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Freshfields Risk & Compliance

| 5 minutes read

COVID-19 treatments – the regulatory and patent systems respond

Human coronaviruses were first identified in the mid-1960s and often cause minor illness, but the more severe diseases they can cause became a major concern in 2002 (SARS), followed in 2012 (MERS) and now 2019 (COVID-19).  

There are currently no authorised vaccines or treatments for any coronavirus. The hunt is now on for treatments for and vaccines to COVID-19 in particular, but what further hurdles will innovators face in the regulatory and patent systems? 

This blog post considers these, with a focus on the UK patent system.

The regulatory system

Regulators around the world are putting in place measures destined to facilitate and fast-track the process of assessing products to cure/prevent/alleviate the effects of COVID-19.

Faced with the emergency of the situation, the European Medicines Agency (EMA) has activated its plan for managing emerging health threats, which involves a quicker regulatory response that could help speed up the authorisation of COVID-19 medicines. 

The EMA has a number of regulatory mechanisms aimed at hastening the approval process, including the PRIME scheme, accelerated assessment, and conditional marketing authorisation procedures. It is also offering free scientific advice for COVID-19 medicines or vaccines.

The US Food and Drug Administration (FDA) has started issuing emergency use authorisations (EUAs) by facilitating the availability and use of medical countermeasures and, on 18 March, the FDA released guidance on conducting clinical trials during the pandemic. 

As for therapeutics, the FDA provides that sponsors are usually expected to allow 30 days between submission and initiation of an initial investigational new drug (IND) protocol to allow for safety review. In the current climate, the FDA has been using both pre-IND discussions and highly expedited initial review to allow such trials to begin as soon as possible.

In the UK, the Medicines and Healthcare products Regulatory Agency (MHRA) has indicated that it is on standby to ensure that applications relating to COVID-19 are dealt with swiftly and that it is working closely with the Department of Health and Social Care (DHSC) and other healthcare partners, contributing to the essential work needed to protect public health in the UK.

The patent system

Speedy approval of a drug, diagnostic method or apparatus is, of course, not the end of the process. The innovator still has to bring the product to market rapidly and at scale. Public pressure to expedite this will be immense and it will be difficult for any single company to match demand.

How will that interact with a patent system which normally provides the innovator with exclusive rights? Does this mean that patent owners should be stripped of all patent protection? Will innovators be subject to compulsory licensing? What will be the response of the UK patent system?

Waiving rights

In times of health crises, prices charged and innovators’ attitudes to infringement of their inventions will be closely scrutinised. 

Most brands are doing all in their power to support the growing number of patients and help stop the pandemic. At the same time, brands want to avoid any suggestion that they are profiting from the pandemic.

Some innovators have chosen to offer royalty-free licences: it was reported that Labrador Diagnostics, a company owned by investment funds and managed by Fortress Investment Group, offered royalty-free licences for its patented diagnostics technology after it faced criticism for the patent infringement action it filed against another company working on coronavirus tests.

Others have denied reports of them filing patent claims against individuals engaged in a coronavirus response. For instance, manufacturing company Intersurgical vehemently denied reports that they had threatened to sue for patent infringement Italian volunteers that had used their 3D printers to create unofficial copies of an urgently needed patented valve.

Not all innovators will choose to waive their rights, particularly where those rights arise from significant research and development. Many will reach a commercial agreement for the use of their intellectual property. 

However, we now consider three other possible routes where agreement cannot be reached: compulsory licences, Crown use and the exception for medicinal product assessment.

Compulsory licences

Compulsory licensing relates to the situation when a government allows an entity to produce a patented product or process without the consent of the patent owner. 

In the UK there is no automatic compulsory licensing of patents, even in respect of life-saving medicines and drugs. 

The rationale is that pharmaceutical companies need the incentive of exclusivity rights in order to decide to invest large sums necessary for the development of life-saving drugs and apparatus (see Birss J’s recent judgment in Evalve v Edwards). 

Although the UK Patents Act 1977 does provide for a process for obtaining a compulsory licence, a range of conditions must first be satisfied. 

Most fundamentally, a compulsory licence does not take effect until three years from the grant of a patent and only after a period of negotiation with the patent owner, who must themselves not be supplying the UK market. 

This is unlikely to satisfy public pressure for access.

Crown use

Sections 55 and 56 of the UK Patents Act 1977 provide for Crown use of patents. As summarised by Aldous J in Chiron Corporation v Organon [1995] FSR 325the Crown use provisions of the Patents Act 1977 provide 'for life-saving drugs, medicines and such things as diagnostic kits to be made available to the public in the United Kingdom without the permission of a patentee'. 

During a period of emergency, section 59 provides the government with the power to use an invention for any purpose which appears necessary or expedient: for the efficient prosecution of war; for the maintenance of supplies and services essential to the life of the community; or for securing a sufficiency of supplies and services essential to the well-being of the community.

Rather than compulsory licensing, it seems more likely that Crown use could be invoked for medicines, devices and vaccines (not least where the UK Prime Minister spoke of a war against the disease). 

The conditions for the operation of Crown use were considered in detail recently in Recorder Douglas Campbell QC’s judgment in IPCom v Vodafone, a patent infringement case relating to a mobile phone standard. Vodafone successfully relied on the Crown use defence in respect of actions taken to support the 'emergency services'.  

The compensatory scheme associated with Crown use is set out in section 57A Patents Act 1977, which provides that the government department concerned shall pay any loss resulting from the patentee not being awarded a contract to supply the patented product,  perform the patented process or supply a product resulting from the patented process.

Medicinal product assessment (Bolar)

Medicines which are used in the context of a medicinal product assessments (clinical trials and HTAs) are deemed to be used for 'experimental purposes' and are exempt from infringement under section 60(6D) of the UK Patents Act 1977. 

This covers not only the formal authorisation of products but also governmental assessment of whether to use or recommend their use in practice. 

Although ostensibly targeted at pharmaceutical companies, the UK government has in the past used these provisions to provide cheaper access to preventative HIV treatment and this might be an alternative to Crown use provisions, particularly where marketing authorisation is expedited. 

However, such use of the patent system is likely to prove controversial, particularly where Crown use may provide a more natural pathway to provide access.

See our coronavirus alert hub for more thoughts on the challenges posed by the pandemic.


covid-19, intellectual property, europe, americas