Hawaii is quietly developing a reputation as “the world’s biotech lab.” With its balmy climate, fertile soil and well-funded research centers, our state cranks out wonders from disease-resistant papayas to vaccine candidates for tropical diseases.
But Hawaii’s trademark position as a global innovator isn’t a given. Unfortunately, a proposal is under consideration at the World Trade Organization (WTO) to waive intellectual property (IP) protections for COVID tests and treatments. The plan would cripple biotech innovation across America, including Hawaii, while helping our technological rivals in China.
It’s up to the Biden administration whether the waiver goes through. Our leaders in Congress should urge the president to say no.
IP protections played a critical part in the global COVID response. During the pandemic, patent-holding drug manufacturers voluntarily entered into scores of licensing and manufacturing agreements with low- and middle-income countries, thus helping get vaccines and treatments to those who needed them. The distribution of these medicines across the globe effectively ended the COVID pandemic.
Crucially, IP protections helped, rather than hindered, these efforts. Developing a new medicine is costly. It typically takes 10 or more years to bring a new medication to patients at a cost averaging more than $2 billion per approval. Each successful project must pay for nine that fail during clinical trials. Patents and other IP protections grant companies a needed period of exclusivity to recoup investment costs and make a return.
Weakening IP protections makes investment in research and development (R&D) for new drugs less financially viable — resulting in fewer medicines and fewer biotech jobs.
This is why an IP waiver for COVID tests and treatments would devastate our biotech innovation system. Investors will not tolerate a process whereby policymakers can arbitrarily void patent protections.
Consider the potential impact on jobs. As of 2020, the U.S. pharmaceutical industry directly employed more than 903,000 workers and supported an additional 3.5 million jobs.
In Hawaii, biopharmaceutical research supports more than 3,600 jobs and accounts for more than $900 million in economic output. The research projects in Hawaii received more than $51 million in funding from the National Institutes of Health last fiscal year.
Hawaii researchers are working hard to promote global health. The state’s largest research firm, Hawaii Biotech, is pursuing novel vaccines for coronaviruses, Zika virus and West Nile virus. Gene editing projects at the University of Hawaii-Manoa’s Institute for Biogenesis Research could help treat cancer.
Extending the COVID waiver would signal to companies that they can’t count on strong IP protections. How can Hawaii Biotech proceed against Zika and West Nile if it’s at constant risk of having its work product transferred to legions of copycats worldwide?
The waiver would also weaken national security. America outpaces the rest of the world in life-sciences innovation. The United States rolled out more new chemical entities in the 2000s than the next five countries combined.
But that could change. Xi Jinping is pushing China to achieve “high-level scientific and technological self-reliance.” On his watch, China has been investing heavily in scientific research. In 2022 alone, total R&D spending soared by 10%. China recently established a Central Science and Technology Commission to oversee state objectives in areas including biotech.
President Joe Biden has taken steps to prevent the United States from losing out to China in critical sectors, including biotechnology and biomanufacturing.
Waiving IP protections for COVID tests and treatments would undermine those important efforts by handing over to China — for free — the products Americans have developed through years of expensive research.
The federal government has a duty to support U.S. jobs and industries against our global competitors. That means rejecting any IP waiver for American technology.
Heather Lusk is executive director of the Hawaii Health and Harm Reduction Center.