Please ensure Javascript is enabled for purposes of website accessibility

Biden Administration Supports Patent Waivers for Coronavirus Vaccine

By Eric Volkman - May 5, 2021 at 8:44PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

If enacted, such a move would hit the smaller vaccine makers particularly hard.

On Wednesday, shares of the makers of authorized coronavirus vaccines were generally slammed by discouraging news from the federal  government.

In an official statementc, U.S. Trade Representative Katherine Tai wrote that "This is a global health crisis, and the extraordinary circumstances of the COVID-19 pandemic call for extraordinary measures. The Administration believes strongly in intellectual property protections, but in service of ending this pandemic, supports the waiver of those protections for COVID-19 vaccines."

Child getting a jab from a medical professional.

Image source: Getty Images.

This comes shortly after top officials at the World Trade Organization apparently pushed its member countries to devise an agreement to temporarily suspend such protections. Such a move would benefit less advantaged countries struggling to contain the spread of the disease.

Tai's statement won high-level support from Tedros Adhanom Ghebreyesus, Director-General of the World Health Organization. In a tweet, Ghebreyesus wrote that it "is a monumental moment in the fight against #COVID19. The commitment by @POTUS Joe Biden & @USTradeRep @AmbassadorTai... is a powerful example of [American] leadership to address global health challenges."

At the moment, three coronavirus vaccines have Emergency Use Authorization from the FDA to combat the global health scourge -- Moderna's (MRNA -0.95%) mRNA-1273, Pfizer (PFE 1.29%) and BioNTech's (BNTX 0.52%) BNT162b2, and the one-shot jab developed by Johnson & Johnson's Janssen unit. All benefit from patent protection.

Of the quartet, shares of Moderna, BioNTech, and Johnson & Johnson all fell after the statement was released, with Moderna suffering the steepest drop (6.2%). Pfizer, meanwhile, rose only very slightly on the day.

Among that group, the younger and less-diversified Moderna and BioNTech stand to lose the most from intellectual property waivers. Shareholders of those companies in particular should keep a close watch on how the situation develops.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool recommends Johnson & Johnson and Moderna Inc. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Pfizer Inc. Stock Quote
Pfizer Inc.
$49.20 (1.29%) $0.62
Johnson & Johnson Stock Quote
Johnson & Johnson
$168.28 (0.91%) $1.51
Moderna, Inc. Stock Quote
Moderna, Inc.
$148.58 (-0.95%) $-1.42
BioNTech SE Stock Quote
BioNTech SE
$148.38 (0.52%) $0.77

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/19/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.