The idea of patent pools to facilitate medical research is gaining ground [8
]. In addition to the examples listed above, patent pools have been proposed in the field of genetics, particularly for gene-based diagnostic testing [6
]. The United States Patents and Trademark Office has explored the potential utility of patent pools for facilitating innovation in biotechnology, particularly for genome-related research. At a panel on the UNITAID patent pool at the 2008 Mexico City AIDS Conference, representatives of drug companies also expressed their openness to the idea [9
]. Pharmaceutical giant GlaxoSmithKline (GSK) has announced that it would make available its neglected disease-related patents through a pool and has called on other companies to follow suit [10
]; others would be able to access those patents to develop medicines for the world’s Least Developed Countries. Notably, GSK so far has not included HIV-related patents in the pool, which has prompted UNITAID to call on GSK to join the UNITAID initiative [11
]. The Indian Pharmaceutical Alliance (IPA) endorsed the UNITAID patent pool initiative in its meeting on 5 September 2008. Finally, patent pools were among the innovative approaches to research & development included in 2008 by the World Health Assembly in its Global Strategy and Plan of Action on Public Health, Innovation and Intellectual Property [12
The adoption of the Global Strategy and Plan of Action by the WHA signals a normative shift in international expectations regarding how the inter-related issues of trade, health and intellectual property ought to be managed. Specifically, there is widespread recognition that a purely market-based system for health R&D suffers from major shortcomings: first, patent monopolies lead to high prices of essential medicines, thereby restricting access; second, priorities are set by the size of the market, not by health needs, which leads to over-investment in some disease areas and neglect of others; and finally, the proliferation of patent monopolies can retard rather than accelerate innovation. A patent pool is one way of managing IP from a public health perspective and to counteract high prices, spur needs-driven research, and facilitate innovation.
The potential and hopes for the UNITAID patent pool are high, but key details will determine whether the pool is a success. In order to achieve both vigorous generic competition and economies of scale in production, the size of the potential market must be sufficiently large. While the default geographical scope of the pool will include all non-high-income countries, companies may specify that certain markets are excluded from the patents that they put into the pool. Companies are urged to allow for sufficient scope in the licenses so that medicines production can be efficient and competitive. Furthermore, it will be critical to obtain licenses for patents relevant to priority medicines so that optimal FDCs can be developed; for example, if two out of three patent-owners agree to allow generic production of a triple FDC, but the third one does not, the entire combination could be undermined.
These concerns highlight the importance of voluntary contributions to the patent pool. Why would pharmaceutical companies participate? First, as noted above, companies will receive royalties for the use of their IP. Second, companies can expect a reputational boost from taking pro-active measures to improve the global access to medicines situation. Third, they can reduce both the monetary and political transaction costs associated with negotiating licenses and price reductions on a case-by-case basis. Fourth, they may get access to new markets and increased information about those markets. Finally, they can avert the political costs of IP-related conflicts, particularly, the risk of compulsory licensing of their patents.
If a workable arrangement for access to intellectual property through mechanisms such as the patent pool cannot be achieved, both patients and companies stand to lose. Not only will the development of needed FDCs become far more difficult, but the prices of second-line and other new drugs are also likely to remain out of reach. Without access to affordable medicines, governments may choose to take advantage of available flexibilities in the World Trade Organization (WTO) Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) to override patents to meet public health needs [13
]. Certainly, doing so would provide countries with the benefit of lower-cost generic alternatives to monopoly-priced drugs. However, since compulsory licenses must be granted country-by-country, at a global level this approach is less likely to achieve economies of scale rapidly, would entail higher transaction costs, imply greater uncertainty for generic producers, and require significant political capital. Current WTO rules also make the export of drugs produced under compulsory license a complex, lengthy and cumbersome process [14
The time is ripe to find new, reliable, sustainable and predictable ways – such as through patent pools – of ensuring widespread access to new essential medicines [12