WAIVING PATENT RIGHTS ON COVID-19 VACCINES: AN ANALYSIS


Author: Advocate Tanveer Singh








INTRODUCTION

“These extraordinary times and circumstances call for extraordinary measures.”


The abovesaid statement came as a tweet[i] from United States Trade Representative Katherine Tai when she released a statement in the first week of May 2021 announcing the Biden-led US Administration’s support for the proposal seeking waiver of intellectual property (IP) protections for Covid-19 vaccines. The proposal – initially put forward by India and South Africa, in October 2020, at the World Trade Organization (WTO), sought to waive certain obligations of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement until the majority of the world’s population gets vaccinated and develop immunity.[ii] This article aims to analyze the waiving of IP rights particularly patent rights, which could boost up the production of the jabs culminating in the acute vaccine shortages faced by Low- and Middle-Income Countries (LMICs).


PATENTS IN THE PHARMACEUTICAL INDUSTRY

In context to the pharmaceutical industry, intellectual property describes creations, such as inventions, which are protected by patents, copyrights and trademarks and the laws governing them, however, patent law is fundamental to the way the pharmaceutical market is constructed. Obtaining a patent on the invention – process or product – plays a significant role as the grant of patents gives the innovating firms a monopoly over the invention to cover the expenses of development and encourage investment.[iii] It is designed to bestow the patent holder a head-start for securing dominant market share as they have the power to restrict artificially the production of the patented good for strategic reasons, for as long as legally possible. But considering the present scenario wherein the whole world is suffering from the pandemic caused by novel Coronavirus, if the patent rights are waived off then it would allow for vaccine technology to be shared more easily and increasing the production of the vaccines exponentially. This would mean generic or otherwise non-licensed manufacturers especially in developing and poor countries could begin with the product if they can do so.[iv]



TRIPS AGREEMENT AND COVID-19

The WTO's TRIPS Agreement which came into effect in January 1995 is the most comprehensive multilateral agreement on intellectual property (IP) which provides for certain basic principles (such as non-discrimination), puts the IP system in terms of promoting innovation and distributing technology for the public's welfare, sets out minimum standards of protection in respect of each of the areas of IP covered by the said agreement, contains provisions that deal with domestic procedures and remedies for IP enforcement, and regulates disputes between members about respect for TRIPS obligations subject to the WTO's dispute settlement procedures.[v] This global IP system also provides a framework in which urgently needed innovation to this pandemic can be encouraged, shared and disseminated among the member countries.


Since the inception of this pandemic, governments and stakeholders have considered how the innovation of the vaccines & medicines and the IP related thereto should be promoted, managed and regulated. Several initiatives have addressed the voluntary sharing and pooling of IP rights, for instance, Moderna, a company developing a messenger RNA vaccine against Covid-19 announced that it will not enforce the patents obtained by them during the pandemic to allow other Covid-19 vaccines in development to use the technology.[vi] Similarly, as per the provision of compulsory licencing under the TRIPS Agreement, the vaccine being produced by AstraZeneca and Oxford University has been licensed to the Serum Institute of India[vii], however, this is a restrictive arrangement wherein AstraZeneca controls ultimate recipients. What is compulsory licensing? It is one of the flexibilities in the field of patent protection under the TRIPS Agreement as per which a government can allow someone else to produce a patented product or process without the consent of the patent owner,[viii] especially in cases of national emergency or other circumstances of extreme urgency.[ix]

The given flexibilities by WTO especially after the implication of the 2001 “Doha Declaration” are not designed in such a way that they function effectively in a global pandemic where vaccines and other critical technologies are protected by multiple forms of IP and the production lies on global supply chains[x].


PROPOSALS TO WAIVE PATENT ALONG WITH OTHER IP RIGHTS

- First Proposal

In October 2020, before TRIPS Council at WTO, a proposal[xi] -led by India and South Africa-was submitted that suggested that all countries should temporarily be waived of their obligations under the TRIPS Agreement to fight the pandemic. The proposal was to waive the IP rights wherein all the member countries would not have to implement, apply and enforce certain provisions of the said agreement and obligations as per Sections 1 (copyright and related rights), 4 (industrial design), 5 (patents), and 7 (protection of undisclosed information) of PART II of the said agreement and to protect countries from the application of dispute settlement rules in this crucial time of the pandemic.[xii] Though the proposal was supported by hundreds of civil society organizations, including Doctors without Borders, Oxfam and Amnesty International but it has failed three times to get a nod in WTO due to the opposition from wealthy and developed countries such as the USA, the UK and the European Union.[xiii]. However, the initiative has gained momentum again due to the recent developments, at the time of writing, wherein the support is coming from many countries, and even from the ones which were initially opposing it, such as China, which is also trying to get Brazil on board and the US as well, which recently announced its support for this proposal and has also reached out to Japan and Switzerland and European Union[xiv] to support this initiative.


- Revised Proposal

After gaining such support, a revised proposal was submitted, with few amendments, on 21st May 2021 by the African Group[xv] before the TRIPS Council as the previous text of the proposal was too broad. The revised proposal follows the original proposal from India and South Africa; however, the following are the key takeaways from the revised one –


The preambular text of the revised proposal emphasises the uncertain nature of the ongoing pandemic which included the emergence of new variants of Covid-19. It also emphasises the discussion to strengthen the production of Covid-19 related products, which could subsequently inform how the negotiations to the waiver and its relevance to the pandemic can be approached.

The revised proposal provides clarity as to the scope of the proposed waiver by inserting “health products and technologies including diagnostics, therapeutics, vaccines, medical devices, personal protective equipment, their materials or components, and their methods and means of manufacture for the prevention, treatment or containment of COVID-19” in paragraph 1.


The revised proposal mentions the tenure of the waiver which was missing in the previous proposal. The proposed duration for which the waiver will remain in effect from the date of the decision on the matter is of 3 years.

Despite the said revision, the revised proposal does carry the essence of the previous proposal.


IMPACT OF THE WAIVER PROPOSAL

Positive Impact

The major purpose of waiving the patent rights on the Covid-19 vaccines is to increase the production of the approved vaccines because as per The New York Times – Coronavirus Vaccine Tracker,[xvi] at the time of writing, the researchers have been conducting tests on around 92 vaccines and only 8 of them have been approved for full use and out of these, vaccines produced by Pfizer-BioNTech, Moderna, Novovax, Johnson & Johnson and Oxford-AstraZeneca are leading worldwide.[xvii] The productions of the approved vaccines can be ramped up by freeing the intellectual property covered by patents and the trade secret because companies like Pfizer, BioNTech and Moderna have not disclosed all their related technologies in patent documentation.[xviii] The waiver would allow countries to adjust their policies and practices to be responsive to the pandemic as waiving the rights, though temporarily only, would remove domestic IP restrictions to support vaccine manufacturing[xix] and it will also allow companies to produce vaccines without fear of being sued by the entity that holds the IP for the technology.[xx] This step is critically important because the Indian variant which is believed to be the cause of the second wave in the country could potentially fuel second or third wave across the world causing a setback to the progress in fighting the pandemic. After all, the scale of the problem is mammoth and the demand for vaccines now has gone up to three times of the initial demand which was around 5.5 billion doses a year, worldwide.[xxi] In such circumstances, a patent waiver on the vaccines, as Anne Moore, a UK-based biologist puts it, may not be a sufficient condition but a necessary one.[xxii]


The waiver is likely to have the following main impacts –


· It would remove barriers of access to covid drugs, vaccines and other treatments as the relaxation of Article 31 of the TRIPS agreement would enable developing countries with insufficient or no manufacturing capacity to freely import pharmaceutical products. The technology transfer would become easier, the licensing terms will be less stringent and access to the raw materials needed to deploy vaccines will increase.

· The adopting manufacturers or countries will become immune to the claims of illegality under the IP, thus not leading to any legal disputes over the patent rights.

· The programs such as COVAX and C-TAP will benefit from the waiver as they are not a substitute to the waiver but are complimentary global initiatives. Though C-TAP, a WHO initiative, was launched in May 2020, and as of January 2021, not a single pharmaceutical firm has donated rights for a single Covid-19 medical technology. The waiver would remove legal and political complications for wealthy countries’ governments to compel companies to commit technological resources and know-how to C-TAP. Similarly, the participation of the US in the COVAX program is important as such participation would boost the program to achieve its goal and waiving the rights would ramp up the production for the same.[xxiii]


- Negative Impact

The critics of the waiver proposal believe that elimination patent protections after the development and approval of the vaccines might discourage pharmaceuticals companies from investing in cures for future public health crises.[xxiv] The pharmaceuticals industry claims the waiver can cause irreparable damage to the system of incentives that made the rapid development of the vaccines possible.[xxv]


Craig Garthwaite, a professor at North-Western University noted that, unlike many drugs, the coronavirus vaccines are complex technologies that will be difficult to copy without the help of the companies that developed them.[xxvi] Many experts have been asserting on the point that the waiver alone is unlikely to increase global vaccine production because low-and middle-income countries still lack manufacturing capacity, technology, skills and raw material. Even these countries get to know what they have to do, they won’t be able to because they would be lacking the resources and technology to perform the process. Also, manufacturing the vaccines is one step of the process of vaccination, the second and important step is of distributing which is yet another hurdle for some countries.[xxvii] Billionaire philanthropist Bill Gates, a major stakeholder in the global Covid-19 vaccine equity has said that the IP rights are not holding things back, the steps and procedures which are complimentary to make the vaccines are also important such as performing trials, which is not feasible for many low-and middle-income countries.


CONCLUSION

Though it is not an easy task to balance the opposing goals and interests but, considering the exceptional circumstance of this pandemic, the WTO must weigh all viable options put forth before it. However, the decision of WTO depends on the consensus of its 164 member states and the discussion for the revised proposal will be held in the first week of June’21 but it won’t be a quick one, it may take up months for the proposal to get a nod even with US backing because it is not only subjected to the pandemic now but has a political touch too.[xxviii] It will extremely important for the stakeholders to check how the negotiations which are to be held at WTO evolve on the revised proposal.

The patent waiver for the Covid-19 vaccines could be a form of respite from the harshness of the pandemic but the problem which lies with the ramping up of the production is the shortage of raw material. If the material required to manufacture the vaccines is provided to those manufacturers who don’t possess the requisite expertise to develop the vaccines, then the existing vaccine producers could run out of the needed stock. We need to ensure that in haste to protect ourselves we don’t cause harm to ourselves further.



[i] Tai, Katherine (AmbassadorTai). “These extraordinary times and circumstances of call for extraordinary measures.” 6 May 2021, 12.40 AM. Tweet. [ii] Covid-19 And Vaccine Equity: Does A Patent Waiver Matter? | Forbes India [iii] https://www.bbc.com/news/world-us-canada-57004302 [iv] Should vaccines be patent protected in a pandemic? | Frontier Economics (frontier-economics.com) [v] https://www.wto.org/english/tratop_e/covid19_e/trips_report_e.pdf [vi] https://investors.modernatx.com/news-releases/news-release-details/statement-moderna-intellectual-property-matters-during-covid-19 [vii] https://blogs.lse.ac.uk/covid19/2021/02/11/vaccines-and-patents-how-self-interest-and-artificial-scarcity-weaken-human-solidarity/ [viii] https://www.wto.org/english/tratop_e/trips_e/public_health_faq_e.htm [ix] https://www.ipwatchdog.com/2021/03/30/calls-compulsory-licensing-ip-waivers-covid-19-vaccines-ignore-technical-complexities/id=131617/ [x] https://www.citizen.org/article/waiver-of-the-wtos-intellectual-property-rules-myths-vs-facts/ [xi] https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=q:/IP/C/W669R1.pdf&Open=True [xii] https://genevahealthfiles.com/2020/10/17/inflection-point-trips-waiver-proposal/ [xiii]https://www.democracynow.org/2021/3/11/rich_countries_block_vaccine_patent_waiver [xiv] https://timesofindia.indiatimes.com/india/india-south-africa-moot-3-year-covid-patent-waiver/articleshow/82868816.cms [xv] The Plurinational State of Bolivia, Egypt, Eswatini, Fiji, India, Indonesia, Kenya, the LDC Group, Maldives, Mozambique, Mongolia, Namibia, Pakistan, South Africa, Vanuatu, the Bolivarian Republic of Venezuela, and Zimbabwe. [xvi] https://www.nytimes.com/interactive/2020/science/coronavirus-vaccine-tracker.html [xvii]https://www.huffpost.com/entry/how-covid-vaccines-compare_l_60186e8fc5b6aa4bad36a3b0 [xviii] https://asia.nikkei.com/Spotlight/Coronavirus/COVID-vaccines/Vaccine-patent-waiver-COVID-stopper-or-innovation-killer [xix] Waiver of the WTO's Intellectual Property Rules: Facts vs. Common Myths - Public Citizen [xx] https://www.statnews.com/2021/05/19/beyond-a-symbolic-gesture-whats-needed-to-turn-the-ip-waiver-into-covid-19-vaccines/ [xxi] https://www.thehindu.com/news/international/explained-can-a-trade-related-aspects-of-intellectual-property-rights-trips-waiver-resolve-the-covid-19-vaccine-shortage/article34516626.ece [xxii]https://indianexpress.com/article/opinion/columns/coronavirus-vaccine-access-to-all-free-covid-medicine-7312732/ [xxiii]https://www.citizen.org/article/waiver-of-the-wtos-intellectual-property-rules-myths-vs-facts/ [xxiv]https://indianexpress.com/article/world/us-backs-waiving-intellectual-property-rules-on-covid-19-vaccines-7303624/ [xxv] https://www.statnews.com/2021/05/06/waiver-of-patent-rights-on-covid-19-vaccines-in-near-term-may-be-more-symbolic-than-substantive/ [xxvi] https://indianexpress.com/article/world/us-backs-waiving-intellectual-property-rules-on-covid-19-vaccines-7303624/ [xxvii] https://www.verywellhealth.com/covid-vaccine-patent-waivers-global-supply-5185669 [xxviii] https://www.livemint.com/news/world/covid-vaccine-patent-waiver-joe-biden-ramps-up-pressure-on-drugmakers-11620346028348.html

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