Discussion #1-

As the United States and other wealthy nations paid drug companies for stockpiles of COVID-19 vaccines lower income countries, who were fighting the same pandemic, were left in an anxious state. In 2020 Moderna announced that they would not enforce its intellectual property during the COVID-19 pandemic.   According to Kubasek (2020), “The laws of intellectual property protect property that is primarily the result of mental creativity rather than physical efforts” (p. 163).  Moderna’s decision to not enforce its patents was meant to “encourage low- and middle-income countries that couldn’t afford to purchase billions of doses of the vaccine to develop their own versions of the shot using less expensive resources” (Park, 2022).  But could others outside of Moderna actually make the vaccine?  As wealthier countries vaccinated the masses and poor countries remained without vaccines for even the elderly and immunocompromised, vaccine inequity was on full display.  A response to ending vaccine inequity began in July 2021 with the creation of the World Health Organization’s Initiative for Vaccine Research.  Scientists and researchers at Afrigen, a South African biotech company, were tasked with learning the technology and generating vaccines for human trials (Park, 2022). “The idea behind the hub was to bring scientists with expertise in the mRNA vaccine-making process together to share their knowledge with colleagues in other low- and middle-income countries who might not have access to such information” (Park, 2022).  Although Moderna did not enforce its patent, it did not agree to transfer its technology for making the vaccine.  Moderna’s patents play a small role in the innovation process, the value is in the knowledge capital (Boldrin & Levine, 2021). Afrigen was tasked with reverse engineering the vaccine, starting from nothing to formulate the RNA and create the delivery system for the viral genetic material in lipid nanoparticles. “That made the process take longer and delayed having safe and effective locally produced vaccines available for countries in Africa and other parts of the world” (Park, 2022).   As Moderna was applauded for not enforcing its patents during the pandemic, corporate leadership should have elevated their assistance by providing the scientists, researchers and technology to actually help the lower income countries develop their own vaccines.

Last month Moderna announced it will extend its patent waiver but only for lower-income countries.  There are 92 lower- and middle-income countries that will be included in this waiver while the remaining countries will be required to work with Moderna on license agreements for Moderna patented related technology (Gardner, 2022).   In higher-income countries Moderna has indicated that vaccine supply is a non-issue and “licensing its COVID-19 intellectual property is appropriate for drug makers who want to make use of its mRNA technology” (Gardner, 2022). Moderna intends for license fees to provide advancements in research and development of new vaccines (Gardner, 2022).  Moderna’s announcement has received backlash from public health officials.  Moderna originally stated that it would not enforce its patents during the COVID-19 pandemic.  The pandemic has not yet been declared over by the World Health Organization who has concerns that Moderna’s recent change could affect their vaccine research hubs in South Africa, Brazil and Argentina (Gardner, 2022).   

Leaders in the pharmaceutical companies should be working together to help end vaccine inequity in underdeveloped countries.  As a leader, I would be providing funds and scientists to assist the established and future World Health Organizations vaccine hubs.  I would want my organization to be a global resource and put people over profits. “Each of you should give what you have decided in your heart to give, not reluctantly or under compulsion, for God loves a cheerful giver” (New International Version, Holy Bible, 2011, 2 Corinthian 9:7).

References

Boldrin, M., & Levine, D. (2021). Reforming patent law: the case of COVID-19. Cato Journal, 41(3), 773-784. http://dx.doi.org.ezproxy.liberty.edu/10.36009/CJ.41.3.15.

Gardner, J. (2022). Moderna extends patent waiver for COVID vaccine, but only for lower-income countries. HR Dive, http://ezproxy.liberty.edu/login?qurl=https%3A%2F%…

Kubasek, N. K., Browne, M. N., Barkacs, L., Herron, D., & Dhooge, L. (2020). Biblical worldview edition of dynamic business law (2nd ed.). N. J. Kippenhan (Ed.). New York, NY: McGraw Hill Education.

Discussion #2-

The coronavirus pandemic brought out the best, worst and in some cases creative sides of everyone and big pharmaceutically CEOs were no exception. This era has seen pharmaceutical companies partner with governments, non-profit organizations, and even competitors for the betterment of society; we have seen creative allocating of vaccines to ensure low income countries have an opportunity to purchase vaccines; but we have also seen large profitable companies accept taxpayer dollars with huge returns (Moderna accepted $483 million in US government funding and expects to bring in $18.5 billion) and no plans to share their vaccine IP (D’Eminio, 2021; Rowland et al., 2021; Taylor & Parker, 2021). Which of these approaches’ best cares for all stakeholders or is there another option?

If I were the CEO of one of the pharmaceutical companies faced with this incredibly challenging scenario, I would take a radical (almost) unheard-of stance . . . Before we get to the radical stance let’s consider what investors in today’s world are looking for and if/how this idea can be successful.

Historically environmental, social, and governance (ESG) issues have been secondary concerns for investors, but this view has changed, and investors now favor social impact organizations in their portfolios (Eccles & Svetlana, 2020). Eccles & Svetlana interviewed 70 executives from global investment institutions with 43 of the 70 stating “that ESG is now a priority . . . and that corporations will soon be held accountable by shareholders for their ESG performance” (Eccles & Svetlana, 2020, para. 2). Understanding the importance of ESG on an organization’s sustainability should not only be a priority for investors but also all corporate executives.

Not only have investors said ESG is important to them, but studies prove organizations are more likely to succeed financially when taking a positive social stance. Berbegal-Mirabent et al. concludes that firms with mission statements that clearly considers the customers and product/service offerings along with stating social intentions are more likely to have greater economic performance (Berbegal-Mirabent, 2021).

With this information it is clear I will take a giving-socially responsible approach. The bible tells us over and over the importance of caring for the poor. In the Old Testament Deuteronomy 24 and 25 tells us not to forget where we come from, reminding the Israelites they were slaves in Egypt before the Lord redeemed them and commanding them to treat the poor fairly and generously (Deuteronomy 24:18-22, NIV Life Application Study Bible, 2011). In the New Testament Paul wrote a letter to his companion Timothy providing direction for leadership. 1 Timothy 6:18 – “Command them to do good, to be rich in good deeds, and to be generous and willing to share” (1 Timothy 6:18, NIV Life Application Study Bible, 2011). The NIV commentary reminds us with great riches comes great responsibility and goes on to say, “Use your money to do good. Be rich in good works, generous, and ready to share” (NIV Life Application Study Bible, 2011, p. 2039). This biblical insight encourages me that my radical stance is the right one.

For this stance to work, I must have developed the right environment inside and outside of your organization. This environment starts with the foundation. An organizations’ missions statement forms its’ foundation. “Mission statements are a strategic tool that can provide a company with a purpose of being, a being that communicates the core of the business to internal and external stakeholders” (Berbegal-Mirabent et al., 2021, p. 705). Creating a mission statement that clearly communicates a balanced approach between profit and social intent will ensure all parties understand the organizations expectations around both areas. By including social intentions in your mission statement, you are not only telling investors what you plan to do, you are also telling them what they want to hear (you are an organization that prioritizes ESG).

Once I have set the expectations with internal and external stakeholders and I am presented with an opportunity to make a social impact, no one will be surprised by the radical decision to lead the organization through this pandemic donating all proceeds from the Coronavirus vaccine. This decision will allow me to openly partner and share any IP related information around the vaccine with non-profits, competitors, and governments always prioritizing and ensuring the safety of production and distribution. How does this care for all stakeholders?

Investors and shareholders – Investors and shareholders care about an organizations social impact and prioritize it when making investment decisions (Eccles & Svetlana, 2020).

Employees – Refinitiv Perspectives published a report finding “A higher [ESG] score indicates more positive workplace sentiment and happier employees” (Refinitiv Perspectives, 2021, para. 5).

Consumers – “83% of consumers think companies should be actively shaping ESG best practices” (PricewaterhouseCoopers, 2021, para. 1).

Does this still sound crazy? Consider that my company has brought large profits to its shareholders year after year developing and selling drugs and will continue these same profits in the future. I am choosing to not profit of this one unexpected global epidemic that was not forecasted (or budgeted) and will not change any other creations or sales. Finally, this same decision was successfully executed the during the pandemic by Wells Fargo & Co. Wells Fargo participated in the Payroll Protection Program and pledged to donate all proceeds toward helping small businesses recover from the pandemic, these proceeds ended up being over $400 million (Moise, 2020). Wells Fargo’s successful navigation of such a strong social stance, along with research proving these types of decisions can be made without financial harm to the organization, making the employee happier, and this is what investors want gives me the confidence needed to proceed with this decision.

References

Berbegal-Mirabent Jasmina, Mas-Machuca, M., & Guix, P. (2021). Impact of mission statement components on social enterprises’ performance. Review of Managerial Science, 15(3), 705-724. http://dx.doi.org/10.1007/s11846-019-00355-2

D’Eminio, F. (2021, October 11). Moderna has no plans to share its COVID-19 vaccine recipe. AP. https://apnews.com/article/coronavirus-pandemic-techology-business-inited-nations-europe-d4aff7ddb273194b312354a57c244ce6

Eccles, R., & Svetlana, K. (2020, November 24). Shareholders are getting serious about sustainability. Harvard Business Review. https://hbr.org/2019/05/the-investor-revolution

Moise, I. (2020, July 9). Wells Fargo pledges $400 million in support of small business after PPP payout. Reuters. https://www.reuters.com/article/us-health-coronavi…

PricewaterhouseCoopers. (2021). 2021 consumer intelligence series survey on ESG. PwC. https://www.pwc.com/us/en/services/consulting/libr…

Refinitiv Perspectives. (2021, May 4). ESG analysis: Happier employees predict higher stock prices. Refinitiv Perspectives. https://www.refinitiv.com/perspectives/future-of-i…

Rowland, C., Rauhala, E., & Berger, M. (2021, March 20). Drug companies defend vaccine monopolies in face of global outcry. The Washington Post. https://link.gale.com/apps/doc/A655745537/BIC?u=vic_liberty&sid=summon&xid=4321e4f8