Economics » Investment » IP strategy to safeguard R&D investment becomes “secondary issue” for big pharma

IP strategy to safeguard R&D investment becomes “secondary issue” for big pharma

Delay in vaccine production requires collaboration amongst drug makers to be prioritised

Big pharma is urged to put IP strategy aside – typically used to protect their R&D investment in the long-term – due to delays in Covid-19 vaccine production calling for greater collaboration amongst drug makers, according to Adrian Tombling, partner and patent attorney at Withers & Rogers.

“At the moment, pharma companies are driven by the urgent need to help save lives by vaccinating as many people as possible, as quickly as possible,” Tombling said in an email.

“Protecting their IP is a secondary issue and while securing patent protection remains a good way to protect their investment in developing vaccines, they are willing to forgo some of their rights and make their innovations freely available where necessary.

“They are generally not thinking about leveraging their IP with respect to Covid-19 at the moment, as doing so could be reputationally damaging.”

Whilst desperate times call for desperate measures, Tombling reiterates that patent protection remains vital for pharmaceuticals in the long run.

“Owning IP rights could act as a deterrent, preventing others from copying their [drug] innovation and potentially beating them to market and undercutting them on price,” he said.

“Pharma companies also need to be planning in the long term. This is not a one vaccine race, there are likely to be multiple generations of vaccines, which are constantly refined and developed to protect against coronavirus outbreaks and mutations in the future.”

Drug makers should protect any underlying IP in areas including vaccine generation, diagnostics, or manufacturing methods – enabling them to generate returns from licensing agreements over time, Tombling said.

“Having an IP strategy that is focused on the long-term is important for all pharma companies, especially those involved in the Covid-19 vaccine race,” he added.

Big pharma have collaborated with smaller peers that fell behind in the search of a coronavirus vaccine – an unprecedented approach from the industry that acknowledges the need to increase production globally.

Earlier this month, the German drug maker Merck announced its expanding partnership with BioNTech to enhance “the amount of lipid delivery towards the end of 2021” which is used for the production of the Pfizer-BioNTech Covid-19 vaccine.

“Extraordinary times like these require bold steps, and we are ready to take these steps to tackle one of the biggest challenges of humanity,” said Stefan Oschmann, chairman and CEO of Merck.

Last month, Sanofi stated it will provide support to BioNtech to combat the emerging demand of Covid-19 vaccine production. Starting in summer, the French drug marker aims to supply over 125 million doses for the EU.

In December last year, Roche also revealed its new collaboration with Moderna to include the SARS-Cov-2 antibody test in vaccine trials – once again highlighting the need for greater collaboration to tackle the spread of coronavirus.

“Roche is at the forefront of the fight against Covid-19 with a growing portfolio of diagnostics solutions, the development of new medicines and a number of partnerships across the industry, and committed significant funds to further expand production capacity across the entire supply chains,” said a spokesperson from Roche in an email.

But while Roche reported a decrease in group sales, CHF 61.5bn in 2019 to CHF 58,32bn in 2020, it remains confident that sales will bounce back in H2 2021.

“We expect the pharmaceutical’s business to be still impacted by the pandemic in the first half of 2021. Especially, the first quarter will be challenging as we have a base effect. We expect the situation to improve in the second half of the year. In contrast, we will see a strong first half of 2021 in the Diagnostics division with a flattening growth in the second half,” said the spokesperson.

“We are confident that despite the continued strong impact of biosimilars, our sales will grow in the low- to mid-single digit range, at constant exchange rates. Based on our rejuvenated portfolio and the significant progress made in our product pipeline, we are strongly positioned for future growth.”

For industry participants that have abandoned research for a coronavirus vaccine, Tombling believes they will remain resilient due to the risk-taking nature of the industry – a scenario which most would have considered in their cash management strategy.

“Few companies are likely to drop out of the vaccine race altogether, and those that do should be able to focus back on other lines of research,” he said. “Pharmaceutical companies are used to investing in multiple drug research programmes, many of which fail, so this is an outcome they will have prepared for.”

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