TRIPS waiver for COVID-19 vaccines, meds just got tougher after US support

There is an irony here. The struggle of developing nations to get a waiver from the World Trade Organziation (WTO) of intellectual property rights (IPR) on the novel coronavirus disease (COVID-19)-related therapies, vaccines and equipment just got harder after the United States announced support for it — partially, that is.

An unexpected statement by US Trade Representative Katherine Tai May 5, 2021 that the Administration of Joe Biden would support the waiver of IPR on vaccines was seized with delight by just about everyone from governments to humanitarian organisations and public health campaigners. It was hailed because the US is the foundational support for IPRs, promoting it with messianic zeal and punishing countries that it accuses  of — rightly or wrongly — transgressing the global rules on IPR protection, known as TRIPS, in WTO.

The US has been viewed as the biggest hurdle to any easing of IPR to fight the devastating effects of the COVID-19 pandemic and it was not surprising that even organisations in the forefront of the campaign for a waiver appeared overwhelmed by Washington’s apparent change of stance.

But was it, indeed, a turnaround?

Tai’s statement is terse. It makes two points: The Joe Biden Administration will support the waiver only for COVID-19 vaccines and that it will participate in text-based negotiations at WTO to make that happen. It makes no mention of the India-South Africa proposal at the WTO, made in October 2020, around which an unremitting global campaign for waivers has coalesced.

That proposal, which now has 60 co-sponsors and well over a 100 WTO members supporting it, has made no headway over the past seven months. There is not even a written text of the proposal which the original sponsors were in the process of redrafting when the surprising US decision was announced.

The opposing camp has consisted of the US, the European Union, other nations like Switzerland and Japan, which strongly echo the powerful voice of the pharmaceuticals giants or the innovator companies. The latter insists that even the limited time waiver of IPR to fight the deadliest pandemic in over 100 years will sound the death knell of innovation in the industry.

Tai is clear that the US belief in IPR is unshaken. However, the extraordinary circumstances of the pandemic call for extraordinary measures, she says, and the Biden Administration’s aim is to get as many vaccines to as many people as fast as possible. To this end, it “will continue to ramp up its efforts — working with the private sector and all possible partners — to expand vaccine manufacturing and distribution”.  It promises to work towards increasing the raw materials for making the vaccines.

To some extent, Biden has proved his credentials. He has worked around the Defence Production Act (DPA) to provide raw materials to the Serum Institute of India for producing two million doses of the AstraZeneca Plc Covishield vaccine. The DPA requires US firms to prioritise government contracts ahead of other American contracts.

According to a recent National Security Council briefing, the US government is diverting its own order for raw materials to India, making it an act of mercy to tackle the horrific spread of SARS-CoV-2 virus in the country.

The question hanging

Text-based negotiations at WTO have invariably been protracted and Tai has warned this would take time given the consensus-based nature of the institution and the complexity of the issues involved. The wording of the text could be a fraught exercise since the sharing of technology needs to be incorporated in it. That is, if developing countries accept the curtailed version of their proposal to start with.

The immediate reaction to the Biden announcement is an indication of what lies ahead. Although the EU says it is ready to discuss the US proposal it wants a more extensive discussion about production capacity, licensing and vaccine exports apart from the IP waiver.

It has thrown cold water on the hope that a waiver will bring in more vaccines. Not even next year, says a dismissive statement. Industry meanwhile has stepped up its shrill campaign, making dire predictions about the end of innovation.

The pandemic has sharpened the familiar north-south divide on many fronts, most notably on access to vaccines. Rich nations have managed to immunise a sizable part of their population and are moving towards herd immunity while many nations, specially in Africa, have been denied vaccines.  

The waiver proposal has polarised the WTO further, not least because of the successful lobbying by industry which is set to make enormous profits from the COVID vaccines. The top five makers of COVID vaccines are expected to rake in profits of $38 billion (nearly Rs 2.8 lakh crore) in 2021.  

But as the death toll crosses 3.2 million (10th May), there is also growing disquiet in the pro-waiver camp that developing countries might be barking up the wrong tree. There is a growing perception that IP is not the only hurdle to vaccine equity but a stack of other problems, including limited manufacturing capacity and a shortage of raw materials and technology. Given this, WTO Director-General Ngozi Okonjo-Iweala has proposed a ‘third way’ based on more licensing to promote access to vaccines. 

Since the waiver proposal was mooted last year, another two million people have died worldwide and the licensing lobby appears to be winning the argument simply because there is no clarity on how the IPR waiver will result in more jabs — if at all. Champions of the waiver have invariably sidestepped the critical question of how they plan to get innovator companies to part with their technology even if there is a successful outcome to the WTO negotiations.

Without cooperation on technology transfer the new mRNA vaccines may be difficult to manufacture assuming that all else is secured: high-tech production facilities, the right kind of scientists to run them and adequate supplies of raw materials. In the case of vaccines it is not patents that act as a barrier but trade secrets which are a more difficult form of IPR to contend with. The alternative to licensing and cooperation would be forced technology transfer, a far from appealing prospect.

Biden has promised Congress that he will turn America into “the arsenal of vaccines” to fight the pandemic. It combines business logic with humanitarian principles and makes his support for the waiver a good strategy. Quite often, it’s not about winning or losing — it doesn’t matter anyway to the US — but about which side of the battle one fought on.

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