Topics Held the "2021 Life Science Intellectual Property Forum Theme is "How to handle IP rights in pandemic response measures including COVID-19"

COVID-19 caused a global pandemic. On the other hand, while vaccines and therapeutics are being actively developed globally, the next issue to emerge is access to medicines. One of the issues is whether, when a therapeutic or other drug is the subject of a patent, it is necessary to restrict the patent right, as in the case of a compulsory license where the state grants a license without the patentee's permission, or whether it should be left to the voluntary efforts of the patent holder.

The issue of public health and patents reminds me of the AIDS drug issue about 20 years ago. At the time, the spread of AIDS in developing countries led to criticism that patents were hindering access to affordable medicines. In response, the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) and the Declaration on Public Health (Doha Declaration, 2001) confirmed the flexibility of the TRIPS Agreement, under which countries can grant compulsory licenses in public health crises such as infectious diseases. After the Doha Declaration, the number of compulsory licenses granted increased, but then slowed down. Various initiatives other than compulsory licenses, such as The Medicines Patent Pool (MPP), have also progressed, and the price of AIDS drugs in developing countries has dropped significantly. These efforts have led to some improvement in the access to medicines issue.

The World Health Organization (WHO) resolution "COVID-19 response" of May 2020 calls for cooperation based on voluntary efforts and refers to the "flexibility" of the Doha Declaration. The "COVID-19 response" also refers to the "flexibility" of the Doha Declaration. Although this does not seem to be a problem, it may be perceived as an acceptance of the active use of compulsory license, and the U.S. has expressed its opinion that it will have a negative impact on incentives for new drug development. In this way, we can see a battle between the side that favors compulsory licensing and the side that favors voluntary efforts by right holders.

One approach that is oriented toward voluntary efforts is a patent pool such as the MPP. Another new approach is the platform type, such as the Open Covid Pledge initiated by US IT companies and the "Declaration of Support for Measures to Combat New Coronavirus Infections Related to Intellectual Property" initiated by Japanese companies. These allow participating companies to make easy and rapid use of their intellectual property in the conduct of COVID-19 countermeasures.

Other developments include the COVAX (COVID-19 Vaccine Global Access) Facility, which was the topic of discussion at the G7 meeting and other meetings, and is a mechanism for jointly purchasing vaccines and supplying them widely, including to developing countries. Even though they are voluntary efforts, the pharmaceutical industry would probably be more receptive to the purchase of patented products such as COVAX than to the free use of patents.

On the other hand, considering the effectiveness of a compulsory license, in the case of pharmaceuticals, since safety and quality are required, how can quality, etc. be ensured without the provision of know-how? Would this affect incentives for new drug development? In particular, the current situation is that there is no effective way to develop therapeutic drugs, vaccines, and other medicines. In particular, under the current circumstances, the promotion of development of therapeutic drugs and vaccines has a high priority, and from the perspective of incentives for new drug development, voluntary efforts should be expected rather than relying on a compulsory license. On the other hand, compulsory licenses have the aspect of promoting voluntary efforts, facilitating private negotiations, and encouraging consensus building. In addition, the possibility that an original therapeutic agent may infringe on the patent rights of a third party cannot be denied, and a compulsory license can be one of the solutions to this problem. Therefore, we believe it is necessary to consider compulsory licenses in conjunction with this issue.

Finally, I have a suggestion. A questionnaire revealed some issues regarding the compulsory license system. One is that a request for award is tantamount to a confession of infringement, and another is the question of the administrative agency's ability to calculate compensation.

To address these and other issues in the compulsory license system, if legislation were to be adopted, a U.S.-style government use would be considered. Government use is not a license, so it does not involve licensing procedures or infringement confessions, and can be handled quickly, especially in the event of a pandemic. In addition, the patentee is entitled to compensation payments based on judicial (court) rather than administrative (administrative) calculations. We believe that this is worth considering in Japan as well.

Today, we would like to deepen our understanding of vaccines by considering in what ways they differ from ordinary pharmaceutical products. In terms of content, I would like to explain the basic concepts of vaccinology, development history, quality assurance, current vaccine production flow and national certification, and finally, I would like to touch on multilateral cooperation.

First, in order to design a vaccine, it is necessary to know what kind of pathogen/virus it is, and the answer is usually found in nature. What are the routes of infection and what kind of infection does it cause, e.g., is there reinfection, asymptomatic infection, etc.? It is important to seize on this because there are phenomena in nature that can serve as models for vaccines. It is also important to understand how the human immune system works defensively. In the case of the coronavirus, neutralizing antibodies play an important role. However, there are pathogens such as Mycobacterium tuberculosis that cannot be protected by antibodies, and there is the question of whether antibodies or cellular immunity should play a central role. In addition, vaccines have public health significance, and whether they are transmitted from person to person is also important. This also changes the nature of the vaccine. For example, in the Japanese vaccination system, Class A vaccines such as measles and rubella are not only for the prevention of self-infection, but also for the concept of group prevention. On the other hand, Class B vaccines, such as pneumococcal vaccines, are primarily designed to protect the individual who has been vaccinated. What about novel coronaviruses, then, must be verified in the future.

In designing a vaccine, it is necessary to consider what are the appropriate pathogen-derived antigens, whether an adjuvant (immunostimulant) is necessary, and what is the appropriate dosage form. The mRNA vaccine developed this time is very easily degraded, and the delivery carrier (carrier) is also important.

Historically, there have been six major innovations in the history of vaccine development. First, the British Jenner's invention of the seedpox method, followed by the development of live vaccines that artificially attenuated the pathogen; in the 1900s, the diphtheria toxoid vaccine was developed that used only certain components of the pathogen. A few years later, the immunopotentiating aram adjuvant was created. Then, in the 1980s, recombinant proteins could be freely produced using molecular biological techniques, and the HBV vaccine was born. And the nucleic acid vaccine utilized in the now popular novel coronavirus was devised in the 1990s, a technology that had shown some efficacy in animal models. As described above, vaccines are classified into live vaccines, inactivated vaccines, toxoids, component vaccines, and nucleic acid vaccines. The mRNA is transcribed from the gene, and after translation into protein, it is assembled to form the pathogen, and the difference is at which stage it is cut out and made into a vaccine. Protection of intellectual property rights is essential for this type of innovation. It can be said that intellectual property rights accelerate innovation and make it possible to prepare for pandemics.

Here are three historical facts about vaccines. First, there was the Lübeck BCG incident in Germany in 1930, in which the vaccine was contaminated with human tuberculosis bacteria, which can now be prevented through GMP compliance. In 1948, the Kyoto diphtheria case, in which diphtheria toxin was contaminated, illustrates the importance of the concept of the lot, or the assurance of uniformity of the population. This is different from the so-called common pharmaceuticals; the third, the 1955 U.S. polio vaccine case, was due to a faulty and inadequate inactivation theory itself. This case illustrates the usefulness of double-checking.

Thus, the importance of quality assurance of vaccines has been recognized by unfortunate incidents in the past. The principle is to minimize variation in all processes. And since they are used in large numbers of healthy people, adequate safety and efficacy/potency must also be ensured. However, vaccines are characterized by their complexity and much larger molecular weight than small molecule drugs, making quality control more difficult. In addition, in vitro tests cannot determine how much antibody can be induced in humans, so in vivo tests are required. Therefore, the specifications must be complicated and must take into account the range of variation. For example, in the case of influenza vaccines, around February each year, the WHO announces the expected epidemic strains for the following year, and the process involves securing a large number of fertilized eggs, which require about 1.5 per person, increasing the number of viruses, and manufacturing the vaccine. Then, as a double check, the product will undergo national certification, which is not the case for ordinary drugs.

As described above, vaccines have a short efficacy period and require a long manufacturing process to cultivate the virus in fertilized eggs, etc., and there are no alternative measures in the event of a shortage.

The COVAX Facility and other groundbreaking multilateral efforts are now underway to develop and disseminate vaccines as a form of global health. Simply put, it is important to form a solid ecosystem of research and development, stable supply, and immunization systems, including routine immunization in each country, to realize the basic principle of preventing diseases that can be prevented through immunization.

This section focuses on trends in the international situation of COVID-19 countermeasure drugs and vaccines.

In Japan, the Ministry of Health, Labour and Welfare (MHLW) and other government initiatives include allocating and securing a reasonable budget, supporting research and development, developing vaccines, securing vaccines, establishing vaccination systems, and promoting systems to prevent the spread of infection.

International trends include the Coalition for Epidemic Preparedness Innovations (CEPI), Gavi, The Vaccine Alliance (Gavi), COVAX, Access to COVID-19 Tools Accelerator (ACT Accelerator) and a brief overview of the movement at WHO.

CEPI is a public-private partnership launched in 2017 that brings together governments, international organizations, the private sector, and civil society to promote vaccine development through research and development, while the Gavi Vaccine Alliance is focused on distributing vaccines to developing countries, especially children, with a focus on developing immunization systems and The Gavi Vaccine Alliance is engaged in the purchase and supply of vaccines.

The COVAX Facility is a mechanism for Gavi, CEPI and WHO to jointly purchase vaccines together. The COVAX Facility is not only designed to support developing countries, but also to allow middle-income countries and developed countries to contribute their own funds to purchase vaccines for their own use through the Facility. Japan joined the program in September 2020, with former Minister of Health, Labour and Welfare Katsunobu Kato signing on. It has pledged 17.2 billion yen to ensure its own portion and $200 million to support developing countries.

The ACT Accelerator was proposed jointly by the EU and others, including Japan. The COVAX Facility is positioned as the vaccine pillar of the ACT Accelerator.

The 2020 WHO General Assembly adopted a resolution to combat novel coronavirus disease, which includes language on intellectual property, calls for fair access and distribution in OP4, and mentions the Doha Declaration. It includes the use of existing mechanisms for voluntary pooling and licensing of patents, as collaboration to expand production is said to be important. The TRIPS Agreement is also mentioned in the resolution's request to the Director-General of WHO.

In my opinion, there is a question of whether vaccines and biologics can really be made only by compulsory licensing of patents, and there may be a different aspect than in the past with HIV/AIDS, and the issue of how far the same approach to COVID-19 antibody preparations as to HIV/AIDS drugs I wonder how far the same approach can be taken with COVID-19 antibody formulations as with HIV/AIDS drugs. This time, there is a new initiative called the COVAX Facility, which is an extension of Gavi, so I hope that everyone involved will keep a close eye on future developments.

I would like to share my personal views on whether or not the patent pool will work in terms of access to medicines.

First of all, in order to understand patent pools, I would like to give an overview of the patent pools in the field of information and telecommunications, which is the most advanced field in the world.

In the information and telecommunications field, interchangeability among manufacturers through standards is important, which improves convenience, increases the number of users, and expands the market. As a result, it becomes difficult to manufacture and sell products based solely on patents held by the company itself, and this leads to a situation where multiple right holders hold multiple essential patents for a single product. This situation has led to the development of patent pools. In other words, since it is very difficult to obtain a license for each individual patent, it is decided to pool a group of patents to be licensed and to license them.

There are two main types of pool operation: (1) a patent management company receives a license and re-licenses the patents, and (2) a patent management company acts as a contracting agent. The MPP described below took the form (1).

In considering patent pools, the relationship with antitrust law is also important. Although the situation differs from country to country, in Japan, the guidelines state that the patent pool is subject to regulation when there are conditions that are restrictive of competition.

Another issue is that of outsiders and hold-ups. Outsider" refers to the case where a patentee owns an essential patent but does not participate in a patent pool, and licenses the patent to the right holder through individual negotiation. A hold-up is a case where a company participates in discussions on technical standards and is aware of patents that could become standard patents, but does not participate in the patent pool and tries to enforce its rights against the implementing company.

In contrast to the information and telecommunications field, where a large number of patents are needed to manufacture a product, as described above, small molecule pharmaceuticals require only a few patents, and market expansion through compatibility is unlikely, so patent pools have traditionally been considered inappropriate.

On the other hand, the situation is different for biopharmaceuticals, where multiple technologies overlap. For example, in the classic case of antibody drugs, multiple technologies overlap, requiring the licensing of third-party patent rights, which is similar to the case in the field of information and telecommunications.

Despite this situation, the Patent Attorneys Association conducted a survey at the time and found the existence of the MPP, a patent pool for small molecule drugs, which was established in 2010 by Unitaid, a fund working on drug access. At the time of its establishment, drug access to HIV drugs was a North-South problem, and something needed to be done about it.

Combination therapy with multiple HIV drugs was being established, but after the TRIPS agreement, substance patent systems were established in many countries, making it impossible to use low-cost generics. Therefore, MPP, which was licensed by the innovator, sublicensed patent rights to multiple generic engineering (GE) manufacturers, creating a mechanism to encourage price competition among GEs and to allow them to offer inexpensive drugs.

Currently, three drugs (HIV, hepatitis C, and tuberculosis) are licensed by MPP, and MPP has proposed that these three diseases be eliminated by 2030.

However, we believe that the MPP-style patent pool has the following problems.

However, we believe that the MPP-style patent pool has the following problems: it provides little incentive for innovators to participate. This is because, as an innovator, you will be offering your products to more than a hundred countries, but you will only receive license fees from a small number of countries, and although this is part of the effort to address the drug access issue, it is unlikely to lead to direct profits. In addition, the form of the license is a sublicense, which means that the licensee cannot be directly controlled, and there are concerns that quality issues cannot be addressed. In addition, since the licensing leads to the widespread use of the drug in large quantities, there is a risk that the possibility of inducing resistance to the drug may increase, and the life of the drug itself may be shortened.

Also, expanding the patent pool to include biopharmaceuticals could create additional problems, such as outsider or hold-up problems. In addition, since biopharmaceuticals cannot be manufactured exactly the same, but are "biosimilars," development and manufacturing costs will be high, and since only a limited number of companies can manufacture them, they may not be suitable for MPP-type price competition. In addition, it would be difficult to implement the patent only by granting a patent license, and there would be a big hurdle for the patent holder to provide manufacturing know-how, etc.

Finally, regarding the effectiveness of patent pools in responding to pandemics, even if patents are released through patent pools, it would be difficult to establish a prompt supply system and may not be suitable for responding to pandemics. In addition, considering the reasons for the success of the MPP in HIV, namely that it was a small molecule drug and that patent rights were the only barrier to entry, the opening of patents allowed multiple GEs to enter the market, resulting in price competition, it is possible that the opening of patents may not be a success or failure for vaccines that require long development periods and high costs. In the case of vaccines, which require a long development period and high costs, it is possible that the opening of patents does not depend on the success or failure of the vaccine.

One of the characteristics of intellectual property rights in the pharmaceutical industry is that, among the intellectual property rights (patents, designs, trademarks, etc.) covering pharmaceutical products, a small number of patents play a particularly important role, including substance patents covering active ingredients and use patents covering indications.

Research and development of a new drug takes a long period of 10 to 17 years from the discovery of a lead candidate compound to the discovery of a development candidate product, through clinical trials, to obtaining approval. In addition, the probability of success is as low as approximately 1 in 30,000, and with significant research costs ranging from tens to more than 100 billion yen per product, the development of new drugs entails significant risk.

The pharmaceutical industry is currently engaged in research and development of vaccines, therapeutics, and diagnostics against COVID-19 at an unprecedented speed worldwide and under a wide variety of alliances. We are also participating in international initiatives such as Gavi, CEPI, and COVAX. As a result, within one year of the spread of COVID-19 infection, vaccines from Pfizer/BioNTech, Modela, and AstraZeneca/Oxford University were approved and administered in many countries.

This unprecedented speed of vaccine development has been made possible by the companies' active sharing of innovation and collaboration on the back of the technologies they have developed over the years. In this process, open innovation through industry, government, and academia is also actively utilized, and we believe that intellectual property does not hinder R&D in this multifaceted alliance, but rather serves as a tool to promote collaboration at such an unprecedented speed.

In the pharmaceutical industry, the patent system is an important system that supports a series of long-term and costly R&D cycles by granting a monopoly to the patent holder for a certain period of time, thereby guaranteeing the possibility of recovering the cost of R&D when the drug is marketed in the future and investing in the next R&D. Under this patent system, pharmaceutical companies have developed and provided many medicines and vaccines, contributing to the welfare of mankind.

In an emergency situation such as a pandemic, it may be necessary to take flexible measures that are not bound by existing frameworks, including patent rights, but we are not aware of any cases where patent rights have been an obstacle to responding to COVID-19 in the first place. Regarding the handling of patents, in order to supply vaccines and therapeutics to those who need them as quickly as possible, it is important to allow broad discretion to each company handling products related to the patents in question, while at the same time providing mechanisms to support the efforts of companies, such as public-private partnerships (push incentives, pull incentives, etc.), We believe that it is important to have a mechanism (push incentive, pull incentive) that supports the efforts of companies, such as public-private partnerships. By conducting R&D in collaboration with many stakeholders based on their respective intellectual property, it will be possible to create various innovations with a greater sense of speed and provide new medicines, vaccines, and other products. In fact, in response to COVID-19, many collaborations are underway to develop a wide variety of vaccines and medicines.

There are regions where access to medicines is limited due to economic reasons, which may require responses such as the application of TRIPS clauses and implementation of voluntary licensing. In the past, pharmaceutical companies have engaged in many voluntary licensing activities, and intellectual property is the source of such activities.

As a pharmaceutical industry, we would like to continue to work under the intellectual property system so that vaccines and medicines can be developed and contribute to people's healthy lives.