Q3. [40 marks] Some of the companies that have developed successful vaccines (e.g. Pfizer) have indicated that they have no intention of renouncing the patent protecting giving them the exclusive right to produce the vaccine. Let's look at some of the ides that have been proposed to deal with the problems that this presents. (a) Some commentators have proposed a suspension of the intellectual property rights for COVID-19 vaccines. (see for example [1]); (b) Others have proposed mandatory licensing (see for example [2]); (c) Some older ideas include such mechanisms as patent buyouts ([3]). Describe each of these proposals. Compare their benefits and drawbacks. Carefully, outline your arguments for and against each method. How does each of them solve the problem created by a vaccine patent? What new problems do they create (if any)? Overall, which of the three is likely to provide the greatest benefit for society in the long run? Explain your answer in detail. Hint: Stay on topic and remember that this is an economics essay. How does your answer address one of the main ideas of economics: Incentives Matter!

Some of the links that might be useful when answering Q3 are given below.

[1] Patent suspension:

https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(20)32581-2/fulltext https://www.theguardian.com/commentisfree/2020/nov/12/covid-vaccine-patent-pharmaceutical-industry-profits-public-sector

[2] Mandatory licensing:

https://www.cnbc.com/2021/01/22/countries-look-to-acquire-the-ip-of-vaccine-makers-to-fight-pandemic.html

[3] M. Kremer 'Patents Buyouts: A mechanism for Encouraging Innovation" https://dash.harvard.edu/handle/1/3693705