has clear advantages, especially during the Covid-19 pandemic, it is important to recognize the possible ulterior motives of the countries pushing this plan. The proposal would require vaccine producers like Pfizer and Moderna to release information on their confidential processes for drug production to the benefit of the generic drug manufacturing industry. Generic drug companies could then mass-manufacture vaccines, directly competing with the companies that developed the vaccines in the first place. India, one of the proposal’s sponsors, is the leading exporter of generic drugs in the world. South Africa, the proposal’s other sponsor, is also a leader in this industry and is home to Aspen, one of the world’s top generic drug manufacturers. Certainly, it would be naïve to suggest that South Africa and India are just looking out for developing countries with their proposal. In reality, their domestic pharmaceutical industries would greatly benefit from this change now and in the future.

It is likely that India and South Africa’s economic motivations for sponsoring the WTO proposal have deterred wealthy countries from backing it. If the proposal were passed, demand for vaccines from companies like Pfizer and Moderna would decrease as other sellers (e.g. Indian and South African companies) entered the market. While many US vaccine companies received federal funding for vaccine development, these companies also invested billions of their own dollars into research and development for their vaccine candidates. It is impossible to know right now how suspending intellectual property rights for vaccines would impact the sales of leading vaccine producers, and in the event that it cuts into their profits, it is possible that doing so would disincentivize them from moving as quickly on vaccine production in the future. That said, given that many of these companies are expected to make north of $10 billion in sales based on existing contracts, Covid-19 vaccines will still be an extremely lucrative product for pharmaceutical companies even if generic vaccines were to cut into their market. In addition, the positive press and goodwill resulting from developing effective vaccines will stick with these companies for years to come. This could enable them to effectively lobby against government regulation and may increase their sales of other drugs.

Even if pharmaceutical companies lose a few billion dollars in sales to generic vaccines, governments could choose to compensate them for their lost profits in order to incentivize future innovation. With people’s health and future vaccine profits at stake, neither governments nor the companies themselves would want big pharma to delay vaccine development during the next pandemic. In the present day, however, South Africa and India’s WTO proposal is unlikely to pass, leaving the world’s most vulnerable countries to fend for themselves in a devastating pandemic that surely requires global cooperation.

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