How Compensating Innovators Could Help Lift Lockdown due to COVID-19

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For quicker lifting of lockdown, the innovators or entrepreneurs holding IP rights over novel technologies with potential to improve diagnostics and therapeutics for COVID-19, who may otherwise be unable to launch the products at scaled up level due to financial and operational constraints should be suitably compensated for the value of their IP rights by the public bodies and/or pharma/biotech giants which would in turn enable the novel technologies to see the day of mass production to fight the infection effectively thus helping lift the economic lockdown sooner.

Lockdown

Coronavirus pandemic caused by COVID-19 has taken the entire world by storm and COVID-19 cases are rising daily with the figure crossing 2.3 million globally on 19th April (1). Presently, the only way of prevention from COVID-19 is social distancing, i.e. staying away from each other, till a cure is developed in terms of small molecule drugs (2), vaccines (3) and/or antibody therapy (4). In order to maintain social distancing, various governments across the world have imposed mandatory lockdowns to ensure people stay at home to halt the spread of the virus. In countries where lockdowns have not been enforced by authorities, people are trying to learn from others across geographical boundaries and maintaining social distancing themselves by avoiding social gatherings and also staying indoors to prevent themselves from contracting COVID-19.

Although lockdown is imperative to avoid further spread of COVID-19, it has brought the world economy to tatters (5) due to huge losses by virtue of businesses and establishments being closed indefinitely till lockdown continues. In addition, there is a huge social cost with impact on people’s relationships and mental health of individuals due to confinement indoors and being unable to interact face to face with each other, leading to problems such as depression, mood swings etc. Medical fraternity, general public and government experts are battling with disease with the following questions in mind. How long should the lockdown continue? What could be the lockdown lifting strategy? Complete or in phases. How can we mitigate the consequences of lockdown? Unfortunately, there is no easy and straightforward answers to all these questions and each person or entity has his/her own perception of what the future is going to be, both short-term and long-term.

However, one thing which is certain is that huge investments have been and are being made not only to contain the COVID-19 disease but also to develop diagnostic and therapeutic interventions that can help in managing the COVID-19 pandemic. The consequences of lockdown can be minimised and its lifting can be eased depending on how quickly diagnostics and therapeutics can be developed. In the wake of this crisis, the world is looking at the entire global scientific community, particularly smaller organisations to bring out innovative technological solutions, in the area of COVID-19 diagnostics and treatment, by being more flexible and agile compared to the bigger giants. While these innovators can provide path breaking technologies, they may not possess the manufacturing capability and distribution reach to bring their product to the masses. In this regard, the bigger companies, philanthropic foundations and other high net worth individuals need to provide the financial muscle required for large scale production and marketing of the product. This can be done by rewarding the innovator either through outrightly purchasing the IP rights owned by the innovator or by entering into an exclusive/non-exclusive licensing agreement to use innovator’s technology for manufacturing and distribution on a bigger scale. The financial stimulus can also be provided by the various governments as well in order to make these technologies available at an affordable cost to the people. This view has been expressed in an article by Prof. Elias Mossialos (6). He emphasized that various governments and philanthropic organisations should come forward and intervene in this crisis situation to fund and/or purchase the technologies from the innovators and then translating them in a manner that it becomes available to general public at an affordable price.

The concept of in licensing technologies from innovators by other companies and then translating them into a realisable product is nothing new and has been in vogue. Small innovator companies either outrightly sell their intellectual property rights of the technology for a one-time fee or enter into a licensing agreement with a bigger company with more financial power, in which the smaller innovator companies get an upfront payment followed by royalty on sales and milestone payments depending on the terms and conditions of the agreement. The concept of utilisation of patents by in licensing for a fee has been elegantly captured and referred by Prof. Elias Mossialos in his book titled “Policies and incentives for promoting innovation in antibiotic research’’, where he analysed the opportunities and incentives to stimulate R&D for antibiotics, and proposed of having a ‘Patent Pool (PP)’ as “a coordinating mechanism that enables the collective acquisition and management of IP for use by third parties for a fee’’ and ‘Product Development Partnerships (PDP’s) as a vehicle to provide greater collaboration among different entities.

The concept of ‘PP’ is that it can be populated by patents coming either from public or the private sector. Any entity that wishes to utilise the patent to develop the novel product can in licence the patent from the pool by paying an upfront fee and/or royalties on the sale of the product later. This can help reduce transaction costs and barriers to market entry resulting from IP protection. Prof. Mossialos also discusses examples in his book where patent pooling was helpful, pertaining to antibiotic research.

In case of PDP’s, entities can enter into a greater collaboration by aiming at product development from the end of clinical phase all the way upto clinical trials. This would result in completion of the product development with various entities sharing the risk and the reward.

Development of a similar concept of ‘Patent Pool’ and ‘Product Development Partnerships’ is the need of the hour today as the world is grappling with the COVID-19 pandemic. The ‘Patent Pool’ will provide a mechanism wherein different entities can contribute by providing their patents, which can then be picked up by interesting and capable companies/research institutes to further develop COVID-19 diagnostic and/or therapeutic products quickly so as to help lift the lockdown soon. Once developed, the ‘Product Development Partnerships’ concept comes in where different/same companies pick up the developed product and enter into clinical development and validation.

Another option of ‘Marketing and Commercial Partnerships (MCP’s)’ following PDPs is proposed once the product is developed and manufactured and ready for commercialisation. This involves companies entering into marketing agreements with the developer of the product for marketing and commercial rights in various geographies across the world in order for the product to reach the entire global population without any major issues. The skills required of companies participating in MCPs are very different than that of companies/institutes involved in PDPs. MCPs can even involve different state governments and public health institutions if there is a need to supply a product at an affordable rate to the population of a particular country to lower the disease burden

The amount of finances involved in developing the concepts of PPs, PDPs and MCPs for COVID-19 is far less than the amount of money the individual countries are losing due to lockdown and other consequences related to the pandemic.

The point that needs to be taken home here is that, in this pandemic situation which the entire world is experiencing regarding COVID-19, the concepts pertaining to PPs, PDPs and MCPs if developed can lead to a swift development of a diagnostic and/or therapeutic regimen concomitantly with compensating the relevant discoverers and developers of the product.

The resulting new and affordable diagnostic procedures and therapeutic interventions for COVID-19, would ease lockdown possibilities moving forward, perhaps much earlier than anticipated and save economic losses that the world is suffering from.

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References:

1. Worldometer 2020. COVID-19 CORONAVIRUS PANDEMIC. Last updated: April 19, 2020, 14:41 GMT. Available online at https://worldometers.info/coronavirus/ Accessed on 19 April 2020.

2. Gordon CJ, Tchesnokov EP, et al 2020. Remdesivir is a direct-acting antiviral that inhibits RNA-dependent RNA polymerase from severe acute respiratory syndrome coronavirus 2 with high potency. J Biol Chem. 2020. First Published on April 13, 2020. DOI: http://doi.org/10.1074/jbc.RA120.013679

3. Soni R., 2020. Vaccines for COVID-19: Race Against Time. Scientific European. Published on 14 April 2020. Available online at https://www.scientificeuropean.co.uk/vaccines-for-covid-19-race-against-time Accessed on 19 April 2020.

4. Temple University 2020. Temple Treats First Patient in the U.S. in Clinical Trial of Gimsilumab for Patients with COVID-19 and Acute Respiratory Distress Syndrome. Lewis Katz School of Medicine News Room Posted on 15 April 2020. Available online at https://medicine.temple.edu/news/temple-treats-first-patient-us-clinical-trial-gimsilumab-patients-covid-19-and-acute Accessed on 19 April 2020.

5. Maital S and Barzani E 2020. The Global Economic Impact of COVID-19: A Summary of Research. Samuel Neaman Institute. Published March 2020. Available online at https://www.neaman.org.il/Files/Global%20Economic%20Impact%20of%20COVID-19.pdf Accessed on 19 April 2020.

6. Mossialos E., 2020. Paying innovators is the way out of lockdown. The Times. Published 15 April 2020. Available online at https://www.thetimes.co.uk/article/paying-innovators-is-the-way-out-of-lockdown-b3jb6b727. Accessed on 19 April 2020.

7. Mossialos E, Morel CM, et al, 2010. Policies and incentives for promoting innovation in antibiotic research. European Observatory on Health Systems and Policies WHO. Available online http://www.euro.who.int/__data/assets/pdf_file/0011/120143/E94241.pdf Accessed on 16 April 2020.

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