Innovation Institutions and COVID-19

Abstract

The COVID-19 crisis has starkly illustrated both the strengths and limitations of U.S. biomedical innovation institutions as deployed to fight a pandemic. These innovation institutions include not just intellectual property law, but also other legal systems that structure incentives for production and allocation of knowledge goods, including regulation by health agencies like the Food and Drug Administration, programs like Medicare and Medicaid that govern healthcare reimbursement, and government subsidies for research and development through agencies such as the National Institutes of Health. In this collection of essays from March 2020 through April 2021, originally published at Written Description, we explore the response of these legal institutions to a variety of COVID-19-related technologies including vaccines, diagnostics, pharmaceutical treatments, and medical devices. While each technology brings its own challenges, we find a number of common innovation inefficiencies present during the COVID-19 pandemic, such as a lack of robust interagency coordination, poor incentives to generate health information, and persistent difficulties in manufacturing health care technologies at scale. In addition, throughout our work we highlight inequities in the healthcare innovation ecosystem related to race, gender, wealth, and geography. Although U.S. innovation institutions have resulted in some remarkable successes—such as the record-breaking speed of vaccine development—the pandemic has also drawn attention to innovation policy failures. Policymakers should focus on addressing these problems now—before the next pandemic strikes.

Keywords: COVID-19, innovation policy, public health, intellectual property law, R&D, grants, procurement, NIH, FDA, EUA, CMS, vaccines, diagnostics, antibody testing, remdesivir, therapeutic antibodies, convalescent serum therapy, pharmaceutical manufacturing, clinical trials, N95s, 3D printing, AI

JEL Classification: I10, I11, I13, I14, I18, K20, K23, K39, L51, O31, O38