TWN Info Service on Intellectual Property Issues (Dec20/07)
14 December 2020
Third World Network

Dear friends and colleagues,

Below is a report on the TRIPS Council’s 10 December discussion regarding the TRIPS Waiver Proposal for COVID-19 medical products.

Members have agreed to keep the waiver proposal on the agenda for the upcoming TRIPS Council meetings to continue with further discussions.

Informal meetings are expected to take place in January and February 2021 followed by a formal TRIPS Council session on 10-11 March 2021.

The WTO General Council is expected to meet on 16-17 December and the recommendation from the TRIPS Council would be considered at the meeting.

An earlier version of this article was first published in SUNS #9253 dated 14 December 2020.

With best wishes,
Third World Network

TRIPS waiver gains more support despite efforts to stall its passage

Geneva, 11 Dec (D. Ravi Kanth) – Attempts to avert an emerging “vaccine apartheid” through a TRIPS waiver for combating the COVID-19 pandemic has gained support from more countries at the WTO as well as international civil society groups, exposing what appears to be the alleged repeated false claims advanced by the United States and a handful of its allies in protecting the monopoly profits of the leading Western pharmaceutical companies over the lives of people, trade negotiators told the SUNS.

At a formal TRIPS Council meeting held virtually on 10 December, the proponents of the TRIPS waiver proposal – South Africa, India, Kenya, Eswatini (formerly Swaziland), Mozambique, Pakistan, and now Bolivia as the latest co-sponsor – answered a maze of questions raised by the countries where Big Pharma is located such as the United States, the European Union, Japan, Canada, Switzerland, among others, said a delegate, who asked not to be quoted.

Several developing countries from the more than 30 countries that spoke, including Indonesia and Egypt, drew attention to the intellectual property (IP) barriers for availing of COVID-19 related vaccines, therapeutics, and other medical equipment.

Meanwhile, international civil society groups have mounted increasing pressure on the governments in the countries opposing the TRIPS waiver to swiftly approve the waiver to combat the extraordinary health crisis that has claimed more than 1.5 million lives.

In a signature campaign launched by civil society groups, more than 900,000 people from around the world called for the passage of the waiver and for putting lives before the rapacious profits and patents of Big Pharma.

At the TRIPS Council meeting on 10 December, the proponents of the TRIPS waiver proposal marshalled all their resources to provide a robust response to the seemingly extraneous questions and allegedly false claims, said a negotiator, who preferred not to be quoted.

South Africa conveyed to the opponents of the TRIPS waiver that “ad hoc, non-transparent, and unaccountable bilateral deals that artificially limit supply and competition, cannot reliably deliver access during a global pandemic.”

“These bilateral deals do not demonstrate global collaboration but rather reinforces “vaccine apartheid” and enlarges chasms of inequity,” South Africa said, according to negotiators present at the meeting.

“Disparity in access is certain to continue unless concrete steps are taken to address intellectual property barriers,” the South African delegate Mustaqeem Da Gama warned, according to several negotiators, who were present at the meeting.

“If what the EU, the US and Japan [are] suggesting, namely that the IP system is responsible for delivery of vaccines in record time, it would fly in the face of the heroic efforts of ordinary people, researchers, scientists and government support and funding to enable this monumental feat,” the South African delegate argued.

Further, “not companies, but ordinary people have generously donated their skills and efforts to enable global collaboration by participating in vaccine trials, many in developing countries, putting their lives at risk for the greater good of mankind,” Da Gama said, pointing out that “yet, the irony does not escape us, these very people are denied priority access despite the enormous sacrifices they made.”

At the meeting, India praised Indonesia for providing concrete evidence regarding IP barriers that Jakarta has faced in addressing the COVID-19 pandemic.

“Our waiver proposal presents an open and expedited global solution to allow uninterrupted collaboration in development, production and supply of health products and technologies required for an effective COVID-19 response,” India said.

The Indian delegate emphasized that the waiver proposal “is targeted and proportionate as it seeks waiver for a limited time from four specific sections of TRIPS Agreement, namely patents, copyrights, industrial designs and undisclosed information, in so far as they hinder the production of health products and technologies, for prevention and treatment of COVID-19 pandemic.”

The waiver proposal, according to Pakistan, “not only promises to help large populations in developing countries, but would also allow export of medicines and medical equipment back to developed countries where poorer segments of their population could also benefit.”

Tanzania on behalf of the Africa Group stressed its support for the waiver proposal, adding “that the TRIPS agreement has to ensure all the member states are not prevented in any way; they are not having difficulties to obtain the vaccine, or treatment of COVID-19. This is the challenge we are having at the moment, and should be a priority for all member states”.

Indonesia reiterated its support for the waiver on grounds that it offers a “different perspective to address global public health crisis by addressing one of the core challenges in rapid, equitable and affordable access to health caused by protection of intellectual properties to much needed diagnostic kits, therapeutics, vaccines, and other medical equipment to combat COVID-19 pandemic.”

Indonesia also related its experience, stating that it “recently failed to convince Gilead to expand its production in Indonesia through voluntary licensing, to address shortages and affordability of the medicine. Importing the medicine was factually more costly and difficult to get as limited supply and higher price for the fulfilment within our region” adding that “selective and secretive production agreement is one of the prime examples on the business-as-usual model”.

It also recalled that during the spread of H5N1 in 2006, despite sharing virus samples and sequence data that were used for analysis and preparation for vaccine production, “the resulting vaccines produced by pharmaceutical companies were in fact unavailable for developing countries such as Indonesia”.

Bangladesh said that the “pandemic is of course a health issue primarily, but this has evidently has far reaching impacts on education, human rights, food security and our economies everywhere” and so “unconditional affordable and timely access to vaccine and other cure measures to must be a priority of the time”, adding that “production and distribution of vaccine and other medical equipment’s for containment and treatment of COVID-19 should be open to all so the people of the world, irrespective of their development status… and the TRIPS regulatory framework should not be a hindrance to the most stark needs of the humanity”.

China also supported further engagement on the waiver proposal, stating that “promoting the availability of COVID medicines and vaccines and ensuring useful and timely access to safe and effective medicines and vaccines for all members, especially the developing members and an LDC is still an urgent call for the global community”.

Mozambique highlighted that “a positive consideration of the requested Waiver would be a substantial contribution for the achievement of the Sustainable development Goal” as Agenda 2030 of the Sustainable Development advocates the need to collectively advance, and leave no one behind.

But the opponents, particularly the US and the EU, where Big Pharma is located, continued to adopt “obdurate and stonewalling” tactics by raising extraneous questions as well as unsustainable claims, said several delegates from developing countries, who asked not to be quoted.

The dominant pharmaceutical industry-led-countries such as the US, the European Union, Switzerland, and Japan among others are using every option to block the negotiations by constantly shifting the goalposts, the negotiator said.

REMARKS BY TRIPS COUNCIL CHAIR

The TRIPS Council Chair, Ambassador Xolelwa Mlumbi-Peter from South Africa, urged WTO members to find “common ground”, suggesting that there is an emerging agreement for sending a factual and neutral communication to the General Council that would reflect the state of play of discussions and the lack of consensus at this juncture, said a negotiator, who asked not to be quoted.

The General Council is expected to meet on 16-17 December and the recommendation from the TRIPS Council would be considered at the meeting.

Ambassador Xolelwa underscored the need to find “common ground in regard to the subject matter of the waiver request, including in relation to scope and substance, as indicated by proponents in order to achieve the common objective you all share.”

Members agreed to keep the waiver proposal on the agenda for the upcoming TRIPS Council meetings to continue with further discussions. Informal meetings are expected to take place in January and February followed by a formal TRIPS Council session on 10-11 March 2021.

An oral status report will be presented at the next General Council meeting on 16-17 December indicating the need for further discussions on this issue, the negotiator said.

During the separate interventions, the proponents along with many other countries highlighted the institutional and legal difficulties for using the TRIPS flexibilities for fighting the COVID-19 pandemic.

A ROBUST RESPONSE

South Africa and India, which have spearheaded the negotiations with the opponents of the waiver, called on members to work together to ensure that patents, industrial designs, copyrights and protection of undisclosed information do not become barriers to timely access to affordable medical products including vaccines and medicines or to scaling-up of research, development, manufacturing and supply of medical products essential to combat COVID-19, according to negotiators present at the meeting.

South Africa suggested that while an effective response to the COVID-19 pandemic requires rapid access to affordable medical products – diagnostic kits, medical masks, other personal protective equipment and ventilators, as well as vaccines and medicines – the outbreak has led to a swift increase in global demand with many countries facing shortages, constraining the ability to effectively respond to the outbreak.

Given the worsening global shortages of these products, South Africa argued that putting the lives of health and other essential workers at risk has led to many avoidable deaths while prolonging the pandemic.

South Africa said that while it is commendable for the efforts to develop COVID-19 vaccines successfully and in record time, these efforts remain “insufficient and not enough to address the needs and underlying problems.”

Responding to a question as to why the scope of the waiver extends to patents, trade secrets, copyrights and industrial designs and what is the evidence that a waiver from these aspects are important to contain, prevent and treat Covid-19, South Africa said that the co-sponsors had presented elaborate answers during the last meeting on 3 December.

As regards which measures would fall within the scope of the waiver and whether measures that are indirectly related would also be included within the scope of the waiver and who would make this determination, South Africa said the proponents have clarified that “the issue is not whether a measure is directly related or indirectly related. It is a matter of what is needed to prevent, contain and treat Covid-19.”

Assuring the opponents that any measure that is not in relation to Covid-19 would not be covered by the scope of the waiver, South Africa said that “for instance, a therapeutic for cancer treatment would not fall within the scope of the waiver.”

Further, the waiver is very specific to COVID-19 for its “prevention, containment and treatment; and therefore, is proportionate,” South Africa said.

In response to the US query about the waiver resulting in counterfeit medicines, South Africa said “the waiver request does not extend to trademark and “counterfeit trademark good” as defined in Article 51, footnote 14 of the TRIPS Agreement.”

South Africa urged “WTO members not to confuse and conflate issues of quality of a product with issues of intellectual property of medical products.”

As regards questions concerning the use of TRIPS flexibilities and COVAX facility of GAVI (Global Vaccine Alliance), South Africa reiterated that “the targets set by WHO’s Act-A including the Covax to provide 2 billion vaccine doses (for 1 billion people) to the world by the end of 2021, 245 million courses of treatment and 500 million diagnostic tests to LMICs (excluding many developing countries) in 2021 are insufficient to meet global needs of the 7.7 billion people of this world.”

“As we have seen vaccine rollouts in the developed world, we cannot but continue to wonder when equitable and timely access will become a reality, with more than 90% of all future production of likely vaccine candidates being reserved for rich developed countries,” South Africa said.

Replying to a question by Brazil, the European Union, and Switzerland posed that the mere existence of patent or patent applications does not amount to a barrier, South Africa said that its submission (IP/C/W/670) presented “a preliminary non-exhaustive snapshot of the patent filing and granting status on five selected therapeutics candidates that are under review by the WHO Access to COVID-19 Tools Accelerator (ACT-A) therapeutics pillar.”

“Due to the interval between the time of patent filing and publication, which can take up to 18 months, new patent applications that might have been filed this year may emerge in the coming months,” South Africa said.

The patent list includes:

i. “Regeneron’s new monoclonal antibody REGN10993 + REGN10987 granted in the US in June 2020, and which expires only in 2040”,

ii. “Merck’s Molnupiravir (MK-4482) has primary patent applications filed in at least 28 jurisdictions, including two regional patent offices, expiring between 2035 and 2038,”

iii. “Atea pharmaceutical’s AT-527 has primary and secondary patents filed or granted in nearly 60 jurisdictions, expiring between 2036 and 2038,”

iv. “Incety Corp’s baricitinib has primary and secondary patents filed or granted in nearly 50 jurisdictions, expiring in 2029,”

v. “Swiss pharma company Roche’s monoclonal antibody therapy tocilizumab has primary and secondary patents filed or granted in nearly 30 jurisdictions, expiring between 2022 and 2028.”

South Africa added that IP/C/W/670 also includes patent landscape for Pfizer/BioNTech and Moderna vaccines.

Drawing attention to the exclusive and monopoly rights that a patent holds during the existence of the patent period, South Africa said that “with this monopoly, the patent holder is able to prevent other competent manufacturers from producing and supplying the patented subject matter, as well as to charge exorbitant prices for the patented medicines, hence hindering the timely access to affordable treatment.”

“Therefore, the patent landscape in IP/C/W/670 is a warning shot of the existing and emerging patent barriers to access and the need for the international community to take urgent action to overcome these barriers so that supply may be diversified and scaled-up,” South Africa said.

Commenting on the US assertion that “where intellectual property rights exist, they can be licensed to companies around the world to scale up manufacturing”, as well as the use of voluntary licensing, South Africa asked pointedly that “if VL (voluntary licensing) mechanisms work, why do various license agreements concluded by companies [such as Gilead] 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?”

Further, if VL mechanisms work, South Africa asked can the companies “provide full details of all voluntary licenses signed with companies all over the world to scale-up manufacturing and for global supply that have been signed by Pfizer/BioNtech and Moderna with respect to their vaccines, and the therapeutics of Regeneron and Eli Lily that recently received emergency approval in the US.”

South Africa and the other proponents sought to know “the full terms of the licenses, with whom these licenses have been signed, which countries will be supplied, when will they be supplied etc.”

Lastly, if voluntary license system works, South Africa asked “why are there geographical restrictions in the VL to limit supply only to 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.”

To a question raised by the US about the data regarding how certain obligations have systematically hindered prevention, treatment, and containment of COVID-19 so that a waiver is needed, South Africa said that “the discussion of the current proposal is to acknowledge the limitation of the existing legal options and to provide additional flexibility at the international level.”

Stressing that Canada, Germany, and Hungary must provide information as to why they “swiftly [amended] 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”, South Africa said that “TRIPS flexibilities are important to increase access to medicines and other medical products not just in a
pandemic.”

In a sharp response to questions raised by the opponents, South Africa asked pointedly as to “why pressure has been applied on developing countries for implementing and supporting public health safeguards in their intellectual property laws and policies under EU’s annual IP enforcement report and the annual “Special 301 Report”, which was released in the midst of a raging COVID-19
pandemic!”

Pointing to the EU IP Action Plan, released on 25 November 2020, South Africa said the plan “reiterates the exigent need to deploy COVID-19 technologies, not only in Europe but also on a global basis.”

South Africa said “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.”

South Africa asked the EU to “elucidate further on how they intend to transform this lofty rhetoric into concrete action?”

According to South Africa, “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.”

India said the time has come for agreeing on a global solution for a global pandemic, where every country is equally affected, according to negotiators present at the meeting.

The Indian delegate challenged the assertion that the IP system provides sufficient tools to ensure swift and equitable access to vaccines and medical products for all, arguing that the availing of TRIPS flexibilities case-by-case entail many problems.

India said the waiver once implemented would provide greater certainty to manufacturers, by providing them freedom to operate.

Replying to a question from the EU “as to how the waiver could operate with regard to the vaccine production, including the transfer of the required technology and know-how and how it would affect the existing licensing mechanisms and Covax in general”, India said “in the area of vaccines, there are two primary barriers, patents and protection of undisclosed information. Patents are used to
protect various aspects of the underlying technology as well as the product.”

In addition, according to India, “manufacturing know-how, test data, and cell lines are needed to facilitate diversification of vaccine production. Hence the importance of addressing protection of undisclosed information under Art. 39 of TRIPS.”

Moreover, the wide range of patents and patent applications as well as exclusivity related to undisclosed information creates a complex and uncertain legal environment for scaling up vaccine development, production and supply, India pointed out.

The Indian delegate argued that “to date most multinational corporations holding COVID-19 vaccine IP have not shown any willingness to openly license or transfer technologies to all competent vaccine developers globally.”

More disturbingly, the pharma industry has objected to participation in WHO’s Covid-19 Technology Access Pool, India said.

“The waiver is about lifting the legal barrier, (and) it does not preclude the possibility of companies agreeing to voluntary licenses,” India said, suggesting that GAVI’s Covax facility “will also benefit from the waiver as production will expand with more manufacturers engaged in manufacturing”.

“With robust competition, prices can also be expected to be substantially reduced,” India said.

Eswatini highlighted the concerns raised by a large number of developing countries in relation to the compulsory licensing mechanisms stated in TRIPS Article 31bis, challenging the argument of developed countries that the IP system provides the necessary incentives for development and commercialization of the product.

Eswatini suggested that the R&D for emerging infectious diseases has typically been dependent on public funding, and not the IP system.

It argued that the COVID-19 is no different, with billions of dollars of public funds spent on R&D and manufacture of vaccines.

It cited the case of Pfizer-BioNTech vaccine for which BioNTech secured public funds to the tune of $546 million, as well as more than $6 billion has been spent on supply deals, while Moderna secured more than $1 billion for R&D.

The Eswatini delegate indicated that AstraZeneca has gone so far as to state that the development of the vaccine will have no financial implications for the company since expenses to progress the vaccine are anticipated to be offset by funding from governments and international organizations.

In response to EU justifying its use of advance purchase agreements to expanding production, the Pakistan delegate said that such agreements, “is in fact, reinforcing inequitable access to vaccines” and even “if production is being expanded, it seems to be for the benefit of a few wealthy nations”. Pakistan referred to reports that “wealthy nations representing representing just 14 per cent of the world’s population have bought up fifty-three (53 per cent) of all the most promising vaccines so far” and that “some countries have already made arrangements to acquire up to 9 doses per person, while among 70 developing or poor countries, only one out of every 10 people will be vaccinated by the end of 2021. It is also estimated that many lower income countries could have to wait until 2023 or 2024 for vaccination”.

Pakistan emphasized that the “situation reveals a lack of global cooperation and solidarity to ensure equitable access and allocation. More specifically, IP monopolies are limiting vaccine production and equitable access”.

Referring to EU’s emphasis on Astra Zeneca’s license, Pakistan noted that “the license is limited, and insufficient to meet global need” and that their “pledge to provide doses to developing nations, can only reach 18 per cent of the world’s population next year at most”. “Besides, Astra Zeneca’s CEO has reportedly opposed any public sharing of technology and IP”, Pakistan stressed.

POSITION OF THE OPPONENTS

The United States, which has been fiercely opposing the waiver proposal, said that the IP system plays a key role in developing partnerships with respect to manufacturing, transportation and distribution.

The US said that these partnerships can help to facilitate access to innovative products, in particular voluntary agreements on mutually agreed terms and conditions have effectively served to advance access to key innovations throughout this pandemic.

The US delegate suggested that manufacturing capacities and problems with supply chains remain the most significant concerns, especially for vaccines.

Raising extraneous arguments that WTO members should be concerned about the pandemic creating the opportunity for an increase in counterfeit health and safety related products, the US refused to budge from its earlier positions, said a negotiator, who asked not to be quoted.

The US also drew attention to exclusive voluntary licensing agreements signed by one company with generic pharmaceutical manufacturers based in Egypt, India and Pakistan to manufacture its drug for distribution in 127 countries.

Washington called for paying more attention “to other factors that are relevant to the access question, [including] pricing and procurement policies, taxes mark-ups, and tariffs and other national policies that result in higher costs for consumers and for health systems.”

It said that some countries continue to apply tariffs of up to 20% on pharmaceuticals and 10% on vaccines – an issue that it is not explored in their proposal elaborated by South Africa.

Despite sharp concerns expressed by several EU parliamentarians about the hurdles posed by the IPRs, the European Union reiterated that the IP system as it stands now is part of the solution to the challenge of universal and equitable access to vaccines and COVID-19 treatments.

According to the EU, the development of vaccines was largely due to the unprecedented work done in collaboration among governments, pharmaceutical innovators, foundations and researchers.

The European delegate said that in suspending the relevant IP rights, collaboration and manufacturing will not be enhanced – to the contrary, it would slow it down, or even lower it to the detriment of all.

Despite growing disparities in the access to the new COVID-19 vaccines, the EU went on to highlight that many pharmaceutical companies have committed publicly and are already working closely with governments to ensure that the vaccines will be available and affordable to all who need them.

Canada defended the TRIPS flexibilities, particularly Article 31bis, suggesting that solutions can be found within the TRIPS provisions. Even as Canada has purchased enough to vaccinate its population five times over, it repeatedly claimed that it was committed to a global effort to address the pandemic.

Canada, jointly with Australia, Chile and Mexico also presented a paper on “Questions on Intellectual Property Challenges Experience by Members in relation to COVID-19” (IP/C/W/671). These co- sponsors claim that they are “committed to fully understanding the nature and scope of any concrete IP barriers experienced by Members related to or arising from the TRIPS Agreement”.

However, although South Africa, India and others have presented the difficulties in using TRIPS flexibilities such as Art. 31 and Art. 31bis these concerns have been ignored. Canada now claims that the concerns raised are mostly “in relation to the domestic implementation” and not “suggestive of issues with the trips regime such that would necessitate a waiver”.

In conclusion, it is clear that the proponents of the waiver are increasingly gaining support inside the WTO despite the relentless efforts by the US, the EU, Japan, Switzerland, Canada and other developed countries to stall the passage of the waiver.

The proponents have ensured that the battle continues into next year when issues relating to the disparities in access to vaccines and therapeutics will become crystal clear.+