PVR

'Evolving intellectual property protection for new corn varieties in the United States: An empirical analysis' by H. Phoebe Chan in (2024) the Journal of World Intellectual Property comments 

The US affirmed patent protection for genetically modified plant traits in 1985, asserting that firms could patent new hybrid plant varieties when formerly plant variety protection was the primary means to protect hybrid varieties. This paper examines how firms' intellectual property choices have changed for new corn varieties created during the years 1985–2012. The data suggests that firms increasingly rely on patent protection as their only form of intellectual property protection for new varieties. For varieties with patent protection, low-valued varieties, as determined by low patent renewal rates, receive less net benefit from obtaining plant variety protection compared to high-valued varieties.

US Pharma Prices

'International Prescription Drug Price Comparisons: Estimates Using 2022 Data' (RAND Research & Commentary Research Reports 2024) by Andrew W Mulcahy, Daniel Schwam and Susan L Lovejoy comments 

 Understanding the extent to which prescription drug prices are higher in the United States than in other countries—after accounting for differences in the volume and mix of drugs—is useful when developing and targeting policies to address both growth in drug spending and the financial impact of prescription drugs on consumers. This report summarizes findings from comparisons of drug prices in the United States and other high-income countries based on 2022 data and presents results for specific types of drugs, including brand-name originator drugs and unbranded generic drugs, and from sensitivity analyses. 

Except for unbranded generics, manufacturer gross drug prices in the United States were substantially higher than those in other countries. Across all drugs, U.S. prices were 278 percent of other countries’ prices. 

U.S. gross prices for brand-name originator drugs were 422 percent of prices in comparison countries. 

After applying an adjustment for rebates paid by manufacturers, U.S. net prices for brand-name originator drugs were relatively lower but still over three times as high as prices in other countries. 

The United States had lower prices for unbranded generics than most countries. Unbranded generics accounted for 90 percent of U.S. prescription drug volume—a much larger share than the 41 percent for the comparison countries—but only 8 percent of U.S. prescription drug spending at manufacturer gross prices (compared with 13 percent in other countries). 

In contrast, brand-name originator drugs accounted for only 7 percent of U.S. prescription drug volume and 87 percent of U.S. prescription drug spending (compared with 29 percent of volume and 74 percent of spending in other countries). 

Overall, the United States' considerable unbranded generic market share and low average unbranded generic prices did not fully offset higher brand-name originator prices. ...

Understanding the extent to which prescription drug prices are higher in the United States than in other countries—after accounting for differences in the volume and mix of drugs—is useful when developing and targeting policies to address both growth in drug spending and the financial impact of prescription drugs on consumers. 

A prior RAND analysis compared 2018 manufacturer gross drug prices in the United States with those in 32 Organisation for Economic Co-operation and Development (OECD) countries using a price index approach. The earlier analysis reported results for all drugs combined, for specific categories of drugs, and under different methodological approaches. This report updates the main results from this earlier report using more recent data through 2022. It also includes new analyses focusing on price comparisons for biosimilars and changes in price comparison results over time. 

In brief, when analyzing data for all prescription drugs available in the United States and comparison countries, we found that U.S. manufacturer gross prices for drugs in 2022 were 278 percent of prices in the 33 OECD comparison countries combined. Put another way, prices in other countries were 36 percent—or a little more than one-third—of those in the United States. 

These results stem from the combination of starkly different price comparison findings for brand-name versus generic drugs: U.S. prices for brand-name originator drugs were 422 percent of prices in comparison countries, while U.S. unbranded generics, which we found account for 90 percent of U.S. prescription volume, were on average cheaper at 67 percent of prices in comparison countries, where on average only 41 percent of prescription volume is for unbranded generics. U.S. prices for brand-name drugs remained 308 percent of prices in other countries even after adjustments to account for rebates paid by drug companies to U.S. payers and their pharmacy benefit managers. 

These high-level findings from the current report are consistent with results from the prior analysis using 2018 data. Overall, the gap between U.S. and other countries’ prices widened slightly between the two analyses because of faster growth in U.S. prices, a change in U.S. drug mix, a change in the overlap of drugs sold in both the United States and other countries, or a combination of factors.

Pharma

'Countermovements from the core: the assetization of pharmaceuticals, transparency activism and the access to medicines movement' by Théo Bourgeron and Susi Geiger in (2024) Socio-Economic Review comments 

The assetization of essential goods brings to high-income countries the logics of scarcity that have been dominant for long in low-to-middle income countries—fostering the rise of new forms of activism. Will this new activism strengthen already existing social movements or weaken them through more moderate politics? Building on interviews and the observation and mapping of activist events, we investigate this question through the case of pharmaceuticals. We detail how the assetization of pharmaceutical drugs has triggered the constitution of a new ‘flank’ in the access to medicines (A2M) movement—pharmaceutical transparency activism. We argue that transparency activism has expanded the contestation of the pharmaceutical state of affairs, by bringing into the broader A2M movement countries that were previously at the core of global pharmaceutical chains. Our article illuminates how the assetization of essential goods creates forms of activism that have significant impact on existing social movements. 

In May 2019, the World Health Assembly (WHA; the decision-making body of the World Health Organization) voted for an important resolution requesting all countries to increase transparency over the prices of medicines and the public funding that pharmaceutical companies receive to develop them (World Health Assembly, 2019). Although this resolution was not binding for its 194 member countries, it was claimed as a victory for an activist movement that had been campaigning since the mid-2010s for what they called ‘pharmaceutical transparency’, a struggle they found crucial to curb the increasingly high prices of new medicines (Health Policy Watch, 2019). Remarkably, this was the first time that a WHA united under the same resolution the low- and middle-income countries that had been critical of the global pharmaceutical market order for decades (e.g. Mexico, Brazil and Thailand), but also countries at the core of global pharmaceutical markets (e.g. Italy, the Netherlands and Norway), which were traditionally favourable to the interests of multinational pharmaceutical corporations. As representatives from these countries would confess themselves, this shift had resulted from their dissatisfaction of ever-rising prices for new medicines marketed by large pharmaceutical companies, itself the result of the increasingly financialized nature of these companies (Health Policy Watch, 2019). This WHA resolution therefore revealed how recent changes in the pharmaceutical sector had actually expanded the coalition of countries contesting the global pharmaceutical order. 

Through the example of the assetization of pharmaceuticals and the access to medicines (A2M) movement, this article investigates the nature and dynamics of countermovements that emerge to contest the assetization of essential goods. Since the 1980s, the ownership and production of pharmaceuticals have been increasingly embedded into financial markets, resulting in rapidly rising pharmaceutical prices and detrimental effects on access to medicines (Gaudilliere and Sundar Rajan, 2021). This has led to the rise of the A2M movement, with activism developing throughout the world to achieve better access to innovative medicines for patients (Baker, 2020). Recently, the vertiginous rise in prices particularly for highly innovative medicines has come to threaten access to medicines in countries that were previously spared by such issues, including in Europe (Krikorian and Torreele, 2021). Focusing on the case of the movement for pharmaceutical price transparency, we trace the rise of A2M movements in countries where such contestation was previously residual. We contend that the recent period has led to a ‘flank movement’ in access to medicines activism, with a triple shift in its orientation compared to previous forms of activism: (a) a shift from the contestation of the root causes of high drug prices to their institutional implementation; (b) from patient-led activism to state-led activism; and (c) from marginal to peripheral and even some core countries in global pharmaceutical markets (see Table 1 for a definition of these terms). We investigate the role that the assetization of pharmaceutical drugs has played in the rise of this movement and the ultimately positive impact that this movement had on the broader A2M one. ... 

Our project addresses the important political issue of how assetization changes the social movement landscape. To do so, our analysis bridges two streams of literature: scholarship on assetization countermovements, which has explored how the transformation of goods into financial assets provokes the rise of new social movements that contest such processes; and radical flank theory, which explores how different forms of activism shape social movement dynamics, their objectives and their chances of success. The case of pharmaceutical price transparency activism in the broader context of the A2M movement allows us to investigate a situation where an emerging form of activism arising from the consequences of assetization affects an already-existing social movement. The conditions for the emergence and success of these movements often remain unclear, along with their ultimate political consequences. 

We shed light on the ambivalent nature of such counter-‘flanks’ arising from the core of global markets, asking whether they may be more or less effective at achieving institutional or societal change than more radical countermovements that have remained at the margins. Our investigation therefore contributes to understanding how the assetization of essential goods reconfigures social movement dynamics. Beyond this theoretical argument, the ‘flank movement’ that we investigate could have considerable consequences on the space for manoeuvring of the pharmaceutical sector. It brings new groups to the A2M movement, in particular actors that are more moderate than the traditional A2M activists focused on abolishing pharmaceutical patents. It also threatens the coalition between core countries’ governments, pharmaceutical corporations and industry-friendly groups of activists and thus disturbs the ‘quiet politics’ (Culpepper, 2012) that had heretofore prevailed in this sector. In the final count, it thus fundamentally alters the ‘system of alignment’ in the pharmaceutical sector (Hartley, 2002). 

In the following sections, we detail the literature on assetization countermovements and radical flank theory before introducing our case context—the transformation of pharmaceuticals into financial assets and its impact on access to medicines. After a brief description of our methods, we develop three empirical sections, which investigate (a) how the A2M movement has been traditionally divided between a radical flank in marginal countries (‘patent activism’) and a broadly cooperative one in core countries (‘patient activism’), (b) how the recent period has seen the rise of a third strand of A2M activism (‘pharmaceutical transparency’) with intermediary objectives; and (c) how this new form of activism has had an ultimately positive impact on the A2M movement, gathering NGOs and individuals from the radical flank with state agencies from core and peripheral countries into contentious activism. We close by discussing the significance of this development for the future of the access to medicines movement and its interactions with the pharmaceutical sector, and we signal the conceptual implications of our case for other assetization countermovements.

GenAI Patents

The WIPO Patent Landscape Report on Generative Artificial Intelligence comments 

 The release of OpenAI’s ChatGPT chatbot in November 2022 has greatly increased public enthusiasm for generative AI (GenAI). It has been described by many, including Nvidia CEO JenHsun Huang, as an “iPhone moment” for GenAI. This is because the OpenAI platform has made it easier for all users to access advanced GenAI programs, particularly large language models (LLMs). These models have reached new levels of performance, demonstrating the potential for various real-world applications, triggering a wave of research and development, and large corporate investments in GenAI. 

This WIPO Patent Landscape Report provides observations on patenting activity and scientific publications in the field of GenAI and builds on the 2019 WIPO Technology Trends publication on Artificial Intelligence. It aims to shed light on the current technology development, its changing dynamics and the applications in which GenAI technologies are expected to be used. It also identifies key research countries, companies and organizations. 

GenAI patent families and scientific publications have increased significantly since 2017 

The rise of GenAI over the past few years has been driven primarily by three factors: more powerful computers, the availability of large datasets as a source of training data, and improved AI/machine learning algorithms. Developments such as the transformer architecture in LLMs have significantly advanced GenAI. This has made it possible to develop complex applications in many different fields. 

The technological advances in GenAI are reflected by the sharp increase in patenting activity. Over the past 10 years, the number of patent families in GenAI has grown from just only 733 in 2014 to more than 14,000 in 2023. Since the introduction of the transformer in 2017, the deep neural network architecture behind the Large Language Models that have become synonymous with GenAI, the number of GenAI patents has increased by over 800%. The number of scientific publications has increased even more over the same period, from just 116 in 2014 to more than 34,000 in 2023. Over 25% of all GenAI patents and over 45% of all GenAI scientific papers were published in 2023 alone. 

Which are the top organizations with the most patents in GenAI?

1. Tencent 

2. Ping An Insurance Group 

3. Baidu 

4. Chinese Academy of Sciences 

5. IBM

 Tencent, Ping An Insurance Group and Baidu own the most GenAI patents. Tencent plans to add GenAI capabilities to its products such as WeChat to improve the user experience. Ping An focuses on GenAI models for underwriting and risk assessment. Baidu was one of the early players in GenAI and recently unveiled its latest LLM-based AI chatbot, ERNIE 4.0. The Chinese Academy of Sciences (fourth) is the only research organization in the top 10 ranking. Alibaba (sixth) and Bytedance (ninth) are other Chinese companies in the top 10. 

IBM (fifth), Alphabet/Google (eighth) and Microsoft (10th) are the top US companies in terms of GenAI patents. IBM has developed a GenAI platform, watsonx, which enables companies to deploy and customize LLMs with a focus on data security and compliance. Alphabet/Google's AI division DeepMind recently released its latest LLM model, Gemini, which is gradually being integrated into Alphabet/Google's products and services. Microsoft is another key player in GenAI and an investor in OpenAI. OpenAI itself has only recently filed its first GenAI patents. Rounding out the top 10 is electronics conglomerate Samsung Electronics (seventh) from the Republic of Korea.

Which institutions published the most scientific publications on GenAI? 

The Chinese Academy of Sciences is clearly in the lead in terms of scientific publications with more than 1,100 publications since 2010. Tsinghua University and Stanford University follow in second and third place with more than 600 publications each. Alphabet/Google (fourth) is the only company in the top 20 (556 scientific publications). 

However, when measuring the impact of scientific publications by the number of citations, companies dominate. Alphabet/Google is the leading institution by a wide margin, and seven other companies are present in the top 20. The case of OpenAI is also noteworthy. In our GenAI corpus of scientific publications, the company has published only 48 articles (325th institution in terms of number of publications), but these publications have received a total of 11,816 citations from other scientific publications (13th overall). 

Where are the most GenAI technologies invented?

1. China 

2. United States 

3. Republic of Korea 

4. Japan 

5. India 

6. United Kingdom 

7. Germany

Inventors based in China were responsible for more than 38,000 patent families between 2014 and 2023, based on the inventor addresses published on patents. Since 2017, China has published more patents in this field each year than all other countries combined. 

With around 6,300 patent families between 2014 and 2023, the US is the second most important research location for GenAI patenting. The Asian countries Republic of Korea, Japan and India are other key research locations for GenAI, all ranking in the top 5 countries worldwide (third, fourth and fifth respectively). The United Kingdom is the leading European location (sixth globally), with 714 patents published in the same period. However, Germany is close behind (708 patent families) and has published more GenAI patents than the UK in recent years. These top inventor locations account for the majority (94%) of global patenting activity related to GenAI. 

Which GenAI model has the most patents? 

In recent years, a number of GenAI programs, or models, have been developed. Among the most important GenAI models are:

1. generative adversarial networks (GANs) 

2. variational autoencoders (VAEs) 

3. decoder-based large language models (LLMs) 

However, not all GenAI patents can be assigned to these three specific core models based on available information from patent abstracts, claims or titles. 

Among these GenAI models, most patents belong to GANs. Between 2014 and 2023, there were 9,700 patent families of this model type, with 2,400 patent families published in 2023 alone. VAEs and LLMs are the second and third largest models in terms of patents, with around 1,800 and 1,300 new patent families respectively between 2014 and 2023. 

In terms of patent growth, GAN patents show the strongest increase over the past decade. However, this has slowed down recently. In contrast, diffusion models and LLMs show much higher growth rates over the last three years, with the number of patent families for diffusion models increasing from 18 in 2020 to 441 in 2023 and for LLMs increasing from 53 in 2020 to 881 in 2023. The GenAI boom caused by modern chatbots such as ChatGPT has clearly increased research interest in LLMs. 

What are the main types of data used in GenAI patents? 

The main GenAI data types include: – Image – Video – Speech – Sound – Music 

Among the different GenAI modes, or the type of data input and output, most patents belong to the image/video category. Image/video data is particularly important for GANs. Patents involving the processing of text and speech/sound/music are key data types for LLMs. The remaining modes: 3D image models, chemical molecules/genes/proteins and code/software have far fewer patents so far. As with patents related to GenAI core models, some patents cannot be clearly assigned to a specific data type. In addition, some patents are assigned to more than one mode because certain GenAI models, such as multimodal large language models (MLLMs), overcome the limitation of using only one type of data input or output. 

Top application areas of GenAI patents 

The key application areas for GenAI patents include: 1. Software 2. Life sciences 3. Document management and publishing 4. Business solutions 5. Industry and manufacturing 6. Transportation 7. Security 8. Telecommunications 

GenAI is bound to have a significant impact on many industries as it finds its way into products, services and processes, becoming a technological enabler for content creation and productivity improvement. For example, there are many GenAI patents in life sciences (5,346 patent families between 2014 and 2023) and document management and publishing (4,976). Other notable applications with GenAI patents ranging from around 2,000 to around 5,000 over the same period are business solutions, industry and manufacturing, transportation, security and telecommunications.  

In the life sciences sector, GenAI can expedite drug development by screening and designing molecules for new drug formulations and personalized medicine. In document management and publishing, GenAI can automate tasks, save time and money, and create tailored marketing materials. In business solutions, GenAI can be used for customer service chatbots, retail assistance systems, and employee knowledge retrieval. In industry and manufacturing, GenAI enables new features like product design optimization and digital twin programming. In transportation, GenAI plays a crucial role in autonomous driving and public transportation optimization. 

However, many patent families (around 29,900 patent families between 2014 and 2023) cannot be assigned to a specific application based on the patent abstract, claims or title. These patents are instead included in the category software/other applications.

TRIPS

Factors influencing the prioritisation of access to medicines in trade-related intellectual property policymaking in Thailand' by Brigitte Tenni, Joel Lexchin, Chutima Akaleephan, Chalermsak Kittitrakul, Belinda Townsend, Deborah Gleeson in (2024) Journal of World Intellectual Property comments 

International trade is often viewed as an essential component of economic growth, however trade agreements come with risks to public health, including to access to medicines. Thailand, like many other low and middle-income countries (LMICs), faces ongoing trade-related challenges that threaten access to an affordable and sustainable supply of medicines. These challenges include external trade pressures to modify policies and laws that govern intellectual property (IP) and bilateral and regional trade agreements through which high-income countries like the United States (US) seek to increase patent protection for pharmaceutical products and processes. 

Access to an affordable and sustainable supply of medicines is an important policy objective for Thailand given its commitment to universal health coverage (UHC) and reliance on locally produced and imported generic medicines. In 2002, Thailand became one of the first middle-income countries to implement UHC which covers 47 million people or 72% of the population. IP barriers have been a consistent challenge to Thailand's ability to ensure access to affordable medicines within its UHC scheme. 

Thailand has a rich history of balancing trade pressures and public health priorities and has been lauded for achieving a degree of policy coherence between trade and health. This balance has been attributed to instances of bold political leadership and skilled advocacy by a well-networked and informed civil society. Trade and health officials have often come together to address divergent interests and positions. A broad range of stakeholders that includes academics, lawyers, pharmacists, patient interest and consumer groups and access to medicines activists, has closely followed these developments and has created broad-based coalitions and sustainable advocacy to preserve Thailand's policies that maximise access to affordable generic medicines. Thailand, therefore, provides an interesting case study of the relationship between trade-related IP and access to medicines as many LMICs look to Thailand for lessons of how to navigate and balance public health imperatives and IP obligations. 

Thailand's IP laws and policies, including its patent laws, are shaped by its membership of the World Trade Organization (WTO). Thailand has been a WTO member since its inception in January 1995 and a member of General Agreement on Trade and Tariffs since 20 November 1982. As a condition of WTO membership, Thailand must abide by the WTO's Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) which came into effect on 1 January 1995 and remains the most comprehensive multilateral agreement on IP. TRIPS binds WTO Members to minimum standards of IP protection and obliges Member States to make patents available for pharmaceutical products or processes that meet the standard criteria for patentability, novelty, inventive step and industrial applicability. TRIPS also contains ‘flexibilities’, designed to mitigate the negative impacts of patents, such as high medicines prices caused by pharmaceutical company monopolies. Compulsory licensing (CL) is one such example of a TRIPS flexibility. CL refers to the process through which a government allows the production of a patented product or the use of a patented process without the consent of the patent owner. The patent holder must be paid a royalty based on a percentage of sales by the licensee. 

Thailand has also experienced ongoing pressures to extend IP protection through its participation in trade agreements with provisions that exceed the requirements of TRIPS (often referred to as ‘TRIPS-plus’ provisions). TRIPS-plus provisions, such as obligations to extend patent terms beyond 20 years, lower thresholds for granting patents or restrict the grounds for granting compulsory licences, can lead to longer monopoly periods for new medicines and delays to the market entry of affordable generics. Thailand has not yet signed a trade agreement with these patent-related TRIPS-plus provisions, yet it has experienced ongoing pressures to do so. 

Indeed, Thailand provides an interesting puzzle. It introduced patent IP protection in the early 1990s before it was required to through TRIPS, is one of the few countries that has initiated CL for local production of generic medicines, and has actively opposed TRIPS-plus measures in trade negotiations, yet has repeatedly expressed interest in joining the Comprehensive and Progressive Agreement on Trans-Pacific Partnership (CPTPP), which includes TRIPS-plus measures (although some of these are currently suspended). 

Why and how governments prioritise access to medicines in their trade policymaking has not received much attention to date in the scholarly literature on trade and health. One study of how health issues fared on the Australian government's agenda during its participation in the Trans-Pacific Partnership negotiations identified 16 factors including the strength of exporter interests; extent of political will of Trade and Health Ministers; framing of health issues; support within the major political parties; the strength of available evidence; and the presence of existing domestic legislation and international treaties, among others. Similarly, a study of why TRIPS-plus measures dropped off the negotiating agenda of the Regional Comprehensive Economic Partnership Agreement (RCEP) negotiations (to which Thailand was party) identified the importance of the technical capacity of strong civil society actors and LMIC negotiators; supportive public health norms; processes that allowed for public scrutiny and public health views; the use of evidence; and country specific support for public health issues. 

A recent narrative review of public health advocacy strategies to influence trade policy identified a range of factors as important for advancing health issues on trade policy agendas, including favourable international media attention and mainstream media coverage, leadership by Ministers of Trade and Health; public support; and political party support. Very few studies identified by the narrative review included Thailand or other nations in Southeast Asia. Two studies explored the feasibility of implementing a human rights-based impact assessment tool to measure the impact of TRIPS-plus trade agreements in Thailand. A study of the access to medicines movement in Thailand traces its links to AIDS activism and identified access to knowledge as a key component of the movement's success. Another study from Thailand explored the capacity building of health actors to engage in global health diplomacy including trade negotiations. This study found that an increase in the capacity of health actors to engage with trade negotiators and a greater understanding of the effects of trade on health led to greater attention to health within trade negotiations. In terms of compulsory licencing, a study analysed the policy processes that led to the granting and implementation of Thailand's compulsory licences and found that the effective confluence of knowledge and evidence, civil society movements, public support and leadership of policy makers and politicians helped overcome the seemingly insurmountable obstacles to issuing the CLs in Thailand. Similarly, Rosenberg found that established relationships between individuals, collective advocacy and structural elements in Thailand created an enabling environment for Thailand to prioritise health over IP rights. 

The current study aims to elucidate the factors that have influenced prioritisation of access to medicines in trade-related IP policy making in Thailand by focusing on three policy case studies: (1) Thailand's patent law and its amendments; (2) its issuance of compulsory licences; and (3) its decision-making about TRIPS-plus trade agreements including potential membership of the CPTPP. These case studies were chosen because they reflect distinct episodes in Thailand's IP policymaking. The findings can provide an evidence base for future trade-related IP decision making for Thailand and other countries that seek to overcome trade-related IP barriers to access to an affordable supply of medicines.

Pharma Markets

'In the Name of Transparency: Organizing European pharmaceutical markets through struggles over transparency devices' by Susi Geiger and Théo Bourgeron in (2023) 44(11) Organization Studies comments 

The controversies surrounding the heavily redacted contracts between the European Commission and Covid-19 vaccine producers have highlighted ‘transparency’ as a hotly debated concept in the pharmaceutical market. We combine research on transparency with literature on the organization of markets to investigate how such struggles over competing visions of transparency end up shaping markets and their politics. Focusing on the case of the European pharmaceutical market, we demonstrate how market transparency was implemented through devices that enacted specific visions of transparency and produced distinct market organizations over time: transparency for states (until about 1990), transparency for corporations (ca. 1990 to 2010) and transparency for state coalitions (since 2010). We discuss how the specific instrumentations and materializations of such visions of transparency play a crucial role in market politics. This debate also highlights why engaging in controversies over transparency has become increasingly important for those contesting the market status quo – in pharmaceutical markets and beyond. ... 

Why aren’t markets more transparent? During the Covid-19 pandemic, this issue was a lively point of debate as activists and politicians questioned the opacity in which Covid-19 treatments and vaccines were ordered, priced and distributed (Centre for Global Development, 2021; Londeix & Martin, 2022). In May 2019, a few months before the virus started to spread, a resolution had already been passed at the World Health Assembly (WHA, 2019), which ordered member-states to ensure transparency in pharmaceutical markets. Making visible a push for transparency by state actors themselves, the resolution aimed to reduce the spaces of opacity in which high prices for medicines were said to proliferate (Shaw & Mestre-Ferrandiz, 2020). Yet, while states, corporations and civil society all agreed on the benefits of ‘more transparency’, its very definition was a contested one. Shortly after the WHA, a pharmaceutical spokesperson published a column suggesting an alternative vision of transparency, one that focused on making the decision-making processes of payers more transparent to corporations (Roedinger, 2019). How do such contestations around visions and definitions of transparency act to reorganize markets, and to whose benefit? 

Once the exclusive concern of stock market regulators and neoclassical economists looking for markets emanating ‘correct’ informational signals, transparency has become a ubiquitous issue in public debate in markets ranging from pharmaceuticals, capital markets, international trade, raw materials and housing to food (BEUC, 2018; EPHA, 2021; Transparency International, 2016). This practical concern over market transparency as a governance ideal arises at a time when organization studies have started to illuminate how the notion of transparency is put to use by policymakers, civil society and corporations (Hansen & Weiskopf, 2021; Heimstädt & Dobusch, 2020; Reischauer & Ringel, 2023; Weiskopf, 2023). This research highlights the constitutive qualities of transparency, where ‘transparency as a form of ordering’ (Flyverbom, 2015, p. 168) shapes organizations and actor conduct. 

We transpose this constitutive view of transparency into the context of markets, demonstrating how shifting meanings of transparency have concrete organizational consequences as they become translated into socio-material market arrangements. We highlight that visions of transparency are materialized through what Harvey, Reeves and Ruppert (2013) called transparency devices, and we investigate the role that these devices play in the organization of markets. Our study contributes to research that moves beyond normative views of market transparency (Roscoe, 2022; Roscoe & Willman, 2021) by analysing the struggles that occur around competing visions of transparency and, crucially, by tracing how these struggles shape markets. 

Investigating such struggles, we claim, is vital to understand market politics. Focusing on the evolution of the European pharmaceutical market, we highlight how the strategic deployment of arrangements that promote selective visions of transparency is a key mechanism to reorganize markets and direct funding to specific actors. In this perspective, a lack of transparency is not the outcome of ill-designed markets – in the pharmaceutical market at least, our investigation shows how (shifting) definitions of transparency were carefully organized with political objectives in mind. Our paper highlights certain moments in time in which transparency assumed a ‘post-political’ role in markets. In post-politics, superficially consensus-based regulatory norms such as transparency are used to ‘hide fundamental differences in interests and power resources’ behind technical settlements (Garsten & Jacobsson, 2013, p. 422; Wilson & Swyngedouw, 2014). In our case, such settlements worked to conceal fundamental conflicts between corporations, states and patients. However, by focusing on transparency’s technical implementation through devices, we also expose the politics around this post-political concept, emphasizing how it has become not only a consensual key organizing principle but also a technocratic battlefield for promoting alternative market organizations. By highlighting these market politics, our discussion offers insights into how civil society and state activists currently reclaim transparency to challenge the market status quo, in pharmaceutical markets and beyond.

'Building the weak hand of the state: tracing the market boundaries of high pharmaceutical prices in France' by  Théo Bourgeron and Susi Geiger in (2022) 27(5) New Political Economy 837-850 comments

Prices for new medications have strongly increased over the last decades, reaching levels that could endanger healthcare insurance systems. Focusing on the French case, this article builds on the structural approach of business power and investigates how this situation results from the construction of market boundaries that created unassailable spaces for high pricing. Starting from the 1990s, it traces how high drug prices relied on the construction of a market setting first designed to increase pharmaceutical prices, in which the negotiating position of the state was deliberately weakened. But the politics of maintaining such high drug pricing quickly required reshaping the boundaries of the pharmaceutical market and concentrating the favourable negotiation framework on a small number of innovative medicines. Most recently, the spiralling of prices for these medicines have necessitated yet another revisiting of these market boundaries. High drug prices do not result from direct business power by the pharmaceutical sector; rather, the pharmaceutical sector depends on boundary-work performed in cooperation with state institutions to carve out domains for favourable market pricing. Emphasising the politics of this boundary-work thus ultimately also signals its potential reversibility. 

In 1989, the French Minister of Health was defending its ‘New Pharmaceutical Policy’ bill. This bill was essential, he argued, because it would ‘ensure the conditions of growth for the pharmaceutical industry’ by rebalancing the negotiations between pharmaceutical companies and the state, allowing the former to obtain higher prices to be competitive on the European single market.  In 2019, Chantal Delorgey, the head of the French health agency Haute Autorité de la Santé (HAS), was wondering whether the relationship between public payers and pharmaceutical manufacturers had become too unbalanced (EPHA 2019). This time, pharmaceutical firms were accused of being in the strong position, building their negotiating power on a market structure that pushed the prices of new medicines to unsustainable highs. This article draws up a history of what happened in the intervening 30 years and describes the intense institutional construction that has shaped the positions of public payers and private firms in the French pharmaceutical market over time. 

Digging into this history reminds us that current high prices for medicines result from political struggles mediated by contested market mechanisms. High prices have become an integral part of the pharmaceutical business model, allowing manufacturers to sustain high levels of profit (Froud and Sukhdev 2006). Past research has investigated how these levels of profits allow pharmaceutical firms to adopt a financialised business model that involves the reconfiguration of biochemical compounds, intellectual property, clinical trials, and the pharmaceutical ecosystem towards profit-making (Dumit 2012, Rajan 2017, Lazonick et al. 2019, Bourgeron and Geiger 2022). These value-extraction strategies fundamentally rely on pharmaceutical companies’ ability to achieve high prices for their pharmaceuticals (Roy 2020), with some analyses predicting how an imbalance between states and multinational pharmaceutical companies may ultimately jeopardise universal access to medicines even in high-income countries (Tansey and Ainger 2019, EPHA 2020). This makes it crucial to understand the political economy determinants of high drug prices, an issue that has not been the topic of much scholarship, despite significant interest in pharmaceutical prices in general (Busfield 2006, Nouguez 2016, Nouguez and Benoît 2017) and in specific cases of high drug pricing (Roy and King 2016). Building on structural approaches of business power, we draw up a political economy of high drug prices by outlining, through the case of France, how their construction results from intense market boundary-work by policymakers and pharmaceutical companies. In our analysis, the weak negotiating position of European states results from the deliberate action of public authorities, who endorsed successive reforms of the boundaries of the pharmaceutical market aimed at replacing direct support to pharmaceutical firms through state aids with indirect support through prices, facilitated by favourable negotiation frameworks. This however loosened the state’s control on pharmaceutical companies and led to disputes over which medicines should enjoy such high prices. As healthcare activists and budget holders all over the EU struggle to maintain universal access to medicines, our perspective is crucial to map the boundaries of high pharmaceutical prices and understand where contestation opportunities lie. 

This article proceeds as follows. We first elaborate on the difficulties raised by high drug prices and explain how this calls for a conceptual background that combines a structural approach of business power with an attention to how the boundaries of markets are transformed. We then detail our methods and the complicated landscape of pharmaceutical price negotiation in France. This brief overview is followed by our historical study. It shows how the initial construction of pharmaceutical prices as market-based prices aimed at weakening the state in the negotiations with companies to help French manufacturers compete at the European level (1989-2003). It then highlights the boundary-work that led this market to be split into differentiated markets, where some medicines were allocated low prices through administrative procedures and others enjoyed favourable market pricing (2003-2011). Finally, it describes how high prices for innovative medicines negotiated through markets have become unsustainable for public payers, leading to further boundary-work and proposals to implement administrative caps on the highest-priced medicines (2011-2020)

AI, Patent Reading and Patent Disclosure

'Misleading AI: Regulatory Strategies for Transparency in Information Intermediary Tools for Consumer Decision-Making' by Jeannie Marie Paterson in (2023) Loyola Consumer Law Review comments

Increasingly, consumers’ decisions about what to buy are mediated through digital tools promoted as using “AI”, “data” or “algorithms” to assist consumers in making decisions. These kinds of digital information intermediaries include such diverse technologies as recommender systems, comparison sites, virtual voice assistants, and chatbots. They are promoted as effective and efficient ways of assisting consumers making decisions in the face of otherwise insurmountable volumes of information. But such tools also hold the potential to mislead consumers, amongst other possible harms, including about their capacity, efficacy, and identity. Most consumer protection regimes contain broad and flexible prohibitions on misleading conduct that are, in principle, fit to tackle the harms of misleading AI in consumer tools. This article argues that, in practice, the challenge may lie in establishing that a contravention has occurred at all. The key characteristics that define AI informed consumer decision-making support tools ––opacity, adaptivity, scale, and personalization –– may make contraventions of the law hard to detect. The paper considers whether insights from proposed frameworks for ethical or responsible AI, which emphasise the value of transparency and explanations in data driven models, may be useful in supplementing consumer protection law in responding to concerns of misleading AI, as well as the role of regulators in making transparency initiatives effective.

'Linguistic metrics for patent disclosure: Evidence from university versus corporate patents' by Nancy Kong, Uwe Dulleck, Adam B Jaffe, Shupeng Sun and Sowmya Vajjala in (2023) 52(2) Research Policy comments 

 Encouraging disclosure is important for the patent system, yet the technical information in patent applications is often inadequate. We use algorithms from computational linguistics to quantify the effectiveness of disclosure in patent applications. Relying on the expectation that universities have more ability and incentive to disclose their inventions than corporations, we analyze 64 linguistic measures of patent applications, and show that university patents are more readable by 0.4 SD of a synthetic measure of readability. Results are robust to controlling for non-disclosure-related invention heterogeneity. The linguistic metrics are evaluated by a panel of “expert” student engineers and further examined by USPTO 112(a) – lack of disclosure – rejection. The ability to quantify disclosure opens new research paths and potentially facilitates improvement of disclosure. ... 

The patent system serves two purposes: “encouraging new inventions” and “adding knowledge to the public domain”. The former incentivizes creation, development, and commercialization by protecting inventors’ exclusive ownership for a limited period of time. The latter encourages disclosure of new technologies by requiring “full, clear, concise, and exact terms” in describing inventions.2 Sufficient disclosure in patents has three major benefits: (1) fostering later inventions (Jaffe and Trajtenberg, 2002, Scotchmer and Green, 1990, Denicolò and Franzoni, 2003); (2) reducing resources wasted on duplicate inventions (Hegde et al., 2022); and (3) inducing more informed investment in innovation (Roin, 2005). 

Despite a large body of literature on the patent incentivizing function (Cornelli and Schankerman, 1999, Kitch, 1977, Tauman and Weng, 2012, Cohen et al., 2002), patent disclosure receives limited attention. This raises concerns; as Roin (2005), Devlin (2009), Sampat (2018), Arinas (2012) and Ouellette (2011) document, the technical information contained in patent documents is often inadequate and unclear. Important questions, such as how to measure disclosure, potential incentives behind disclosure, heterogeneous levels of disclosure by entities, and the tactic of avoiding the disclosure requirement, have not been directly investigated. A major barrier to such empirical research has been the lack of broadly applicable, reproducible quantitative measures of the extent of disclosure or information accessibility. We propose and demonstrate that extant metrics developed in computational linguistics can help to fill this gap. 

In using computational linguistic metrics to compare the readability of documents, we follow researchers in the finance and accounting literature, who have used readability metrics to gauge whether readers are able to extract information efficiently from financial reports (Li, 2008, Miller, 2010, You and Zhang, 2009, Lawrence, 2013). This literature posits that more complex texts increase the information processing cost for investors (Grossman and Stiglitz, 1980, Bloomfield, 2002) and finds, for example, that companies are likely to hide negative performance in complicated text to obfuscate that information (You and Zhang, 2009). 

Although patent applications differ from corporate annual reports, the research question regarding strategic obfuscation is similar: Documents are created subject to regulation, in which the purpose of the regulation is to compel disclosure, but the party completing the document may have incentives to obscure information. Our proposed linguistic measures are likely to serve as an informative proxy for the explicitly or implicitly chosen level of disclosure. The goal of this article is simply to demonstrate that these measures do appear to capture meaningful differences in accessibility or disclosure, and thereby opening up the possibility of research on the causes and effects of variations in disclosure. 

Our strategy for demonstrating the relevance of linguistic readability metrics is to identify a situation in which we have a strong a priori expectation of a systematic difference in disclosure across two groups of patents. If the proposed metrics show the expected difference, we see this as an indication to treat them as potentially useful. We compare patent applications from universities with those of corporations. Both strategic reasons and the costs of revealing information inform our expectations. From a strategic perspective, universities, with their focus on licensing of patents have an interest in making their patents more accessible. In contrast, corporations (particularly practicing corporations) may benefit from limiting the accessibility of information. From a cost perspective, drafting patents is usually informed by documentation of the relevant research or process of innovation. Given university researchers’ primary interest in accessible publications and the relevant standards of documentation, the source material available to an attorney drafting a patent may be much better than in the case of the same attorney drafting a patent for a corporation, in which the need for such documentation is much less. The literature also supports this expectation (Trajtenberg et al., 1997, Henderson et al., 1998, Cockburn et al., 2002). 

Universities and corporations follow different business models for patenting: technology transfer versus in-house commercialization. Patents applied for by universities, with a focus on generating income from the licensing of inventions, should have a higher level of disclosure because transparent information makes it easier to signal the technology contained in the patent and attract potential investors. As a result, they are more readable than corporate patents. The readability difference could be further magnified by the moral requirements of university research as well as the rigor of academic writing, which could further affect the level of disclosure. 

Corporations, particularly those with a focus on in-house production, on the other hand, have a greater incentive to obfuscate crucial technical information to deter competitors from understanding, using, and building on their inventions. The profit-maximizing motive, as well as a lack of incentive to thoroughly document the invention, could also contribute to the low level of disclosure. Together, it is reasonable to assume that universities may strategically (or unconsciously) choose a higher disclosure level in patent applications than corporations. We emphasize that we do not see this analysis as testing the hypothesis that universities engage in more disclosure than corporations for a particular reason. Rather, we take this as a maintained hypothesis and show – conditional on that maintained hypothesis – that the linguistic measures meaningfully capture differences in disclosure across patents, which indicates the value of further research and the need to reconsider patent examination with respect to the accessibility and disclosure of information contained in patents. 

Similar to the finance literature, we use a computational linguistic program designed to assess the reading difficulty of texts using 64 measures from second language acquisition research. The indicators cover the lexical, syntactic, and discourse aspects of language along with traditional readability formulae. We apply them to a full set of U.S. patent application texts in three cutting-edge industries from the past 20 years. Our baseline OLS estimations reveal significant differences between university and corporate patents. Using principal component analysis (PCA) to combine the 64 indicators and create synthetic readability measures, we show that composite indices detect strong differences between university and corporate patents, which lends support to the validity of our measures. 

The key empirical challenge is that the nature of corporate and university inventions might differ; thus, the textual communication required for corporate inventions could differ. To address this concern, our identification strategy employs the following. First, to account for the unobserved heterogeneity in linguistic characteristics intrinsic to technical fields, our econometric method controls for U.S. patent subclass fixed effects. This enables us to measure disclosure as the degree of readability relative to other technologically similar patents. Second, we use patent attorney fixed effects to control for systematic disclosure effects from the drafting agents. This compares the university and corporate patents drafted by the same patent attorney. Third, we employ cited-patent fixed effects with a data compression technique, least absolute shrinkage and selection operator (LASSO), to further control for the nature of inventions. This is because university and corporate patents that cite the same previous patents build on the same prior knowledge, and are therefore likely to be technologically similar inventions. Fourth, to deal with any selection bias from observables, we use a doubly robust estimation that combines propensity score matching and regression adjustment. This enables us to compare university and corporate patents with similar attributes. 

Our results show that corporate patents are 0.4 SD more difficult to read and require 1.1–1.6 years more education to comprehend than university patents. We find that the difference is more prominent for more experienced patent applicants, and that licensing corporate patents disclose more than other corporate patents, which we believe supports the idea that the differences in readability are at least somewhat intentional. We also show that a potential channel for obfuscation lies in the provision of many examples in order to conceal the “best mode” of inventions. 

This paper is one of the first to specifically use textual analysis to examine patent disclosure (with exception of Dyer et al. (2020) who focus on patent examiners’ leniency) and validate the measure. We obtain the whole set of full text patent applications in categories related to nanotechnology, batteries, and electricity from 2000 to 2019, totaling 40,949, and apply our linguistic analysis model to the technical descriptions of these patents. We expand readability studies in related literature that rely heavily on traditional readability indices such as Gunning Fog, Kincaid, and Flesch Reading Ease by including lexical richness, syntactic complexity, and discourse features. We use the best non-commercial readability software (Vajjala and Meurers, 2014b) to capture the multidimensional linguistic features of 64 indicators, and perform a more in-depth linguistic analysis (Loughran and McDonald, 2016) than previous studies. We also use principal components analysis to construct synthetic overall measures of readability. 

Having developed this rich set of readability measures, we validate them as indicators of effective patent disclosure by testing whether the lexical measures show patents to be more readable in several real-world contexts. Our primary comparison is between university and corporate patents. The licensing aims of universities and absence of market driven competitive motives mean that they have greater incentive to disclose – less incentive to conceal – key information relative to corporations. Through analyses that control for sources of variation in readability, we find that university patents are, indeed, more readable. We support this main analysis with several other comparisons. Intellectual Ventures – a corporation that, akin to universities, seeks to license its patents over competing in the market – also holds patents with above average readability. Several large corporations known to be active patent licensors (IBM, Qualcomm, and HP) similarly exhibit higher readability. Additionally, a set of patents that can be presumed to have been reassigned also exhibit higher readability than otherwise similar patents. Finally, we compared the computational readability measures to subjective evaluations of readability and disclosure for a small number of patents, and assessed the readability of patents rejected by the USPTO for reasons that include failure to adequately disclose the technology. 

We see the role of this paper as analogous to Trajtenberg et al. (1997), who first introduced metrics of patent “importance”, “generality” and “originality” based on patent citation data. We imitate their strategy to test whether our proposed new measures reveal the contrast we expect between university and corporate patents, and argue that the finding – that they display the predicted pattern – can be taken as initial evidence that they capture meaningful variation in unobservable patent disclosure quality. The introduction and initial validation of these measures open up the possibility of quantitative treatment of extent of disclosure in patents, both for social science research on the sources and effects of better or worse disclosure, and potentially for use in more systematic treatment of the disclosure obligation in the patent examination process. 

The rest of the paper proceeds as follows. Section 3 explains the linguistic measures used in the study. In Section 2, we review the relevant literature and lay out our hypothesis of differences in disclosure between university and corporate patent applications. Section 4 presents our data and baseline estimation, followed by our main results in Section 5. We examine attorney fixed effects and cited-patent fixed effects in Section 6, and one channel that corporations could use to obscure patent applications in Section 7. We show heterogeneous effects in Section 8 and usefulness tests in Section 9, and conclude in Section 10.

Jabs and TRIPS

'An ethico-legal assessment of intellectual property rights and their effect on COVID-19 vaccine distribution: an Australian case study' by James Scheibner, Jane Nielsen and Dianne Nicol in (2022) 9(2) Journal of Law and the Biosciences comments 

This article posits that Australia, as an affluent country with increasing capacity to manufacture vaccines, has an obligation to assist its regional (and global) counterparts in implementing vaccination programs that protect their populations. First, the article explores the capacity of high-income nations to meet their obligations, assist their neighbours and refrain from vaccine nationalism. This inquiry involves an analysis of the optimal ethical strategy for distributing vaccines globally, and the role that Australia might play in this distribution strategy. Secondly, the article examines the intellectual property landscape for vaccines in Australia, focusing on the patents that cover vaccine compositions and manufacturing techniques (recognizing the potential for know-how and access to materials as well as patents to affect manufacturing capacity). This article then discusses the strategies the Australian Government has at its disposal to counter potential intellectual property impediments whilst complying with existing obligations under the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS), as an ethically appropriate response to the pandemic. This article also considers whether a so-called TRIPS waiver could provide better options and concludes that the challenge of compelling disclosure of know-how remains. 

 The authors argue 

 The race for effective vaccine candidates to fight the current COVID-19 pandemic has been like no other vaccine race in history. The extent of impacted populations, coupled with the rapid transmissibility of the virus, has prompted a push for vaccines on both public and private fronts that is unique in scale. In recognition of the fact that many nations lack both the capacity to manufacture vaccines and the funds to purchase them at market prices, COVAX was established in 2020 by the WHO, along with The Vaccine Alliance (GAVI) and the Coalition for Economic Preparedness Innovations (CEPI). The stated purpose of COVAX is to ‘… support the research, development and manufacturing of a wide range of COVID-19 vaccine candidates, and negotiate their pricing’. To this end, COVAX negotiated supply agreements with vaccine manufacturers in earlier phases of the pandemic. 

Whilst COVAX was meant to be the primary avenue for the global vaccine rollout in response to COVID, the extent to which this goal was achieved was hampered by a number of factors. One significant weakness was that nations which had secured supply of vaccines via bilateral agreements only decided to make them available once they had become surplus to their own needs. Rutschman notes that if governments engage in this form of ‘vaccine nationalism’, reserving vaccine supplies for their own population, this will undermine public health outcomes in other nations, particularly low- and middle-income nations. The tendency for nations in possession of vaccines surplus to their requirements to enter into bilateral agreements also appears to have increased the price of vaccines available via COVAX. 

This article uses Australia as a case study to examine the role and responsibility of high-income nations in contributing to the global effort to suppress this pandemic and respond to future pandemics. We suggest that nations such as Australia have an ethical responsibility to engage in vaccine distribution grounded in moral cosmopolitanism extending beyond state borders. We recognize that this duty should include provision of assistance to low- and middle-income nations to assist them in developing their own domestic manufacturing capabilities, to fulfill their moral nationalist obligations to their own citizens. However, the primary focus of this article is not so much on the ways in which nations like Australia could fulfil this duty (which we recognize as a laudable long-term goal). Instead, this article focuses specifically on the responsibility and freedom that nations like Australia possess to manufacture vaccines for supply to those nations in response to pandemic diseases such as COVID-19. Through an assessment of the intellectual property landscape associated with approved vaccines, this article concludes that intellectual property rights over vaccines, including patents, know-how and bilateral licensing agreements, do have the capacity to hinder domestic manufacture of vaccines. As such, high-income nations like Australia need to consider utilizing the full armoury of current and proposed flexibilities under the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) in attempting to fulfil their global responsibilities. 

The first section of this article involves an examination of what might be the optimal, ethical strategy for distributing vaccines globally, and the role that Australia can play in this distribution strategy. The Australian Government’s primary focus was on vaccinating the Australian population, although it has also assisted with the global vaccination effort. These programs have involved both formalized global vaccine-sharing commitments and bilateral arrangements with Australia’s nearest neighbours. Australia is a signatory to COVAX, and in this role the Government has committed to contribute to the distribution of vaccines for lower-income nations through the COVAX Advanced Market Commitment scheme. Bilaterally, the Australian Government responded to acute COVID crises in India through donation of materials and equipment and in Papua New Guinea (PNG) through an initial donation of 8000 doses of AstraZeneca vaccine. Notwithstanding the importance of these contributions to the welfare of peoples in the region, the potential negative impact of bilateral arrangements on the COVAX response should not go unmentioned. 

In addition, the Australian Government was an early signatory to contracts with vaccine producers to allow it to gain access to large quantities of manufactured vaccine. Given that the Australian Commonwealth Serum Laboratories (CSL) already had existing capacity to manufacture viral vector vaccines, the Government also made an early decision to contract CSL as a producer of AstraZeneca’s Vaxzervria vaccine. However, CSL indicated that it would not renew this contract in late 2021. The Government has since also announced an intention to build capacity to manufacture mRNA vaccines in collaboration with the State of Victoria and Moderna, with a view to commencing manufacture in 2024. As such the Government appears to be prepared to work with the major vaccine producers in formulating its plans for domestic manufacture of COVID vaccines into the future. 

In parallel, the Australian Government has expressed some support for a draft waiver proposed by the so-called Quadrilateral or ‘Quad’ of the United States, European Union, India and South Africa, currently before the TRIPS Council, to waive some COVID-related intellectual property rights. This proposal, initially sponsored by India and South Africa, sought to temporarily waive TRIPS provisions with respect to relevant intellectual property rights associated with COVID-19 vaccines, diagnostics and therapeutic tools. As originally intended, the waiver might have applied not only to formal intellectual property rights, such as patents, copyright and geographical indications, but also to ‘informal’ intellectual property rights, such as trade secrets and know-how. However, the current waiver being considered is significantly narrower, and only applies to certain patents on COVID-19 vaccines. 

If the waiver is passed by the TRIPS Council and implemented domestically, intellectual property rights holders would no longer be able to enforce relevant rights against other manufacturers or nations producing versions of their therapeutics. Proponents of the waiver argue this needs to be implemented because intellectual property rights have been used to deter developed nations from fully participating in the global effort to defeat the COVID-19 pandemic. It should be noted, however, that there are other flexibilities already available under TRIPS, particularly those relating to uses without authorization under TRIPS Article 31, which could be used legitimately either by governments or by third-party manufacturers without authorization from the rights holders. 

The impact of intellectual property rights on the capacity of governments in developed nations to distribute COVID-19 vaccines to low- and middle-income nations, together with the utility of the TRIPS waiver, is a central theme of the later sections of this article. This article examines the extent to which intellectual property rights have impeded Australia’s capacity to contribute to this strategy in a meaningful way. This examination includes an analysis of the Australian intellectual property landscape surrounding the main vaccine candidates that have reached clinical trials and/or been approved for clinical use. The final section of the article analyses potential workarounds to intellectual property impediments (focusing particularly on existing legislative provisions permitted under TRIPS), to ascertain whether Australia is in fact in a legitimate position to assist other nations in surviving this pandemic and future pandemics.

TRIPS Waiver

'The COVID-19 TRIPS Waiver and the WTO Ministerial Decision' by Peter K Yu in Jens Schovsbo (ed) IPR in times of crisis: Lessons Learned from the Covid-19 Pandemic (Edward Elgar, 2023) comments

In October 2020, India and South Africa submitted an unprecedented proposal to the WTO, calling for the partial suspension of the TRIPS Agreement to facilitate the ‘prevention, containment or treatment of COVID-19’. Although this proposal immediately received considerable support from other WTO members, civil society organizations and individual experts, it faced strong opposition from some developed countries – most notably the European Union, the United Kingdom, Switzerland and, to some extent, also the United States. 

 By December 2021, it was quite clear that the COVID-19 TRIPS waiver proposal would not receive enough support to achieve consensus within the WTO membership. Around that time, the European Union, India, South Africa and the United States, with the support of the WTO, launched quadrilateral consultations to find a compromise solution. The ‘Quad proposal’ that was eventually developed through these high-level consultations became the blueprint from which WTO members developed a new ministerial decision at the Twelfth WTO Ministerial Conference in Geneva in June 2022. This decision allowed WTO members to manufacture COVID-19 vaccines – and, if subsequently approved, also other COVID-19 health products – without the authorization of the relevant patent holders. 

 This chapter traces the TRIPS waiver debate from the submission of the original proposal by India and South Africa in October 2020 to the final adoption of the Ministerial Decision on the TRIPS Agreement in June 2022. The chapter further evaluates the strengths and weaknesses of this newly adopted decision, comparing it with the earlier TRIPS waiver proposal. It concludes by offering suggestions for future actions that WTO members on both sides of the waiver debate could take to help combat the COVID-19 pandemic.

TRIPS Waiver

'The COVID-19 TRIPS Waiver Process in Critical Review: An Appraisal of the WTO DG Text (IP/C/W/688) and Recommendations for Minimum Modifications' by Siva Thambisetty, Aisling McMahon, Luke McDonagh, Hyo Yoon Kang and Graham Dutfield comments

The original TRIPS waiver proposal made by India and South Africa in October 2020 was based on the need for affordable access to medical products for the prevention, containment of treatment of COVID-19 during the pandemic. That proposal sought to bring into force a waiver of WTO States’ TRIPS obligations with regard to patents, copyrights, industrial designs and undisclosed information as they relate to COVID-19 health technologies. In May 2021, we set out the legal and political case for this principles-based TRIPS waiver. Subsequent negotiations over the waiver have been difficult and protracted. Only in May 2022 did an apparent ‘compromise’ text emerge from the WTO Director General (DG), but without the explicit support of the waiver’s main proponents, India and South Africa, leading to concern over the scope and effectiveness of the DG text. In this paper we provide a short commentary that critiques the WTO DG text’s deficiencies and spells out the minimum modifications necessary for a meaningful workable text for use in the COVID-19 emergency context.

innovation

'Profitability and drug discovery' by Enes Işık and Özgür Orhangazi in (2022) Industrial and Corporate Change comments 

Pharmaceutical firms are highly profitable due to high markups enabled by high drug prices. This is justified by the argument that high profits provide incentives for innovation and help fund high research and development (R&D) costs. We investigate the link between past profitability and drug discovery for large publicly-listed pharmaceutical firms between 1980 and 2018. Our sample includes 118 firms with 2534 firm-year observations and in terms of sales corresponds to 55% of the global spending on drugs. By merging three data sets on firm financials, new patent applications, and new drug approvals, we show that pharmaceutical firms’ markups and profitability are consistently higher than average nonfinancial firm profitability, with secularly increasing trends since 1980. Whereas R&D spending has also increased, the number of new drug approvals has not increased at the same pace and the productivity of R&D spending has been declining. In statistical analysis, we fail to identify any strong positive relationship between profitability and new drug discovery. Results are broadly in line with the earlier findings of research on the pharmaceutical industry and provide a contribution to the discussion on the link between profitability and innovation as well as on formulating policies for increasing drug innovation and ensuring the provision of essential drugs while keeping their costs low. 

 The authors argue 

 The Covid-19 pandemic once again put the pharmaceutical industry under the spotlight. While developing a number of vaccines in a historically short time span was recognized as an extraordinary achievement and the perception about pharmaceutical firms turned “from greedy patent exploiters to the saviors of humankind,” 1 some were quick to point out the essential role of public funds and technology behind this success2 and how monopolization of the vaccine production through patents decreases the overall social welfare of the world population.3 In fact, profitability, productivity, and innovation capacity of the pharmaceutical industry have long been subject to detailed investigations and controversy. The recent body of research suggests that it has consistently been among the most profitable industries (Spitz and Wickham, 2012; Ledley et al., 2020), while, at the same time, it is one of the most research-intensive industries measured by research and development (R&D) spending and the number of patents (Rikap, 2021: 99). However, despite high profitability and high R&D spending, a productivity crisis has been affecting the industry as indicated by a decline in pharmaceutical innovation (e.g., Munos, 2009; Paul et al., 2010; Pammolli et al., 2011; Khanna, 2012; Scannell et al., 2012; Scannell and Bosley, 2016), which, according to some, is due to the increased financialization and shareholder value focus of the industry (Montalban and Sakınç, 2013; Lazonick et al., 2017; Tulum and Lazonick, 2018). The high cost of drugs in the USA has also led to a criticism of the high markups of the industry (Kesselheim et al., 2016), while others defended the high profits on two grounds: it gives incentives for innovation and helps pharmaceutical firms recoup high R&D costs to continue investment in R&D and innovation (e.g., DiMasi et al., 2003, 2016). Yet, these grounds have also been challenged as it has been argued that most of the new drugs that come to the market are not invented by the large and highly profitable pharmaceutical firms but by smaller labs and through partnerships with publicly funded research labs (Jung et al., 2019; Rikap, 2021). 

We focus on the profitability and productivity of large pharmaceutical firms by combining and analyzing three different data sets on firm financial statements, patents, and new drugs approved by the Food and Drug Administration (FDA). We specifically focus on the link between profitability and innovation as measured by new drug approvals. Our analyses reveal four things: First, large pharmaceutical firms indeed charge higher markups and earn higher profits compared with the average markups and profitability of the rest of the nonfinancial corporate sector; and both rates have significantly increased over time. Second, while it is true that they devote a higher share of their profits to R&D, this share has declined in the late 2000s and only recovered to its previous high after the mid-2010s, whereas payments to shareholders have been taking up a much larger share of pharmaceutical firms’ profits. Third, even though the total number of patents filed by the pharmaceutical firms has significantly increased, new drug or biologics license approvals, especially ones constituting highly innovative forms have slowed down and R&D productivity measured in terms of drug innovation has been declining. Fourth, firm-level statistical analyses show no evidence of a positive relationship between profitability and drug innovation. These results are broadly in line with the earlier findings of research on the pharmaceutical industry and provide a contribution to the discussion on the link between profitability and innovation as well as on formulating policies for increasing drug innovation, ensuring the provision of essential drugs, while keeping their costs low. 

2. Profitability and innovation 

The pharmaceutical industry is perhaps one of the most researched industries. There is a voluminous literature in economics, business, and finance investigating various dynamics of the industry. While we will not attempt to present yet another review of this literature (for a recent review of the literature, see Lakdawalla, 2018), it is important to highlight that a central question regarding the industry has been the link between its high profitability and innovation capacity. This is because the pharmaceutical firms are among the most profitable in the nonfinancial corporate sector and their business model essentially depends on continuous innovation. A number of recent studies compare the profitability of large pharmaceutical firms with the rest of the nonfinancial corporate sector and find that pharmaceutical firms’ profitability has been significantly higher than average profitability (e.g., Spitz and Wickham, 2012; Ledley et al., 2020). This high profitability has been accompanied by high R&D spending and a large number of patents produced (Rikap, 2021: 99). The high markups and profitability of the industry drew criticism, especially because of the high costs of drugs in the USA (Kesselheim et al., 2016). 

It has generally been argued that the monopoly rents arising from patent protections and the resultant high profits are necessary rewards for high risk-taking. Innovations that provide monopoly rents and high profits will generate larger funds to further invest in R&D and for further innovation. These arguments are reminiscent of Schumpeter’s (1942) two types of innovative regimes. The first one, Mark 1, is the entrepreneurial regime that is mostly dominated by small innovative firms; and the second one, Mark 2, is the regime where innovations are mostly carried out by large established firms While the former is referred to as “creative destruction”, the latter is referred to as “creative accumulation.” In the latter, the R&D efforts of the large firms are sustained by the high profits of the previous periods that help finance innovative activities. Along these lines, Nordhaus (1969) argues that investments in innovation increase with high expected profits from innovation. Hence, the high profitability of the pharmaceutical firms is defended. First, on the ground that the monopoly rents that are behind the high profits generate incentives for taking risks and innovating. Second, since not all R&D activity results in profitable innovation, high profits are also seen as necessary for recouping these high R&D costs (e.g., DiMasi et al., 2003, 2016). 

There has been a number of empirical studies looking at profitability, cash flow, and R&D relationship for pharmaceutical firms. For example, Scherer (2001) finds that short-term deviations in profitability predict R&D expenditures, while works such as Grabowski (1968) and Grabowski and Vernon (2000) find that cash flow is an important determinant of R&D expenditures. However, as Lakdawalla (2018: 415) also notes most of this literature has not been clear whether the explanation relies on a financial constraints argument or a profitability argument. Yet, a number of recent studies point out that the industry has been suffering from a productivity crisis as revealed by the decline in pharmaceutical innovation (e.g., Munos, 2009; Paul et al., 2010; Pammolli et al., 2011; Khanna, 2012; Scannell et al., 2012; Scannell and Bosley, 2016). Focusing on this productivity crisis, Montalban and Sakınç (2013), for example, emphasize that the business model of the pharmaceutical industry in the USA has historically been based on “the exploitation of monopoly rents of innovation” and was supported by large amounts of public funding of basic research and strong patent protections. (p. 992). They go on to argue that a large part of this productivity crisis is due to increased financialization and shareholder value focus of the industry (Montalban and Sakınç, 2013; Lazonick et al., 2017; Tulum and Lazonick, 2018). In fact, some recent works argue that the existing innovation models of the pharmaceutical industry not only lack directionality to meet key needs but also lead to inefficient collaboration (Mazzucato and Li (2021: 39). 

Another significant challenge to the argument about profitability and innovation is that most of the new drug innovation does not come from highly profitable, large pharmaceutical firms but from smaller labs and/or publicly funded research labs (Jung et al., 2019; Rikap, 2021). In fact, according to this argument, large pharmaceutical firms profit from the marketing of the innovations that are due to small labs and/or publicly funded research labs. 

In the light of these discussions on the link between profitability and innovation, we ask in the following sections whether it is possible to empirically identify a link between profitability of the large pharmaceutical firms and their drug innovation.

Pharma

'Repositioning for Rare Diseases – Too Much, Too Little or Just Right?' by Jakob Wested and John Liddicoat in (2021) NIR: Nordiskt Immateriellt Rättsskydd / Nordic Intellectual Property Law Review comments 

“Drug repositioning” refers to the idea of expanding the use of an already authorised drug, for the treatment of new patient categories with the same diseases as well as the treatment of new diseases. Repositioning is considered an important innovation modality to increase treatments for patients with rare diseases. Yet, two recent EU studies have raised concerns that developers who reposition drugs are financially overcompensated to the detriment of national healthcare systems and patients and, therefore, suggest limiting the benefits provided by the orphan drug regulation. In this study, we show that the number of drugs repositioned for rare diseases (22%) is more modest than predicated and argue this indicates that developers may not be overcompensated, otherwise we would expect a much higher number. Furthermore, we argue that changing the incentives provided by the orphan drug regulation to address overcompensation is not the option if policymakers want to realise the benefits of repositioning. Instead, we suggest policymakers consider other legal and regulatory tools to address overcompensation issues, such as competition law and novel mechanisms emerging in Canada.

Patent contestations and a blockbuster drug

'(De-)assetizing pharmaceutical patents: Patent contestations behind a blockbuster drug' by Théo Bourgeron & Susi Geiger in (2022) 51(1) Economy and Society 23-45 comments

Recent debates in public health and social sciences have shown how biofinancialization has been fuelled by patents’ transformation into ‘patent-as-assets’. This paper traces the historical construction of one such patent-as-asset bundle: the multi-billion worth architecture of patents behind the hepatitis C blockbuster drug sofosbuvir. Following this process from the late 1980s to present times, we highlight the ontological entanglements of pharmaceutical patents and the scientific, legal, commercial and political contestations that result from the focal firms’ assetization projects. By shining a light on these entanglements, our paper points to the extraordinary historical conditions required for the assetization of drug patents as well as to their vulnerability to contestations. In particular, we highlight new forms of patent activism that threaten the ‘asset condition’ of high-priced pharmaceuticals. 

The authors state

 ‘The philosophy is very simple. Good drugs save lives and a major side effect is they can also make you rich’. This statement was made by Dr Raymond Schinazi, one of the main scientists involved in the invention of the hepatitis C cure sofosbuvir and the owner of a company that held a string of crucial patents over the forthcoming drug, just after selling his company Pharmasset to Gilead Sciences for US$11 billion in 2011. This quote signals how pharmaceutical patents – initially designed to encourage inventors to disseminate their findings without fear of intellectual theft – have been increasingly turned into assets, allowing their holders to extract large quantities of wealth from them. However, this assetization dynamic is by no means an unavoidable or uncontested process. Following the history of the patents behind sofosbuvir, in this paper we highlight the socio-material resistances to the assetization of patents, demonstrating how this process involves numerous scientific, legal, commercial and political disputes. We outline how powerful pharmaceutical actors were able to appropriate an intricate patent architecture around sofosbuvir – and through this bundling stabilize a value regime that allowed them to turn the patents into assets. However, this assetization process has remained vulnerable to contestation by other actors including scientists involved in the invention, pharmaceutical competitors, and access to medicines activists. We demonstrate that the transformation of the patents underlying sofosbuvir into profitable assets passed through several phases between 1987 and 2020 that each entailed different forms of contestations. In the most recent period, these are mainly driven by civil society and are building a potential counterweight to the current ‘assetized’ pharmaceutical business model. 

We build our conceptual argument on debates regarding biopharmaceutical assetization. Birch and Muniesa (2020) have recently called for detailed empirical investigations on how things are turned into assets, which they see as the conversion of scientific knowledge, legal and other practices into ‘identifiable and alienable property’ that ‘can be owned … and capitalized as a revenue stream’ (p. 14). Considering how patents are constructed, bundled and held together as assets helps to understand important facets of contemporary biopharmaceutical capitalism, particularly the value extraction mechanisms in the sector where the (bundled) patent-as-asset is the crucial cog in the appropriation of pharmaceutical value by ‘technoscientific rentiers’ (Birch, 2020). A move from the focus of earlier biocapital literature (for instance Sunder Rajan, 2006; Waldby, 2002) toward an examination of patents-as-assets thus allows to explain how the ‘living things’ that biopharmaceutical firms commodify are turned into future-oriented sources of rent through the construction of specific valuation and accumulation regimes (Geiger & Gross, 2021). In particular, we highlight the construction and management of patent architectures as a vital lever in the profit-seeking activities of biopharmaceutical firms. 

Tracing the multiple pre- and post-market patent oppositions threatening its ‘asset form’ through the case of sofosbuvir reminds us that patents-as-assets are never fully disentangled from their multiple positionalities in legal, scientific and social practices. Emphasizing the conflictual dimensions of patents-as-assets both supports and complicates existing calls to view pharmaceutical knowledge as communal (Boyle, 2003). In reality, as we will show, there is no straight line from open to enclosed knowledge (see also Kang, 2020). At the same time, a focus on the instability of patents-as-assets highlights the fact that the making of pharmaceutical assets and the many contestations they provoke open up to civil society new forms of activism against the financialized biopharmaceutical business model (Geiger & Gross, 2018; Parthasarathy, 2017). The story of sofosbuvir’s patent contestations also includes a broader historical interest, as they contributed to major shifts in the biopharmaceutical political economy. This included the 1996 legal decision favourable to Emory University, which accentuated the rift between international and US patent law, an 18-month US Senate Committee on Finance Investigation into sofosbuvir’s price and its impact on the US healthcare system, the activist oppositions against the sofosbuvir patents in 2015 and 2017, the first of their kind in high-income countries, and the advent of European state activism against pharmaceutical pricing strategies, culminating in the 2019 World Health Assembly Transparency Resolution. The contestations around this high-profile drug continue to reverberate in the political economy of pharmaceuticals, including in the fight for widespread access to COVID-19 technologies and vaccinations by access to medicines movements. Acknowledging patents’ multiple origins and trajectories strengthens calls to infuse a public utility character into the industry, which have grown louder during the COVID-19 pandemic, and which may serve to reintroduce an explicitly moral economy that acknowledges the collective nature of the knowledge underlying an invention and a duty to make it useful to the public (Gaudillière, 2008). By putting its emphasis on the contested dimensions of assetization, this paper thus ultimately points to its potential reversibility.