While collaboration is nothing new to the pharma industry, the speed and urgency of new partnerships to tackle COVID-19 are truly revolutionary, sources from innovator companies say.
The contract terms that stipulate the sharing of intellectual property rights in collaborative agreements not only allow firms to combine their expertise to accelerate drug research, they also clarify how profits and products discovered from the collaboration will be divided in the future.
For pharma collaborative efforts to work as smoothly as possible, contracts that stipulate the sharing of IP rights need to be handled with care.
“This is truly unprecedented. What we are seeing is a bit like if Apple and Google came together to build a phone,” says Tonya Combs, deputy general patent counsel at Eli Lilly in Indiana. “There is a lesson here that when we are all aligned on the same goal, we can proceed safely and urgently.”
Examples of collaboration that she cites include GSK forming a partnership with Sanofi, Pfizer teaming up with BioNTech, and AstraZeneca working with Oxford University’s Jenner Institute.
She says that the alliances created between pharma companies are notably different from past collaborations because every company is united around a common goal. Not only are pharma firms teaming up with old rivals, they are also coordinating with NGOs such as the Bill & Melinda Gates Foundation to share data from their clinical trials.
Contract is king
Combs says: “Everything is laid out in the collaboration agreement, and it’s not as nebulous as it seems. Patents are the foundation of these collaborative agreements. Each party brings what they can offer to the table.”
She says this might include innovator companies contributing patent rights to medications, and third parties providing expertise in clinical development and manufacturing capabilities.
“It’s valuable if each side has components they contribute because this is about everybody taking their best shot at a common goal and increasing the likelihood of success to treat patients,” she says.
The assistant general counsel for a pharma innovator based in the UK says that writing a collaborative contract that clearly defines IP rights between companies is nothing new to the industry because there were plenty of partnerships between companies before COVID-19 began.
“Now, the pandemic calls for more collaboration, and the more companies collaborate, the better. When you make a deal, you agree up front to the terms and who will get what out of the deal,” she says.
She adds that any good contract will include terms about who has the rights to any unexpected discoveries made while doing the research for a specific disease. “This is perfectly doable, but it’s not very common to have unintended discoveries come out of the research.”
IP the bedrock
He argues that the patent system has allowed for the creation of the medications currently in clinical trial, and that the sustainability of drug research is contingent on maintaining IP rights.
“Many of the treatments in clinical trials are still protected by rights that contributors will continue to need to sustain their research and innovation engines long after this pandemic is over. This includes compounds, proteins, and other substances that already have, and will continue to have, important medical applications well beyond COVID-19,” he says.
“All of this may also be subject to certain pre-existing arrangements with third parties. Likewise, the results and intellectual assets that come out of these collaborations based on these types of inputs may have important applications in other areas well beyond COVID-19.”
Because most of the medications currently in clinical trial for COVID-19 were discovered for other indications such as SARS or Ebola, pharma companies need to clearly define who owns the IP rights so they can continue to do research for other diseases that could arise in the future.
Salsberg adds that an overlooked benefit of collaboration agreements is that they allow government authorities to trace a medication back to the original IP holder. This can be important if a counterfeit medication is found on the market, or if different compounds in a medication need to be traced back to their source.
“These collaboration agreements can allow regulatory agencies to see who the rights holders are if there are three collaborating companies working on the same thing. If you don’t know who was working on something, it will take longer to trace where a medication or compound came from. IP has many benefits that can come out of collaborative agreements like these,” he says.
Business as usual
“Many companies want to seem like they are doing a lot and sharing and collaborating to tackle this disease, but ultimately it is very difficult to make money on vaccines or treatments.
“By the time a company has invested 18 to 24 months in vaccine research, it could be in a situation where governments prefer to buy a vaccine from another source. The benefit of the collaboration is that it divides the risk between companies in the event that the research doesn’t result in a marketable vaccine.”
The senior IP lawyer says that collaboration is uniquely important for pandemics because pharma companies need to have a presence in many countries to enter local markets. If a drug business developed a vaccine, it would need to team up with a local manufacturer to guarantee access for the country’s population.
He says: “Healthcare is one of the most regulated industries. There has been collaboration in the past because companies need geographic footholds in countries in order to sell their products. Companies need to be liable for what they are selling, so sometimes innovators make deals with local pharma companies.
“The company we have teamed up with has a global foothold. We only have limited coverage in the US, so through this other company, we can market to the rest of the world.”
Patrick Duxbury, partner at Gowling WLG in London, says that the pharma industry is used to making contracts that deal with ownership and commercialisation of IP. What is different about COVID-19 is that so many companies are collaborating at once, and there could be some valuable lessons learned on how to do research in the future.
“What might be interesting as a result of this is if new efficiencies are discovered because of the sheer scale and speed of drug research. This might drive new and broader collaboration if this leads to something that is seen as successful in the future,” he says.
