This section of an MTA might need to deal with two different types of intellectual property (IP). First, on rare occasions the samples and associated data being transferred might include existing intellectual property. This might necessitate agreeing in advance access rights to materials already covered by IP. It is important that one party takes responsibility for licensing background IP and this is clarified in the MTA. This would be uncommon for samples and associated data generated during a public health emergency.
Second, there are broader questions as to how any benefits generated from the transfer or subsequent uses might be captured in IP. As noted in Section 9 on Benefit Sharing, IP could be one tool used for benefit sharing, for example its management though licenses could be relevant to commercial activities. A number of participants in the public consultation on this tool were cautious about using IP for benefit sharing, citing competing commercial and public health objectives. They also highlighted capacity issues in taking, managing and negotiating IP terms. There have been calls to include provisions in an MTA to explicitly excluded from taking any IP. However, several concrete examples of IP provisions in relevant MTAs have been identified and as this issue may arise during the development of MTAs for use during public health emergencies, it is being covered by the tool. The tool examines different approaches for dealing with IP in this context and considers some of their strengths and weaknesses, so as to help the user understand how they might (or might not) apply to them.
Resolving issues around IP is often expensive and time consuming. The capacity or regulatory regime necessary for taking and enforcing IP may not exist in all countries. In general, when developing MTAs for use during public health emergencies, the minimal possible IP should be used to accomplish any necessary protections. It is also important that any IP provisions within an MTA should be as simple and user-friendly as possible.
IP is not only relevant for enabling commercial development, or as part of benefit sharing agreements. It has been used as a tool to further public health goals, for example, the Wellcome Trust considers how the protection, management and exploitation of IP derived from activities it funds can be appropriate means of achieving public benefits. For more information see: The approach of the Wellcome Trust in managing intellectual property to maximise public health benefit.
The UK Biobank, for example, waives any right to IP created using its samples unless IP is being used unreasonably to restrict health-related research and/or access to healthcare anywhere in the world. In such cases, a clause in its MTAs provide it with a license designed to remove such restrictions. Furthermore, some IP agreements include non-assert covenants in which the party controlling the IP agrees not to assert patent or other IP rights under certain circumstances, such as in the context of a public health emergency.
There are a number of different approaches to protecting IP which might be used in different circumstances, including:
1. Open access;
2. Co-ownership of IP;
3. A third-party beneficiary;
4. Patent-pooling;
5. Cross-licensing;
6. The supplier retains the IP; and
7. The recipient takes the IP.
A more detailed typology of Intellectual Property Management for Public Health Innovation and Access was prepared by the World Trade Organization.
There are a number of practical issues that might need to be addressed if IP is being protected. How is this to be handled if the IP is the output of collaborations between multiple parties? It might also be necessary to consider who can grant licenses or sub-licenses, or if and how licenses might be transferred. It might be necessary to identify who is entitled to seek IP protections and in what jurisdictions.
Identifying the most appropriate approach will likely be context specific. What is to be done with the transferred samples and associated data could help determine which approach might be most suitable. To this end, issue-spotting analysis, identification and analysis of relevant IP issues, can be useful. It will be important to tailor measures to local legal frameworks. As a result, both parties are likely to need to consult experts in IP if it is to be addressed in an MTA.
It is important to consider the cost implications of different IP models, including determining who would bear these costs, and what the likely impact on the cost of permitted or future use might be. It is also necessary to consider what resources might already exist to enable IP to be taken (e.g. are there robust functional IP regimes in place covering the actions of both the supplier and the recipient? Can both parties access the necessary legal experts?).
Given that determining IP provisions can be time consuming and costly, there have been calls for them to be set aside in the context of public health emergencies. Past consultations have heard examples where no IP is conferred unless requested, in which case the burden is on the recipient to make clear their ambitions for the IP. This, for example, is a clause found in all MTAs used by MSF.
Comments received during the public consultation on this tool suggested that “it may not be feasible to exclude “commercialization” from initial consideration of an MTAs and reserve it for future negotiations once an emergency has passed. Recent experience demonstrates that the participation of commercial actors may be necessary in order to develop and mass-produce diagnostics during the emergency period.”
Regardless what approach to IP is determined to be most appropriate, an MTA should take into account public health needs. In general, even in models where IP provisions have been put in place, there is an expectation that publication and data sharing should be open.
Whatever model is adopted, the terms must also be enforceable – other clauses in the MTA, such as those determining arrangements for dispute resolution, may be important.
IP provisions need to be flexible enough to address both specific IP generated from the use of samples and associated data, as well as background IP (for example, procedures, methodologies, and secondary products).
It may be useful to include provisions triggering a re-negotiation of IP, for example, should the use of the samples and associated data result in unforeseen commercial opportunities.
Finally, there may be risks associated with failing to address IP provisions. In some cases, an absence of IP provisions in an MTA may enable others to seek those rights, although it might be possible to address this through strategic publication - placing key knowledge or resources in the public domain.
Should it be agreed that the parties will not seek IP protection, it will be essential to include specific language to that effect in the IP section of the agreement.
Not mentioning IP in an MTA is not the same as indicating that none should be taken i.e. failing to include a provision on IP may enable the recipient to claim any and all resulting IP. Issues around IP for third parties might also usefully be considered.
Such an approach is cheap, simple and places a minimal burden on parties to the MTA. It still requires the inclusion of proactive obligations on publication and knowledge and data sharing.
Including a clause prohibiting the taking of IP may be suitable when transfers are particularly time sensitive (negating the need to analyse and negotiate more complicated IP provisions) or where the capacity or regulatory framework to take and enforce IP might be missing in one or more party. It is useful for providing an open source platform destined for use for the public good.
A relevant case study of such an approach is the WHO Pandemic Influenza Preparedness Framework, in particular Annex 1, Article 6.
All parties to an MTA could agree on an equitable co-ownership mechanism for the management of future IP which takes into consideration public health objectives. Such an agreement can be relatively straight forward to draft and to reach agreement on as the negotiations are effectively bilateral. This agreement can also help to ensure equity through co-ownership.
On the other hand, such a model is comparatively difficult to manage and implement. It can quickly become complicated due to differences in national approaches to IP. As a result, any such mechanism would need to be preceded by careful analysis of the different national legal and regulatory regimes. These agreements often also complicate decision making as a dedicated structure acceptable under both regulatory frameworks can be necessary.
A co-ownership model for IP may be suitable where both parties have strong traditions of IP and no other model can be agreed upon.
In some cases, it might be desirable to pool patents in pursuit of a specific purpose. Public health patent pools do exist. Developing them is a complicated task. Negotiating licenses, as done by the Medicines Patent Pool for example, is a long and complicated process and unlikely to be accomplished in times of emergency.
Private sector buy-in is required for patent-pooling to be effective, as it ensures that the pool has sufficient coverage to actually allow the necessary work to be undertaken.
A patent-pooling model for IP may be suitable where there are existing collective efforts towards a specific goal closely related to the transfer of materials.
A useful case study of a patent-pooling approach might be Hepatitis B Vaccine and the Medicines Patent Pool.
There are also examples where the necessary IP to accomplish a specific task can have different owners. This model enables reciprocal arrangements between those holding the relevant IP to enable collaborative projects which leverage multiple sources. A cross-licensing model for IP may be suitable where both need access to each other’s IP in areas associated with the transfer of materials.
A variation on other approaches might be to involve an additional beneficiary - embedding a neutral third-party into the development, implementation, and enforcement of an MTA. These third-parties could include other organizations with public health objectives, such as the World Health Organization or MSF. Granting an automatic license to such bodies can be particularly important in the pursuit of broader public health objectives.
There may be challenges in identifying a suitable third-party as it is important they have no direct interest in the transfer, are mandated to work towards a public good, and have a suitable financial status (for example, operating on a non-profit basis).
Adding an extra party to an agreement complicates it logistically and may increase the time it takes to find consensus. It can, however, be useful for ensuring equity. A useful case-study were the MTAs involving WHO during the EVD PHEIC in West Africa.
The supplier can retain all rights to future IP but commits to exploit these rights in a manner which is consistent with global public health considerations, for example by granting to manufacturers in developing countries licenses on mutually agreed terms that should be fair and reasonable including in respect of affordable royalties, taking into account development levels in the country of end use of the products.
It is also possible that a third party, such as the WHO, might support the supplier in protecting its IP if such a capacity does not exist.
Such an approach is comparatively simple as all the IP resides in one place. It intrinsically favours the supplier. This provides a firm foundation for streamlined decision making and simplifies efforts to make use of the IP in the future (potentially encouraging commercial development). However, that means that all the power also resides with a single entity, providing a potential disincentive for collaboration. It can also mean that all the costs associated with the IP fall on the supplier as well as the burden of identifying potential users of the IP and negotiating the terms of use.
The supplier retaining the IP may be suitable where the supplier has a well-developed IP legislative and regulatory framework and the resources to register, manage and leverage the IP generated.
A useful case study of this approach is the recent decision by GSK not to seek licenses for products in low and middle income countries.
If detailed, or if there are no other provisions included in an MTA, the recipient may be free to reserve all rights to IP derived from using the samples and associated data. The MTA represents one opportunity to place conditions upon the recipient (such as that any IP taken must take into account public health objectives).
It might also be necessary to reflect ownership issues, restrictions or conditional terms derived from earlier documents, such as informed consent provisions, MTAs associated with the provisions of material to the supplier, or pre-standing agreements between the parties.
It is important to distinguish between ownership of the samples and associated data (which, dependent upon other clauses within the MTA, might not be transferred with the samples and associated data) from any derivatives or IP generated from them.
This approach is comparatively simple, as all the IP resides in one place. It intrinsically favours the recipient. As this means all the associated costs also reside with the recipient, it may be necessary where the supplier lacks the necessary resources or regulatory capacity. However, that means that the supplier will need to surrender some degree of control over further use. It will likely require the negotiation of a comprehensive licensing agreement to ensure some degree of benefit sharing. As a result, it will also be closely connected to the details of the governing law, for example for enforcement and dispute resolution.
The recipient retaining the IP may be suitable where it is important to incentivize collaboration by recipients.
For more information on IP elements of MTAs, see: Specific Issues with Material Transfer Agreements