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VIEWPOINT: Slashing IP rights will hurt Delaware companies

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The U.S. Attorney General recently announced arrests and charges associated with multiple schemes tied to the Chinese government’s “relentless campaign to gain access to our technology.”

This multi-year effort is all too well understood by American researchers, who have been subjected to an unrelenting wave of foreign-inspired attempts to steal the product of decades of complex, arduous work in the labs and billions of dollars in invested capital.

Michael Fleming | PHOTO COURTESY OF DELAWARE BIO

It’s not a surprise our intellectual property is so coveted by international rivals. There is no place where scientific research, specifically biopharmaceutical research, is as innovative and productive as the United States. The benefits of these breakthroughs are clear. Every day, we are unlocking the mysteries of deadly, crippling diseases, transforming human health and our economy in the process.

Two key initiatives launched by President Biden underline the critical role that American science and advanced manufacturing play in our national security. His “Moonshot” push to align resources focused on beating cancer, and an executive order calling for a comprehensive government strategy to strengthen our biomanufacturing capabilities.

The ultimate success of these programs hinges, as so many good outcomes do, on American ingenuity, the foundations of which are rooted deeply in essential intellectual property (IP) rights.

So, it is inexplicable that this past June, U.S. trade negotiators supported a World Trade Organization proposal to suspend international IP rights for the technologies used to develop coronavirus vaccines. This waiver to the agreement on “Trade-Related Aspects of Intellectual Property Rights,” or TRIPS, allowed manufacturers worldwide to access patented American innovations at no cost.

In December, the WTO will decide whether to extend the TRIPS waiver to include proprietary research for COVID diagnostics and therapeutics.

The expanded TRIPS waiver would give governments of “developing countries” the right to manufacture and export hundreds of patented medicines and diagnostics without the knowledge or consent of the innovator company. Such waivers make it easier for notorious IP pickpockets like China and Russia – who qualify as “developing countries” – to help themselves to U.S. technology and weaken efforts to crack down on industrial theft in general.

In response to the global pandemic, U.S. manufacturers have launched development programs for over 1,100 treatments for COVID, many involving compounds and technologies being used or studied in other diseases. The expanded TRIPS proposal could therefore create a potentially unlimited class of products subject to the waiver, carrying damaging consequences for American companies, particularly for the small and medium-sized enterprises that account for 76% of these projects.

The failure of U.S. officials in Geneva to consider the implications of this decision is baffling, and patently contradicts the intent of the president’s stated policies.

Fortunately, U.S. senators of both parties, including Tom Carper and Chris Coons of Delaware, have posed serious questions to the U.S. Trade Representative on the issue, explaining that “the United States will continue its leadership … to ensure developing countries have access to the tools and treatments needed to combat COVID, and we believe this can be accomplished without undermining U.S. leadership in medical innovation.”

The implications of this expanded TRIPS waiver for the economic future of the president’s home state – and indeed our entire nation – is substantial. Delaware’s biotech sector is thriving, responsible for thousands of great careers in construction, advanced manufacturing and pediatric biomedical research. With a 65% increase in new firms in the past decade, it’s one of our state’s most important and fastest-growing economic engines.

Much of our time at Delaware Bio, in fact, is spent helping these small companies get off the ground, and ensuring they appropriately secure their IP is an early priority.

Fundamentally, the TRIPS waiver itself is based on a wobbly justification. The initial proposal at the outset of the pandemic by India and South Africa – countries with major generic drug industries that would undoubtedly benefit from free access to American biotech IP – was ostensibly intended to speed production and distribution of vaccines, tests and treatments.

Two years later, thanks to U.S. companies who willingly licensed their products for manufacturing, there is a global surplus of vaccines and no shortage of tests or treatments.

U.S. trade negotiators must understand that a waiver-prone WTO will quickly give pause to those who risk precious capital to fund biomedical innovation. Without robust IP protection the TRIPS agreement provides globally, there will be no innovation to share under its terms. That would be a disaster come the next pandemic, and it would be a disaster for America’s unrivaled leadership in biomedical innovation.

Michael Fleming is president of the Delaware BioScience Association.

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