Pharma's expensive gaming of the drug patent system is successfully countered by the Medicines Patent Pool, which increases global access and rewards innovation

Patent pools were first used in 1856 for sewing machines and were once ubiquitous across multiple industries. Patent pools gradually disappeared after a 1945 U.S. Supreme Court decision that increased regulatory scrutiny, hindering the formation of new pools. Patent pools were later revived in the 1990s in response to licensing challenges in the information and communication technology sector.

Despite many challenges, the first patent pool created for the purpose of promoting public health formed in 2010 with support from the United Nations and Unitaid. The Medicines Patent Pool, or MPP, aims to spur generic licensing for patented drugs that treat diseases disproportionately affecting low- and middle-income countries. Initially covering only HIV drugs, the MPP later expanded to include hepatitis C and tuberculosis drugs, many medications on the World Health Organization’s essential medicines list and, most recently, COVID-19 treatments and technologies.

But how much has the MPP improved drug access?

I sought to answer this question by examining how the Medicines Patent Pool has affected generic drug distribution in low- and middle-income countries and biomedical research and development in the U.S. To analyze the MPP’s influence on expanding access to generic drugs, I collected data on drug licensing contracts, procurement, public and private patents and other economic variables from over 100 low- and middle-income countries. To analyze the MPP’s influence on pharmaceutical innovation, I examined data on new clinical trials and new drug approvals over this period. This data spanned from 2000 to 2017.

I found that the MPP led to a 7% increase in the share of generic drugs supplied to LMICs. Increases were greater in countries where drugs are patented and in countries outside of sub-Saharan Africa, where baseline generic shares are lower and can benefit more from market-based licensing.

I also found that the MPP generated positive spillover effects for innovation. Firms outside the pool increased the number of trials they conducted on drug cocktails that included MPP compounds, while branded drug firms participating in the pool shifted their focus to developing new compounds. This suggests that the MPP allowed firms outside the pool to explore new and better ways to use MPP drugs, such as in new study populations or different treatment combinations, while brand name firms participating in the pool could spend more resources to develop new drugs.

The MPP was also able to lessen the burden of post-market surveillance for branded firms, allowing them to push new drugs through clinical trials while generic and other independent firms could monitor the safety and efficacy of approved drugs more cheaply.

Overall, my analysis shows the MPP effectively expanded generic access to HIV drugs in developing countries without diminishing innovation incentives. In fact, it even spurred companies to make better use of existing drugs.

Since May 2020, the Medicines Patent Pool has become a key partner of the World Health Organization COVID-19 Technology Access Pool, which works to spur equitable and affordable access to COVID-19 health products globally. The MPP has not only made licensing for COVID-19 health products more accessible to low- and middle-income countries, but also helped establish an mRNA vaccine technology transfer hub in South Africa to provide the technological training needed to develop and sell products treating COVID-19 and beyond.

Licensing COVID-19-related technologies can be complicated by the large amount of trade secrets involved in producing drugs derived from biological sources. These often require additional technology transfer beyond patents, such as manufacturing details. The MPP has also worked to communicate with brand firms, generic manufacturers and public health agencies in low- and middle-income countries to close the licensing knowledge gap.

Questions remain on how to best use licensing institutions like the MPP to increase generic drug access without hampering the incentive to innovate. But the MPP is proving that it is possible to align the interests of Big Pharma and generic manufacturers to save more lives in developing countries. In October 2022, the MPP signed a licensing agreement with Novartis for the leukemia drug nilotinib – the first time a cancer drug has come under a public health-oriented licensing agreement.

This article is republished from The Conversation, an independent nonprofit news site dedicated to sharing ideas from academic experts. It was written by: Lucy Xiaolu Wang, UMass Amherst. If you found it interesting, you could subscribe to our weekly newsletter.

Lucy Xiaolu Wang receives research funding from Cornell University and the Institute for Humane Studies.