TRIPS waiver proposal from India and South Africa

Access to vaccines – the public release of the text from the U.S., EU, India and South Africa to the full WTO Membership for consideration by the Council for Trade Related Aspects of Intellectual Property Rights

· May 4, 2022 · TRIPS waiver proposal from India and South Africa · · No Comments

In a post from March 17, 2022, I had reviewed a draft of language under consideration by the U.S., EU, India and South Africa meant to be reviewed by the full WTO Membership once agreement was reached by the four WTO Members. March 17, 2022:  Possible Compromise on Access to Vaccines — draft understanding between EU, US, South Africa and India, https://currentthoughtsontrade.com/2022/03/17/possible-compromise-on-access-to-vaccines-draft-understanding-between-eu-us-south-africa-and-india/.

On May 3, 2022, the WTO’s Director-General forwarded to the Chair of the TRIPS Council the text (including brackets) as forwarded by the four Members for consideration by the full Membership through the TRIPS Council. The Trips Council held an informal meeting on May 3. The Chair of the TRIPS Council released the text to the membership in a public document. See Communication from the Chairperson, IP/C/W/688 (3 May 2022). The document (including note from the Director-General and the two page document (“TRIPS COVID-19)) is embedded below.

W688

There are only two changes from the draft document reviewed in mid-March. The first is the most important and concerns the definition of “an eligible member” contained in footnote 1. Originally, footnote 1 consisted of the following – “For the purpose of this Decision, developing country Members who exported more than 10 percent of world exports of COVID-19 vaccine doses in 2022 are not eligible Members.” From public data, this language would have excluded China from being an eligible Member. In the footnote 1 forwarded to the Membership on May 3, there are two bracketed sentences, the second of which is what was in the earlier draft. The other bracketed option would make all developing countries “eligible Members” — “[For the purpose of this Decision, all developing country Members are eligible Members. Developing country Members with capacity to export vaccines are encouraged to opt out from this Decision.]” Should China opt out of the Decision, the resulting potentially eligible countries would be the same. The opt out language could also arguably get additional Members who have significant vaccine producing and exporting capacity to voluntarily opt out as well (e.g., India).

The second change is the bracketing of paragraph 3.(a) with an additional footnote indicating that “This paragraph is under further consideration as to whether to keep or delete.” The paragraph (which is unchanged from the earlier draft other than the addition of brackets) reads,

“(a) [With respect to Article 31(a), an eligible Member may issue a single authorization to use the subject matter of multiple patents necessary for the production or supply of a COVID-19 vaccine. The authorization shall list all patents covered. In the determination of the relevant patents, an eligible member may be assisted by WIPO’s patent landscaping work, including on underlying technologies on COVID-19 vaccines, and by other relevant sources. An eligible Member may update the authorization to include other patents.]”

It was reported that China was pushing to be included in the small group discussions and took exception to the footnote 1 language which would exclude only it. Presumably the alternative bracketed language in footnote 1 is designed to address China’s concerns. However, it is less likely that the U.S. will accept a final package if China doesn’t opt out of the decision.

Consistent with the earlier draft, the Decision, if adopted would remain in effect for either three or five years (numbers are braketed alternatives).

Many NGOs have raised concerns about the lack of immediate coverage of therapeutics and diagnostics. Paragraph 8 continues to read, “No later than six months from the date of this Decision, Members will decide on its extension to cover the production and distribution of COVID-19 diagnostics and therapeutics.” Thus, a decision on coverage of therapeutics and diagnostics will occur, absent a change in language in the text, by the end of 2022, if the decision is adopted.

If the text is accepted by the WTO membership (or modified in ways acceptable to all), then there should be an agreed WTO response to the pandemic at the 12th Ministerial. For reasons noted in recent posts, the value of such a response will be more in the other aspects of the response (keeping markets open, limits on export restraints, transparency, etc.) than on the document dealing with access to vaccines via TRIPS actions. See, e.g., May 1, 2022:  Financial Times article from May 1, 2022 reaffirms current excess capacity for COVID-19 vaccines, https://currentthoughtsontrade.com/2022/05/01/financial-times-article-from-may-1-2022-reaffirms-current-excess-capacity-for-covid-19-vaccines/; April 30, 2022:  World Trade Organization 12th Ministerial Conference — the possible response to the COVID-19 pandemic amid the declining demand for vaccines, https://currentthoughtsontrade.com/2022/04/30/world-trade-organization-12th-ministerial-conference-the-possible-response-to-the-covid-19-pandemic-amid-the-declining-demand-for-vaccines/. Nonetheless, an agreed response, including the vaccine TRIPS provisions, would be an important accomplishment in the current times.

Possible Compromise on Access to Vaccines — draft understanding between EU, US, South Africa and India

· March 17, 2022 · TRIPS waiver proposal from India and South Africa · , , , · No Comments

Press articles and a release from the World Trade Organization indicate that the small group negotiations between the European Union, United States, India and South Africa have reached a compromise on the India-South Africa proposal for a broad waiver of TRIPS requirements during the COVID-19 pandemic and the European Union’s proposal for a different solution that wouldn’t constitute a waiver. See PoliticoPro, SCOOP: There’s a TRIPS waiver compromise. It’s been reached between EU, SA, India & US and currently only covers vaccines, March 15, 2022, https://twitter.com/ashleighfurlong/status/1503799100214583300; Inside U.S. Trade’s World Trade Online, USTR: High-level TRIPS waiver talks yield compromise; text not yet agreed to, March 15, 2022,https://insidetrade.com/daily-news/ustr-high-level-trips-waiver-talks-yield-compromise-text-not-yet-agreed; Inside U.S. Trade’s World Trade Online, Okonjo-Iweala hails TRIPS compromise as industry remains opposed, March 16, 2022, https://insidetrade.com/daily-news/okonjo-iweala-hails-trips-compromise-industry-remains-opposed; Washington Trade Daily, Details of TRIPS Waiver Compromise, March 17, 2022, https://files.constantcontact.com/ef5f8ffe501/abdf1d95-8d5b-4bb6-87e9-9ad73bcae287.pdf.

The agreement, which still requires final agreement on text by the small group and then consideration and acceptance by the full WTO Membership, is a staged one, applying first to vaccines and six months later (if subsequently agreed) to diagnostics and therapeutics. The agreement would apply to developing countries other than those who exported 10% or more of vaccines in 2021. Based on the WTO-IMF COVID-19 Vaccine Trade Tracker, the only developing country with 10% or more of global exports in 2021 was China. https://www.wto.org/english/tratop_e/covid19_e/vaccine_trade_tracker_e.htm.

By picking exports in 2021 as the test for eligibility for developing countries, India remains eligible for the proposed compromise simply because the country, one of the world’s largest vaccine producers and a country that had contracts to export huge quantities to many of the world’s poorest countries in 2021, closed off exports for much of 2021 because of internal needs.

Press reports have indicated that some other countries, like Brazil, are not eligible. If true, this would flow from something other than export volume (e.g., indication that it would not seek special and differential treatment going forward) as Brazil had a negligible share of global exports of COVID vaccines in 2021.

The WTO’s Director-General released a press statement on March 16 which is copied below. See WTO news release, Director-General Okonjo-Iweala hails breakthrough on TRIPS COVID-19 solution, 16 March 2022, https://www.wto.org/english/news_e/news22_e/dgno_16mar22_e.htm

“World Trade Organization Director-General Ngozi Okonjo-Iweala today warmly welcomed the breakthrough among four WTO Members on a waiver of the Trade Related Intellectual Property agreement for the production of vaccines against the COVID-19 pandemic.

“’This is a major step forward and this compromise is the result of many long and difficult hours of negotiations. But we are not there yet. We have more work to do to ensure that we have the support of the entire WTO Membership,’ the Director-General said.

“While the agreement between the European Union, India, South Africa and the United States is an essential element to any final deal, she cautioned that not all the details of the compromise have been ironed out and that internal domestic consultations within the four members are still ongoing. Moreover, she stressed that work must commence immediately to broaden the discussions to include all 164 members of the WTO.

“’In the WTO we decide by consensus, and this has not yet been achieved. My team and I have been working hard for the past three months and we are ready to roll up our sleeves again to work together with the TRIPS Council Chair Ambassador Lansana Gberie (Sierra Leone) to bring about a full agreement as quickly as possible. We are grateful to the four Members for the difficult work they have undertaken so far,’ said Dr. Okonjo-Iweala.”

Neither the EU nor the U.S. have released statements which is consistent with the apparent state of play of the negotiations in the small group. One of the parties or one of those private parties being consulted by WTO Members presumably has leaked the text which is available on Stats News. See Stat News, Ed Silverman, A compromise is reached on an intellectual property waiver for Covid-19 vaccines, but does it go far enough?, March 15, 2022, https://www.statnews.com/pharmalot/2022/03/15/covid19-vaccine-patents-wto/. The two page document is embedded below.

TRIPS-COVID-19-solution-document

Proponents and opponents of a TRIPS waiver responded quickly as reflected in press releases and other articles. See, e.g., KNOWLEDGE ECOLOGY INTERNATIONAL, QUAD’s tentative agreement on TRIPS and COVID 19, March 15, 2022, https://www.keionline.org/37544; In These Times, New “Compromise” on an IP Waiver for Covid Vaccines Is Worse Than No Deal, Activists Say, March 16, 2022, https://inthesetimes.com/article/wto-trips-waiver-intellectual-property-biden-vaccines-diagnostics-treatments; Devex, Devex Check Up: At last, a TRIPS waiver compromise. But who’s happy?, March 17, 2022, https://www.devex.com/news/devex-checkup-at-last-a-trips-waiver-compromise-but-who-s-happy-102844; InfoJustice, STATEMENT ON THE LEAKED COVID-19 TRIPS WAIVERPROPOSAL, Posted by
Sean Flynn, Mar 16, 2022, http://infojustice.org/archives/43947; Relief Web, MSF responds to potential compromise on the ‘TRIPS Waiver’, 16 March 2022, https://reliefweb.int/report/world/msf-responds-potential-compromise-trips-waiver; U.S., Chamber of Commerce, U.S. Chamber of Commerce Opposes Proposal at WTO to Waive Intellectual Property Rights , March 16, 2022, https://www.uschamber.com/intellectual-property/u-s-chamber-of-commerce-opposes-proposal-at-wto-to-waive-intellectual-property-rights; , International Federation of Pharmaceutical Manufacturers & Associations, IFPMA statement on TRIPS discussion document, 16 March 2022, https://www.ifpma.org/resource-centre/statement-ifpma-trips-discussion-document/.

The proponents of a waiver are basically unhappy with the compromise which is not a waiver but rather a modification to requirements under TRIPS Art. 31. They are also unhappy with the fact that only vaccines are covered initially and the fact that the draft agreement deals with patents only versus the broader array of intellectual property rights. The statement from Doctors Without Borders reflects the types of concerns from those wanting a broader agreement and is copied below.

“MSF responds to potential compromise on the ‘TRIPS Waiver’

“Compromise neglects COVID-19 treatments and diagnostics and fails to address intellectual property barriers beyond patents, but there’s still time to get it right

“Geneva, 16 March 2022

“– The European Union, India, South Africa and the United States are working on a possible compromise to address intellectual property (IP)barriers on COVID-19 medical products. Médecins Sans Frontières/Doctors Without Borders (MSF) acknowledges the efforts towards a final resolution, but notes that the text that was leaked today is far from being an IP ‘waiver’ for pandemic medical tools.

“MSF urges all World Trade Organization (WTO) members to be aware of the limitations of the leaked text. WTO members should work together to ensure that any agreement tackles the current barriers to accessing all COVID-19 medical tools, including treatments and diagnostics, and also addresses patents and non-patent barriers in an effective way.

“According to MSF’s initial analysis, key limitations of the leaked text include that it covers only vaccines, is geographically limited, and covers only patents and does not address other intellectual property barriers, such as trade secrets, which may cover critical information needed to facilitate manufacturing. Regarding compulsory licensing for patents on COVID-19 vaccines, the leaked text introduces unnecessary reporting requirements for WTO members that could undermine the effectiveness of the mechanism.

“The leaked text appears to leave the door open for possible inclusion of treatments and diagnostics at a later stage. But delaying the decision on treatments is unacceptable, as many people will have no access to generic antivirals and countries are paying high prices for access to lifesaving treatments like baricitinib due topatent monopolies that block more affordable generic versions.

“The leaked text also fails to cover all countries. It limits ‘eligible members’ to developing countries and only those who exported less than 10 percent of the world’sCOVID-19 vaccine exports in 2021, effectively excluding Brazil and China from being able to use the ‘waiver’.

“The proposed compromise would require authorisation by governments on a product-by-product basis, which was one of the shortcomings of the existing mechanism in a pandemic context and makes its use very cumbersome. There is also a new obligation to identify all patents covered by the authorisation, something not required today under WTO trade rules.

“MSF points again to our position underlining the necessary scope and duration of an effective TRIPS Waiver for COVID-19.

“Dimitri Eynikel, EU Policy Advisor for MSF’s Access Campaign:

“‘While it is good to see the groundwork for a potential compromise on addressing COVID-19 intellectual property barriers, all WTO members should remain vigilant to the fact that this leaked text contains considerable limitations, and needs to be urgently improved.

“It is incredibly concerning that the leaked text currently only covers vaccines, but neither treatments nor diagnostics. Excluding treatments and diagnostics is acritical weakness, especially as access to COVID-19 treatments remains a significant problem in many low- and middle-income countries, particularly in Latin America, in part because of patent barriers and restrictive licensing deals controlled by pharmaceutical corporations. Excluding countries with significant manufacturing and supply capacity like Brazil is highly problematic as it arbitrarily blocks potential critical avenues to increase access to COVID-19 medical tools for low- and middle-income countries.

“‘The world needs effective solutions to the inequities in access for all COVID-19 medical tools witnessed in this pandemic. The good news is there is still room for governments to improve and make sure that any final agreement adequately addresses the remaining barriers now missing in the leaked text. We urge all WTO members to do so.’”

The pharmaceutical industry’s concerns basically follow their longstanding position that with the rapid increase in vaccine production in 2021 and ongoing in 2022, there is no need for the agreement and it sends the wrong message to innovators. The statement from the IPFMA is copied below.

“Following reports on the status of informal discussions led by the WTO Secretariat with the European Union (EU), India, South Africa, and the USA, on 16 March 2022, biopharmaceutical companies reaffirm their position that weakening patents now when it is widely acknowledged that there are no longer supply constraints of COVID-19 vaccines, sends the wrong signal. 

“2022 kicked off with COVID-19 vaccine production from both developing and developed country manufacturers reaching 12 billion within a year of the first vaccine being authorized. Today industry is able to produce over a billion vaccine each month. COVAX is now fully meeting its commitments. Since the beginning of 2022, there has been broad consensus that the challenge now is how to get the vaccines into the arms of people who need them, rather than vaccine supply. When the IP TRIPS Waiver was first proposed in 2020, it was to the wrong solution to the problem of scaling up manufacturing of potential COVID-19 vaccines which at the time had not yet even been authorized. Now the problem of supply has been addressed thanks to unprecedented collaboration involving companies from industrialized and developing countries, the TRIPS Waiver is not only the wrong solution, it is also an outdated proposal, that has been overtaken by events.

“Weakening intellectual property (IP) will do nothing to help the scaling up of vaccine manufacturing. There is a broad consensus among experts that waiving patents would not add a single additional vaccine dose, because technology transfer goes far beyond the patent, is built on trust, know-how sharing and voluntary licensing. This is exactly what manufacturers have done on an unprecedented scale. As of now, there are 371 collaborations on vaccines manufacturing and 155 for therapeutics and, in addition, the multiple announcements of partnerships to improve geographical diversity of vaccine production, are proof in themselves that the proposed IP TRIPS waiver is unnecessary and irrelevant, at worst sends the wrong signal at the wrong time.

“The IP TRIPS Waiver proposals should be recognized for what they are – political posturing that are at best a distraction, at worse creating uncertainty that can undermine innovation’s ability to respond to the current and future response to pandemics. The current proposals should be shelved; and the focus should be directed, to admittedly more difficult actions that will change lives for the better: supporting country readiness, contributing to equitable distribution, and driving innovation (Ref Three priorities to urgently increase access to COVID-19 vaccines).”

Comments

Over the last eighteen months, I have posted regularly on the COVID-19 pandemic and the Indian and South African proposal for a broad TRIPS waiver. Following the recent European Union – African Union meeting in Brussels, it was clear that the EU was committed to finding a mutually agreeable solution with the countries of Africa in the coming months. Thus, the announcement of a breakthrough in the small group negotiations is not surprising. See February 21, 2022:  The EU – AU Summit and the promise of a resolution to the WTO pandemic response package, https://currentthoughtsontrade.com/2022/02/21/the-eu-au-summit-and-the-promise-of-a-resolution-to-the-wto-pandemic-response-package/.

Data gathered and published by various multilateral organizations confirm the enormous ramp up in both vaccine capacity and production. And there has been significant movement in increasing production of vaccines in more developing countries, including a number in Africa. See, e.g., February 16, 2022:  Building Vaccine Capacity in Africa – Exciting News from BioNTech, https://currentthoughtsontrade.com/2022/02/16/building-vaccine-capacity-in-africa-exciting-news-from-biontech/.

Articles also confirm that the challenge in low-income countries is now not access to vaccines but rather all of the other requirements to achieve much higher vaccination rates (including better access to testing). See, e.g., WHO, WHO Director-General’s remarks atSession 2 – Potential Opportunities for Innovation and Collaboration, 3 March 2022, https://www.who.int/director-general/speeches/detail/who-director-general-s-remarks-at-session-2-potential-opportunities-for-innovation-and-collaboration-covid-19-dialogue-with-ministers-of-health-3-march-2022.

Thus, it is hard for me to find merit in the ongoing claims for a need for a broad TRIPS waiver or even the draft agreement at least as it pertains to the COVID-19 pandemic and equitable access to vaccines. WTO relevance requires addressing either current pressing issues or those that will continue to be present in the future. The draft agreement may meet the need for some compromise between Members like the EU and India, South Africa and other supporters of the waiver. However, the agreement doesn’t appear to serve a useful purpose by addressing current challenges (e.g., testing) or addressing a road forward for future pandemics.


The EU – AU Summit and the promise of a resolution to the WTO pandemic response package

· February 21, 2022 · TRIPS waiver proposal from India and South Africa, Uncategorized · , , · No Comments

The sixth European Union – African Union summit took place last week in Brussels on February 17-18. The summit covered a broad array of topics including access to vaccines. It followed an event on vaccine equity in Africa hosted by BioNTech and the kENUP Foundation on the 16th which announced the schedule for shipping facilities to several African countries to produce mRNA vaccines in the second half of 2022. See February 16, 2022:  Building Vaccine Capacity in Africa – Exciting News from BioNTech, https://currentthoughtsontrade.com/2022/02/16/building-vaccine-capacity-in-africa-exciting-news-from-biontech/.

The Summit was an effort to have the two Unions form a new partnership, and for the EU to be the partner of choice for countries in Africa. The joint declaration from the summit is included below and reviews the broad areas of discussion and agreed actions to be taken by the two Unions following the Summit.

final_declaration-en

The discussion of the COVID-19 pandemic and the ongoing discussion on the WTO’s consideration of a response to the pandemic (both trade and intellectual property) was one of the important issues at the summit. The joint declaration discussion of the issue is copied below.

“The immediate challenge is to ensure a fair and equitable access to vaccines. Together we will support local and regional mechanisms for procurement, as well as allocation and deployment of medical products. The EU reaffirms its commitment to provide at least 450 million of vaccine doses to Africa, in coordination with the Africa Vaccine Acquisition Task Team (AVATT) platform, by mid-2022. Contributing to this and complementing the actions of the AVATT, Team Europe has provided more than USD 3 billion (i.e. the equivalent of 400 million vaccine doses) to the Covax Facility and to vaccination on the African continent.

“Team Europe will mobilise EUR 425 million to ramp up the pace of vaccination, and in coordination with the Africa CDC, to support the efficient distribution of doses and the training of medical teams and the capacity of analysis and sequencing. We will also contribute in this context to the fight against health-related disinformation.

“Learning from the current health crisis, we are committed to supporting the full-fledged African health sovereignty, in order for the continent to respond to future public health emergencies. To this end, we support a common agenda for manufacturing vaccines, medicines, diagnostics, therapeutics and health products in Africa, including investment in production capacities, voluntary technology transfers as well as strengthening of the regulatory framework to enable equitable access to vaccines, diagnostics and therapeutics.

“The African Union and the European Union underlined the urgency of the WTOs contribution to the fight against the pandemic and to the recovery of the global economy, and commit to engage constructively towards an agreement on a comprehensive WTO response to the pandemic, which includes trade related, as well as intellectual property related aspects.”

The European Commission’s President Ursula von der Leyen statement at the press conference on February 18 provided the timeline for reaching agreement with the African Union on the WTO response package to the COVID-19 pandemic, including finding an acceptable path forward on intellectual property. The EU and AU will be meeting in the Spring to find a mutually acceptable solution. President von der Leyen’s comments at the press conference on this topic are copied below.

“And finally, from the health of our planet, to the health of our people. Europe is Africa’s number one
partner in the fight against COVID-19. And we will do even more. We are on the right track to reach
our goal to share at least 450 million vaccine doses by this summer. And indeed, together, we are
building up mRNA manufacturing capacity across Africa. I will not go in detail because we have
discussed that in the press conference this morning.

“But important is that we had a very good, intense, constructive discussion on the question of TRIPS
waiver and compulsory licencing. We share the same goal. We have different ways to reach that goal.
There must be a bridge between those two ways. And therefore, we have decided that the two
Commissions – the African Union Commission and the European Union Commission – will work
together. We will organise a College-to-College meeting here in Brussels, in spring. And at that time,
at the latest, we have to deliver a solution. This will be accompanied by the WTO, Director-General
Ngozi. And therefore, I always like it when a task is clear and defined. The task is set for the two
Commissions. The frame is clear, the goal is clear, we have to deliver.”

Statement by President von der Leyen at the joint press conference following the 6th European Union-African Union Summit, Brussels, 18 February 2022, https://ec.europa.eu/commission/presscorner/detail/en/STATEMENT_22_1181.

The European Union has been working for most of the last year on moving towards significant vaccine production capacity being built in Africa. President von der Leyen’s statements at the start of the EU-AU Summit and her statement at the Vaccine Equity for Africa event on February 16 provide significant detail on actions the EU is taking to help Africa develop vaccine manufacturing capacity as well as address the build up of health care infrastructure on the continent. See Opening speech by President von der Leyen at the 6th European Union-African Union Summit, Brussels, 17 February 2022, https://ec.europa.eu/commission/presscorner/detail/en/SPEECH_22_1142; Statement by President von der Leyen at the‘Vaccine Equity for Africa’ launch event, co-organised by BioNTech SE and the kENUP Foundation, 16 February 2022, https://ec.europa.eu/commission/presscorner/detail/en/STATEMENT_22_1105.

Parts of the February 16 speech are copied below.

“This year already, at least two of these container factories will move to Africa. To Rwanda and to Senegal, where I visited last week the Institut Pasteur de Dakar. Close cooperation is ongoing with South Africa’s Biovac Institute. And with our partners in Ghana. We are advancing in record time. Commercial production is set to begin in 2023. 

“The ‘Vaccine Equity for Africa’ project is only possible thanks to teamwork. Starting with Africa’s declared ambition to build its own vaccine production capacity. Teaming up with a European innovation champion such as BioNTech. Supported by the European Union and the African Union. Governments in Europe and Africa. And the UN system. This is how we emerge from the pandemic and build a stronger future for Africa and Europe.

“The initiative is first and foremost about vaccine equity. Vaccines from the new factories will be sold at not-for-profit prices, exclusively to African countries. They will be made in Africa, for Africa, with world-class technology.

“At the same time, this initiative can advance public health and industry, well beyond the pandemic. We know the mRNA technology is revolutionary. It holds promises for the fight against other diseases, like malaria and tuberculosis. BioNTech factories can be adjusted within weeks to make different vaccines. It could thus be an African-made solution to diseases that currently kill millions.

“This project is part of a larger ambition. By 2040, the African Union wants that 60% of the vaccines used on the continent are manufactured on the continent. The European Union fully supports that goal. Together with our Member States and financial institutions, we have committed over one billion euros in financing. To strengthen regulatory frameworks, and transfer skills and know-how. Because regional capacities are the cornerstone of global public health.

“And the project goes even beyond public health. Building this technological capacity in Ghana, Rwanda, Senegal and South Africa – countries that are regional leaders in innovation – will strengthen the innovation ecosystem on the entire continent.”

Documents from the European Council and European Commission at the conclusion of the Summit provide the EU’s view of the healthcare portion of the summit and EU actions. See European Council, Council of the European Union, First technology transfer of mRNA vaccines: Working together to build new solutions, 18 February 2022, https://www.consilium.europa.eu/en/european-council/president/news/2022/02/18/20220218-mrna-vaccines-technology-transfer/ (“In the margins of the European Union-African Union Summit, the World Health Organisation (WHO) announced the first six countries that will receive the technology needed for the production of mRNA vaccines on the African continent. Egypt, Kenya, Nigeria, Senegal, South Africa and Tunisia all applied and have been selected as recipients. The announcement was made at a ceremony hosted by the European Council, France, South Africa and the WHO in the presence of the following leaders: Charles Michel, President of the European Council, Ursula von der Leyen, President of the European Commission. President Macron, President Ramaphosa, President Sall, President Kenyatta, President Buhari, President Saïed and  President al-Sisi.”); European Commission, EU-Africa: Global Gateway Investment Package – Health, factsheet, 9 February 2022,https://ec.europa.eu/commission/presscorner/detail/en/fs_22_870.

While vaccines and health issues were just one of a number of important topics reviewed during the Summit, it has been the focus of this post simply because the outcome and promised meeting in the Spring between the two Unions offers the hope of a resolution to the WTO’s ongoing negotiations on a pandemic response package — one that covers various trade actions as well as what, if any, actions are needed on intellectual property rights during a pandemic. While the member states of the EU and the AU are not the only parties with strong positions in the ongoing discussions at the WTO, it would seem likely that if the EU and AU are able to reach agreement on a package that will likely form the basis of a final resolution in Geneva.

With the WTO apparently discussing dates in June 2022 for rescheduling the 12th Ministerial Conference, the ability of the EU and AU countries to find a mutually agreeable solution to the intellectual property component of the pandemic response package could permit an agreed package to be accepted by WTO Members at the Ministerial Conference. See Inside U.S. Trade’s World Trade Online, World Trade Organization now eyeing June for 12th ministerial, February 18, 2022, https://insidetrade.com/daily-news/world-trade-organization-now-eyeing-june-12th-ministerial. The announcement last week of the Spring effort to reach agreement may also help facilitate movement on fisheries subsidies at the WTO — a negotiation that has been ongoing for more than 20 years.

In short, the EU-AU Summit while covering a lot of ground on issues of importance to both Unions may also have created a path to forward movement at the WTO on the response to the pandemic and more ahead of the 12th Ministerial Conference.

Actions by the US, EU, Quad (US, Japan, India, Australia), China and others should ensure that there are more than adequate vaccines available in 2022 to vaccinate all countries against COVID-19. Efforts by the WHO, GAVI, the U.S., EU and others are also likely to significantly increase the ability of countries in Africa to vaccinate their populations. Thus, the real benefit of resolving the WTO pandemic response at the 12th Ministerial will not be responding to COVID-19 but rather adopting rules and policies that will make the world more responsive to future pandemics.

We wish the EU and AU well in their upcoming negotiations.

World Trade Organization — possible deliverables for the 12th Ministerial Conference to be held in Geneva November 30-December 3, 2021

· May 10, 2021 · TRIPS waiver proposal from India and South Africa, WTO Trade Negotiations Committee · , , , , , , , , · No Comments

On May 3, 2021, the WTO held a Trade Negotiations Committee (“TNC”) session combined with an informal session of the Heads of Delegation in Geneva. Because the WTO over time has eliminated the immediate release of statements of the Chair of the TNC and the Chairs of different negotiating groups who provide updates on the status of negotiations, there is very limited public information on the meeting at the present time. The WTO released a news release on the meeting entitled “Members discuss contours of potential MC12 deliverables”. See TNC and Heads of Delegation Meeting, Members discuss contours of potential MC12 deliverables, May 3, 2021, https://www.wto.org/english/news_e/news21_e/hod_03may21_e.htm. A review of WTO documents listed on the WTO website reveals that Director-General Ngozi Okonjo-Iweala provided a seven page Chair’s statement at the meeting, although the document is not publicly available. See JOB/TNC/91. There was at least one other statement made by chairs of negotiating groups, though the statement is not publicly available. See Council for Trade in Services – Special Session – Report by Ambassador Zhanar Altzhanova, Chair of the CTS Special Session, to the informal TNC and HODs meeting – 3 May 2021, JOB/SERV/307, May 4, 2021. One would assume there were reports on the fisheries subsidies negotiations, on agriculture and on various Joint Statement Initiatives though there is no listing of any such statements.

Copied below is the May 3 WTO news release.

“Heads of WTO member delegations today exchanged views about issues on which they can realistically reach agreements in the run-up to the 12th Ministerial Conference (MC12) later this year, and what needs to happen to make such deals possible. Fisheries subsidies, agriculture and the COVID-19 pandemic featured prominently in the discussions, with several members stressing that delivering concrete negotiated results was critical for the WTO’s credibility. The 3 May gathering was both a formal session of the Trade Negotiations Committee and an informal meeting of Heads of Delegation.

“Summing up members’ interventions at the end of the day, WTO Director-General Ngozi Okonjo-Iweala said what she had heard matched what she had been told in her own consultations: ‘Views are coalescing around the most feasible priorities for delivery between now and MC12 — although of course there are gaps on how we get there and on the content of prospective results.’

“She said three concrete deliverables stood out: an agreement to curb harmful fisheries subsidies; outcomes on agriculture, with a focus on food security; and a framework that would better equip the WTO to support efforts against the COVID-19 pandemic and future health crises.

“Looking to the weeks and months ahead, the Director-General expressed hope that by July members would be able to finalize an agreement on fisheries subsidies and achieve clarity about what can be delivered by MC12, scheduled to run from 30 November to 3 December in Geneva.

“On fisheries subsidies, she urged members to exercise the necessary flexibility to overcome the remaining hurdles. With ministerial involvement likely required to finalize an agreement in July, she called on delegations to work with the chair of the negotiations, Ambassador Santiago Wills of Colombia, to prepare a draft negotiating text with a minimal number of outstanding issues for ministers to resolve. ‘We are almost there, we can see the light at the end of the tunnel,’ she said, stressing she stood ready to help members and the chair translate increased flexibility into an agreement.

“Noting that for many members, meaningful outcomes on agriculture were necessary to make MC12 a success, DG Okonjo-Iweala said that the pandemic, and rising hunger around the world, made a strong case for a WTO ‘food security package’. Elements for a prospective package included public stockholding, the proposed exemption from export restrictions of World Food Programme humanitarian purchases, domestic support and transparency, with some delegations also raising cotton and the special safeguard mechanism.

“The Director-General welcomed the view expressed by many delegations that MC12 can deliver concrete responses on trade and health. The WTO’s spotlight on export restrictions and the need to increase vaccine production volumes was gaining attention and engagement from leaders, she said.

“Reporting on a 14 April event where vaccine manufacturers, international organizations, civil society and members looked at how the WTO could contribute to efforts to combat the global scarcity of COVID-19 vaccines, she said it was clear that underused manufacturing capacity existed in several developing countries.

“DG Okonjo-Iweala praised members’ support to India amid the upsurge in COVID-19 cases there, which followed India’s own exports of a large number of vaccines. ‘That is what the WTO membership should be about — working together, supporting each other,’ she said. She asked members to bring the same sense of common purpose to bear on engaging in text-based negotiations on the TRIPS waiver proposal aimed at finding a pragmatic compromise that works for all.

“With regard to dispute settlement, where many members called for resolution to the impasse over the Appellate Body, the Director-General expressed hope that by MC12 members ‘can reach a shared understanding on the types of reforms needed’.

“The General Council chair, Ambassador Dacio Castillo of Honduras, is consulting on proposals about issues specific to least-developed countries such as the G-90 proposals on special and differential treatment as well as on small economies and areas such as the e-commerce Work Programme, she said.

“She noted that groups of members had signalled a desire to move ahead in areas such as services domestic regulation, e-commerce, investment facilitation, women’s economic empowerment, micro, small, and medium-sized enterprises as well as issues related to trade and climate change.

“For issues not in a position to be concluded this year, the Director-General said members had called for post-MC12 work programmes on multilateral issues relating to agriculture, services, and special and differential treatment as well as in joint statement initiatives in areas including plastics pollution and environmental sustainability.

“DG Okonjo-Iweala said that in the coming days, she would intensify her own outreach with heads of delegation, organizing meetings “in various configurations large and small” to support the chairs of negotiating groups in their efforts to broker compromise among members. She reiterated her commitment to ensuring adequate representation and transparency in these meetings ‘Nothing will be done behind closed doors that people don’t know about,’ she emphasised. She indicated that she would work closely with the General Council chair and the chairs of the negotiating bodies as well as MC12 chair Kazakhstan to conduct these meetings.

“Emphasising the tight timeframe for members to resolve their outstanding differences, the Director-General said the ‘path to July’ would involve a large number of intensive meetings aimed at narrowing gaps. ‘Week in, week out, this is what we will do now.’”

It is often the case that the U.S., European Union and China release their statements at events like the May 3 TNC session. Reviewing the webpages for the three Members’ WTO operations shows a statement only for the EU. See EU Statement at the Trade Negotiations Committee/Heads of Delegation meeting, 3 May 2021, Statement delivered by Ambassador João Aguiar Machado, https://eeas.europa.eu/delegations/world-trade-organization-wto/97682/eu-statement-trade-negotiations-committeeheads-delegation-meeting-3-may-2021_en.

The EU seeks a number of specific outcomes for the 12th Ministerial Conference and emphasizes the need to keep the agenda limited to permit success. The EU’s list starts with the conclusion of the fisheries subsidies agreement negotiations and secondly achieving agreement on trade and health including increasing COVID-19 vaccine production.

“Firstly, on fisheries subsidies; the EU supports the Chair’s efforts to move the negotiations forward and the
Director-General’s involvement and intent to achieve an outcome already in July. With this in mind, we need to
consider how best to use the short time ahead. These negotiations are a test case of the ability of the WTO to
deliver on the Sustainable Development Goals, in this case SDG 14.6. We are already late, well passed the
deadline that Heads of State and Government instructed us, here at the WTO, to deliver. We have full
confidence that Ambassador Wills will find the best way forward for these negotiations.

“Secondly, on trade and health, we must work towards a Ministerial Declaration that brings together key
elements of the Ottawa Group proposal on Trade & Health (export restrictions, transparency, trade facilitation)
as well as progress on the expansion of production capacities through voluntary licensing and, where necessary,
supporting the use of the available TRIPs flexibilities.”

Beyond these two deliverables, the EU looks for an agreed work program for reform of the WTO’s three core functions — negotiations, transparency/monitoring, and dispute settlement. Restoring a functioning two-tier dispute settlement system is the top priority in this area followed by improved notification practices.

The EU supports the various Joint Statement Initiatives and intends to propose additional ones on industrial subsidies, state-owned enterprises, and trade and environment topics.

The EU’s proposal on agriculture differs in part from the summary of views presented by DG Okonjo-Iweala as addressing export restraints, particularly for World Food Programme purchases is a priority while other issues including public stockholding (and other forms of domestic support) is viewed as more appropriate for a work program outcome from the 12th Ministerial.

Developments in the last week

The WTO held a two day General Council meeting on May 5-6 with the big news being the United States’ indication that because of the extraordinary circumstances of the global COVID-19 pandemic, the United States would support the proposed waiver of certain TRIPS obligations on medical goods for the duration of the pandemic, more specifically being willing to enter into text negotiations in the TRIPS Council. See May 6, 2021, COVID-19 vaccines — role of WTO and developments at May 5-6, 2021 General Council meeting on TRIPS Waiver, https://currentthoughtsontrade.com/2021/05/06/covid-19-vaccines-role-of-wto-and-developments-at-may-5-6-2021-general-council-on-trips-waiver/.

The major countries within the EU have come out opposing the U.S. change of position on the waiver proposal and have urged the United States to remove export restrictions on vaccines and raw materials and other inputs, See The Hill, EU leaders criticize Biden push to waive COVID-19 vaccine patents: Not a ‘magic bullet’, May 8, 2021, https://thehill.com/policy/international/europe/552459-eu-leaders-criticize-biden-push-to-waive-covid-19-patents-not-a; Euronews, EU leaders urge US to end COVID-19 vaccine export limits amid patents controversy, 8 May 2021, https://www.euronews.com/2021/05/07/european-leaders-urge-u-s-britain-to-match-eu-generosity-on-vaccine-exports. Not surprisingly, the move was also criticized by the pharmaceutical and biotech industries. See, e.g., McDonnell Boehnen Hulbert & Berghoff LLP – JDSupra, BIO & IPO Issue Statements on Biden Administration’s Support for Proposed WTO Waiver, May 7, 2021, https://www.jdsupra.com/legalnews/bio-ipo-issue-statements-on-biden-3271048/.

There have been additional announcements by the WHO on vaccines receiving emergency use authorization (first of two Chinese vaccines was approved on May 7, 2021; a second is pending), additional vaccine producers have reached agreements with COVAX for supplying vaccines once their vaccines are approved by the WHO (Moderna, Novavax), and increased production targets by major COVID-19 producers (e.g., Pfizer raised its target for 2021 to 3 billion doses from 2.5 billion and increased 2022 from 3 billion doses to 4 billion doses; Moderna increases production forecast for 2021 to 800 million to 1 billion and is making investments to increase production in 2022 to 3 billion doses). See, e.g., World Health Organization, WHO lists additional COVID-19 vaccine for emergency use and issues interim policy recommendations, 7 May 2021, https://www.who.int/news/item/07-05-2021-who-lists-additional-covid-19-vaccine-for-emergency-use-and-issues-interim-policy-recommendations; Gavi, Gavi signs agreement with Moderna to secure doses on behalf of COVAX Facility, 3 May 2021, https://www.gavi.org/news/media-room/gavi-signs-agreement-moderna-secure-doses-behalf-covax-facility; Gavi, Gavi signs agreement with Novavax to secure doses on behalf of COVAX Facility, 6 May 2021,https://www.gavi.org/news/media-room/gavi-signs-agreement-novavax-secure-doses-behalf-covax-facility; Wall Street Journal, Pfizer Lifts Covid-19 Vaccine Production Targets for 2021, 2022, May 7, 2021, https://www.wsj.com/articles/pfizer-lifts-covid-19-vaccine-production-targets-for-2021-2022-11620425904; Moderna, Moderna Reports First Quarter Fiscal Year 2021 Financial Results and Provides Business Updates, May 6, 2021, https://investors.modernatx.com/news-releases/news-release-details/moderna-reports-first-quarter-fiscal-year-2021-financial-results

What is clear is that the increased attention that will be paid by WTO Members on the waiver proposal within the TRIPS Council will likely suck a lot of oxygen out of the WTO in the coming months for other negotiating issues, many of which remain controversial in their own right. Any text based agreement on a TRIPS waiver is unlikely until close to the 12th Ministerial (and unlikely then if EU opposition remains or the U.S. is unable to achieve acceptable text). Thus, the remaining months before the 12th Ministerial Conference will present some major challenges to the WTO Members in their efforts to come up with achievements to keep the WTO relevant going forward. The U.S. move also creates a division with European allies and appears to have been taken without consultation with those allies ahead of last week’s announcement — a departure from the Biden Administration’s approach to date.

The EU’s response to challenges to its actions on COVID-19 vaccine exports

· March 4, 2021 · COVID-19, EU COVID-19 vaccine export authorization, TRIPS waiver proposal from India and South Africa · , , , , , , , , , , , , , , , , , , · No Comments

At the WTO General Council meeting held on March 1-2 this week, agenda item 9 was aimed at the European Union. The agenda item, entitled “Call to Prevent Export Restrictions on COVID-19,” was put on the agenda by Colombia, Costa Rica, Ecuador, Panama and Paraguay. I had reviewed this agenda item as one of 16 agenda items that was likely to draw a fair amount of attention. See February 26, 2021, WTO Director-General Ngozi Okonjo-Iweala’s first week on the job starts with a two day General Council meeting, https://currentthoughtsontrade.com/2021/02/26/wto-director-general-ngozi-okonjo-iwealas-first-week-on-the-job-starts-with-a-two-day-general-council-meeting/ (Agenda item 9 was added by Colombia, Costa Rica, Ecuador, Panama and Paraguay reflecting concerns by them (and presumably many other trading partners) about actions taken by the European Union to exert control over exports of vaccines from the EU in light of EU concerns about its own access to vaccines from manufacturers. See CALL TO PREVENT EXPORT RESTRICTIONS ON COVID-19 VACCINES, WT/GC/818 (18 February 2021)).

The new Director-General, Ngozi Okonjo-Iweala, has stressed the importance of the WTO doing more to address the COVID-19 pandemic and help Members recover. Equitable and affordable access to vaccines is an issue of importance to the membership and stressed by the Director-General. See, e.g., March 3, 2021, WTO Director-General opinion piece in the Financial Times and recent actions by the U.S., https://currentthoughtsontrade.com/2021/03/03/wto-director-general-opinion-piece-in-the-financial-times-and-recent-actions-by-the-u-s/; March 1, 2021, WTO Director-General Ngozi Okonjo-Iweala’s opening statement at the March 1 General Council meeting, https://currentthoughtsontrade.com/2021/03/01/wto-director-general-ngozi-okonjo-iwealas-opening-statement-at-the-march-1-general-council-meeting/

While the EU Ambassador provided comments on various agenda items, agenda item 9 was obviously one of importance to the EU. See EU Statement at the General Council of 2 March 2021 on the “Call to Prevent Export Restrictions on Covid-19Vaccines,” 02 March 2021, https://eeas.europa.eu/delegations/world-trade-organization-wto/94083/eu-statement-general-council-2-march-2021-%E2%80%9Ccall-prevent-export-restrictions-covid-19-vaccines%E2%80%9D_en. EU Ambassador João Aguiar Machado provided a detailed justification for the EU actions in imposing an export licensing/authorization regime on COVID-19 vaccines claiming lack of transparency by pharmaceutical companies and the need to ensure “fair” distribution. The EU program does not affect vaccines for COVAX low- and middle-income countries nor for various neighboring countries. Of note, for countries covered by the export licensing/authorization scheme, there have been 150 export requests all of which have been granted. The statement is embedded below.

EU-Statement-at-the-General-Council-of-2-March-2021-on-the-Call-to-Prevent-Export-Restrictions-on-Covid-19-Vaccines-–-02-March-2021-European-External-Action-Service

The EU stressed that the major problem facing the world was global capacity far below global demand. The EU is working to identify production bottlenecks and to encourage producers to license their products to maximize global production and expressed a willingness to work with other WTO Members and with the Director-General. The part of the statement covering the demand/supply imbalance is copied below.

“However, the root causes of the problem lie elsewhere: the exploding global demand is well above the global production today. As long as this global industrial challenge is not met, and the world population is not vaccinated quickly enough, we will all face a risk of a continuing health emergency including new Covid-19 variants and a prolonged economic crisis.

“The European Union believes there is an important role for public authorities to play and to drive the increase of production, and to facilitate access to the vaccines and other treatments that are in need today. Cooperation must be promoted amongst the different participants along the value chains where necessary to enhance production capacities. A closer, more integrated and more strategic public-private cooperation with the industry is needed. In this spirit, the EU has set-up a Task Force for Industrial Scale-up of COVID-19 vaccines to detect and help respond to issues in real-time. In order to ramp up production, we will, amongst others, work closely with manufacturers to help monitor supply chains and address identified production bottlenecks. Since EU vaccine production is critical for global supply, the benefits of this initiative will extend beyond the EU’s borders.

“Scaling-up of production on a global level requires further actions. It will not happen without increased global collaboration with the pharmaceutical industry, which should facilitate the transfer of the right know-how and technology for the highly complex vaccine production process. We should facilitate this collaboration, while also recognising that intellectual property provides the necessary platform for it to take place. Waiving intellectual property rights would disrupt this collaboration and the transfer of know-how. In conclusion, Mr Chairman, we believe it is legitimate to engage the sector in order to ensure that all complementary production facilities across companies and continents are actively contributing to ramp up production. Companies that have tried and failed to develop a vaccine of their own, for example, should actively consider making their facilities available for the production of vaccines of successful companies. Companies with new vaccines should consider whether they have checked all options for licensing agreements to increase production. The objective should be to ensure they enter into licence agreements with companies around the world that have the necessary production capacities and could export the vaccines to any low middle-income countries without production capacities. At the same time, we should be mindful that the manufacturing campaigns for covid-19 vaccines do not crowd out the production of other life-saving vaccines and therapeutics.

“The EU, working together with other WTO Members and under the leadership of the Director-General Dr. Ngozi Okonjo-Iweala is ready to facilitate a dialogue between the vaccine developers and companies with the production facilities that are ready to step in to help out with the production of vaccines and their delivery to the countries in need. We welcome the DG’s proposal to focus on collaboration among companies to enhance licensing in order to use all the adequate manufacturing capacity, including in developing countries. The EU is ready to facilitate this dialogue and contribute to the efforts on expanding these partnerships.

“The EU remains open to a dialogue with all WTO Members on how to facilitate the collaboration with the pharmaceutical industry on the transfer of know-how and technology. In the same manner, the EU remains open to a dialogue on how to facilitate the use of the TRIPS flexibilities, should the voluntary solutions fail or not be available. The flexibilities offered by the TRIPs Agreement are absolutely legitimate tools for Members in need, as many are in the midst of this pandemic. This includes fast track compulsory licences for export to countries without manufacturing capacity. Administrative burdens should not stand in the way of manufacturing and delivering vaccines to where they are needed.

“We believe that a successful contribution of the WTO to the current pandemic will require all WTO Members to agree on actions that will not only encompass the elements enshrined in the Ottawa Group’s proposal on Trade and Health, such as export restrictions or transparency, but also address the problem of insufficient manufacturing capacity. The EU stands ready to engage in such a dialogue.”

In my post yesterday, I reviewed some of the efforts that have already occurred where pharmaceutical companies are working with other companies to expand production and availability worldwide. See March 3, 2021:  WTO Director-General opinion piece in the Financial Times and recent actions by the U.S., https://currentthoughtsontrade.com/2021/03/03/wto-director-general-opinion-piece-in-the-financial-times-and-recent-actions-by-the-u-s/. But the articles referenced yesterday are just some of the collaborations going on as manufacturers with existing capacity work with companies with COVID-19 vaccines to help expand capacity and production and vaccine manufacturers work with contract producers to expand supply chain capabilities. An additional cooperation agreement was announced today in the press. In addition, some governments, including the U.S. and EU have also worked with manufacturers to ramp up production. See, e.g., Wall Street Journal, Novartis to Help Make CureVac Covid-19 Vaccine, March 4, 2021, https://www.wsj.com/articles/novartis-to-help-make-curevac-covid-19-vaccine-11614859271; Reuters, Poland strikes deal to produce Novavax COVID-19 vaccine, March 3, 2021, https://www.reuters.com/article/us-health-coronavirus-poland-mabion/poland-strikes-deal-to-produce-novavax-covid-19-vaccine-idUSKBN2AV19O (“Polish biotech firm Mabion has signed a preliminary agreement to manufacture Novavax’s COVID-19 vaccine with financial support from a state-run fund, as the government strives to accelerate its vaccination programme.”); PMLive, Novartis, Bayer announce separate agreements to bolster COVID-19 vaccine manufacturing, February 1, 2021, http://www.pmlive.com/pharma_news/novartis,_bayer_announce_separate_agreements_to_bolster_covid-19_vaccine_manufacturing_1362454#:~:text=Novartis%20and%20Bayer%20have%20announced,vaccine%20and%20CureVac’s%20vaccine%2C%20respectively.&text=Novartis%20will%20aim%20to%20begin,its%20site%20in%20Stein%2C%20Switzerland (“Novartis and Bayer have announced separate agreements to aid the manufacturing of Pfizer/BioNTech’s COVID-19 vaccine and CureVac’s vaccine, respectively.”); Pharmaceutical Technology, Pharmaceutical Technology-02-01-2021, Volume 2021
Supplement, Issue 1, Contract Service Tapped to Produce COVID-19 Vaccines, Page Number: s29-s30, https://www.pharmtech.com/view/contract-service-tapped-to-produce-covid-19-vaccines (reviewing actions by Pfizer/BioNTech, Moderna, Johnson & Johnson, AstraZeneca, Novavax). Expanding supply also requires vaccines being approved by governments for use. The EU recently announced it was beginning review of the Russian vaccine Sputnik V. See The Globe and Mail, Europe starts review of Russia’s Sputnik V vaccine to try to overcome shortages as new variants appear, March 4, 2021, https://www.theglobeandmail.com/world/article-europe-starts-review-of-russias-sputnik-v-vaccine-to-try-to-overcome/. And, of course, major producers are expanding where they are producing their vaccines using existing or new facilities. See, e.g., The Globe and Mail, Novavax publishes COVID-19 vaccine contract with Canada, March 4, 2021, https://www.theglobeandmail.com/canada/article-novavax-publishes-covid-19-vaccine-contract-with-canada/ (“American pharmaceutical company Novavax has published its vaccine agreement with Canada for 52 million doses of its COVID-19 vaccine. The company expects to eventually produce some of the vaccine in Canada.”).

Thus, a great deal is going on to expand production capacity globally. Strong intellectual property laws are critical to the developments and resource commitments being made. While many developing countries are pushing to start a process of text drafting for a TRIPS waiver at the WTO, such an effort would be counterproductive to global health needs over the longer term. Washington Trade Daily’s March 2, 2021 edition at pages 5-7 has an article entitled “Call for TRIPS Waiver Negotiations” which presents the views of largely developing countries on the desire to move to negotiating text even though there is not agreement on the proposed waiver. See Washington Trade Daily, March 2, 2021, https://files.constantcontact.com/ef5f8ffe501/ed93e180-7dee-4beb-8629-0e73d4d0ea5c.pdf.

The U.S. Chamber of Commerce released a statement on March 2nd characterizing the effort for a TRIPS waiver being promoted by India, South Africa and others as “misguided”. See U.S. Chamber, U.S. Chamber Statement on Proposed WTO IP Rights Waiver, March 2, 2021, https://www.uschamber.com/press-release/us-chamber-statement-proposed-wto-ip-rights-waiver. The statement is copied below (emphasis added to the third paragraph).

“WASHINGTON, D.C. – The U.S. Chamber of Commerce’s Global Innovation Policy Center (GIPC) issued the following statement from Senior Vice President Patrick Kilbride regarding the World Trade Organization (WTO) General Council’s discussion of a proposed waiver of intellectual property (IP) commitments in the Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement. 
 
“‘Vaccine distribution is critical for ending the pandemic and reviving the global economy. The U.S. Chamber of Commerce welcomes the WTO General Council’s discussion of the role of intellectual property rights in defeating the COVID-19 pandemic. During this time, transparent and predictable intellectual property rights have formed the legal and economic basis for an unprecedented level of highly successful collaborations between government, industry, academia and NGOs. 
 
“‘The Chamber supports decisive and bold action to remove regulatory and trade barriers in order to boost the global distribution of treatments and vaccines, including support of global vaccine programs such as COVAX. Proposals to waive intellectual property rights are misguided and a distraction from the real work of reinforcing supply chains and assisting countries to procure, distribute and administer vaccines to billions of the world’s citizens. Diminishing intellectual property rights would make it more difficult to quickly develop and distribute vaccines or treatments in the future pandemics the world will face.  
 
“’The ‘3rd Way’ proposed by incoming WTO Director General Ngozi Okonjo-Iweala to encourage licensing agreements is worthy of further discussion and consistent with the ongoing success of government-industry efforts to bring an end to COVID-19 as rapidly and as safely as possible.’”

Conclusion 

While there has been a lot of concern among trading partners about the EU action in imposing export licensing of COVID-19 vaccines, to date the licensing system does not appear to have caused problems in fact in the distribution of doses ordered by the group of countries covered by the new system. Moreover, with or without government encouragement, vaccine producers have been working to expand production through arrangements with other vaccine producers, through working with contract manufacturers, and by expanding facilities and internal capacities.

There is no doubt that the COVID-19 pandemic presents a once in a century global health pandemic with demand at the beginning far outstripping supply. Governments have a role to play working with producers, suppliers, those involved in distribution and applying the vaccines to address bottlenecks, to provide encouragement and incentives to rapidly expand production and to support the efforts of the WHO, GAVI, CEPI, and UNICEF to fund the needs of COVAX. While concerns in the early days of vaccine rollout are understandable, COVAX has contracts with a number of vaccine producers and others under negotiation or awaiting approval. AstraZeneca, the first vaccine producer with a contract to supply COVAX put out a press release on March 2, 2021 which is copied in part below. See AstraZeneca, AstraZeneca advances mass global rollout of COVID-19 vaccine through COVAX, March 2, 2021, https://www.astrazeneca.com/media-centre/press-releases/2021/astrazeneca-advances-mass-global-rollout-of-covid-19-vaccine-through-covax.html.

“Supply to 142 countries underway as part of the unprecedented effort to bring
broad and equitable access to the vaccine

“AstraZeneca with its partner Serum Institute of India
will be the biggest initial supplier to COVAX
 

“The first of many millions of doses of AstraZeneca’s COVID-19 vaccine have begun arriving in low and middle-income countries across the world through the multilateral COVAX initiative, the first steps in fulfilling the Company’s efforts to provide broad and equitable access to the vaccine.

“First COVAX shipments were dispatched late last week to Ghana and Cote D’Ivoire, and more are due to begin arriving this week in countries including the Philippines, Indonesia, Fiji, Mongolia and Moldova. This supply represents the first COVID-19 vaccine for many of these countries.

“Further shipments will arrive in the coming weeks with the aim of supplying a total of 142 countries with hundreds of millions of doses of the vaccine in the coming months. The majority of these doses, manufactured by AstraZeneca and its licence partner Serum Institute of India, will go to low and middle-income countries.

“Pascal Soriot, Chief Executive Officer, Astra Zeneca, said: ‘These first steps towards fulfilling our broad, equitable and no-profit emergency response to the pandemic mean millions of people, irrespective of their country’s income level, will soon be protected against this deadly virus. This is a moment of great pride for us at AstraZeneca and I am extremely grateful to our partners including Gavi, CEPI and Oxford University for their hard work and dedication in order to make this humanitarian ideal a reality for many millions of people around the world.’

“Seth Berkley, Chief Executive Officer, Gavi, said: ‘Global, equitable access to COVID-19 vaccines is only possible when the public and private sectors work together. When we launched the Gavi COVAX Advance Market Commitment in June 2020, our first Agreement was with AstraZeneca. Nine months later, the first doses are already being delivered to those that need them most. This is the beginning of COVAX’s effort to end the acute phase of the pandemic, not the end, but we can all take strength from this moment and I thank AstraZeneca and the University of Oxford for their support and partnership at every step of our journey.’

“Vaccine shipments have been allocated according to the COVAX Allocation Framework which determines volume per participating country based on a number of factors, including country readiness, national regulatory authorisations and national vaccination plans in place. The supply through COVAX follows the recent Emergency Use Listing by the World Health Organization (WHO) for active immunisation in individuals 18 years of age and older, which provides a vital and accelerated pathway to enable supply.

“AstraZeneca was the first global pharmaceutical company to join COVAX in June 2020 in line with the Company’s shared commitment to global, equitable access to vaccines.

“The vaccine can be stored, transported and handled at normal refrigerated conditions (2-8 degrees Celsius/36-46 degrees Fahrenheit) for at least six months and administered within existing healthcare settings.”

The “third way” sought by the WTO Director-General has been underway for some time and is picking up speed as vaccines start to be approved. There are an increasing number of announced agreements among producers to work together to expand production of particular vaccines. Thus, collaboration and cooperation among producers has and is occurring. Governments can help by identifying bottlenecks in all areas relevant to raw materials, intermediate products, finished vaccine doses, distribution and resources to apply the vaccines and helping to resolve the bottlenecks; by encouraging increased ramp ups of capacity and production, including through licensing.

A broad waiver of TRIPS obligations as being pursued by India, South Africa and many other developing and least developed countries is unwise, unlikely to be agreed to, and if implemented, will backfire in terms of global cooperation in getting the world’s population vaccinated and will destroy the likelihood of private sector engagement to solve future pandemics. The EU’s approach as laid out in EU Ambassador João Aguiar Machado’s statement on March 2 is likely the best course forward whether through the WTO or otherwise.

Council for Trade-Related Aspects of Intellectual Property Rights meeting of December 10, 2020 – no resolution on proposed waiver of TRIPS obligations to address the pandemic

· December 11, 2020 · COVID-19, TRIPS waiver proposal from India and South Africa · , , , , , · No Comments

On December 10th, the WTO Council for Trade-Related Aspects of Intellectual Property Rights held a meeting to consider a proposed waiver for all countries of various TRIPS Agreement obligations during the COVID-19 pandemic. I have previously looked at the proposed waiver and reactions thereto in two prior posts. See December 6, 2020, Upcoming December 11th Council for Trade-Related Aspects of Intellectual Property Rights meeting – reaction to proposed waiver from TRIPS obligations to address COVID-19, https://currentthoughtsontrade.com/2020/12/06/upcoming-december-11th-wto-council-for-trade-related-aspects-of-intellectual-property-rights-meeting-reaction-to-proposed-waiver-from-trips-obligations-to-address-covid-19/ (date of meeting incorrectly listed as December 11); November 2, 2020:  India and South Africa seek waiver from WTO intellectual property obligations to add COVID-19 – issues presented, https://currentthoughtsontrade.com/2020/11/02/india-and-south-africa-seek-waiver-from-wto-intellectual-property-obligations-to-address-covid-19-issues-presented/.

The WTO press release on the meeting indicates that Members will continue to discuss the proposal in future meetings as there was no consensus yet on the proposed waiver. See WTO press release, December 10, 2020, Members to continue discussion on proposal for temporary IP waiver in response to COVID-19, https://www.wto.org/english/news_e/news20_e/trip_10dec20_e.htm. The meeting was held to permit the Council to prepare a report to the General Council ahead of its December 16 meeting. As noted in the press release,

“As a result of the consultations, the chair proposed that the TRIPS Council provide a neutral and factual communication to the General Council reflecting the state of play of discussions and the absence of consensus on the waiver proposal in the TRIPS Council at this time. The communication would indicate that the TRIPS Council has not yet completed its consideration of the waiver request and may not be able to do so within the 90 days stipulated. Therefore, it would propose that the TRIPS Council continues its consideration of the waiver request and reports back to the General Council as stipulated in Article IX:3 of the Marrakesh Agreement.”

The next scheduled TRIPS Council meeting is scheduled for March, but the Chair indicated informal meetings may be held in January and February to work on a path forward.

The press release in its entirety is embedded below.

WTO-_-2020-News-items-Members-to-continue-discussion-on-proposal-for-temporary-IP-waiver-in-response-to-COVID-19

There remains a sharp divide between the proponents and their supporters on the one hand who argue that TRIPS obligations will hinder speedy and equitable distribution of vaccines and other materials needed for handling the pandemic and the range of Members who opposed a waiver on the basis that there hasn’t been a factual showing that TRIPS flexibilities don’t address concerns and that TRIPS provisions are not the only issue that goes to production capacity and production.

As noted in my last post, four WTO Members (Australia, Canada, Chile and Mexico) have proposed a series of questions for Members to consider and respond to in an effort to develop a factual record for what actual problems Members are having so any waiver or other action would respond to actual versus feared potential problems. There was no public indication of whether WTO Members will respond to the questions and/or otherwise cooperate in the establishment of a data base of challenges being experienced in fact by Members in addressing the pandemic.

Trade press have reported on the meeting and the continued disagreement between the two groups of Members. See, e.g., Inside U.S. Trade’s World Trade Online, December 10, 2020, WTO members to continue talks on TRIPS waiver, but no consensus in sight, https://insidetrade.com/daily-news/wto-members-continue-talks-trips-waiver-no-consensus-sight (“The U.S., the European Union and Japan, among others, oppose the waiver, insisting that intellectual property protections are necessary to spur innovation and collaboration. The U.S. on Thursday called instead for members to identify specific problems related to accessing a product and then find targeted solutions. * * * Canada on Thursday argued that the built-in flexibility of the agreement is proven to work, citing the example of Canada’s issuance, in 2017, of a compulsory license granting a Canadian company permission to use nine patents in producing an HIV drug for Rwanda.”); Washington Trade Daily, December 11, 2020, TRIPS Waiver Talks to Continue, https://files.constantcontact.com/ef5f8ffe501/25ec633d-96b4-44cd-8c0d-2eb9108795b9.pdf (pages 2-4).

Look for the proposed waiver to be a topic of continued disagreement within the TRIPS Council in 2021 until such time as there is a much clearer picture of the actual problems to which a much narrower waiver would actually be needed and effective if nonwaiver options are not available. With vaccine approvals starting and with production and distribution being ramped up in 2021, there will be materials delivered to many countries next year either through COVAX or through voluntary licensing arrangements. As noted in an earlier post, there are several billion vaccine doses capacity available through these current options.

Upcoming December 11th WTO Council for Trade-Related Aspects of Intellectual Property Rights meeting — reaction to proposed waiver from TRIPS obligations to address COVID-19

· December 6, 2020 · COVID-19, Trade-Related Aspects of Intellectual Property Rights Agreement, TRIPS waiver proposal from India and South Africa · , , , , , , , , , · No Comments

In my post of November 2, 2020, I reviewed a proposed waiver from many TRIPS obligations for all countries to address the COVID-19 pandemic. See November 2, 2020, India and South Africa seek waiver from WTO intellectual property obligations to add COVID-19 – issues presented, https://currentthoughtsontrade.com/2020/11/02/india-and-south-africa-seek-waiver-from-wto-intellectual-property-obligations-to-address-covid-19-issues-presented/. While originally filed by India and South Africa (IP/C/W/669), a few other countries have joined the proposal including Eswatini (IP/C/W/669/Add.1), Kenya (IP/C/W/669/Add.1), Mozambique (IP/C/W/669/Add.2) and Pakistan (IP/C/W/669/Add.3). South Africa made a supplemental filing providing what it described as “Examples of IP Issues and Barriers in COVID-19 pandemic”. Communication from South Africa, Examples of IP Issues and Barriers in COVID-19 Pandemic, IP/C/W/670, 23 November 2020. The South African communication is embedded below.

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My post of November 2 had raised a number of question presented by the proposed waiver:

” The proposal raises a series of questions that should be addressed to understand whether the waiver is appropriate. These questions include whether such a broad waiver request is appropriate or envisioned by Article IX:3 and 4 of the Marrakesh Agreement? Shouldn’t those requesting a waiver be required to demonstrate that the existing flexibilities within the TRIPS Agreement are inadequate to address concerns they may have? Can two Members request a waiver of obligations for all WTO Members? Can a waiver request be considered where the product scope is lacking clarity, and the uses/needs of the waiver are very broad and potentially open to differing views? To what extent is there a need for those seeking a waiver to present a factual record of actions being taken by governments, companies and international organizations to provide access to medical goods during the pandemic including to developing and least developed countries? Shouldn’t those seeking a waiver identify the extent of existing licenses by major pharmaceutical companies with them or other WTO Members for the production of vaccines or therapeutics to address COVID-19?”

The supplemental information provided by South Africa identifies various patent pending matters and identifies what it describes as restrictive actions by some companies and some patent litigation by certain companies. As such the communication provides some information of possible relevance in examining the proposed waiver. However, there is little if any information provided on most questions that seem important to an informed discussion of the proposed waiver.

On November 27, Australia, Canada, Chile and Mexico filed a communication entitled “Questions on Intellectual-Property Challenges Experienced by Members in Relation to COVID-19”. IP/C/W/671. While the entire communication is embedded below, paragraphs 3 and 4 are copied below and present a framework for the consideration of the proposed waiver and seek factual answers to a series of questions which would help understand if there are in fact any significant barriers being confronted by WTO Members in addressing the pandemic.

“3. The co-sponsors of this communication remain of the view that these important, challenging, and complex issues merit further reflection and significant consideration, in order to identify any specific and concrete IP-related challenges faced by Members in addressing COVID-19. In addition, we take note that IP rights are one part of a broad discussion informing the availability and accessibility of treatments for COVID-19. Indeed, as the Doha Declaration on the TRIPS Agreement and Public Health emphasizes, the TRIPS Agreement itself is part of the wider national and international effort to address public health problems. With respect to COVID-19, this broader response includes significant investments through procurement mechanisms like the Access to COVID-19 Tools Accelerator and the COVAX Facility and Advance Market Commitment, as well as work within the WTO and elsewhere to safeguard and protect global supply chains.

“4. The co-sponsors of this communication are actively committed to a comprehensive, global
approach that leverages the entire multilateral trading system in place to supporting the research,
development, manufacturing, and distribution of safe and effective COVID-19 diagnostics, equipment, therapeutics, and vaccines. The co-sponsors also reaffirm their support for the TRIPS Agreement, including the flexibilities it provides, and for the Doha Declaration on the TRIPS Agreement and Public Health. In this context, we invite consideration of how the existing legal framework under the TRIPS Agreement, including the flexibilities affirmed under the Doha Declaration on the TRIPS Agreement and Public Health, have operated thus far in the context of Members’ efforts to address the COVID-19 pandemic. We are also committed to fully understanding the nature and scope of any concrete IP barriers experienced by Members related to or arising from the TRIPS Agreement, and such that would constitute impediments to the fight against COVID-19. To that end, and with a view to facilitating a consensual, evidence-based approach, the co-sponsors of this communication therefore respectfully submit the following questions to Members for their consideration and response.”

The communication from Australia, Canada, Chile and Mexico then provides eight questions designed to develop a factual record of challenges faced on procurement of products, local production, compulsory licenses, as well as copyright-related challenges, industrial-designs-related challenges, and challenges from undisclosed information. The questions also include an inquiry as to “what specific legal amendments or actions would the proponents seek to enact for the prevention, containment, and treatment of COVID-19 that are not – or may not be – consistent with the TRIPS Agreement and its flexibilities?”

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There is a meeting of the Council for Trade-Related Aspects of Intellectual Property Rights scheduled for December 11 at the WTO. It is assumed that the only item on the agenda will be the consideration of the proposed TRIPS waiver submitted by India and South Africa and joined by four other countries. A recommendation should be forwarded to the General Council by December 31. While the proposed waiver may receive support from many WTO Members, it will be opposed by many as well as not justified and undermining the existing WTO TRIPS Agreement and built-in flexibilities. The communication from Australia, Canada, Chile and Mexico provides a possible path forward by seeking to gather factual information that would permit Members to identify what challenges actually exist and what existing tools are available for addressing the existing challenges so that the need for any waiver is limited to what is actually needed instead of being the very broad waiver proposal for all countries regardless of actual problems faced.

India and South Africa Seek Waiver from WTO Intellectual Property Obligations to Address COVID-19 — Issues Presented

· November 2, 2020 · COVID-19, TRIPS waiver proposal from India and South Africa · , , , , , , · No Comments

India and South Africa submitted a communication to the WTO Council for Trade-Related Aspects of Intellectual Property Rights entitled “Waiver from Certain Provisions of the TRIPS Agreement for the Prevention,
Containment and Treatment of COVID-19.” IP/C/W/699 (October 2, 2020). The document and correction are embedded below.

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The waiver request was made part of the agenda of the Council for TRIPS agenda for its meeting on October 15-16. The WTO Secretariat provided a short press release on the TRIPS Council meeting. The discussion on the waiver proposal is quoted below.

“Some 40 members engaged in a substantive discussion on a proposal submitted by India and South Africa for a temporary waiver of certain TRIPS obligations they said would facilitate an appropriate response to COVID-19. The proposal suggests a waiver for all WTO members on the implementation, application and enforcement of certain provisions of the TRIPS Agreement in relation to the “prevention, containment or treatment” of COVID-19. The proponents argued this would avoid barriers to the timely access to affordable medical products including vaccines and
medicines or to scaling-up of research, development, manufacturing and supply of essential medical products.

“The waiver would cover obligations in four sections of Part II of the TRIPS Agreement (https://www.wto.org/english/docs_e/legal_e/27-trips_04_e.htm) — Section 1 on copyright and related rights, Section 4 on industrial designs, Section 5 on patents and Section 7 on the protection of undisclosed information. It would last for a specific number of years, as agreed by the General Council, and until widespread vaccination is in place globally and the majority of the world’s population is immune. Members would review the waiver annually until its termination.

“According to the proponents, an effective response to the COVID-19 pandemic requires rapid access to affordable medical products such as 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. As new diagnostics, therapeutics and vaccines for COVID-19 are developed, there were significant concerns about how these will be made available
promptly in sufficient quantities and at affordable prices to meet global demand.

“The proponents argued that many countries — especially developing countries — may face institutional and legal difficulties when using TRIPS flexibilities, including the special compulsory licensing mechanism provided for in Article 31bis (https://www.wto.org/english/res_e/publications_e/ai17_e/trips_art31_bis_oth.pdf), which they saw as a cumbersome process for the import and export of pharmaceutical products. Now was the time for the WTO as an organization to rise up to the collective call for defeating the pandemic. The WTO would not succeed in its efforts to rebuild the COVID-19 affected economies unless it acts now to first save those lives that are going to build these economies. It is time for members to take collective responsibility and put people’s lives before anything else, they concluded.

“While a number of developing and least developed country members welcomed the proposal as a contribution to the discussion, many were still studying it in their capitals and asked for clarification on certain points, particularly regarding its practical implementation and the possible economic and legal impact of the waiver at national level. A number of developing and developed country members opposed the waiver proposal, noting that there is no indication that intellectual property rights (IPRs) have been a genuine barrier to accessing COVID-19 related medicines and technologies.

“While acknowledging that the sustained and continued supply of such medicines and technologies is a difficult task, they observed that non-efficient and underfunded health care and procurement systems, spiking demand and lack of manufacturing capacity are much more likely to impede access to these materials. In the view of these members, solutions can be legitimately sought within the existing IP system as the TRIPS Agreement provides enough tools and sufficient policy space for members to take measures to protect public health. The suspension of IPRs,
even for a limited period of time, was not only unnecessary but it would also undermine the collaborative efforts to fight the pandemic that are already under way.

“Given this range of positions, the Council chair, Ambassador Xolelwa Mlumbi-Peter of South Africa, said that the item would remain suspended as members continue to consider the proposal. Requests for waivers concerning WTO agreements must be submitted initially to the relevant council for consideration. After 90 days, the TRIPS Council has to submit a report to the Ministerial Conference. Given that the proposal was submitted on 2 October, the 90-day time-period expires on 31 December 2020. The TRIPS Council meeting will be reconvened on the item of the waiver proposal as appropriate before that date, the chair said.”

WTO, 20 October 2020, Members discuss intellectual property response to the COVID-19 pandemic, https://www.wto.org/english/news_e/news20_e/trip_20oct20_e.htm.

Waiver provisions in the WTO

Article IX:3 and 4 of the Marrakesh Agreement Establishing the World Trde Organization deal with waivers from obligations WTO Members have assumed.

“Article IX

“Decision-Making

” * * *

“3.   In exceptional circumstances, the Ministerial Conference may decide to waive an obligation imposed on a Member by this Agreement or any of the Multilateral Trade Agreements, provided that any such decision shall be taken by three fourths of the Members unless otherwise provided for in this paragraph.

“(a)    A request for a waiver concerning this Agreement shall be submitted to the Ministerial Conference for consideration pursuant to the practice of decision-making by consensus. The Ministerial Conference shall establish a time-period, which shall not exceed 90 days, to consider the request. If consensus is not reached during the time-period, any decision to grant a waiver shall be taken by three fourths of the Members.
 

“(b)    A request for a waiver concerning the Multilateral Trade Agreements in Annexes 1A or 1B or 1C and their annexes shall be submitted initially to the Council for Trade in Goods, the Council for Trade in Services or the Council for TRIPS, respectively, for consideration during a time-period which shall not exceed 90 days. At the end of the time-period, the relevant Council shall submit a report to the Ministerial Conference.

“4.   A decision by the Ministerial Conference granting a waiver shall state the exceptional circumstances justifying the decision, the terms and conditions governing the application of the waiver, and the date on which the waiver shall terminate. Any waiver granted for a period of more than one year shall be reviewed by the Ministerial Conference not later than one year after it is granted, and thereafter annually until the waiver terminates. In each review, the Ministerial Conference shall examine whether the exceptional circumstances justifying the waiver still exist and whether the terms and conditions attached to the waiver have been met. The Ministerial Conference, on the basis of the annual review, may extend, modify or terminate the waiver.”

Some questions from the waiver proposal

The waiver proposal put forward by India and South Africa is extraordinarily broad – covering all WTO Members for a broad range of products not clearly delineated, with the waiver of a broad array of TRIPS obligations without a demonstration of the relevance of the requests for some (e.g., copyright) for a potentially lengthy period of time.

The proposal raises a series of questions that should be addressed to understand whether the waiver is appropriate. These questions include whether such a broad waiver request is appropriate or envisioned by Article IX:3 and 4 of the Marrakesh Agreement? Shouldn’t those requesting a waiver be required to demonstrate that the existing flexibilities within the TRIPS Agreement are inadequate to address concerns they may have? Can two Members request a waiver of obligations for all WTO Members? Can a waiver request be considered where the product scope is lacking clarity, and the uses/needs of the waiver are very broad and potentially open to differing views? To what extent is there a need for those seeking a waiver to present a factual record of actions being taken by governments, companies and international organizations to provide access to medical goods during the pandemic including to developing and least developed countries? Shouldn’t those seeking a waiver identify the extent of existing licenses by major pharmaceutical companies with them or other WTO Members for the production of vaccines or therapeutics to address COVID-19?

Historical usage of waivers have not been as broad as that requested by India and South Africa

Waivers are exceptional by their nature and Article IX:3 talks in terms of a waiver of some obligation for a particular Member, not the waiver of many parts of an agreement for all members. When one looks at waivers granted previously by the WTO, one sees a range of topics — many relate to time for Members to implement changes from updates of the harmonized tariff systems (for individual countries who sought the temporary waiver), some pertain to preferential arrangements between one Member and another or a group of Members and some pertain to waiver of deadlines or specific obligations for least developed countries. Two documents prepared by the WTO Secretariat show waivers granted or continuing in existence in 2019 and all waivers between 1995 AND 2015. The two documents are embedded below.

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Thus, the present request for a waiver by India and South Africa doesn’t seem to comply with the literal terms of Article IX:3 of the Marrakesh Agreement or with the much more narrow scope of waivers typically considered. As reviewed above, the request would apply to all members, not just India and South Africa. The request also seems overly broad both in terms of products (not clearly defined), uses and provisions to be waived.

Existing flexibilities within the TRIPs Agreement

Because of the importance to all WTO Members of the health of their citizens, there has been a lot of focus and discussion within the WTO on the interface between intellectual property and public health. Under the original TRIPs Agreement and the subsequent amendment to the Agreement in 2005 that took effect as Article 31bis to the TRIPs Agreement in 2017, there is flexibility within the TRIPs Agreement for Members to deal with health emergencies including through compulsory licensing which can include the right to manufacture and export to developing and least developed countries who don’t have pharmaceutical manufacturing capabilities in-country. See TRIPs Agreement Article 31, Article 31bis and WT/L/641. The current language of Articles 31 and 31bis from the patent portion of the TRIPS Agreement are presented below.

“Article 31 Other Use Without Authorization of the Right Holder

“Where the law of a Member allows for other use (7) of the subject matter of a patent without the authorization of the right holder, including use by the government or third parties authorized by the government, the following provisions shall be respected:

“(a)  authorization of such use shall be considered on its individual merits;
 

“(b)  such use may only be permitted if, prior to such use, the proposed user has made efforts to obtain authorization from the right holder on reasonable commercial terms and conditions and that such efforts have not been successful within a reasonable period of time. This requirement may be waived by a Member in the case of a national emergency or other circumstances of extreme urgency or in cases of public non-commercial use. In situations of national emergency or other circumstances of extreme urgency, the right holder shall, nevertheless, be notified as soon as reasonably practicable. In the case of public non-commercial use, where the government or contractor, without making a patent search, knows or has demonstrable grounds to know that a valid patent is or will be used by or for the government, the right holder shall be informed promptly;
 

“(c)  the scope and duration of such use shall be limited to the purpose for which it was authorized, and in the case of semi-conductor technology shall only be for public non-commercial use or to remedy a practice determined after judicial or administrative process to be anti-competitive;
 

“(d)  such use shall be non-exclusive;
 

“(e)  such use shall be non-assignable, except with that part of the enterprise or goodwill which enjoys such use;
 

“(f)  any such use shall be authorized predominantly for the supply of the domestic market of the Member authorizing such use;
 

 “(g)  authorization for such use shall be liable, subject to adequate protection of the legitimate interests of the persons so authorized, to be terminated if and when the circumstances which led to it cease to exist and are unlikely to recur. The competent authority shall have the authority to review, upon motivated request, the continued existence of these circumstances;
 

“(h)  the right holder shall be paid adequate remuneration in the circumstances of each case, taking into account the economic value of the authorization;
 

“(i)  the legal validity of any decision relating to the authorization of such use shall be subject to judicial review or other independent review by a distinct higher authority in that Member;
 

“(j)  any decision relating to the remuneration provided in respect of such use shall be subject to judicial review or other independent review by a distinct higher authority in that Member;
 

“(k)  Members are not obliged to apply the conditions set forth in subparagraphs (b) and (f) where such use is permitted to remedy a practice determined after judicial or administrative process to be anti-competitive. The need to correct anti-competitive practices may be taken into account in determining the amount of remuneration in such cases. Competent authorities shall have the authority to refuse termination of authorization if and when the conditions which led to such authorization are likely to recur;
 

“(l)  where such use is authorized to permit the exploitation of a patent (“the second patent”) which cannot be exploited without infringing another patent (“the first patent”), the following additional conditions shall apply:
 

“(i)  the invention claimed in the second patent shall involve an important technical advance of considerable economic significance in relation to the invention claimed in the first patent;
 

“(ii) the owner of the first patent shall be entitled to a cross-licence on reasonable terms to use the invention claimed in the second patent; and
 

“(iii)  the use authorized in respect of the first patent shall be non-assignable except with the assignment of the second patent.

“Article 31bis

“1. The obligations of an exporting Member under Article 31(f) shall not apply with respect to the grant by it of a compulsory licence to the extent necessary for the purposes of production of a pharmaceutical product(s) and its export to an eligible importing Member(s) in accordance with the terms set out in paragraph 2 of the Annex to this Agreement.

“2. Where a compulsory licence is granted by an exporting Member under the system set out in this Article and the Annex to this Agreement, adequate remuneration pursuant to Article 31(h) shall be paid in that Member taking into account the economic value to the importing Member of the use that has been authorized in the exporting Member. Where a compulsory licence is granted for the same products in the eligible importing Member, the obligation of that Member under Article 31(h) shall not apply in respect of those products for which remuneration in accordance with the first sentence of this paragraph is paid in the exporting Member.

“3. With a view to harnessing economies of scale for the purposes of enhancing purchasing power for, and facilitating the local production of, pharmaceutical products: where a developing or least developed country WTO Member is a party to a regional trade agreement within the meaning of Article XXIV of the GATT 1994 and the Decision of 28 November 1979 on Differential and More Favourable Treatment Reciprocity and Fuller Participation of Developing Countries (L/4903), at least half of the current membership of which is made up of countries presently on the United Nations list of least developed countries, the obligation of that Member under Article 31(f) shall not apply to the extent necessary to enable a pharmaceutical product produced or imported under a compulsory licence in that Member to be exported to the markets of those other developing or least developed country parties to the regional trade agreement that share the health problem in question. It is understood that this will not prejudice the territorial nature of the patent rights in question.

“4. Members shall not challenge any measures taken in conformity with the provisions of this Article and the Annex to this Agreement under subparagraphs 1(b) and 1(c) of Article XXIII of GATT 1994.

“5. This Article and the Annex to this Agreement are without prejudice to the rights, obligations and flexibilities that Members have under the provisions of this Agreement other than paragraphs (f) and (h) of Article 31, including those reaffirmed by the Declaration on the TRIPS Agreement and Public Health (WT/MIN(01)/DEC/2), and to their interpretation. They are also without prejudice to the extent to which pharmaceutical products produced under a compulsory licence can be exported under the provisions of Article 31(f).”

The WTO Secretariat has a page on its website that discusses intellectual property and the public interest, https://www.wto.org/english/tratop_e/trips_e/trips_and_public_interest_e.htm, which reviews both flexibilities for Members in addressing public interest needs as well as current topics being discussed within the TRIPS Council. There also have been publications by the WTO Secretariat, WIPO and WHO on flexibilities in accessing medical technologies. See, e.g., WTO, WIPO and WHO, Promoting Access to Medical Technologies and Innovation, SECOND EDITION, https://www.wto.org/english/res_e/booksp_e/who-wipo-wto_2020_e.pdf. And on October 21, 2020 the WTO held a technical workshop on health, trade and intellectual property in addressing COVID-19. See 21 October 2020, WTO workshop on health, trade and intellectual property: an integrated approach to COVID-19; https://www.wto.org/english/news_e/news20_e/heal_21oct20_e.htm. There is a lengthy combined powerpoint presentation available from the webpage which was used in the workshop.

Thus, there can be no doubt that the WTO TRIPS Agreement provides significant flexibilities to Members to address health emergencies. The waiver proposal from India and South Africa doesn’t review any actual efforts to utilize the flexibilities but just opines that Members won’t be able to effectively utilize them. Such an approach should not be acceptable for such far reaching requests as the proposal from India and South Africa.

Ongoing efforts by governments, companies and organizations to make medical goods available to developing and least developed countries

Strangely missing from the waiver request submitted by India and South Africa is any mention of the global efforts underway to ensure access to medical goods and vaccines and therapeutics as approved.

There have been various fund raising efforts in 2020 to provide the necessary wherewithal to organizations focused on developing vaccines for global distribution or focused on the distribution of medical goods, vaccines and therapeutics globally.

CEPI and GAVI in coordination with the WHO have extensive efforts underway, including access to large manufacturing capacity for approved vaccines within the pool of vaccines being developed and included in the CEPI portfolio.

In addition, some private companies involved in manufacturing vaccines under development have licensing arrangements with certain producers for distribution to developing and least developing countries. Some companies have made access to the drawings of their medical equipment available to any company wishing to produce the equipment.

Thus, it is hard to understand a need for a broad waiver when there is considerable international cooperation and substantial vaccine capacity available for some of the vaccines in late stage testing. The WTO membership deserves to have a full compilation of developments and existing actions to facilitate access to medical supplies for developing and least developed countries. The India and South Africa waiver proposal provides none of the relevant information.

While it is not the purpose of this post to develop the full factual record, I provide below some links which supply some information on ongoing developments. See The Guardian, October 20, 2020, India at heart of global efforts to produce Covid vaccine, Country plays central role in development, manufacture, and possible distribution of potential vaccines, https://www.theguardian.com/world/2020/oct/20/india-at-heart-of-global-efforts-to-produce-covid-vaccine (“A deal has already been struck for the Serum Institute of India, based in the city of Pune, to produce 1bn doses of the the Oxford/AstraZeneca vaccine, seen as the forerunner in the vaccine race.” “Johnson and Johnson, whose Covid-19 vaccine is also in phase 3 clinical trials, has struck a deal with the Indian pharmaceutical company Biological E to produce up to 500m doses if successful.” “Bharat Biotech, a Hyderabad-based pharmaceutical company, has a deal to manufacture 1bn doses of Washington University’s intranasal vaccine, now in clinical trials, and Indian pharmaceutical giant Dr Reddy’s has a deal to do a phase 2/3 human trials in India of Russia’s controversial Sputnik vaccine and then produce 100m doses. There are also at least a dozen indigenous vaccines being developed within India. ” “Poonawalla of the Serum Institute said that ‘50% of whatever quantity we manufacture will be kept for India and the remaining will go to low- and middle-income countries.'”).

GAVI, the Vaccine Alliance, October 15, 2020, COVID-19 SITUATION REPORT #19, https://www.gavi.org/sites/default/files/covid/Gavi-COVID-19-Situation-Report-19-20201015.pdf (“COVAX is the vaccines pillar of the Access to COVID-19 Tools (ACT) Accelerator, co-led by Gavi, the Coalition
for Epidemic Preparedness Innovations (CEPI) and WHO. Gavi is coordinating the development and implementation of the COVAX Facility, the global procurement mechanism of COVAX. The COVAX Facility will make investments across a broad portfolio of promising vaccine candidates (including those being supported by CEPI) to make sure at-risk investment in manufacturing happens now. Gavi is also coordinating the development and implementation of the Gavi COVAX Advance Market Commitment (AMC), the financing instrument that will support the participation of 92 low- and middle-income countries and economies in the COVAX Facility.
The goals of the COVAX Facility and AMC include:
“❖ to support the largest actively managed portfolio of vaccine candidates globally
“❖ to deliver 2 billion doses by the end of 2021
“❖ to offer a compelling return on investment by delivering COVID-19 vaccines as quickly as possible
“❖ to guarantee fair and equitable access to COVID-19 vaccines for all participants
“❖ to end the acute phase of the pandemic by the end of 2021”).

CEPI, October 21, 2020, CEPI expands global manufacturing network, reserving manufacturing capacity for more than 1billion doses of COVID-19 vaccines, https://www.gavi.org/vaccineswork/cepi-expands-global-manufacturing-network-reserving-manufacturing-capacity-over-1-billion-doses (“CEPI signs agreements with Biofabri (Spain) and GC Pharma (Republic of Korea) to reserve vaccine manufacturing capacity for more than 1 billion doses of COVID-19 vaccines designated by CEPI.
CEPI’s strategic investments in vaccine manufacturing at facilities around the world will support the COVAX goal to produce 2 billion doses of safe and effective vaccine by the end of 2021.”).

Conclusion

There is no doubt that the COVID-19 pandemic presents a global health crisis. In response to the crisis there have been activities within the WTO to minimize restrictions on the movement of medical goods and a workshop looking at the interface of trade, intellectual property and public health to help Members address internal needs. The TRIPS Agreement has various flexibilities to permit Members to address health challenges. At the same time there have been extraordinary efforts by many governments, companies and international organizations to cooperate both to develop vaccines and therapeutics but also to speed up manufacturing and work towards equitable distribution of medical goods. Leading pharmaceutical companies have already entered into licensing arrangements to provide billions of doses of vaccines when approved to developing and least developing countries. GAVI and CEPI in coordination with the WHO are working on supporting various vaccine development, securing manufacturing capacity and raising funds to permit broad distribution of vaccines and other products to countries in need and others who have contributed to the group effort.

So factually, it is hard to understand the waiver request filed by India and South Africa. Against a backdrop of how waivers have been used in the past and the lack of a demonstration that existing flexibilities won’t provide acceptable answers, the waiver proposal also is deficient in terms of legal justification. The proposal is not justified, is too broad both in terms of product coverage, Members who would be given waivers, and the range of
TRIPS provisions that would be waived for some number of years.

These are serious problems with a proposal that requires TRIPS Council action and referral to the General Council by the end of the year. Thus, the TRIPS Council should recommend against acceptance of the waiver proposal put forward by India and South Africa.