Towards a New Compulsory Licensing Mechanism for the EU for the Next (Health) Crisis? A Comparative Analysis of the Effectiveness of Compulsory Licensing Mechanisms

In many countries major concerns exist regarding exorbitant prices for medicines in view of the gradual change towards more personalized medicine and new technologies. This has created enormous tensions on global health budgets. The pharmaceutical and biotechnology sectors are heavily regulated at the national, European and international level (e.g. marketing authorizations, market and data exclusivities, clinical trials, intellectual property law, reimbursements). The regulatory landscape is very complex and multilevel. Although patent law is only one part of this complex, multilevel landscape, politicians, consumer organizations and patient organizations often refer to patent law as a major barrier and key determinant for the high prices in this market. Indeed, essential medicines are generally protected by a robust patent portfolio and associated know-how protection, market and data exclusivities. This strong portfolio of exclusive rights enable the holders of those rights to exploit their in an aggressive manner and to charge high prices. However, patent systems all over the world also contain mechanisms, such as compulsory licenses, which are intended as a counterforce against such exploitation strategies. Interestingly, these mechanisms are not often explicitly invoked (e.g. ‘t Hoen et al., 2018). Although they supposedly play a key role in price negotiations (Matthews et al., 2023), the actual institutional design of many national compulsory licensing mechanisms appears to lack effectiveness and would benefit from a thorough revision. The EU is currently contemplating a proposal for a new compulsory licensing mechanism for crisis management. This proposal would benefit from a systematic comparative analysis of the institutional design of a variety of compulsory licensing mechanisms. The paper will cover at least Germany, the UK, the US, Brazil, South-Africa, India and Thailand focusing on scope, rationale, criteria, process, decision-making body and practice.