Research locally, diffuse globally? American universities, patents and global public health.

• Author: Sampat, Bhaven N.

An important challenge in sustainable development is promoting the creation of new medical technologies and ensuring their diffusion in developing countries. There is growing concern that, with the implementation of the World Trade Organization's agreement on Trade Related Intellectual Property Rights (TRIPs), pharmaceutical patents will restrict access to medicines globally. Profit-oriented companies are now aggressively pursuing intellectual property protections in developing countries, many of which had previously not allowed product patents on drugs. The concern is that absent generic competition, patients will not be able to access life-saving medications. Recent attention has focused on a perhaps unlikely set of actors to help ameliorate the access to medicines problem: American research universities. A decade-old student movement has argued that universities own intellectual property rights on many important drugs, and has pushed for inclusion of "humanitarian licensing" clauses that would compel the pharmaceutical firms that license these technologies to allow generic access in developing countries. In this paper, I discuss the emergence and evolution of this student movement, and the set of patent policy changes that got us here. I also summarize data on the feasibility of these policies: for how many drugs would changes in university policies plausibly affect access? Next, I discuss the desirability of changing university licensing practices and the tradeoffs universities face when considering humanitarian licensing approaches. I conclude with a discussion of the limits of campus-level initiatives alone, and the potentially important role for research funding agencies, such as the National Institutes of Health, in promoting humanitarian licensing and access to medicines.

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Over the past decade, global public health has been identified as a crucial driver of sustainable human development. Yet marshaling collective action toward global health goals is difficult, since the developing world lacks the resources to do so and taxpayers in developed countries traditionally have been anemic in providing financial support for this purpose.

In the face of these difficulties, recent attention has focused on a potentially useful role for U.S. universities in promoting global public health. For example, Professor Jeffrey D. Sachs, director of Columbia University's Earth Institute, has argued that, relative to private sector actors, universities are less myopic, less motivated by commercial interest, more cosmopolitan and, therefore, better suited to play a central role in the advancement of global public health. (1) Optimism that universities can help promote global health finds support in history: U.S. universities have a long and storied record of rising to address important social and economic challenges. They were integral in promoting agricultural development in the 19th century; in developing indigenous American chemical and engineering industries in the early 20th century; and most famously perhaps, in advancing U.S. research efforts during the Second World War. (2) In the postwar era, universities have had an important role in biomedical research, including in the war on cancer and in drug development. Sachs suggests that "the challenge today is to extend such local actions to global problems, with universities taking on the challenges in other parts of the world." (3) U.S. universities appear to be rising to this challenge; university activity in the global health arena has grown dramatically over the past decade. Dr. Michael Merson, director of the Duke Global Health Institute based at Duke University, recently suggested that 270 U.S. academic institutions had some sort of global health program, of which seventy had global health centers. (4)

Academic institutions might contribute to global health through numerous channels, including training, research and development (R&D), and program evaluation and delivery. This paper examines the potential for university action in another domain: the diffusion of pharmaceuticals. Specifically, I examine how changes to university patenting and licensing policies can promote broader access to medicines.

Access to medicines is widely viewed as a crucial component of global public health. (5) Recognizing this, and the lack of private sector incentives to promote access, a cross-campus student movement called the Universities Allied for Essential Medicines (UAEM) attempts to shape university licensing policies to ensure that drugs researched and developed at universities, in whole or in part, are licensed at low cost in the developing world. (6) In this paper, I first provide an overview of the potential role that university intellectual property right policies could play in improving the diffusion of biomedical technologies in developing countries. I then set the stage by discussing the problem of access to medicines and new international patent laws that may contribute to it. Next, I examine the rise of academic patenting and licensing. Finally, I discuss the initiatives now underway to use academic technology transfer policies--in particular, so-called humanitarian licensing policies that seek to encourage low prices for university-developed technologies in developing countries--to overcome barriers to diffusion created by patents. In this section, I summarize data on the feasibility of these policies and the tradeoffs universities face when considering humanitarian licensing approaches. I conclude by arguing that campus-level action may need to be reinforced by national policymaking (and/or guidance from U.S. federal funding agencies) for humanitarian licensing policies to be more widely adopted.

PATENTS AND ACCESS TO MEDICINES

Access to drugs is widely recognized as an important component of global health and sustainable development. (7) Many factors affect the extent to which the population in developing countries has access to medicines, including the strength of health systems, the general state of infrastructure, indigenous manufacturing capabilities and national income levels. (8)

Recently, another potential factor has been added to the mix: patents. Patents on new drugs give their owners limited term rights--currently, twenty years from patent filing--to exclude other firms from selling the same technologies. The theory underlying patent policies is that, absent this limited term monopoly, firms would not invest in costly research and development. Patents are more important in pharmaceuticals than in other industries because R&D in the area of new drug development and testing is particularly expensive. Once a compound is discovered, however, imitation is easy. (9) Furthermore, drug patents are difficult to invent around and thus effective at preventing competition. Because they are subject to generic competition, drugs without patents are priced much lower and are more broadly available. This is why Doctors Without Borders has argued that generic competition is "the most significant factor in lowering prices" for drugs. (10) Oxfam similarly notes that it is "the single most important tool to remedy the access gap." (11)

Historically, developing countries have had flexibility in how they designed their patent laws, and many (probably most) chose not to allow patents on pharmaceuticals. (12) This reflected the view among policymakers in the developing world--and among development economists--that the benefits of increased innovation due to patents and other intellectual property incentives were minimal for developing countries; after all, most pharmaceutical R&D is performed on the basis of profit expectations from developed country markets. (13) Additionally, the benefits generated from lower prices and broader access to drugs are potentially large in developing nations. (14)

The World Trade Organization's 1995 agreement on Trade Related Intellectual Property Rights (TRIPS) appears to have changed this. TRIPS led to an upward harmonization of patent standards to match those of the developed world. TRIPS forbids excluding entire fields from patentability. Most developing countries were compelled...