TWN Info Service on Health Issues (Jan21/05)
19 January 2021
Third World Network

Proponents of TRIPS waiver issue documents to facilitate discussions
Published in SUNS #9266 dated 19 January 2021

Geneva, 18 Jan (D. Ravi Kanth) – In the face of the worsening COVID-19 pandemic that has already claimed 2 million lives globally, the proponents of the waiver proposal to suspend certain provisions in the WTO’s TRIPS Agreement in combating the pandemic have upped the ante by releasing documents aimed at facilitating a constructive discussion at the WTO in order to reach an agreement on the waiver, sources told the SUNS.

The waiver proposal for suspending the TRIPS provisions concerning copyrights, industrial designs, patents, and protection of undisclosed information “has received global support from intergovernmental organizations, human rights and other experts and most importantly from many WTO members.”

The proponents of the TRIPS waiver – South Africa, India, Kenya, Eswatini (formerly Swaziland), Pakistan, Bolivia, Mozambique, Mongolia, and Venezuela – stated unambiguously that “shortcomings in the ramping up of the manufacturing of specific COVID-19 diagnostics, equipment, therapeutics or vaccines” have now become commonplace.

Ahead of the informal WTO TRIPS Council meeting on 19 January, the proponents released two separate documents (IP/C/W/672 and IP/C/W/673) highlighting their responses to questions raised by the opponents, as well as a third document on their questions (IP/C/W/674) to the opponents.

The first document (IP/C/W/672) of 30 pages contained the specific responses offered by the proponents to questions raised by the opponents led by the United States, the European Union, Japan, and Canada among others during the meetings held on 16 October, 20 November, and 3 and 10 December 2020 (see SUNS #9253 dated 14 December 2020).

The second document (IP/C/W/673) of 12 pages covers the responses from the proponents to eight questions raised by Australia, Canada, Chile, and Mexico on 10 December 2020.

In their responses to the eight questions by Australia, Canada, Chile, and Mexico, the proponents emphasized that “the Waiver proposal is to ensure that complications arising from intellectual property rights protection do not delay response or lead to sub-optimal response from the countries around the world affecting lives of all people.”

“Management of a pandemic,” according to the proponents, “needs a swift response and it is in the interest of all countries that every country has the capacity to fight this through vaccines, therapeutics and devices.”

It is well established over the past 25 years that “IP (intellectual property) had proved to be a substantive barrier during the HIV crisis and continues to affect access to medicines in the treatment of many diseases,” the proponents argued.

The proponents cautioned that “the pandemic has a huge social cost and if unaddressed through swift and appropriate action by each country, will create negative externality for every country.”

Moreover, to the constant refrain voiced by the opponents that TRIPS flexibilities are adequate to address the pandemic, the proponents said unambiguously that “TRIPS Article 31 and 31bis do not address the situation created by a pandemic where every country in the world is affected and the numbers impacted continue to rise.”

Further, Article 31 of the TRIPS Agreement mainly addresses country-specific measures such as in situations of a national emergency, extreme urgency or when the medicine is required for public non-commercial use. Article 31 does not address a situation where the world as such is impacted, according to the proponents.

It is little wonder that a “waiver is therefore required because a disease like the COVID-19 needs collaborative action in social interest while IP protected products promote private interests only,” the proponents argued.

Therefore, the “exercise of relief limiting the rights of the right holder will be time consuming and considering the extent of the crisis will have considerable human cost,” the proponents said.

To a question from Australia, Chile, Mexico, and Canada on whether members experienced IP challenges that have impeded or prevented the timely procurement of COVID-19 diagnostics, equipment, therapeutics or vaccines, the proponents replied that “to revisit IP challenges experienced by countries in the COVID-19 pandemic, it is critical to first clarify that the understanding of IP challenges needs to consider at least five aspects.”

These aspects include:

(1) the immediate blocking effects on production and supply, such as those arising from patents on medicines and other IP;

(2) the effects of restrictive IP management that limits the production, supply and procurement options, such as those associated with selective and exclusive voluntary licensing practices;

(3) the effects of legal uncertainty and delay on alternative and independent development and production, such as those associated with patent thickets and IP disputes;

(4) the emerging and anticipated barriers that arise alongside the evolving product development pipelines, concerning both background IP and foreground IP related to COVID-19 health technologies, for instance, the unpublished patents on pipeline medicines, vaccines and diagnostics; and

(5) the effects of different types of IP on different aspects of COVID-19 health technologies and their combined effect on availability and affordability, for instance, the combined effect of patents and undisclosed information on medicines, vaccines and diagnostics.

According to the proponents, “addressing each of these IP challenges requires either removing existing barriers or anticipating emerging barriers and adopting legal measures to enable quicker and easier actions when needed.”

The proponents stated that “the need to address IP challenges with a global outlook also challenges WTO Members to look beyond existing legal options under the TRIPS Agreement which adopts a product-by-product and country-by-country scenario.”

Paradoxically, “early in the pandemic, some developed country Members (e.g., Canada, Australia, Germany, Hungary etc.) amended laws to enable quicker and easier procedures for the grant of compulsory licenses to overcome possible IP barriers to COVID-19 technologies, without any specific instance of IP barriers necessitating the actual use of such a measure,” the proponents said.

“These law revisions were done to enable and prepare the governments to act rapidly to address IP barriers, if they were to arise,” the proponents argued.

Given the past practices of using compulsory licenses, the proponents explained that “in the context of a pandemic, compulsory licenses offer imperfect solutions.”

The proponents emphasized in the TRIPS Council “that the waiver proposal provides a legal option under the WTO framework for countries to use in addressing IP challenges (that are either present or that might arise) to expand global supply and facilitate access.”

“Worse still, an individual country’s legal preparation is insufficient to address global needs.”

“In addition, the waiver proposal also goes beyond the product-by-product scenario that is currently embedded in the TRIPS Agreement,” the proponents said.

But the opponents went on to maintain that the TRIPS Agreement provides requisite flexibilities, including compulsory licensing provisions for addressing the pandemic.

They insisted that IPRs (intellectual property rights) are not a hindrance and suspending the protections accorded to innovators would send the wrong message and undermine the global IPR system.

The US, the EU, Japan, and Switzerland among others also argued that the TRIPS Agreement provides the right balance and the necessary means and remedies to allow the use of protected products.

Some opponents insisted that initiatives such as ACT-Accelerator (ACT-A) and COVAX Advance Market Commitment (AMC) as well as some $7 billion in donations for implementing these initiatives are sufficient to address the global need for vaccines and therapeutics.

Despite these initiatives, developing and poor countries are currently facing a “vaccine apartheid” and growing incidence of COVID-19 cases. The pandemic has already claimed 2 million lives with confirmed cases of almost 95 million globally.

After systematically answering the questions raised by the opponents, the proponents posed their own questions to the opponents in a third document (IP/C/W/674) at the TRIPS Council meeting.

Mozambique, for example, asked the opponents pointedly that “after years of discouraging WTO Members especially developing countries to take steps to improve their patent law so that compulsory licenses may be issued in the interest of public health, how does the European Union expect all WTO Members to be ready to use compulsory licenses should the need arise?”

South Africa posed the following questions to the opponents:

(1) We would like to ask Canada, Germany and Hungary, when they decided to swiftly amend national laws to enable quicker use of compulsory license, what kind of data was relied upon at that time – demonstrating the necessity of revising the laws? [We refer to the Secretariat note and compilation of COVID-19 measures.]

(2) The European Union (EU) and Switzerland both highlight the flexibilities (compulsory license) as the key measures for Members to use; does it mean the EU and Switzerland will from now on commit not to pressure developing countries when they improve their laws on compulsory license and other TRIPS flexibilities or make use of compulsory license? Would the European Commission (EC) from now on exclude compulsory license and other TRIPS flexibilities from its IP enforcement report? Would the United States Trade Representative (USTR) do the same to its Special 301 report?

(3) If voluntary licensing (VL) mechanisms work, why do various license agreements concluded by companies exclude half of the world’s population from supply and only license to a few very specific manufacturers. Why is it that no one knows the full terms of the license?

(4) If VL (voluntary license) works then why are there geographical restrictions in the VL to limit supply to only low- and middle-income countries (LMICs) under the agreements, excluding supply to other developing countries? Taking note that the issue of classification of countries based on singular criteria such as per capita GDP ignores the deep and persistent structural deficits between developed and developing countries.

(5) In the European Union, data exclusivity and on certain products market exclusivity are granted. How does the EC want to make effective use of CL in this pandemic with these non-patent barriers in place.

(6) The European Union IP Action Plan, released on 25 November 2020, reiterates the exigent need to deploy COVID-19 technologies, “not only in Europe but also on a global basis.” To this end, the EU IP plan calls for “voluntary pooling and licensing of intellectual property related to COVID-19 therapeutics and vaccines, in line with the recent resolution of the World Health Assembly to promote equitable global access as well as a fair return on investment.” Can the European Union elucidate further on how they intend to transform this lofty rhetoric into concrete action? The EU IP Action Plan notes that the Commission is “working on mechanisms that would enable and incentivise the rapid pooling of critical IP in times of crisis”. Could the European Union please explicate on these mechanisms that would enable the “rapid pooling of critical IP in times of crisis.”

(7) Following on from President Ursula von der Leyen’s State of the Union call for the establishment of an EU BARDA, the EU’s IP action (plan) calls for the development of an “effective framework for march-in rights that should guarantee that publicly funded IP is available in case of critical shortages”. Could the European Union please provide details on the design of these march-in rights?

(8) We would counter the EU’s assertion, repeated once again today, that compulsory licensing should be used as “means of last resort and a safety net when all other efforts to make IP available have failed.” Nonetheless, could the European Union please provide further details on the EU IP Action Plan’s recommendation that EU Member States “establish fast-track procedures to issue compulsory licenses in emergency situations”?

(9) The Commission will explore with Member States the possibility of creating an emergency co-ordination mechanism, to be triggered at short notice when Member States consider issuing a compulsory license. What is the rationale behind this policy decision?

(10) As the European Union has opted out of Article 31bis of the TRIPS Agreement, how would EU Member States with no or insufficient manufacturing capacities make effective use of the compulsory licensing provisions of the TRIPS Agreement, especially in light of the IP Action Plan’s emphasis on establishing “fast-track procedures to issue compulsory licenses in emergency situations”?

In a similar vein, India had raised four questions at the last TRIPS Council meeting in December 2020. The questions include:

1. Do the opponents have any data regarding how the waiver would demonstrably have negative impact on Members’ economies, if any?

2. Public funding has been driving COVID-R&D. In addition, billions of dollars are spent on purchasing the vaccine. Given the demand volumes, pharma companies will anyway make profits. So why is there a need for IP as an incentive, in a global pandemic situation?

3. Can the opponents provide data as to how voluntary licensing approaches and existing global cooperation mechanisms, including ACT Accelerator, the COVAX facility and COVAX AMC, would be sufficient to address the vaccine requirements of 7.8 billion people in the world?

4. If voluntary mechanisms work, why has the pharmaceutical industry collectively rejected participation in the World Health Organization (WHO) COVID-19 Technology Access Pool (C-TAP), an initiative that encourages voluntary contribution of IP, technology and data to support global sharing and scale-up of manufacturing and supply of COVID-19 medical and pharmaceutical products?

Pakistan sought to know from the opponents “how would countries that argue for such licensing arrangements (voluntary licensing), address companies’ conduct and ensure the availability of non-exclusive, global, open licenses on reasonable terms and conditions, where all manufacturers globally may be engaged; and all countries may benefit from supply without any restrictions?”

In short, the proponents appear to have turned the tables on the opponents by posing these pertinent questions that could well expose on which side the opponents are, said a trade negotiator.

“Are they with the Big Pharma to protect their billions of dollars of monopoly profits and patents or do they want to save lives through agreeing to the waiver?” the negotiator asked.