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The Conflict Between Corporate Social Responsibility and IPR

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Conflict between Corporate Social responsibility and IPR for life saving drugs.
 
In today’s world where sustainability and responsible business practice is no longer an option, a dilemma has emerged in the pharma sector regarding the conflict between corporate social responsibility and IPR.
Pharma companies have a huge responsibility on their shoulders, especially in current times with the outbreak of COVID-19 pandemic. The rapid spreading of the virus across the globe has led to a large number of casualties and loss of life. The containment strategies consist of social distancing, quarantine and isolation and restricted movement. While these strategies work in reducing the spread of the virus, it is not enough to defeat it. Therefore, the onus to defeat the virus lays on the pharma companies who need to develop treatment and vaccination for coronavirus while keeping in mind the three imperatives of speed, scale in manufacture and deployment as well as ensuring global access.

The Issue: Corporate Social Responsibility Vs Intellectual Property Right

The coronavirus pandemic has brought about a realization in the world that no country is equipped to handle a pandemic. The healthcare facilities and infrastructure are not enough to sustain the huge global population. In order to accommodate the patients and save maximum numbers of lives, the hospitals and doctors are compelled to do rationing of medical supplies. Losing lives because of not being able to afford the treatment or medicines sounds completely inhumane. This goes against the ethical conduct of any company, SDGs as well as Corporate Social Responsibility.
However, the production of vaccines, medicines or other medical equipment requires high cost, very sophisticated methods and the high level of knowledge. This, in turn, requires a large amount of funds. In order to protect the initial investment made by the pharma companies and gather funds, the global pharmaceutical industry exercises Intellectual Property Rights (IPRs) like patents and passes leveraging huge profits from the sale of such medicines making it rather expensive for the final consumers.
The problem with the latter arrangement is that international trade agreements require countries with vaccine manufacturing capabilities to provide patent protection under the WTO agreement on trade-related aspects of intellectual property (TRIPS). In this context, IP laws are required to promote innovation in the R&D of new medicine or vaccines. However, it is due to these IPRs laws only, the global pharmaceutical industry establishes a monopoly over life-saving drugs. This, in turn, generates billions of dollars in revenue and wealth for shareholders and also impedes new manufacturers from entering the Pharma research domain.

Balancing the Conflict between Corporate Social Responsibility and IPR

The main argument of the pharma companies for overlooking the public interest while enforcing patents is that they require the funds that are generated for further research and innovation. If the funds are raised without keeping public health at stake, then this argument would be defeated easily.

Patent Pool for life-saving drugs

Competition is always beneficial for the customers, especially for the pharma sector as it makes treatment affordable for all. To facilitate this, the Costa Rica government has recently called on the WHO to establish a voluntary pool of IP rights for Covid-19 treatments, which would allow multiple manufacturers to supply new drugs and diagnostics at more affordable prices. This Medicines Patent Pool as recommended by Costa Rica is not a new practice. It has been utilised by the United Nations and the WHO for years to increase access to treatments for HIV/AIDS, hepatitis C, and tuberculosis.

Vaccine Bonds

Green bonds are issued in present times to raise funds for environmental conservation projects. Blue bonds are issued to fund ocean conservation projects. Inspiration from such bonds should be taken to raise funds for the development of vaccines. This has been done in the past by the International Finance Facility for Immunisation. They are launched with advanced market commitments, where donors make funding commitments to vaccine manufacturers and, in exchange, companies sign a legally binding commitment to provide the vaccines at a price affordable to low-income and middle-income countries.

Conclusion

In a debate between public health which is a major component of ethical conduct and CSR of any company and IPR, which is important for recognition of the intellect behind an innovation, as well as raising funds for further R&D, there cannot one winner or another. For greater human good, it is important that both win and therefore it is important that a balance is maintained between the two.