v1.0 researched and written by Danielle Navarro, edited by Suerie Moon, last updated February 2019
The literature around patent pool is considerable*, with most of the analyses focusing on the Medicines Patent Pool (MPP). The literature seems to be produced mostly from 2010 onwards.
Patent Pool; Patent Pool and Biomedical, and Research and Development; Patent Pool and Research and Development
SYNTHESIS OF THE LITERATURE
Patent pools are mechanisms that aim to facilitate both research and development (R&D) and access to medicines within the context of the existing international intellectual property rights framework. Because R&D can require access to many patents held by different entities, product developers may need to negotiate rights to use IP and pay royalties to different patent owners. To address this complex patent landscape, patent pools were conceived as ‘“one-stop shop[s],”’ wherein different IPR holders license their patents into the pool to be bundled together for licensing out (subject to payment of a corresponding royalty), to the other patent owners and/or to third parties (Hoffman and So 2015).
Licenses granted by patent pools have been referred to as “‘one-stop licenses’” since it cuts the need to negotiate individual licenses with the various patent holders and instead offers all patents relevant for a particular invention in one license agreement (van Zimmeren et al. 2011). Though they were frequently used in the information technology field, Heller and Eisenberg (1998) expressed skepticism that patent pools would be attractive to drug developers considering that patent exclusivity is deemed particularly valuable and profitable in this field (Heller and Eisenberg 1998).
The pooling of patents, which can make existing patents on compounds accessible to third parties, is expected to facilitate the development of fixed-dose combinations or paediatric formulations of existing drugs, as well as allow generic drug development to begin before the relevant patent term expires (Satyanarayana and Srivastava 2010). Patent pools, in general, are credited for lowering costs for license negotiations, decreasing the risk of patent litigation and addressing the issue of “blocking patents” (Grassler and Capria 2003).
Most of the literature has focused on one particular initiative, the Medicines Patent Pool (MPP). The MPP was created by UNITAID in 2010 (Wirtz et al. 2017). Bermudez and Hoen (2010); Childs (2010) discuss the considerations in setting up the patent pool (Bermudez and Hoen 2010; Childs 2010). MPP focuses on making priority antiretroviral drugs (ARV) covered by existing patents accessible to patients in low and middle income countries (LMICs) by obtaining voluntary license agreements from various patent owners, then sublicensing the patents on non-exclusive terms to various generic drug manufacturers for the development, manufacture and distribution of generic ARV drugs (Juneja et al. 2017). Wirtz et al. (2017) lists the significant milestones achieved by the Medicines Patent Pool from 2010 to 2015, particularly those relating to the patent licenses granted and their effect on drug supply and cost savings (Wirtz et al. 2017). Another paper estimated the cost savings resulting from MPP’s ARVs licenses at USD 2.3 billion from 2010 to 2028 (Juneja et al. 2017). Analysts have noted that the success of the MPP depends on whether patent-holders are willing to license their patents to the pool and be licensed to third parties (Hoen and Passarelli 2013; Hoen et al. 2011). The provisions of MPP licenses, especially those with the pharmaceutical company Gilead, have been analyzed and discussed in detail in the following papers: The Medicines Patent Pool: Promoting Access and Innovation for Life-Saving Medicines through Voluntary Licenses (Cox 2012), A Sliver of Hope: Analyzing Voluntary Licenses to Accelerate Affordable Access to Medicines (Baker 2018), Medicine Patent Pool – Pharma Philanthropy or PR? (De Luca 2015). As of 2018, the MPP reported that that its adult formulation licenses cover 87 to 91% of HIV patients in developing countries (Medicines Patent Pool n.d. a). Also, every widely-patented WHO-recommended antiretroviral medicine has been licensed to the MPP (See Medicines Patent Pool n.d. b).
1.b Criticisms of MPP
I-MAK (2011) analyzed the benefits projected by the MPP in 2009 to the UNITAID Executive Board. Among others, it argued against the following claims: that the MPP would enable the development of fixed-dose combinations and solid pediatric formulations as well as “widespread voluntary licensing.” With respect to these criticisms, I-MAK (2011) provided recomputed financial savings as opposed to those asserted by the MPP (I-MAK 2011). A noted limitation of this patent pool is the voluntary nature of its licensing process, mainly relying on pharmaceutical companies granting use of their licenses to the pool and on the generic manufacturers making use of these licenses (Bermudez and Hoen 2010). Baker (2018) observes the increased yet limited geographical reach of MPP licenses, particularly that “[t]he territorial coverage of MPP licenses averages only 90% for adult licenses and 99% for pediatric licenses” in low-and middle-income countries. A number of MICs are excluded from this coverage, which mean that millions are still unable to benefit from the licensed medicines. Contrary to criticism, the MPP licenses preserve the right to use of IP flexibilities allowed under the TRIPS Agreement, e.g. patent oppositions or cancellations and compulsory licenses (Baker 2018). The application of competition law has relevance to patent pools (van Zimmeren et al. 2011; Simon et al. 2005).
The Severe Acute Respiratory Syndrome (SARS) pool was intended to be an initial experiment in the life sciences field to set up a patent pool. However, this was never operationalized and has since been discontinued. It was meant to facilitate research and development of SARS vaccines by pooling relevant patents (van Zimmeren et al. 2011). The World Intellectual Property Office Re:Search (WIPO Re:Search) project is another approach to patent pooling. The following organizations have granted royalty-free access to their patents related to neglected tropical disease drug development: GlaxoSmithKline (GSK), Alnylam, AstraZeneca, Eisai, MSD, Novartis, Pfizer and Sanofi (Ziegler, Gassmann, and Friesike 2014). WIPO Re:Search has its origins in the GSK Pool for Open Innovation against Neglected Tropical Diseases, which was then subsequently housed with BioVentures for Global Health (BVGH) before being moved to WIPO (Eisenberg 2014). Schoen-Angerer (2011) pointed out that WIPO Re:Search patents were only available for use in least-developed countries and therefore had very limited geographical scope; other developing countries would only be able to obtain access to the IP through negotiation (Schoen-Angerer 2011).
SUGGESTIONS FOR EXPANDED MODEL
Patent pool models have been recommended to facilitate R&D and access to the full WHO list of essential medicines (Wirtz et al. 2017) and drugs for “orphan/rare diseases” (Muthyala 2011). Patent pools have also been suggested to advance R&D in the fields of nanotechnology (Sanhai, Spiegel, and Ferrari 2007), genetics (Verbeure et al. 2006; Van Overwalle et al. 2006; Ebersole, Guthrie and Goldstein 2005) and stem cell (Winickoff, Saha and Graff 2009).
Analysis of interaction between patent pools and other policies intended to promote innovation or access to medicines
CITED PAPERS WITH ABSTRACTS
Abbott, Frederick. 2016. “Excessive Pharmaceutical Prices and Competition Law: Doctrinal Development to Protect Public Health.” UC Irvine Law Review 6 (3): 281."Abstract: Public health budgets and individual patients around the world struggle with high prices for pharmaceutical products. Difficulties are not limited to low income countries. Prices for newly introduced therapies to treat hepatitis C, cancer, joint disease and other medical conditions have entered the stratosphere. In the United States, state pharmaceutical acquisition budgets are at the breaking point -- or have passed it -- and treatment is effectively rationed. Competition/antitrust law has rarely been used to address “excessive pricing” of pharmaceutical products. This is a worldwide phenomenon. In the United States, the federal courts have refused to apply excessive pricing as an antitrust doctrine, either with respect to pharmaceutical products or more generally. Courts in some other countries have been more receptive to considering the doctrine, but application in specific cases has been sporadic, including with respect to pharmaceuticals. This remains a paradox of sorts. Competition law experts acknowledge that one of the principal objectives of competition policy is to protect consumers against the charging of excessive prices. The currently preferred alternative is to address the “structural problems” that allow the charging of excessive prices. That is, “fixing the market” so that the underlying defect by which excessive prices are enabled is remedied. There is a fundamental problem with the “fixing the market” approach when addressing products protected by legislatively authorized market exclusivity mechanisms such as patents and regulatory marketing exclusivity. That is, mechanical aspects of the market are not broken in the conventional antitrust sense. Rather, the market has been designed without adequate control mechanisms or “limiters” that act to constrain exploitive behavior. Political institutions, such as legislatures, that might step in are constrained by political economy (e.g., lobbying), and do not respond as they should. Competition law and policy should develop robust doctrine to address excessive pricing in markets lacking adequate control mechanisms. This article will focus specifically on the pharmaceutical sector because of its unique structure and social importance. This focus is not intended to exclude the possibility that development of excessive pricing doctrine would be useful in other contexts. This article is divided into two parts. The first addresses competition policy and why it is appropriate to develop the doctrine of excessive pricing to address distortions in the pharmaceutical sector. The second addresses the technical aspect of how courts or administrative authorities may determine when prices are excessive, and potential remedies. The policy prescription of this article is twofold: first, the United States should incorporate excessive pricing doctrine in its antitrust arsenal, and; second, other countries should maintain the status quo with respect to multilateral competition rules that allow them flexibility to develop and refine doctrine, including excessive pricing doctrine, that is best suited to their circumstances and interests. Link: https://scholarship.law.uci.edu/ucilr/vol6/iss3/3/
Heller, Peter S. “The Prospects of Creating ‘Fiscal Space’ for the Health Sector.” Health Policy and Planning 21, no. 2 (March 1, 2006): 75–79. https://doi.org/10.1093/heapol/czj013."Abstract: Not Available Link: https://academic.oup.com/heapol/article/21/2/75/554947
Lexchin, Joel. 2015. “Drug Pricing in Canada.” In Pharmaceutical Prices in the 21st Century, 25–41. Adis, Cham. https://doi.org/10.1007/978-3-319-12169-7_2."Abstract: Not available Link: https://link.springer.com/chapter/10.1007/978-3-319-12169-7_2
Love, James. 2012. “Affidavit: Natco Pharma Limited versus Bayer Corporation.” https://www.keionline.org/sites/default/files/aff-jameslove_13Feb2012_as_Filed.pdf."Abstract: Not available Link: https://www.keionline.org/sites/default/files/aff-jameslove_13Feb2012_as_Filed.pdf
Ottersen, Trygve, Riku Elovainio, David B. Evans, David McCoy, Di Mcintyre, Filip Meheus, Suerie Moon, Gorik Ooms, and John-Arne Røttingen. 2017. “Towards a Coherent Global Framework for Health Financing: Recommendations and Recent Developments.” Health Economics, Policy, and Law 12 (2): 285–96. https://doi.org/10.1017/S1744133116000505."Abstract: The articles in this special issue have demonstrated how unprecedented transitions have come with both challenges and opportunities for health financing. Against the background of these challenges and opportunities, the Working Group on Health Financing at the Chatham House Centre on Global Health Security laid out, in 2014, a set of policy responses encapsulated in 20 recommendations for how to make progress towards a coherent global framework for health financing. These recommendations pertain to domestic financing of national health systems, global public goods for health, external financing for national health systems and the cross-cutting issues of accountability and agreement on a new global framework. Since the Working Group concluded its work, multiple events have reinforced the group’s recommendations. Among these are the agreement on the Addis Ababa Action Agenda, the adoption of the Sustainable Development Goals, the outbreak of Ebola in West Africa and the release of the Panama Papers. These events also represent new stepping stones towards a new global framework. Link: https://www.cambridge.org/core/journals/health-economics-policy-and-law/article/towards-a-coherent-global-framework-for-health-financing-recommendations-and-recent-developments/32B84686FD13D7CB340643D798832095
Wirtz, Veronika J., Hans V. Hogerzeil, Andrew L. Gray, Maryam Bigdeli, Cornelis P. de Joncheere, Margaret A. Ewen, Martha Gyansa-Lutterodt, et al. 2017. “Essential Medicines for Universal Health Coverage.” The Lancet 389 (10067): 403–76. https://doi.org/10.1016/S0140-6736(16)31599-9."Abstract: Not available Link: https://www.thelancet.com/action/showPdf?pii=S0140-6736%2816%2931599-9
World Health Organization. n.d. “Essential Medicines.” WHO. http://www.who.int/medicines/services/essmedicines_def/en/.Abstract: Not available Link: http://www.who.int/medicines/services/essmedicines_def/en/
Xu, Ke, David B Evans, Kei Kawabata, Riadh Zeramdini, Jan Klavus, and Christopher J L Murray. 2003. “Household Catastrophic Health Expenditure: A Multicountry Analysis.” The Lancet 362. http://www.who.int/health_financing/documents/lancet-catastrophic_expenditure.pdf."Abstract: Not available Link: http://www.who.int/health_financing/documents/lancet-catastrophic_expenditure.pdf
* For the purposes of this review, we have established three categories to describe the state of the literature: thin, considerable, and rich.
- Thin: There are relatively few papers and/or there are not many recent papers and/or there are clear gaps
- Considerable: There are several papers and/or there are a handful of recent papers and/or there are some clear gaps
- Rich: There is a wealth of papers on the topic and/or papers continue to be published that address this issue area and/or there are less obvious gaps
Scope: While many of these issues can touch a variety of sectors, this review focuses on medicines. The term medicines is used to cover the category of health technologies, including drugs, biologics (including vaccines), and diagnostic devices.
Disclaimer: The research syntheses aim to provide a concise, comprehensive overview of the current state of research on a specific topic. They seek to cover the main studies in the academic and grey literature, but are not systematic reviews capturing all published studies on a topic. As with any research synthesis, they also reflect the judgments of the researchers. The length and detail vary by topic. Each synthesis will undergo open peer review, and be updated periodically based on feedback received on important missing studies and/or new research. Selected topics focus on national and international-level policies, while recognizing that other determinants of access operate at sub-national level. Work is ongoing on additional topics. We welcome suggestions on the current syntheses and/or on new topics to cover.