The Medicines Patent Pool (MPP) is a not-for-profit organisation founded in 2010 with the support of the United Nations. Its mission is to improve access to essential medicines in low and middle-income countries (LMICs). It negotiates voluntary licences with patent holders – typically, pharmaceutical companies – before granting non-exclusive and geographically limited sublicences to manufacturers in targeted countries, where the originator companies, i.e; those that bring new medicinal products to the market are typically not active. This results in low or no royalty payments by sublicencees to patent holders, together with competition among multiple sublicencees in the targeted geographic markets, which helps reduce the price of medicines.
Over the 2020-2025 period, 44 products were in-licensed from 22 originator companies, and 62.14 billion doses of treatment were supplied through the MPP sublicences. For example, 286 million packs of 30 TLD tablets (the most widely used HIV regimen in the world) were supplied in 108 countries, including South Africa (93.7m), India (30.2m) and Nigeria (21.1m).
While this access model initially applied to small-molecule medicines (chemically synthesised compounds), in 2023 the MPP announced its intention to use its expertise to accelerate access to biotherapeutics (larger molecules derived from living organisms) and support the development of mRNA (messenger ribonucleic acid) vaccine manufacturing in low- and middle-income countries.
From small molecules to more complex technologies
Cancer, among other diseases, is a priority of the MPP, as by 2030 approximately three quarters of all deaths caused by that condition will occur in the developing world (Pramesh C S, Badwe R A, Bhoo-Pathy N, et al. Priorities for cancer research in low- and middle-income countries: a global perspective. Nature Medicine 2022). For example, in 2025, sublicence agreements with manufacturers of generic versions of patented medicines enabled supply in El Salvador, Indonesia and the Philippines of 1.2 million capsules of nilotinib, a small molecule for treating a form of leukemia.
Expanding the MPP’s activities to biotherapeutics aims to improve access to medicines for people in LMICs suffering from other forms of cancer. However, the complexity of biotherapeutic production processes creates more opportunities for patenting than the manufacturing of smaller chemical molecules, resulting in a larger number of patents. In addition, biotherapeutics are often associated with a greater number of patent holders as a consequence of R&D being frequently conducted through collaborative partnerships, which enhance capabilities and mitigate the risks inherent in the lengthy process towards innovative products.
Supporting the installation of mRNA-based capabilities in LMICs aims to strengthen preparedness for future pandemics and can accelerate the availability of new vaccines against a range of pathogens, including dengue, human papillomavirus and the parasite responsible for malaria. In this domain as well, the MPP faces a complex patent landscape, as mRNA-based vaccines are associated with a matrix of intellectual property (IP) rights held by a diverse set of organisations – pharmaceutical companies, biotechnology firms, and universities – that protect complementary technologies, for example in relation to mRNA synthesis or lipid nanoparticle delivery systems, regardless of the target pathogen.
By extending its activity to products and technologies that are more complex than small-molecule medicines, the MPP has de facto initiated a transformation from the business model of a “clearinghouse” – that is, an intermediary supplying geographically bounded sublicences for a set of unrelated or substitutable technologies – to that of a genuine “patent pool”, which bundles sublicences into a single “package” covering a set of related and complementary technologies required to manufacture complex products, and are often protected by patent families held by multiple entities.
An economic assessment
A patent pool operates as if it were the joint subsidiary of participating patent holders. In a recent study published in Nature Biotechnology, we construct an economic model to evaluate the public health impact of the MPP’s new approach. We assume that the ‘raison d’être’ of the patent pool is to maximise access, which implies that the price of licences – that is, per-unit royalties – should be kept as low as possible. We also introduce into the model the conservative financial constraint that, for patent holders to join the access mechanism voluntarily, their profits from contributing to the pool must be at least as high as those they would earn by licensing their technologies independently. This constraint ensures that joining the pool does not weaken patent holders’ incentives to develop new medicinal products.
Our economic analysis, which builds on seminal contributions (Shapiro C. Navigating the patent thicket: Cross licences, patent pools, and standard setting. Innovation Policy and the Economy 2001; Lerner J, Tirole J. Efficient patent pools. American Economic Review 2004) shows that an important source of efficiency gains is the reduction in royalty rates (per unit of product sold in a given country) paid by technology users for a package sublicence, compared with a counterfactual scenario in which licences are negotiated separately. This effect cannot be generated through a clearinghouse mechanism, where intellectual property rights refer to unrelated or substitutable technologies. The reduction in royalty rates results from the internalisation of technological complementarities, which is achieved by charging a single royalty for a set of necessary patents.
Another important result is that the gains to end buyers (e.g., governments, hospitals, and patients), relative to a situation in which patent holders licence their technologies separately to generic or biosimilar manufacturers, increase more than proportionally with the fragmentation of intellectual property rights, as measured by the number of patents and patent holders.
At a time when the global health funding ecosystem is under significant strain, our analysis therefore provides further support for protecting the Medicines Patent Pool from financial pressures and ensuring its continued capacity to deliver health and economic benefits.
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