"The humanitarian IP proposal is intended to incent innovation in areas that will help people be more healthy, that will get access to medicines they need, to sanitation they need, to clean water, and that will help people in impoverished parts of the world." So said David Kappos, the Director of the U.S. Patent and Trademark Office (USPTO), to BioCentury TV's Washington Editor Steve Usdin during an interview last week about the USPTO's new program to accelerate the creation and wider distribution of technologies that address global health needs. Under this proposed pilot program, patent holders who make their technology available for humanitarian purposes would be eligible for a voucher entitling them to an accelerated re-examination of a patent.

We at BIO Ventures for Global Health (BVGH) commend the USPTO for their efforts to employ a market-based incentive to address global health needs.  The USPTO worked closely with the biopharmaceutical industry to determine what would incentivize companies to work on humanitarian technologies such as developing new drugs, vaccines, and diagnostics for neglected tropical diseases.  Creating a voucher for re-examination gives companies a powerful opportunity to take a cloud off a patent quickly, which has potentially very high value for companies. While BVGH is still developing our opinion on this program - still in very early days -- we offer a few preliminary thoughts.

The USPTO program appears to be modeled after the U.S. Food & Drug Administration's (FDA's) Priority Review Voucher (PRV) program and we believe that the USPTO could learn some lessons from the implementation of the PRV program.  While voucher programs in general can potentially be behavior changing, the FDA's PRV program has demonstrated how poor implementation can undermine any incentive it's based upon.  The FDA's program has created unworkable restrictions on biopharmaceutical companies earning vouchers, and has created unnecessary restrictions on the use and sale of the voucher.  As a result, the biopharmaceutical community doesn't understand the PRV, and the program's impact on global health has been small.   The USPTO should take note, and implement their proposed program in close coordination with industry stakeholders.

The USPTO also needs to establish clear and transparent criteria for what triggers earning a voucher.   Unlike the PRV program, which -- to its credit -- lists out the specific diseases that are "PRV eligible," the current USPTO pilot program only has principles that would establish "humanitarian use."  Companies need to have a clear signal as to what does and does not qualify them to receive a voucher, and the USPTO should carefully consider how many accelerated ex parte reviews it can process in a year and what practices it should reward.  From this, the number of vouchers awarded should be adjusted accordingly.

Finally, the USPTO should recognize the critical need for secondary markets for vouchers.  The market value of these vouchers is difficult to predict, but early estimates vary within the $500,000 to $1 million range.  Secondary markets bring many benefits, among them the ability to better approximate the market value of the voucher addressing the lack of information regarding voucher value.  But in addition, the ability to trade and sell these vouchers would make them available outside of the pharmaceutical sector.  Industries such as software, consumer electronics, automotive, and others may have a greater need for accelerated ex parte review, and may face greater threat from suits from "non-practicing entities."  Secondary markets will open up the possible end users of these vouchers, and potentially increase their value significantly.

BVGH will be submitting comments to the USPTO about this new program and we welcome input from companies about how this program could incentivize work in global health research and development.  Please fill out this form to share your thoughts with us. 

Q: We were excited to announce that you joined the BVGH Board of Directors last month.  Can you tell us why you decided to come on board and about your personal commitment to global health?

 

BVGH was created to serve an important role: helping to link the biotech and global health communities.  It's clear that the biotech community can make enormous contributions to the world of global health, but these two communities had not been closely linked in the past. I think BVGH can play a great role in strengthening and expanding those links.

 

Personally, I have always been drawn to trying to help people who are addressing important social problems, particularly in health care.  Global health is obviously one of the great unmet needs of our time, and is in many ways similar to what initially brought me to Genzyme.  Genzyme was focused on orphan diseases, which were orphaned in the sense that the pharmaceutical industry hadn't seen a financial rationale for investing, and as a result no one was trying to develop drugs for them.  Now, 20 years later, orphan diseases are a very robust area of drug development because companies like Genzyme have shown that you can build sustainable business models around them.  Neglected diseases are very much in that same vein and I'm attracted to them for the same reason.  I think our industry can make a great contribution, and playing a role in helping to identify the ways biotech can get involved in global health and then helping the industry actually do so seems to me to be a very important and rewarding thing to contribute.

 

Q: You've done a lot of work at Genzyme focused on global health, particularly heading their Humanitarian Assistance for Neglected Diseases program, under which Genzyme helps develop innovative therapeutic programs on a non-commercial basis.  Can you talk about Genzyme's motivation to work in global health?

 

Genzyme has always seen global health as what I would call a 'strategic responsibility,' which combines our strategic interests and our social responsibilities.  On the one hand, we have a fiduciary duty to our shareholders to always act in their best interest, and on the other hand we have a responsibility to society to act in its best interest.  We look for ways to combine those two ideas. 

 

As a global company, emerging markets are very important to us and are a key part of our future.  As a company and an industry, we have unique capabilities that allow us to develop novel therapies for the diseases that affect the people in these markets.  We feel we have a responsibility to contribute those capabilities.  From a shareholder perspective, those contributions are justified by our corporate interest in being a part of the emerging market community.

 

Q: As an executive at one of the leading biotechnology companies in the world, what kind of impact do you see BVGH's programs having on the decision-making at companies, particularly when it comes to exploring potential global health opportunities?

 

I think that in the global health community, there is a great need for access to and delivery of existing therapies, but there is an equally great need for the development of innovative new products.  That second point is much less well-recognized in American society generally, and really hasn't been recognized in the biopharmaceutical community specifically.  I think BVGH can play a strong role in raising awareness around that by doing what it has done very well for the last several years - identifying within the global health community what are the unmet needs, and then identifying from the product development partnerships what are the needs for new products and new capabilities, and then identifying companies that have those capabilities and linking them through various mechanisms so that new drugs, vaccines, and diagnostics can be developed.  I think there's a really urgent need and I think BVGH can and does play an important role in helping to fill that need.

 

Q: You mentioned emerging markets earlier.  There's a lot of talk now about the potential role of emerging markets in product development for neglected diseases.  Where do you see this going in the next few years?

 

I think that emerging markets are a great area of opportunity and growth.  I've spent a lot of time talking with leading government officials in Brazil, China, India, and many other emerging markets.  What I'm hearing from them are two things - 1) that they aspire to help address and solve these medical problems, and 2) that they want our industry's help in doing that more directly.  The second point is really important because the help they are looking for is in developing the capabilities -- innovative scientific capabilities, clinical capabilities, and industrial capabilities around product development -- in order to develop novel products themselves and make a direct contribution.

 

For example, we work with the Medicines for Malaria Venture to develop drugs for malaria, but we also work with Fiocruz, a company in Brazil, to develop drugs for Chagas disease.  In that collaboration, one objective is to develop a new drug for Chagas disease, but the other is to help Fiocruz become a more capable partner and participate in the development of the therapies themselves.  I think that's an incredible contribution that biopharmaceutical companies can make and is very highly valued by companies in these emerging markets.