Lessons for a COVID-19 related patent pool from the now ended Eco-Commons

The COVID-19 Patent Situation

The current pandemic is the biggest global emergency perhaps since the second world war. It is a crisis of health, economics and ethics. Medical inventions are being devised at an astounding rate to treat, test and hopefully prevent infection. IP is critical to maintaining the economy, so the question is how to manage IP rights without preventing vital technology from having life-saving impact. The international Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) provides for compulsory licensing of patents during an emergency. This would allow the vital technology to be shared on licensing terms. However, the only countries at the time of publication– May 2020 –  to be engaging in such licensing measures are Canada, the State of Israel, France and Germany.

The President of Costa Rica has made a proposal to create a patent commons pool of testing, medicines and vaccine inventions with either free or reasonable licensing terms. This proposal is made in light of the potential high expenses of licensing crucial patents that may prove too costly for some countries to use effectively. In a letter, the Costa Rican President requested that the pool “should include existing and future rights in patented inventions and designs, as well as rights in regulatory test data, know- how, cell lines, copyrights and blueprints for manufacturing diagnostic tests, devices, drugs, or vaccines.” The World Health Organisation (WHO) is now working with Costa Rica on this proposal and is “call[ing] countries, companies and research institutions to support open data, open science and open collaboration so that all people can enjoy the benefits of science and research.” However, it may take some time for the terms of a patent pool to be decided, owing to the complexities of international patent law, and it is likely that the World Intellectual Property Organisation (WIPO) will soon be brought into discussions.

Countries without measures currently in place are not the only ones likely to avail from a global covid-19 patent pool as suggested by Costa Rica. Even countries with legal provisions in place for government powers related to patents in health emergencies may benefit from such a collaboration. For example, in France, there are legal provisions for times of a health disaster already in place to allow the government to “requisition […] all goods and services necessary to fight the health disaster” and to “to take all measures to make available to patients appropriate medicines for the eradication of the health disaster.” However, these legal provisions only apply to licensing granted patents, and as such these would not be useful for newly filed applications relating to the current developments of a COVID-19 vaccine, test or treatment inventions.

There is also reason for expediting the formation of an international patent pool in that as litigation continues to move forward online during social distancing, many courts are only hearing high priority cases. This means patent infringement hearings are often deferred. Without the threat of immediate injunction or seizure of goods being available against infringers, or knowing the terms of the potential patent pool or compulsory licensing arrangements, there is currently a great deal of uncertainty for both third parties and rights holders.

An analogy may be drawn between the proposed COVID-19 patent pool and the Eco-Commons, which was halted in 2016.

The Eco-Commons

Started in 2008, the Eco-Commons was a pool of ‘eco’ patents contributed by its members. The Eco-Commons was initiated as a way to share the value in underused patents lying dormant in portfolios. The goodwill gesture of sharing a company’s unused patented technology in exchange for the same of other companies, was intended to increase innovation in the environmental technology field. Only patents related to 60 select IPC codes were allowed to be contributed to the pool. The rights holders pledged not to assert the patents contributed to the pool against any other member of the commons, with the exception of when a second participant already asserted any environmental patent against a first participant.

The only criteria for membership was to make available a patent covering a green invention from at least one of the designated IPC codes to the pool for free access by the other members. Members were not even required to pay a membership fee. At peak participation, there were 248 patents in the pool, covering 94 green inventions from 13 large multi-nationals. The Eco-Commons provided an incentive of free access to patented technology, for the price of reciprocation, with the aim of diffusing knowledge to encourage innovation, without requiring its members to relinquish their monopoly rights entirely.

The success of this type of patent pool is dependent on the quality of the patents being pledged so that there is some parity between the patents shared, and reason for their uptake. For example, this type of patent pool was successful in the 1850s in the peak of development of the modern sewing machine. In contrast, the Eco-Commons appears to not have been effective and/or sustainable beyond its 8 year lifetime as its operation was ceased. One possible reason is that from the outset, the attitude was to pledge patents that were not being used within the members’ portfolios. This way of selecting patents was beneficial to the contributor, thereby maintaining their own exclusive access to their best technologies, but resulted in less useful patents being pledged and shared.

A 2018 report by the Centre for International Governance Innovation on the effectiveness of the Eco-Commons concluded that the program was not successful in achieving its goal. The lack of success was primarily attributed to mismanagement of the organisation. The report also highlighted recommendations for a successful patent commons, which may be of interest in relation to a COVID-19 related patent pool.

How the Eco-Commons was managed

The patent pool was administrated by a third party non-governmental organisation. The administrative duties consisted primarily of hosting the website and promoting the Eco-Commons. The administrating organisation was focused on environmental and sustainability issues and publicised the Eco-Commons to its corporate members, thereby attracting participants from an already established network. An executive board was established, with representatives from the participating companies, to vote on decisions.

While the Eco-Commons had certain administrative procedures built into the ground rules, these were not observed. In fact, the executive board never voted on management issues as was their role, rather the majority of business decisions were made by the founding company. In 2013, the administrative body was switched to a trade and advocacy organisation, after the initial administration began to view the commons as misaligned with the IP strategies of its members. Perhaps as a result of the management change, there was very little activity until the formal discontinuation of the Eco-Commons in 2016. The initial administrative body had pre-existing relationships with the participants and the second management body may not have been able to engage effectively with the members.

The experience of the Eco-Commons for participants

Interviews with the participants revealed that the main motivation for joining the Eco-Commons was not for public relations, as one might expect, but rather driven by business goals relating to the environment and sustainability. As membership was driven by business goals, there was no emphasis on the need to accelerate research and development in environmental inventions. Perhaps as a result, the selected patents for pledging to the pool were not often utilized by other members. Patent selection should have been a guided process following discussion between the members of their interests and aims, however patent selection was typically made internally by participants. The reason for the internal selection process was made to keep down the costs of participation by avoiding third party input. This meant that there was little objective or collaborative input into the selection making process.

The participants reported that the most engagement and effort took place at the initiation of membership. Thereafter, there was very little involvement, although the participants reported that they did not feel that more involvement was necessary at the time. In hindsight, more involvement and more effort in the initial selection process could have resulted in greater ultimate gains for the members. Additionally, the perception of high costs and difficulty in selecting appropriate patents could explain the relatively small number of participants.

The lack of communication between participants also reportedly led to a lack of take up, owing to the difficulty of ascertaining how to apply a technology through only reading the patent specification. Knowledge transfers through direct communication between participants would most likely have increased the uptake and usage of the technologies.

A further complaint by participants was that there was no tracking of the usage of the pledged patents and thereby no means of knowing how useful membership would be before joining. The lack of tracking was deliberate in order to simplify the operations and minimise hurdles to participation. However, it was also reportedly unclear to the participants who the target audience of their pledged patents was, as the members were all well-established multi-nationals with their own specific research and development goals.

Overall, while initially receptive to the idea, the participants considered the program to be a failure.

Recommendations for a successful patent commons

Possible lessons from the Eco-Commons that may help inform a future patent commons structure were outlined in the report. One recommended action is identifying and consulting the end users before initiating any commons procedures. Another is to include users that would benefit the most by performing more outreach than was performed during the Eco-Commons' lifetime. Knowledge transfer and more communication between participants is also recommended to complement the aims of the patent pool. A membership fee is also recommended to cover the costs of providing the above administrative suggestions, however this should not be so high as to be a deterrent to joining. Tracking and monitoring patent technology uptake is strongly recommended as it can enable measuring the value and success of the program.

A  “Corona Commons”

The Costa Rican proposal has many obvious benefits. The aims of a COVID-19 patent pool would be similar to the aims of the Eco-Commons, namely to share technology and accelerate innovation and uptake.

The problems identified in the Eco-Commons should inform the creation of a Corona Commons. There are some key differences between the purposes of the Eco-Commons and a Corona Commons. The latter is far more targeted than the broad goal of the Eco-Commons, which involved diffusing patented technology relating to decreasing climate change. The specific aim of the Corona commons would be to increase access to any relevant medical technology.

Spending time ascertaining the worth of COVID-19 patents before contributing them should not be a hindrance. In contrast to the Eco-Commons, the Corona Commons could include all inventions that can be applied to the problem. Therefore, the deterrent of perceived difficulty in identifying relevant and appropriate patents seen with the Eco-Commons, should not be such a problem. Time is also of greater urgency in organizing a Corona Commons so the criteria for patents in the pool should be clear and unambiguous.

The incentive would also be different as the basic idea is different. Not only patent contributors should benefit, and fair cooperation should be encouraged. One could only speculate as to the possible incentives or rewards that might be introduced, or whether this will be necessary beyond the moral incentive. Nevertheless, how this proposal develops will be of interest to many companies globally over the coming months.