On May 5, local time, the U.S. government announced that it would support the abandonment of the New Crown vaccine patent. A stone stirred a thousand layers of waves, the U.S. stocks anti-epidemic concept stocks fell sharply for two consecutive trading days, and the Chinese stock market was also affected as a result.
The risk of global epidemic has rebounded due to the continued intensification of the New Crown outbreak in India. Faced with serious problems such as shortages of New Crown vaccine in many countries, the World Health Organization and others have called for temporary exemptions from intellectual property rights for New Crown vaccine to boost vaccine production.
Or pressure to do so, U.S. Trade Secretary Dyche issued a statement saying that the waiver of intellectual property rights for the New Crown pneumonia vaccine is intended to provide universal access to a safe and effective vaccine as soon as possible and end the New Crown outbreak as soon as possible.
Previously, most pharmaceutical companies were strongly opposed. The huge capital investment in corporate vaccine development often relies on subsequent patent licensing fees to fill the gap. According to project evaluation data released earlier by the non-profit organization CEPI (Coalition for Epidemic Prevention Innovation), achieving the goal of three vaccine candidates submitting marketing applications by 2021 would require about $2 billion in R&D investment.
Meanwhile, pharmaceutical companies argue that the removal of intellectual property protection and increased vaccine production are not directly related, and that issues including access to raw materials and vaccine distribution are the real barriers to vaccine launch into countries around the world.
Giving up the patent rights to the new crown vaccine affects the interests of pharmaceutical companies and even jeopardizes the proper functioning of their business models.
As a result of the news, U.S. stocks of anti-vaccine concepts fell sharply for two consecutive trading days. Three vaccine giants, Pfizer (a BioNTech partner), Moderna and Johnson & Johnson, saw their cumulative market value evaporate $7.655 billion, or about RMB 49.7 billion.
Vaccine stocks fell in a wave that triggered a dramatic shock in China’s stock market, and vaccine stocks fell across the board in early trading on May 6 due to the negative news.
On the A-share side, more than 10 stocks fell by more than 5%. Among them, Fosun Pharmaceuticals was the first to bear the brunt, once falling 25.87% and touching a halt during the session, while Haili Biologicals also fell by one word.
As for Hong Kong stocks, by the close of trading, Fosun Pharmaceuticals plunged 14.13%, Concierge-B plunged 15.01%, China Biopharmaceuticals fell 5.83% and Sinopharm Holdings fell 6.8%. The cumulative market value of the four leading vaccine companies evaporated over 40 billion yuan.
The combined market value of 7 representative vaccine stocks in China evaporated 117.746 billion RMB!
In this regard, some domestic brokerages did not show a pessimistic attitude, saying that the abandonment of intellectual property rights of mRNA New Crown vaccine by the US does not affect the current shortage situation and the industry still continues to be bullish on the vaccine sector.
At the same time, some institutions pointed out that one of the core barriers of mRNA vaccine lies in the delivery system. Even if this patent waiver is finally realized, mRNA production technology still has barriers and is difficult to be fully mastered by other pharmaceutical companies in the short term.
Professionals reminded that even if pharmaceutical companies are willing to release the relevant patents, it will take time for them to take effect officially, so the patent review of the new crown vaccine will most likely continue normally and will not have much impact on the domestic new crown vaccine companies whose products are already listed.
If the U.S. pharmaceutical companies are unwilling to give up their patent rights, is there really no other way to promote fair and reasonable distribution of vaccines?
Yin Fenglin, an associate professor at the School of Public Policy and Management of the University of Chinese Academy of Sciences, told 21CBR, “According to the U.S. Baidoo Act, the right to apply for patents for scientific and technological achievements resulting from government-funded research projects belongs to the funded entity, but the government has the right to intervene and use the patents when necessary. In other words, funded vaccine intellectual property is potentially subject to government restrictions.”
According to the World Intellectual Property Organization (WIPO), the introduction of a “compulsory licensing system” can, to a certain extent, promote access to basic medicines and medical technologies when patentees are faced with the dilemma of saving lives and protecting intellectual property rights.
In order to protect the rights and interests of patent owners, China’s Patent Law also specifies that “the novelty of a patented invention shall not be lost if it is first disclosed for the purpose of public interest within six months before the filing date in the event of a state of emergency or extraordinary circumstances in the country.”
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