With Great IP Comes Great Responsibility - Developing and Deploying IP in the Public Interest During COVID-19 (Licensing Remdesivir)
May 6, 2020
By Noel Courage
Gilead Sciences, Inc. is currently treading a tightrope between making money and ensuring wide access to a drug. Companies do have to make money to pay for R&D, employees and overhead. IP rights are important to help recover these significant costs, since if a company does not continue to exist, then there will be no “next drug” from that company.
My prior article discussed companies making face shield, ventilator and reagent IP freely available to fight COVID-19. The Gilead situation is more complex because it is the IP owner of the sole drug that has been authorized by the FDA on an emergency use basis to treat COVID-19. There are no approved alternatives, and the scale on which the invention is going to be deployed is global. Gilead stated that its, “overarching goal is to make remdesivir both accessible and affordable.” This article describes some of the issues of commercializing an invention against the backdrop of a heavy public interest.
The Drug and its IP
The drug attracting attention is called remdesivir. It is a novel chemical compound designed, tested and patented by Gilead, with help from various research partners. Until recently, remdesivir was not licensed or approved anywhere globally. It was rushed into COVID-19 clinical trials to try to determine if it was safe and effective.1
Gilead later ran experiments to show the usefulness of the compound against adenovirus and coronavirus infections, and filed a patent specifically on this new medical use. The MERS virus and SARS virus are two examples of coronavirus virus.
Gilead has covered its new use of remdesivir, for example, by US patent no. 10,251,904 (methods for treating adenovirus infections), and its related pending, allowed US patent application no. 16/265,016 (methods for treating coronavirus infections). Certain representative compounds in the patent filing were tested for MERS-CoV and SARS-CoV antiviral activity (see Examples 40-44). The 2019-nCov virus was, of course, not tested before the patent application was filed because it was not yet known to exist. The corresponding Canadian patent application is still in examination (no. 2,998,189).
There is controversy about effectiveness of remdesivir, which is beyond the scope of this article. It is still undergoing significant testing in other clinical trials that will provide more clarity. Cautious optimism is a good way to view the potential of remdesivir.
The drug was authorized by the FDA for potential COVID-19 treatment at the start of May on an emergency use basis. This is a significant upgrade in regulatory approval compared to the previously permitted limited use. In Canada, remdesivir has been available on a limited basis through Health Canada’s Special Access Program. The European Medicines Agency previously approved remdesivir for compassionate use access.
Using IP to Control the Expansion of Production
Physicians will be looking for more remdesivir in the near future than Gilead can produce. It needs to be distributed widely and quickly. Licensing will allow expansion of production and distribution that can potentially eventually meet global supply needs. Licensing is a flexible tool in that the IP owner can use to grant some of all of the rights to manufacture, use and sell an invention. Specific territories can be set out in a license in order to coordinate operations.
Gilead is going to be working with international partners to expand production. Through partnerships, Gilead can not only grant a license providing permission to use the IP, but it can also provide manufacturing and formulation on how partners can promptly scale up, get their own regulatory approval and hit the market. The license terms are not available, so it is unknown what revenue will be generated. It is key to engage enough partners and grant enough licenses to be able to supply the international market. Therefore, these partners include generic drug companies that are skilled at making large amounts of low cost drugs. Gilead is also working with the Medicines Patent Pool to license remdesivir for developing countries. This wide licensing approach may also pre-empt governments from seeking compulsory patent license to make the drug.
Existing manufacturing and supply networks are also being engaged. A consortium of manufacturing partners is being created to help maximize global supply. It is not a simple task to produce raw materials and manufacture, and the supply chain must run as smoothly as possible to avoid disruption. Disruption will reduce the amount of drug produced and create treatment backlogs. UNICEF will be helping deliver remdesivir through its well-established distribution networks.
Profit vs Donation
Gilead is using donations in the short term, rather than extracting revenue from sales. Gilead donated its entire stockpile of remdesivir to the U.S. government, which will manage distribution in the U.S. As well, Gilead plans to have manufactured enough remdesivir by the end of May to treat more than 140,000 patients, which will be donated to hospitals. According to Reuters, Gilead is keeping options open whether and when to make revenue – Reuters declined to answer questions about whether Gilead plans to eventually profit from the COVID-19 treatment rather than just donate the medicine. It is likely that Gilead and many of its partners will eventually have to generate revenue in order to support the huge scope of the business undertaking. The focus now is on getting the medicine out there, and profit seems to be a longer term goal for Gilead.
Using IP to Control Quality
IP allows Gilead to potentially block low quality and counterfeit copies of the drug. In the medical devices area of COVID-19, there has been rampant supply of poor quality product, so quality control is a legitimate concern.
IP provides monopoly rights to use an invention, in order to reward those that advance applied science. However, the responsibility to get public health inventions deployed is paramount. Many companies have previously licensed IP for use in treating epidemics. However, the scope of the Gilead licensing roll-out is unique in its scope and urgency, in view of the pandemic. It will be interesting to see if this aggressive and fast IP licensing model being adopted by Gilead becomes a template for other public health inventions.
1 Remdesivir was originally developed for treatment of Ebola virus and Marburg virus but did not perform well.
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