TWN Info Service on Intellectual Property Issues (Jun21/01)
3 June 2021
Third World Network

Revised TRIPS waiver bolsters demand for text-based talks at WTO
Published in SUNS #9358 dated 3 June 2021

Geneva, 2 Jun (D. Ravi Kanth) -  The 63 co-sponsors of the proposed TRIPS waiver for saving human lives from the worsening COVID-19 pandemic have brought about a fundamental shift towards text-based negotiations at the WTO, with their revised proposal that calls for an early decision on a "proportionate legal measure for clearing IP barriers for ramping-up the production of COVID-19 vaccines, therapeutics, and diagnostics," said people familiar with the development.

At an informal WTO TRIPS Council meeting held virtually on 31 May, the 63 co-sponsors of the proposed waiver (Jordan being the latest member to join as a co-sponsor) made a persuasive case to bolster their demand for text-based negotiations based on their revised proposal (as contained in IP/C/W/669/Rev.1) without any delay, said several people after participating in the discussions.

Significantly, the United States, which has endorsed the need for the waiver as well as text-based negotiations, New Zealand, China, and Ukraine among others stated unequivocally that they are ready to participate in the text-based negotiations anchored on the revised proposal.

Although no member at the meeting opposed text-based negotiations on the basis of the revised proposal circulated by the 63 developing and least-developed countries, a handful of countries continued to raise extraneous issues that have little bearing on the waiver proposal. Nevertheless, they cautiously welcomed the revised proposal on the TRIPS waiver.

In the face of intense lobbying by Big Pharma to oppose the "Patent Waiver" in several countries as reported by the Wall Street Journal on 26 May, the positions adopted by these handful of countries seem to have confounded the discussions, said a person, who asked not to be identified.

In what appears to be an attempt to confound the negotiations on the TRIPS waiver, the EU is apparently floating a proposal concerning compulsory licensing provisions for patents along with ideas for ramping up production of vaccines, said people familiar with the development.

The WTO director-general Ms Ngozi Okonjo-Iweala has been appraised of the EU proposal, as she had indicated that Brussels is considering a proposal that could be tabled soon.

"Beyond pandemic response, where the EU signaled that it would table a proposal, we (the EU and the DG) also spoke about agriculture and wider WTO reforms," she told an informal General Council (GC) meeting on 28 May.

TRIPS CHAIR'S COMMENTS

The chair of the TRIPS Council, Ambassador Dagfinn Sorli from Norway, said "since the formal meeting of the Council on 10-11 March, the co-sponsors circulated a joint statement on 17th of May 2021 which has been circulated to members in document IP/C/W/677 and a revised decision text for the proposed waiver circulated on 21st of May 2021, circulated to members in document IP/C/W/669/ Rev.1."

"Before giving the floor to the co-sponsors, I would like to invite members who take the floor today, to also share their views on how they wish to take this item forward. In that context, I remind delegations that this issue will be on the agenda of the formal meeting of the TRIPS Council next week," the chair said.

CO-SPONSORS CLARIFY REVISED PROPOSAL

Clarifying the revised waiver proposal, South Africa said the waiver has now been backed by more than 400 civil society groups, the World Health Organization, the African Commission on Human and People's Rights, UNAIDS, thousands of parliamentarians across countries, and more than 170 former heads of government and Nobel Laureates.

Elucidating on the revised waiver proposal, South Africa's trade envoy Ambassador Xolelwa Mlumbi-Peter said "the waiver is a necessary and proportionate legal measure for clarifying intellectual property barriers in a direct, consistent, and efficient fashion, enabling the freedom to operate for more companies to produce COVID-19 vaccines and other health technologies without infringing the IP (intellectual property) rights and the attendant threat of litigation."

More importantly, the TRIPS waiver, she said, "acts as an important political, moral, and economic lever towards encouraging solutions aimed at global equitable access to vaccines, diagnostics, and therapeutics, which is in the wider interest of the global public," said people familiar with her statement.

Given the rising wave of new registered COVID-19 cases, which have crossed 170 million and with more than 3.5 million deaths, she highlighted the gross inequity of the vaccines available to people in the developed world on the one side, and the developing countries on the other.

She quoted her President Mr Cyril Ramaphosa, who had said at a high-level dialogue on the future of vaccine manufacturing, that "vaccines are flooding into upper income countries but trickling into Africa. It also undermines the global effort to defeat this coronavirus: for us as long as the virus continues to spread in one part of the world, it remains a threat to the whole world."

Ambassador Xolelwa underscored the urgent need for the WTO to act now "to arrest the rising human toll and economic strain from the COVID-19 pandemic."

She called for "global solidarity" for ramping-up production of vaccines, therapeutics and diagnostics for effectively dealing with the SARS-Cov-2 virus that is increasingly mutating in various countries.

She said it is important to "leverage the under-utilized manufacturing capacity in developing countries."

Sustainable global economic recovery is possible only when countries eradicate the COVID-19 disease, she said, emphasizing that "ending the pandemic in a timely manner is a global public good and this should be the overarching priority for the WTO."

She explained that the revised proposal, which was submitted last month, includes three amendments in the preamble, as compared to the first proposal circulated on 2 October 2020.

The revised preambular text, she said, reflects the concern of continuous mutations, which are more transmissible, the global need for access as well as the importance of diversifying production and supply, and the recognition of the importance of preserving incentives for research and innovation.

The revised proposal also further explained and streamlined the overall goals underlying the waiver, in line with some complaints that the original proposal was too broad.

It focuses on "health products and technologies" for the prevention, treatment and containment of COVID-19 that involves a range of products, she said.

The TRIPS waiver proposal, she said, "is motivated by the need for rapid scaling up and diversification of supply options to address the timely availability and affordability of the required products to prevent, treat and contain COVID-19 for all countries in need."

Further, the waiver recognizes that "vaccines are necessary but not sufficient to respond to the pandemic," she suggested.

The South African trade envoy emphasized that along with the development of vaccines, the growing importance of therapeutics - such as remdesivir, bamlanivimab, casairivimab plus imdevimba - are also equally important.

Also, the revised proposal calls for access to personal protective equipment, diagnostic tests, therapies, and vaccines to prevent the spread of COVID-19 and reduce illness and death in high risk populations.

The revised waiver proposal calls for suspending the implementation of key provisions in the TRIPS Agreement relating to copyrights, industrial designs (transfer of technology and know-how), patents, and protection of undisclosed information (trade secrets) for at least three years.

Further, the operative paragraph 2 in the revised proposal has called for a duration of at least three years to keep the waiver in force, with the General Council having to determine the date of the termination of the waiver. (See SUNS #9349 dated 20 May 2021).

Ambassador Xolelwa explained that the waiver shall be reviewed by the General Council one year after it comes into force.

She provided figures of huge gaps in the production of vaccines, suggesting that in 2020 only 4% of the projected vaccine production was delivered. Also, given the varying reports on how long it will take to roll out vaccination globally, she said some reports have suggested that it may take up to five to seven years for global vaccination to be realized.

Further, the duration of the waiver "has to be practical for manufacturing to be feasible and viable," she said, stating that "the complexities and uncertainties related to the pandemic suggest the need for a practical and flexible duration."

She said that the "co-sponsors would like to call on all the WTO Members to support the text-based negotiations," suggesting that "it is only when we seat in negotiating table that we all will be able to engage in good faith, solution-oriented discussion that will result in a balanced outcome that addresses the concerns of all."

Ambassador Xolelwa assured members that "the co-sponsors will engage constructively and will remain flexible in working towards an outcome that will truly boost and diversify production across the world."

Therefore, "a sustainable solution to this pandemic, necessitates sharing of new COVID-19 technologies" with manufacturers and producers, and "accompanied by know-how transfer programs to ensure the rapid uptake of quality high volume production."

INDIA'S INTERVENTION

In its intervention, India said that the failure to act on the waiver proposal for removing the IP barriers to ramp-up production of COVID-19 vaccines, therapeutics and diagnostics has "cost us 2 million more lives."

India's trade envoy Ambassador Brajendra Navnit drew attention to the IMF's call for $50 billion by industrialized countries for global vaccination efforts that could save the global economy to the tune of $9 trillion.

He said the huge gap between the demand and production of vaccines, which is currently estimated to be 12 billion doses, can only be addressed by the elimination of IP barriers to pave the way for increased manufacturing of vaccines, therapeutics, and diagnostics for COVID-19.

He said "some sceptics argue that it is not the patents which are holding back the scaling up of production, but the scarcity of necessary raw material."

Ambassador Navnit argued that "once the IP barriers are eliminated and manufacturing of vaccines, therapeutics and diagnostics for COVID is scaled up, increased demand for their raw materials itself will create favourable market conditions for and adequate supply of their raw materials."

He said that a recent report points out that "accelerated production of lipids by MilliporeSigma, one of the few companies manufacturing lipids, a component of mRNA-based vaccines and therapeutics, to fill in the increased demand, goes on to corroborate this argument."

According to the Indian trade envoy, "the opposition to the waiver on the grounds that it would not help augment production is also not supported by past experiences, such as scaling up of production of penicillin after World War II that could be achieved by sharing of scientific information as well as mold cultures by Oxford scientists with US officials, scientists that sparked a unique collaborative effort with no risk of patent infringement and elimination of traditional barriers to sharing resources, more recently, production of generic and affordable ARV (antiretroviral) medication during the peak of HIV/AIDS."

He said that the past seven months of discussions on the waiver also showed changing positions by some of "the naysayers".

He said that some of the arguments advanced by "the naysayers" is about "export restrictions and trade barriers affecting supplies of important raw materials and vaccine production and the need to eliminate these barriers."

Ambassador Navnit said "export restrictions will continue till demand will outpace supply to a large extent as we are not in an ideal market situation." He assured members that the waiver proposal "is not in conflict with other endeavours undertaken across the globe or in the WTO."

Without mentioning the DG's "third way" approach, he said that "we (the co-sponsors) are not obstructing any of the ways whether the 1st way, the 3rd way, 4th or 5th way which we may see in coming weeks or months; these ways are not competing with the different waves of the pandemic that are hitting us."

While the co-sponsors recognize that IPRs are not the only barrier for augmenting manufacturing and addressing supply side constraints, they reckon that IPRs are the biggest barrier in addressing supply side constraints, the Indian trade envoy said.

In a seemingly subtle dig at the DG's common refrain that the WTO would lose its credibility without an agreement on fisheries subsidies, Ambassador Navnit said if the WTO does not deliver during the pandemic on the issues and agreements for which it bears responsibility then it would be a grave mistake.

The TRIPS waiver, he said, is "a necessary, proportionate and temporary legal measure for removing IP barriers and paving the way for more companies to produce COVID-19 vaccines, therapeutics or diagnostics by providing them freedom to, without the fear of infringement of IP rights or the threat of litigation."

INTERVENTION BY MAURITIUS

Mauritius said the current revised proposal, circulated in document IP/C/W/669/Rev.1, which has been discussed with all the co-sponsors, provides the necessary flexibility in terms of duration, and necessary coverage for threats of variance and related areas.

"As such it provides a solid basis, [and] gives us the commencement of text-based negotiations," Mauritius said, emphasizing that "since time is of the essence, Chair, we would request that the discussions on text start early and be accelerated."

TANZANIA ON BEHALF OF AFRICAN GROUP

On behalf of the African Group, Tanzania said "like other continents, Africa is grappling to contain the pandemic since its outbreak from early 2020. The prevention, treatment and containment of Covid-19 remains a top priority for governments today."

It offered a graphic account of how people in Africa are being affected without vaccines, suggesting that "numerous stakeholders and key groups of people across the globe, have acknowledged the current production and distribution set-up, as being contributing to the low pace of vaccination, which delays the achievement of global health in completing herd immunity of 60%."

The African Group has consistently pointed out that "the proposed waiver will contribute to the scaling up of production and distribution of vaccines across the globe," adding that the revised proposal "forms a good anchoring negotiation text, as it contains the needed clarity on the envisioned waiver."

It reiterated "the long-standing call for the commencement of text-based negotiations. A long and prolonged philosophical debate at the TRIPS Council of questions and answers will not achieve the contribution of WTO to achieve the Covid-19 challenges."

The African Group, said Tanzania, would "like to thank all members who are supporting the proposal to have a waiver, including those who have announced themselves not to stand in the way, towards advancing the discussion that will lead to the conclusion of these negotiations."

Many countries - Pakistan, Mauritius, Tanzania (on behalf of the African Group), Argentina, Mozambique, Bangladesh, Bolivia, Egypt, Nepal, Fiji, Cabo Verde, Paraguay, Indonesia, Jordan, Zimbabwe, Chad, Vanuatu and Kenya - called for initiating text-based negotiations on the TRIPS waiver.

The United States, which endorsed the need for text-based negotiations based on the revised proposal, said "the top priority of the Biden Harris Administration is saving lives and ending the pandemic in the United States and around the world."

"The administration's aim is to get as many safe and effective vaccines to as many people as fast as possible," the US delegate said, adding that "this is a global Health crisis and the extraordinary circumstances of the Covid-19 pandemic call for Extraordinary Measures."

It added that the US "believed strongly in the intellectual property protections and we support the goals to increase manufacturing and increase equitable distribution of vaccines."

The US said that it hopes that "our openness to engaging in a text-based discussion with any proposal that could address the immediate need for increased vaccine production and distribution, will encourage others to step forward with something that they can say yes to."

The US said "we are closely analyzing the revised proposal in IP/C/W/669/ Rev.1 and will provide comments in due course, in future meetings. In the meantime, we continue to urge all members to act with urgency."

China said the revised text circulated by the proponents limits the scope of the proposed waiver by focusing on health products and technologies for COVID-19 prevention, treatment, and containment and establishing a concrete duration.

China said that it is closely evaluating the new text which, in its view, provides a basis for text-based discussions.

The Chinese delegate noted the five initiatives for global solidarity against COVID-19 recently announced by its government.

Emphasizing that Beijing supports a TRIPS waiver for COVID-19 vaccines, the Chinese delegate said it has been eight months since a waiver text was initially proposed last October, so it is time to move to the next stage.

New Zealand, one of the first developed countries to support the waiver, said that it is an important part of the collective efforts to address the human catastrophe caused by the pandemic.

Ukraine said that it supports the text-based negotiations in order to achieve the common goal of ensuring timely universal access to vaccines and other health products needed to fight the COVID-19 pandemic.

Argentina reiterated its "support to the documents and reaffirms its conviction that Covid-19 vaccines should be deemed to be global public goods, to which all people have fair access."

It argued that Argentina "suffered almost a year and a half of this pandemic and regrettably the conditions have not improved," adding that "the situation is particularly critical for many developing countries, and the production and distribution of vaccines has been very unequal across the length and breadth of the planet."

"In view of the magnitude of the current health crisis," Argentina said, "there is a need on an immediate basis, and in a complementary fashion, to take into account, any proposals that might be aimed at guaranteeing fair access, whilst also promoting transparent transfer of technology, with increased local production and timely distribution of vaccines globally."

CAUTIOUS APPROVAL FOR TEXT-BASED NEGOTIATIONS

Countries that have opposed the waiver until now have cautiously welcomed the revised proposal.

Korea, which has entered into an agreement with the US for manufacturing vaccines by Korean companies, said the revised proposal is too broad and creates uncertainties, including unintended consequences, when applied to patents, copyrights and industrial designs and protection of undisclosed information in relation to health products and technology, including diagnostics, therapeutics and vaccines.

Korea said that the revised waiver proposal would continue practically indefinitely, leaving not much room for incentives for research and innovation in the future.

The EU, which appears to have embraced the DG's "third way" approach, said the immediate urgent goal should continue to be ramping up production to share vaccines wider and faster, and ensuring equitable access to low- and middle-income countries at affordable prices.

It highlighted about lifting export restrictions for vaccine ingredients and other inputs, using to the maximum the existing production capacity and refitting those facilities that can be easily adapted to produce more vaccines.

Switzerland, one of the strongest opponents of the waiver, said it is ready to examine any proposal that contributes effectively towards the objective of expanding production of COVID-19 vaccines and health technologies and facilitating equitable access.

It called for a holistic approach, consisting of strengthening supply chains, intensifying industry partnerships, and efficient transfer of technology and know-how through voluntary licensing agreements to speedily scale up manufacturing outputs.

Without directly opposing the waiver, Switzerland said members should consider ways to facilitate the use of existing TRIPS flexibilities.

In varying statements of emphasis, the United Kingdom, Australia, Japan, Singapore, Brazil, Chinese Taipei and Norway suggested that they are ready to consider the proposal along with other proposals that are expected to be tabled soon.

The United Kingdom referred to the recent agreement of the trade ministers of the Group of seven countries that echoed the DG's "third way" approach, while remaining silent on the waiver.

Japan said it is ready to participate in this discussion constructively. It said that the revised proposal is a positive development as it gives a new momentum to the discussion, together with further upcoming proposals as the one announced by the European Union.

Australia said that it remains open to all proposals supporting the increased production of COVID-19 vaccines, including proposals for a TRIPS waiver.

Several other countries welcomed the revised proposal tabled by the co-sponsors and committed to study the revised proposal seriously in order to have further clarification about the scope and operationalization of the waiver.

In short, the co-sponsors appear to have succeeded in galvanizing the waiver negotiations by elevating it to a higher pedestal of engaging in text-based negotiations, said people familiar with the development.