Sharing COVID therapy secrets is a Trojan horse that would gut U.S. biotech

Several countries are urging the United States to dismantle a cornerstone of its economic success. And the Biden administration may give them exactly what they want.

The intention behind the proposal is to ensure people living in developing countries can access the same life-saving medicines available in wealthier nations. It’s an admirable goal, but unfortunately the proposal at hand will have precisely the opposite effect, by gutting the U.S. biotech industry and depriving future generations of revolutionary treatments.

Here’s some background. Last year, with support from the U.S, the World Trade Organization waived global intellectual property protections for COVID-19 vaccines — a measure originally proposed by India and South Africa. The WTO has since debated expanding the waiver to COVID-19 therapeutics and diagnostics, but no final decision has been made.

It’s time for the Biden administration to nix this misguided IP waiver once and for all. While some U.S. policymakers depict it as a humanitarian measure that would expand access to COVID-19 tests and treatments in poorer countries, there’s no need for such an effort today. The “emergency” phase of the pandemic is over. The White House, The Centers for Disease Control and Prevention, and the World Health Organization have all said as much.

In reality, the waiver is a Trojan horse that would jeopardize U.S. manufacturing and research competitiveness, even as China and other rivals are working overtime to surpass us in the life sciences. That would work directly against the Biden administration’s efforts to strengthen U.S.
biotech innovation.

Even if the COVID-19 emergency wasn’t over, a broad IP waiver would still be a solution in search of a problem. Many companies have already signed licensing deals to ensure access to oral antivirals in more than 100 low- and-middle-income countries.

The same dynamic was at play when the WTO passed last year’s vaccine waiver. India, South Africa and other countries that pushed for the measure actually had a surplus of shots when the waiver was approved. In September 2022, India’s largest vaccine manufacturer disposed of a staggering 100 million expired doses. Around the same time, South Africa’s Aspen Pharmacare factory shut down production of a vaccine it licensed from Johnson & Johnson due to low demand.

Simply put, IP protections weren’t precluding countries from distributing vaccines. Organizational issues and persistent vaccine hesitancy were the real culprits.

Similarly, as a recent report from the U.S. International Trade Commission confirms, global IP rights aren’t to blame for low uptake of tests and treatments in the
developing world.

While it wouldn’t solve any real problem, waiving IP protections would have serious consequences for America’s world-class biotech industry. The waiver would compel U.S. companies to hand over not just the chemical formulas behind their COVID-19 treatments, but also the technical details of the manufacturing processes needed to create these advanced drugs. It would essentially allow developing countries to help themselves to billions of dollars’ worth of U.S. trade secrets — for free.

Patents and other IP rights enable life sciences firms to participate in the risky process of drug development. Without these protections, copycats can freeload off the years of work and billions of dollars required to invent just one new medicine. Arbitrarily ignoring IP rights — as the WTO proposal would do — robs life sciences firms of the opportunity to earn a return on their investments and lessens their incentive to innovate in the first place. As a result, we’d lose out on countless future treatments.

By stifling investment in the life sciences sector, the waiver would harm everyday Americans by threatening hundreds of thousands of biotech manufacturing and
R&D jobs.

An expanded IP waiver would also have significant implications for U.S.-China competition. China already leads the United States in 37 of 44 advanced technologies. Leaders in Beijing have made no secret of their desire to make China a global biopharma superpower, and biotech was singled out as a crucial growth industry in the so-called Made in China 2025 national strategy. America may lead the world in developing novel therapies today, but a waiver expansion could change that.

Luckily, no country took advantage of the original vaccine waiver. But there’s no guarantee the same will be true for a waiver on tests and treatments — which, if used, would represent an unprecedented transfer of proprietary U.S. biotechnology overseas.

A robust global IP system enabled the development and distribution of breakthrough COVID products that saved millions of lives. The proposed waiver would fail to achieve its purported humanitarian goal of broadening access to treatments, since IP protections aren’t actually a barrier. Instead, the waiver would only undermine our ability to counter future public health threats and weaken U.S. economic competitiveness. It’s imperative that the White House abandon this disastrous proposal.

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