TWN Info Service on Intellectual Property Issues (Mar21/06)
12 March 2021
Third World Network

Strong support for TRIPS waiver amidst opposition by Big Pharma
Published in SUNS #9304 dated 12 March 2021

Geneva, 11 Mar (D. Ravi Kanth) – More than 100 countries have upped the stakes for text-based negotiations on the TRIPS waiver proposal that seeks to temporarily suspend certain provisions of the WTO’s TRIPS Agreement in combating the COVID-19 pandemic, amidst attempts by Big Pharma to kill the waiver proposal, said people familiar with the development.

Ahead of the WTO’s TRIPS Council meeting on 10 March, the representatives of Big Pharma wrote to President Joseph Biden that the “US government has stood alongside other governments, including the European Union, United Kingdom, Japan, Canada, Switzerland, Brazil, and Norway to oppose this waiver.”

“We urge your administration to maintain this longstanding support for innovation and American jobs by continuing to oppose the TRIPS waiver,” said the CEOs of Pfizer, AstraZeneca, PhRMA (Pharmaceutical Research and Manufacturers of America), Eli Lilly, Bristol Myers Squibb, Gilead Sciences, Merck, Sanofi, Takeda Pharmaceuticals, Novartis, Abbvie, Bayer AG, Amgen Inc, and Biogen among others.

The CEOs of these companies, who constitute the powerful Big Pharma, decried the waiver proposal, saying that “in requesting the waiver, India and South Africa argued without evidence that the intellectual property is hindering the global response to the pandemic and that the waiver would help scale up research, development, manufacturing and supply of needed products.”

TRIPS COUNCIL MEETING

It is against this backdrop that the regular TRIPS Council meeting took place on 10 March during which the opponents – the US, the European Union, the United Kingdom, Japan, Canada, Switzerland, Brazil, and Norway – stuck to their “diversionary” tactics to oppose the waiver.

The TRIPS waiver proposal seeks the temporary suspension of certain provisions in the WTO’s TRIPS Agreement relating to copyrights, industrial designs, patents, and protection of undisclosed information to enable countries to ramp up the production of COVID-19 vaccines globally in containing the spread of the SARS-CoV-2 virus.

It has been one year since the COVID-19 pandemic has brought about an unprecedented health crisis, followed by an economic crisis.

So far, the COVID-19 pandemic has affected around 118 million persons, resulting in the deaths of 2.6 million, according to data provided by the World Health Organization and other agencies.

At the TRIPS Council meeting held on a virtual platform on 10 March, the co-sponsors of the TRIPS waiver proposal exposed the seemingly flawed arguments and false evidence put forward in support of voluntary licenses instead of agreeing to the waiver, said sources who took part in the meeting.

The voluntary licenses are being touted as the best way to ramp up the production of COVID-19 vaccines and diagnostics under the so-called “Third Way” as proposed by the WTO Director-General Ms Ngozi Okonjo-Iweala. She apparently continues to sit on the Board of the Geneva-based GAVI (the Vaccine Alliance).

“We have so far not seen one single example led by multinational vaccine and therapeutic companies that has used a different approach to voluntary licenses, keeping the license terms and conditions fully transparent, opening up world-wide coverage for production and supply of both raw materials and finished products, unconditional transfer of know-how and technologies and coming with no other restrictive conditions,” said Mr Mustaqeem De Gama, South Africa’s TRIPS negotiator at the TRIPS Council meeting.

WHO’S STATEMENT AT TRIPS COUNCIL MEETING

Participating as an observer at the meeting, the World Health Organization openly embraced the TRIPS waiver proposal as a “win-win initiative by South Africa and India to facilitate desperately needed production of vaccines and diagnostics”.

The WHO expressed concern that the COVID-19 Technology Access Pool (C-TAP), intended to provide a means to accelerate the development of products needed to fight COVID-19 as well as to accelerate the scale-up of manufacturing and the removal of barriers to access in order to make products available globally, has not been utilized so far by owners of knowledge and patent-holders.

Moreover, “only limited exclusive and not often non-transparent voluntary licensing is the preferred approach of some companies, and this is insufficient to address the needs of the current pandemic,” the WHO official noted at the meeting.

But the opponents of the TRIPS waiver proposal including Switzerland, Canada, the European Union, and the US, adopted ambivalent positions that amounted to stalling any move towards text-based negotiations, said several participants, who asked not to be quoted.

Brazil, which had championed the 2001 TRIPS Public Health initiative, has opposed the TRIPS waiver proposal, saying that the TRIPS Agreement provides enough flexibilities to address the current pandemic, said participants after the meeting.

At the regular WTO’s TRIPS Council meeting, the positions adopted by both the proponents and the opponents remained diametrically opposed to each other with nuanced statements from both sides.

The TRIPS waiver proposal is now being co-sponsored by 57 countries with support from 61 other countries. It seeks to temporarily suspend the implementation of copyrights, industrial designs, patents, and protection of undisclosed information for scaling-up production of vaccines across countries so as to contain the spread of the SARS-CoV-2 virus.

The proponents of the TRIPS waiver proposal, according to South Africa’s TRIPS negotiator Mr Mustaqeem De Gama, thanked the outgoing chair of the TRIPS Council, Ambassador Xolelwa Mlumbi-Peter from South Africa, for confirming 15-22 April as the possible dates for the next round of meetings on the waiver.

THE CHAIR’S REPORT

At the meeting, the chair delivered her report on the state of play in the continued discussions on the waiver and the way forward to arrive at a solution-based outcome on this issue, said participants, who preferred not to be identified.

So far, the waiver proposal has been discussed in eight meetings since October when it was formally introduced by South Africa and India.

Thirty-four delegations as well as the WHO, as an observer, delivered statements during the three-hour meeting on 10 March.

A factual report issued early last week at the WTO’s General Council (GC) meeting provided an account of the waiver discussion, including the members’ common goal of providing timely and secure access to high-quality, safe, efficacious and affordable vaccines and medicines for all.

The GC report also noted that members had exchanged views, asked questions, sought clarifications and provided replies, clarifications, and information, including through new documents, but had not been able to reach consensus, including on whether it is appropriate to move to text-based negotiations.

At the meeting on 10 March, Ambassador Xolelwa underscored the need for members to engage in a candid, good faith and evidence-based discussion on what is required for a scale-up in global production in these unprecedented times of a public health crisis, according to people, who asked not to be quoted.

The chair urged members to focus on a result-oriented process that will contribute to an effective solution to boosting productive capacity for products that are essential to deal with COVID-19 across the world.

She emphasized the need for swift action to scale up COVID-19 vaccine production and distribution, said people after the meeting.

Ambassador Xolelwa urged members to shift gears and move towards a solution-oriented discussion. She said the world is in desperate need of solutions.

She apparently urged members to work together and engage with that purpose, according to people present at the meeting.

Ambassador Xolelwa emphasized that this pandemic is literally a life-and-death issue because people are dying as we speak, said people, who asked not to be quoted.

The time has come for members to demonstrate their commitment to the overarching goals of universal and equitable access to COVID-19 medical products – not only in words, but through action.

The world is watching, and we dare not fail, the chair concluded in her last statement to the TRIPS Council, said people, who asked not to be quoted.

Norway’s trade envoy Ambassador Dagfinn Sorli, who has consistently and vehemently opposed the TRIPS waiver proposal, will take over as the new chair of the TRIPS Council on 11 March.

ARGUMENTS BY THE CO-SPONSORS

India, which is one of the first sponsors along with South Africa of the TRIPS waiver proposal, cautioned that the world is not producing sufficient vaccines to end the pandemic despite the existence of several approved candidates and un-utilized vaccine manufacturing capacities in the world.

According to India, the waiver proposal offers an open and expedited global solution to allow un-interrupted collaboration in the production and supply of health products and technologies required for an effective COVID response.

Despite support from more than 100 countries for the waiver proposal, India said a few members, who have had a lion’s share in availing of vaccines, have continued to oppose it.

Without naming the countries that have continued to hoard the vaccines and thereby exacerbating the “vaccine inequity”, India said that the vaccine hoarders have also hindered coordination for an efficient global vaccination program.

India urged these members to fulfill their obligations under WTO rules and engage in text-based negotiations on this issue.

India said it is pleased to see that some of the members who adopted a conservative approach and questioned the mere existence of any problem in vaccine access (in apparent reference to Australia, Canada, Chile and Mexico), are finally acknowledging that they are facing serious vaccine production and distributional challenges.

SOUTH AFRICA’S INTERVENTION

The South African negotiator Mr Mustaqeem De Gama intervened twice during the meeting to reiterate that the discussions cannot continue to be mired in an evidentiary loop.

He called for moving towards text-based discussions. He said South Africa is ready to have a discussion on the scope and duration of the proposal following a series of bilateral meetings with other members over the last two weeks.

Mr De Gama suggested that these conversations will spill over into the broader discussion under the auspices of the TRIPS Council.

He reminded the participants at the TRIPS Council meeting that the COVID-19 is a global problem requiring a global solution through multilateral cooperation as no one is safe until everyone is safe.

The South African negotiator emphasized that “an effective response to the pandemic is only achievable when everyone, everywhere can access the health technologies they need for COVID-19 detection, prevention, treatment, and not through hoarding of vaccines.”

He pointed out that the EU’s “Implementing Regulation (2021/11)”, which establishes an authorization scheme, has the potential to restrict or negatively affect the export of vaccines and key vaccine supplies.

“In a global pandemic,” said Mr De Gama, “lifting IP (intellectual property) monopolies will give governments and manufacturers full freedom to operate and allow collaboration for the development, production and supply of COVID-19 medical products including therapeutics and vaccines, without being restricted by big corporation’s “voluntary” willingness.”

He said that “the current ad-hoc, secretive and restrictive business-as-usual voluntary licensing practices is limiting production and artificially constraining supply with detrimental consequences for public health, society, livelihoods and the economy globally.”

“It is an abuse of the intellectual property system for it has in the past one year failed to leverage global production capacity,” Mr De Gama argued, emphasizing that “passing this waiver makes ethical, epidemiological, and economic sense.”

South Africa drew attention to its experience with voluntary licenses and raised sharp concerns.

They include: (1) the lack of transparency as the terms of the license are usually confidential; (2) the limited geographic scope that even excludes many developing countries from being supplied under the license agreement or allows for manufacturing only for purposes of export; (3) the license is only offered to very specific manufacturers presumably aiming to limit supply; (4) the restrictive terms on the source and production of active pharmaceutical ingredients (APIs).

He urged members to draw appropriate lessons from the past mistakes to ensure that “the experience of ad-hoc, secretive, limited and restrictive VLs (voluntary licenses) does not repeat itself.”

Mr De Gama said the “pandemic has shone a harsh light on the skewed and unsustainable business models with which the pharmaceutical industry maximizes its profits at the expense of legitimate public interests.”

“Despite generous contributions from tax-payer money and pre-order purchases, companies are still allowed to decide on critical elements such as the scale of production (and now conveniently complain that demand outstrips supply) while setting ever higher prices that cannot be justified on any rational basis,” he argued.

According to Mr De Gama, reports suggested that “South Africa has paid $5.25 a dose for a version of the vaccine manufactured in India while it seems that the European Commission is paying only $3.50 per shot. Uganda seems to have paid $8.50 a dose.”

He debunked the flawed arguments advanced about the price differentials which are justified on grounds that “such price differentials include arguments that high-income countries have a lower price because they have invested in the research and development.”

The South African TRIPS negotiator challenged the argument that the TRIPS Agreement offers flexibilities, which are often undermined by adopting coercive methods behind the scenes.

“These and other problematic terms and conditions that restrict production were commonplace even before the pandemic,” the South African negotiator said, arguing that “they have been a challenge for access prior to the pandemic and such approaches will not deliver to address the access needs of this devastating pandemic.”

Therefore, “disparity in access is certain unless concrete steps are taken to address intellectual property barriers,” he emphasized.

Commenting on the common refrain by the waiver opponents about the use of flexibilities in the TRIPS Agreement, he said countries have been recently criticized by the US Special 301 report about the use of compulsory licenses.

South Africa also illustrated the hypocrisy that underlies much of the encouragement to use TRIPS flexibilities taking into account recent criticism by Big Pharma against countries like Russia, Colombia, Indonesia or Hungary for the legitimate use of compulsory licenses on COVID-19 medicines in the pandemic.

Even the European Union has been criticized for considering how to improve the effective use of compulsory licenses, South Africa pointed out.

South Africa announced it will convene meetings in various formats and configurations in coming weeks to start a process to discuss possible approaches to the draft waiver text, which may lead to an amendment of the current text.

CHINA’S INTERVENTION

China underscored the need for the rapid development and deployment of COVID-19 vaccines, suggesting that it is concerned about the limited supply capacity, particularly in developing and least-developed countries.

According to China, the proposal by South Africa and India provides a good starting point for members to discuss trade emergency measures in response to the pandemic. China said it is ready to engage in such discussions to find balanced and effective solutions, said people present at the meeting.

INTERVENTION BY ACP GROUP

On behalf of the ACP (Africa, Caribbean, and Pacific) group of countries, Jamaica said the “ACP Group endorses the public health objectives of the proposal, which is, to ensure that our people have affordable access to medicines, vaccines and other items required to prevent, treat and contain the virus.”

The ACP group said that this waiver “proposal comes during the most devastating health crisis in our lifetime,” suggesting that “the Covid-19 pandemic is unprecedented and has caused major disruptions socially and economically.”

Jamaica thanked “the co-sponsors for their hard work and take this opportunity to invite other members to engage constructively with a view to finding a landing zone. In order to move to such a landing zone, the ACP Group would support a move to text-based discussions.”

Jamaica said this seems to be the most effective way to tailor the waiver to a consensus approach without being tied up in a continuous evidentiary loop.

PAKISTAN’S STATEMENT

In a sharp statement, Pakistan said that the proponents “have consistently been highlighting the acute shortages of supply of vaccines, the un-utilized capacity in developing countries, and the tendency of big pharmaceutical companies to reap exorbitant profits on the back of global health crises by protecting unnecessarily the intellectual property, technology and technical know-how.”

Pakistan said: “It is ironic, and at the same time unfortunate to note that, members that dismissed our arguments and concerns at the time, and had reportedly pre-purchased enough doses of the vaccine to vaccinate their population multiple times over, are now faced with supply shortages; are needing to resort to export restrictions (imposed by the EU); and to highlight the limitations of the Covax facility. Some of the same members are now pleading against export restrictions on vaccines, and calling for voluntary sharing of technology and exchange of technical know-how.”

Pakistan asked the opponents “how they would ensure this “voluntary” sharing and transfer of technology.”

It sought to know, “given that such voluntary sharing has only been possible by the private companies in an arbitrary, limited, and secretive manner, creating part of the problem we are facing, would these members force the companies to “voluntarily” share their technology? And if so, how? This question is even more important with reports surfacing that the same pharmaceutical companies are lobbying with their governments to impose sanctions on countries that adopt compulsory licensing.”

It drew reference to “alarming reports in the media that certain countries had developed patent-free vaccines several months ago as early as May last year. Yet, instead of choosing to make it public they chose to side with Big Pharma, placing profits above public health.”

Pakistan said “the big pharmaceutical companies are set to reap billions of dollars of profits from these vaccines by charging inflated prices and keeping the intellectual property protected for years to come.”

Several other developing countries – Tanzania (on behalf of the African Group), the Maldives, Egypt, Zimbabwe, Vanuatu, Namibia, Bangladesh, Qatar, Cuba, Nepal, Mozambique, Mongolia, Cameroon, Indonesia and Nigeria – delivered strong statements in support of the waiver.

OPPONENTS OF THE TRIPS WAIVER

The United States, unlike its earlier positions against the waiver, seemed less strident on the waiver at the meeting, said a TRIPS negotiator.

The US acknowledged it is an important task to collectively increase access to facilitate equitable distribution of COVID-19 vaccines and to support policies that drive the rapid development, production and distribution of new vaccines, medicines and other health products.

The US said it is looking forward to engaging in further fact-based discussions on the questions that a number of members have raised about the proposal, with the aim of finding multilateral solutions to amplify the public health and humanitarian responses to the ongoing crisis.

However, it stuck to its old position on the importance of incentives for innovation, so that members can better understand and consider the challenges with respect to the licensing, manufacturing, procurement and distribution of COVID-19 diagnostics, therapeutics and vaccines, and how those relate to the TRIPS Agreement.

The US said it is ready for further engagement with the sponsors of the waiver proposal, including hearing further responses to the questions posed. It said that it is committed to working constructively with members to tackle this unprecedented global health crisis and endless pandemic and is considering proposals, based on whether they can effectively address these shared goals.

Switzerland, a strong opponent of the waiver proposal, suggested that considerable efforts are underway to scale up global manufacturing, arguing that they need to be further intensified.

In line with the constant refrain from the International Federation of Pharmaceutical Manufacturers & Associations that transfer of technology of novel mRNA technology is difficult, Switzerland asked for time as novel COVID-19 vaccines are complex, as they are based on the mRNA technology which involves completely new manufacturing processes, including the set-up of new manufacturing facilities or extensive re-purposing of existing ones.

The Swiss delegate said that it is misleading to argue that the temporary suspension of large parts of the TRIPS Agreement would translate swiftly into a worldwide supply of COVID-19 vaccines, or that it would even have avoided scarcity at this initial stage of the process, or global access needs to be geared up to supply more than 8 billion people.

The European Union stressed that equitable access to vaccines is the top priority and that the main global mechanism to achieve it is the COVAX facility after receiving a major financial boost following the G7 meeting, which will allow the delivery of 1.3 billion doses to 92 low- and middle-income countries by the end of 2021.

The other opponents of the waiver who spoke at the meeting include Japan, Canada, Singapore, and Chinese Taipei.

However, several South American countries – Chile, Colombia, and El Salvador – as well as Ukraine underscored the need to contribute to a constructive dialogue on the waiver so as to find balanced and effective solutions.