Assignment 1 | Tanushree | 0076/57

Question A: What are the IPR, patent rights, pricing and access challenges around the
Covishield and Covaxin debate. Make a list of these details, who invested in the
research, who holds the patents, how has the pricing been done.

Patents give manufacturers of vaccines absolute rights to prevent third parties from
producing, using, promising to sell or import the vaccine they have developed. Patent
holders are also free to charge a price that includes their research, development costs and
profit margins. In a crisis like the Covid pandemic, this exclusivity and profit-mindedness
might appear to be insensitive to the people at large. Some of the arguments around the two
vaccines, Covishield and Covaxin, are below -

● Suspending patents could improve the supply available-

○ Waiving IP rights could allow for vaccine technology to be more easily shared
- eg Brazil and India have the production capacity
○ Concentration of vaccine in richer nations as they hoard the vaccine just
because they are capable of it.
● Stifling of innovation -
○ Copyright protection offers firms a measure of comfort that previous
investment costs can be recouped at a later date, thereby increasing the level
of research and development work that firms intend to invest in.
● Short-cut to acquire expensive technology -
○ Companies also say that IP relief will not speed up vaccine manufacturing as
the problem lies in shortage of material supply and it takes years to build
capacity from scratch.
● Option for compulsory licensing -
○ To revoke IP during emergencies, there is an option to apply for Compulsory
Licensing but these are often very time consuming and the process is
extremely complicated.
○ A compulsory license is not a very attractive option because it is not an
important 'formula', but practical cooperation, staff training, resource
requirements and the highest standards of safety labs required.

Government or the ICMR shares the IPR for Covaxin, yet only one company is provided an
exclusive license for manufacture despite being funded publicly. Despite the scarcity,
non-exclusive licenses aren’t provided to multiple manufacturers to fulfill the deficit.

● How is the pricing been done -

Vaccine Cost per dose Tax Max service charge Max price/dose

Covaxin 1200 60 150 1410

Covishield 600 30 150 780

 ○ The supply price of COVAXIN to the government of India at ₹ 150 / dose;
since the price is not sustainable in the bigger picture, a higher price of about
₹ 1200 in private markets is required to offset part of the costs.
○ For Covishiled, SII fixed prices at ₹150 for the Central government, ₹300 for
State governments and ₹600 for private hospitals
● Access challenges -
○ Low income countries, Africa for instance, is home to 1.3 billion people but
received only 300 million doses. While rich countries have secured 53% of
the best vaccines with only 14% of the world’s population. And there is a very
high possibility that 9/10 people in poor countries may never be vaccinated at
all
○ If the citizens of these countries don’t get vaccinated, or only a partial
population gets vaccinated, the virus will, historically, keep on mutating itself
and the people who are already vaccinated will be at risk again, bouncing
back to square one.
○ The slot booking in India was done online, the tools and technical knowledge
for which wasn’t available to everyone, and the ones who did couldn’t do so
because of shortage as the slots used to expire within 3 seconds. Those who
got around using hacks were able to get the vaccine on time.
○ There wasn’t proper infrastructure and human capital for the entire process
and while some set examples on how to get people vaccinated properly,
others became hotspot for infections and a topic of shame.
● Research and development -
While pharmaceutical companies have invested heavily in the development of
Covid-19 vaccines, most of them have also received funding and support from
government and non-profit organizations.
○ Out of the ₹900 crore invested by the government for R&D for this pandemic,
no such information has been made publicly available in its true sense. The
centre told the SC that no aid was given to BBIL and SII, only a small chunk
was given for clinical trials.
○ Covishield was 97% publicly funded and the govt invested about 33 million
euros
● Who holds the patent -
○ Covaxin - ICMR shares the patent with BBIL, and gets a royalty of 5% on net
sales
○ Covishield - Vaccitech, owner of patent for ChAdOx2 vector technology, gets
royalty from the Oxford-AstraZeneca partnership on net sales. India’s SII was
chosen by Oxford to manufacture their Covishield vaccine in India, and the
latter hence doesn’t hold any patents.

Question B: Discuss the responsibility and ethical implications of the patent rights,
pricing and access for one of the above vaccines.

Topic - COVAXIN
● Patent Right
○ India and South Africa started a campaign to suspend patents on foreign
vaccines; it got support from 100+ countries but was opposed by rich,
 developed countries and the pharmaceutical companies. This can be called
hypocrisy at its peak; more and more people are dying everyday and the
need to ease IPR and Patents is increasing more than ever, yet ICMR and
BBIL haven’t deployed many other manufacturers to produce the vaccine. It
was only recently, Apr '21, that 3 PSU’s were allowed to aid production of
Covaxin.
○ Mass production should have been the way to go as we saw loss of lives, not
witness anything like this before.
● Pricing
○ Differential pricing
○ Profiteering -
■ ICMR shares IPR with Bharat Biotech, yet the vaccine costs almost
double the cost of covishield, where SII pays royalty fee to
AstraZeneca.
■ The government first bought the vaccine at 295 but later negotiated
and got it at a rate of 150 which shows that there was always a scope
to set the prices lower down but that didn’t happen as the company
looked at it from the perspective of now or never profit making
opportunity.
■ India hasn’t suspended the patent for Covaxin but supported waiving
the patents on foreign-made vaccines.
● Access -
○ Economic access - It is very highly priced in a country where the top 20% of
the people warm less than a lakh per year. Even if it becomes physically
accessible, it is not economically,
○ Physical access - The way to get the vaccine was to book a slot through an
online method but weren't able to as it got exhausted really soon. Even there,
the no. of covishiled doses very a lot more than that of Covaxin - they should
have made amendments for mass production
○ Mental access- Educating the public about the efficacy of vaccines is pivotal.
Many people are still suspicious that vaccines are a way to decrease the
population and they people who are vaccinated are fools and will die soon.

References -
● https://www.frontier-economics.com/uk/en/news-and-articles/articles/article-i8200-sho
uld-vaccines-be-patent-protected-in-a-pandemic/
● https://www.mondaq.com/india/patent/1087886/is-patent-waiver-a-solution-to-covid-1
9-pandemic-
● https://www.nature.com/articles/d41586-021-01242-1
● https://www.theguardian.com/commentisfree/2021/mar/17/rich-countries-hoarding-va
ccines-us-eu-africa
● https://www.bbc.com/news/world-asia-india-57007004