Coming to Grips with Patents and Tobacco Harm Reduction

patents valuation

Why developing countries are woefully short of tobacco harm reduction patent protection?

Originally published on IP Kat. Says Neil Wilkoff: Kat friend Roya Ghafele offers a challenging analysis of why (the lack of) IP protection for harm reduction technologies is contributing to the rise of smoking in the developing world.

Though global public health governance has taken strides against smoking in recent years, the epidemic persists, and nearly 8 million people globally die from smoking-related diseases every year. The economic toll of tobacco is equally striking. The World Health Organization (WHO) estimates that, globally, smoking causes over US$500 billion in economic damage each year. Worst still, smoking is not spread equally, with over 85% of all smokers residing in low- and middle-income countries (LMICs).

From a business perspective, this situation can also not be maintained. No corporation can build a sustainable future on the basis of such circumstances. Given the choice to perish or innovate, the tobacco industry must continue to innovate.

The way forward appears to be technologies that aim to reduce the adverse effects of smoking. Three different technologies have emerged as an alternative to traditional cigarettes. The oldest are smokeless forms of tobacco such as snus. Second are heated tobacco products that heat tobacco sticks in a device, emitting nicotine but not tar. More recently, electronic nicotine delivery systems (e-cigarettes) have been introduced, which heat a liquid nicotine mixture to form vapour that is then inhaled. Though still addictive, by providing nicotine without tar inhalation, these products appear to be a healthier alternative to traditional cigarettes.

Jointly with a technical expert trained at Imperial College London, a preliminary patent landscape analysis was prepared, which looks at these technologies. Patents are often seen as a proxy for innovation and can provide otherwise unavailable information. The Patent Landscape Report study suggests that leading tobacco companies, such as Philip Morris International and British American Tobacco, now maintain large and growing patent portfolios in the claimed tobacco harm-reduction space, with the number of nicotine vapour technology patents published rising by 9.1% annually during the past 10 years. Growth in smokeless tobacco patents was notably slower, at only 1.1% annually. This sounds positive, but there is a growing international challenge.

For market leaders in the developed world, intellectual property investment in many low- and middle-income countries (LMICs) can be a risky prospect. Often local IP institutions are seen as dysfunctional, such that industry shies away from the difficulties associated with protecting intellectual property. Problems associated with enforcing intellectual property, counterfeiting and piracy, do not increase the motivation to invest and spread new technologies in these countries either.

As a consequence, consumers in LMICs can miss out on the latest technology trends. This can be explained by the fact that corporations tend not to disseminate products in countries where their technology does not enjoy patent protection. For the smoking pandemic, this may be particularly problematic as the vast majority of smokers are in LMICs. This untapped opportunity is bad for business as well as public health, yet reversing the current state of play is tricky.

Though patent portfolios are growing in the developed world, preliminary findings of our report suggest that this may not be matched in many LMICs. In particular, no significant patents were filed across the vast majority of countries in Africa and the Middle East, with the only exceptions being Israel, Morocco and South Africa. Contrast that with the United States, where 42,189 patents were registered over the past decade.

Compare those patent registrations to the trends in smoking rates and it tells a concerning story. In 2005, 21% of adults in the U.S. smoked cigarettes, in 2019, that had fallen to 14.0%.  This, while in Africa, the opposite trend is happening, with rates climbing sharply across the continent; in some countries, smoking rates are now over 50%. Lesotho, for example, has seen the largest spike in smoking from 15% of its population in 2004 to 54% in 2015.

One constraint is that developing countries are supposed to be Trade-Related Intellectual Property Rights (TRIPS) compliant. This requires them to develop IP institutions, such as patent offices or adequate enforcement agencies and patent courts. Unfortunately, many developing nations are new to the patent system and some may have little knowledge of the importance of IP. Foreign imposed IP systems also rarely reflect the existing local culture or local legal identity. In addition, establishing IP systems is time-consuming and costly – training patent attorneys, judges and patent examiners does not happen overnight.

The tendency is to simply blacklist such countries because they have  still to come to grips with TRIPS criteria, but this is unquestionably not the best solution. IP-related development aid is the way forward and provides a possible way out of this dilemma. Historically, such efforts  have shown to be rather poorly funded and dispersed around the world. But a concerted global effort to help LMICs come to grips with harm reduction IP could be transformational, save lives and reduce smoking’s crippling impact on already strained health systems.

With intellectual property not getting the attention it deserves, there is a significant risk that the democratisation of alternatives to cigarettes is hampered at the global level.

Any effort to combat the smoking epidemic cannot afford to overlook the importance of intellectual property. Using intellectual property to promote products that aim to reduce the harms of tobacco is a complex enterprise that requires significant political and business will, but it has the potential to be a key resource in combatting smoking in the developing world. In the absence of adequate consideration for the patent system, we risk technology take off at different speeds across the world. This calls for a change of course.

This means, as it currently stands, we risk a significant rise in smoking in the developing world, even as declines in richer countries are observed. This is a sorry state of affairs, which further widens the global health and development gap.

Key words: smoking, tobacco hard reduction, patent protection, low- and middle-income countries

The preliminary patent landscape report is available here