Given all the public-private partnerships responding to the need for timely COVID-19 therapies, diagnostics and vaccines, the demands to forgo patents or exclusive licenses for coronavirus products and the clamor that industry shouldn’t “profit” from U.S. taxpayer-supported research are growing louder.
The trouble is the U.S. has already been there, done that – and it doesn’t work, according to experts speaking last week at an Information Technology & Innovation Foundation (ITIF) webinar on Bayh-Dole during the COVID-19 pandemic.
Contrary to a lot of public opinion, industry is not getting a free ride under the 40-year-old law. “It’s not just a one-way street with NIH supplying the funds,” said Mark Rohrbaugh, special adviser for technology transfer at the NIH. “Companies are offering up their resources, their intellectual property, their expertise, taking on large risky investments.”
Wendy Commins Holman, CEO and founder of Ridgeback Biotherapeutics LP, agreed. “The financial sting is very real” for companies, she said. Her Miami-based biotech has put everything else on hold to focus 24/7 on developing an antiviral targeting SARS-CoV-2, the coronavirus responsible for the pandemic. If the compound fails, “nobody’s going to make those losses good,” she said.
Last month, Ridgeback licensed EIDD-2801 from Drug Innovations at Emory LLC, a not-for-profit biotechnology company wholly owned by Emory University. “While tremendous work was done at Emory to do very early stage work in the discovery of the compound, the real capital is … being deployed now,” Commins Holman said.
Ridgeback is investing heavily in developing and conducting clinical trials and manufacturing capacity for millions of doses of the oral drug. “Manufacturing without any proven clinical data is completely at risk,” Commins Holman said, adding that, in such a crisis, a therapy needs to be available as soon as it’s approved. But the risk in securing manufacturing capacity so early is that the candidate might not work.
That risk became all too real this past week when preliminary reports from a trial in China suggested that Gilead Sciences Inc.’s remdesivir might not live up to expectations in COVID-19. The message was reiterated Monday as Regeneron Pharmaceuticals Inc. and Sanofi SA announced that they were scaling back their COVID-19 trial for Kevzara (sarilumab), an interleukin-6 receptor antibody, on the advice of an independent data monitoring committee.
For industry, more than money is at risk. There’s also all the time and energy – and the opportunity cost of putting everything else on the back burner. “I, as well as everybody who works at Ridgeback Biotherapeutics, believe [COVID-19] is the only thing we should be working on,” Commins-Holman said.
Because of that commitment, “there’s also a big personal risk,” she noted. Her company has ramped up hiring to tackle the development of COVID-19 therapies. “We need the best of the best who are willing to work seven days a week around the clock,” while dealing with homeschooling their children and the other personal challenges the pandemic has brought, she added.
The same level of commitment is being seen at universities, said Jon Soderstrom, managing director of Yale’s University Technology Commercialization and Faculty Innovation. COVID-19 is “the singular focus of almost all academic research” across the country, he said, adding that he’s never seen the like of it before.
While life science researchers are looking for new compounds and trying to repurpose old drugs, engineering schools are designing new types of personal protective equipment, addressing shortages and redesigning devices such as ventilators. “This has been quite amazing to see this mustering of resources,” Soderstrom said.
“It’s a partnership,” he added. “It’s government, it’s companies, it’s venture investors, it’s academic researchers – all working together, all for a common goal.”
That kind of collaboration is what’s needed to take on COVID-19. “The disease has many stages,” Commins Holman said, and the virus is starting to mutate. On top of that, “coronaviruses are weird viruses. There’s a reason there’s never been a vaccine for a coronavirus,” she noted.
Because of the challenges this particular coronavirus poses, there won’t be a one-size-fits-all solution, and one company won’t solve all the problems, Commins Holman said. Instead, the collaboration of tens, if not hundreds, of companies will be needed to provide multiple solutions.
Efforts to undermine the Bayh-Dole Act by prohibiting exclusive licensing of government-supported research or setting prices for the resulting products could have worrying consequences, not just for this pandemic, but for ones that could prove more deadly in the future.
Success of Bayh-Dole
Passed in 1980 to spur U.S. innovation, the Bayh-Dole Act allowed universities to patent and exclusively license inventions their federally supported researchers discovered. Prior to Bayh-Dole, the federal government maintained the intellectual property rights and only granted nonexclusive licenses. As a result, not a single drug was developed from NIH-funded research before Bayh-Dole, said Joseph Allen, former president of the National Technology Transfer Center.
“The United States used to be a global-also-ran in life sciences innovation,” said Stephen Ezell, ITIF vice president of global innovation policy. In the latter half of the 1970s, European-headquartered companies introduced more than twice as many new-to-the-world drugs as did U.S. companies, and only about 10% of new drugs were first introduced in the U.S., he said.
That all changed after Bayh-Dole, which is now recognized as an international best practice for translating all forms of government-funded research. In the first 20 years of Bayh-Dole, academic patenting increased tenfold across all sectors, Ezell said. And since 1996, Bayh-Dole has resulted in more than 100,000 academic patents, 420,000 invention disclosures and the launch of 13,000 companies.
In the life sciences, more than 200 drugs and vaccines have been approved since 1980 because of Bayh-Dole, Ezell said. And today, key technologies initially developed at universities with federal funding are being used in the development of COVID-19 drugs, devices and vaccines.
Despite those successes, several lawmakers and policy advisers are pushing to do away with the patents and exclusive licenses for COVID products, claiming that it would make such products more available and affordable during the pandemic.
But history has already proved the fallacy in that. Rohrbaugh noted that in response to the price of azidothymidine, or AZT, the first approved HIV drug, the NIH in 1989 added a “reasonable pricing clause” for products that stemmed from its industry collaborations or from exclusive licenses. Within five years, industry partners had backed away from those collaborations and licenses. When the clause was removed in 1995, the collaborations rebounded.
Cost of undermining Bayh-Dole
Commins Holman said that without an exclusive license to Emory’s compound, it would have been “irresponsible” for Ridgeback to license the drug because the company wouldn’t have been able to raise the money to develop and manufacture the product. Without private money, “it would have been a nice little science experiment … without the possibility of making it into people,” she said.
“Science experiments are interesting,” Allen responded, “but this is no time for just having papers on the shelf.”
Companies have to raise tens of millions of dollars just to take a promising therapy to clinical development, Soderstrom said. And then there’s the cost of clinical trials, which run about $1 million per day. “They are not cheap to run, and the government doesn’t pay for them,” he said.
Putting price constraints on products that stem from government-funded research also could be problematic. Such constraints would make early stage technologies less valuable to companies, while other technologies, including those from other countries, would be more valuable, Rohrbaugh said. “That would not be in our national interest in terms of facilitating new innovative drugs or the whole scale of technologies,” he added.
Commins Holman said that her biggest worry about proposals for compulsory licensing, price constraints or other punitive measures “is not actually that it’s going to happen, because it’s irrational for it to happen, but how much it detracts other people to come in and help with the solution.”
“The implementation of it is ridiculous,” she continued. “And I say that because it is the No. 1 way to kill innovation. … We need to be working not only on this pandemic but the ones that come in the future, and the more the conversation tilts toward this, the less likely that you’re going to have the best and brightest coming in here to solve the problem.”