Patent Rights at Virtual.COMPAMED 2020: "Companies recognize their social responsibility"

At the virtual.COMPAMED, Dr. Robert Harrison talked about "Patent Rights – Facilitating, not Hindering, Corona Solution". We inquired about the points that were especially important to him and asked how he felt about the first virtual COMPAMED trade fair.

Mr. Harrison, you talked about patent rights and the COVID-19 pandemic at the virtual.COMPAMED 2020. How do patent rights affect the medical technology industry?

Dr. Robert Harrison: Patents protect innovations. The purpose of the patent is to give the owner the legal right to disclose the information about the invention so that everyone can copy the product. In return, the patent owner is granted the exclusive right to this product for up to 20 years and receives an agreed-upon royalty or licensing fee. This is the fundamental idea behind patent law – monopoly rights in exchange for information.

We are living in extraordinary times. Some people might argue that we are in somewhat of an emergency situation. Why then should companies be granted exclusive rights for 20 years when it comes to developing or producing the drugs, medical supplies, or medical devices we so desperately need to fight the pandemic? This has resulted in excellent, progressive solutions and many companies have recognized and embraced their social responsibility. While companies have indeed filed patents to profit from the research, they also invested a lot of money in these innovations. Nevertheless, they are willing to license their patents and know-how to any third party in need. What’s more, the companies have partly agreed to defer royalty or licensing fees, at least amid the pandemic. They recognize their responsibility and obligations to society. When the pandemic is over, third parties can still obtain the right to use the invention and know-how, but the companies expect patent license royalties in return once that day comes.

Let’s take the example of BioNTech: the company reported huge losses in recent years but is now likely to make a profit. This means that the company’s investors have financed the losses over several years and are only now getting their money back. The company would not exist today had the investors not invested in it. In other words, we would not have mRNA vaccines in the fight against COVID-19. One must acknowledge the (also private) investors who had confidence in the company’s CEO. They were also willing to invest because they have confidence in the technology. They funded the company during its dry spell and are now – obviously - realizing a profit. Simply saying that the patent must not ‘realize a profit' and should be made available for anyone to use free of charge – means being unfair to the world. And it certainly is unfair to the investors who financed the company in the early stages. The German Federal Government and the U.S. government also provided funding. This means that the German Federal Government or the National Institutes of Health (NIH) may also reap some of the upcoming profits. One must also point out that these innovative companies would not exist without patent laws.

Do companies now have to go into agreements with each patent holder to specify how long the product can be used free of charge?

Harrison: Technically, yes. However, the current situation means that no contracts are entered at the moment; or if parties go into agreements, it isn’t a top priority as agreements can also be entered retroactively. In Germany and many other countries, the respective governments can issue compulsory licenses if no agreements are concluded. My take is that third-party research companies stand a good chance to be approved if they want to use the patented know-how of another company. The former do not have to embark on any extensive patent search; in many cases they don't even have to talk to the companies. They can research and develop products and subsequently have talks with the patent holders. We recently handled one of these cases. I told the company owners: "I expect we will get a license, so please continue to develop your product. It is more important to press ahead with your development than having any rushed discussions about patent licenses. You should focus your efforts on moving in that direction." We have sent a notification to the patent owner but have not heard back yet. However, we assume we will be granted permission, provided that he receives a licensing fee in the future.

Finally, a question about the virtual.COMPAMED 2020: What was it like for you to give a virtual lecture? Did it work out the way you wanted it to?

Harrison: I must admit it was a challenge. You don’t have the opportunity to have spontaneous in-person conversations with peers on location. Having said that, I believe that this was still a great chance to stay in touch, network, and forge new contacts. Yet I miss the face-to-face meetings with colleagues at the trade fair. That is why I look forward to the time when COMPAMED will be an in-person event again.