TWN Info Service on Trade, Intellectual Property and Health
8 February 2021
Third World Network
www.twn.my

Developing countries call for text-based negotiations on TRIPS waiver
Published in SUNS #9280 dated 8 February 2021

Geneva, 5 Feb (D. Ravi Kanth) – A large majority of developing countries at the World Trade Organization (WTO) have joined forces to demand text-based negotiations on the proposed TRIPS waiver to combat the COVID-19 pandemic expeditiously, participants told the SUNS.

The call by the developing countries has come amidst the worsening “vaccine wars” and escalating COVID-19 cases of more than 105 million so far, with the loss of 2.2 million lives globally.

Despite a groundswell of support from international civil society organizations and pressure groups across the world, the so-called “protectors” of the exploitive international IPR (intellectual property rights) regime – the United States, the European Union, Japan, Switzerland, and Canada among others – have blocked the demand for text-based negotiations on the waiver, said participants, who asked not to be quoted.

Adopting “diversionary” tactics by raising somewhat extraneous and irrational arguments, the US, the EU, Japan, Switzerland, and Canada among others said that they will not enter into text-based negotiations on the waiver on grounds that the TRIPS flexibilities and the COVAX facility being implemented by the Geneva-based GAVI (The Vaccine Alliance) can address the concerns raised by the proponents, said participants.

The TRIPS waiver seeks to temporarily suspend provisions in the TRIPS Agreement relating to copyrights, industrial designs, patents, and protection of undisclosed information to ramp up production of therapeutics and vaccines globally so as to address the worsening pandemic.

During an informal TRIPS Council meeting held virtually at the WTO on 4 February, the proponents of the TRIPS waiver – South Africa, India, Pakistan, Tanzania on behalf of the African Group, Zimbabwe, and Venezuela among others – urged their opponents to adopt an open mind to consider the waiver proposal on the concrete evidence they have provided as to why IPRs remain the biggest barriers in addressing the COVID-19 pandemic and for ramping up production across the world, participants said.

However, the US, the EU, Japan, and Switzerland refused to give up their “theological” opposition to the waiver regardless of the evidence provided by the proponents, according to the participants, who preferred not to be quoted.

Interestingly, those opposed to the TRIPS waiver proposal, particularly Canada, the EU, Japan, and Switzerland, who are part of the Ottawa Group, want WTO members to consider their trade and health initiative that calls for further trade liberalization and removal of export-related restrictions, said a participant, who asked not to be quoted.

At a time when the EU has placed several export-related restrictions on the vaccines manufactured in their territory to outsiders, those opposed to the waiver proposal have lost their credibility, the participant said.

Incidentally, Norway, one of the countries that is blocking the TRIPS waiver proposal, is apparently trying to chair the TRIPS Council this year when the new chairs of various WTO bodies are selected next month, said another participant, who asked not to be quoted.

“VACCINE NATIONALISM”

At the TRIPS Council meeting on 4 February, the proponents of the TRIPS waiver led by South Africa brought to the centre-stage the raging issue of “vaccine nationalism”.

South Africa’s trade official Mr Mustaqeem Da Gama said the world is facing two challenges at this juncture. First, there is growing “vaccine nationalism” and “artificial scarcity” that prevents vaccines from being shared equitably among countries, according to the participants present at the meeting.

“A few countries [are] vaccinating the majority of their population, possibly several times while others [are] vaccinating a few or none at all,” the South African trade official said.

“In this scenario,” he said, “new variants will emerge that are immune to treatments and vaccines, and the world will face multiple waves and continuous cycles of lockdowns.”

Another scenario, said Mr Da Gama, “is that we agree that there will be no intellectual property monopolies over the technology and know-how that relate to COVID-19, and these are shared so that manufacturing can be ramped up, and supply of (vaccines and therapeutics) diversified with the aim to vaccinate everyone and everywhere in the shortest timeframe with the most effective vaccines” and “this will stop the virus circulating and countries can control the pandemic” immediately.

Citing the World Health Organization (WHO) Director-General (DG) Dr Tedros Adhanom Ghebreyesus’s recent pronouncement that “the world is on the brink of a catastrophic moral failure,” the South African delegate warned that “in failing to move this issue (the TRIPS waiver) forward quickly to text-based discussions and to reach a solution expeditiously, this organization (the WTO) is complicit in that failure,” according to participants present at the meeting.

Given the opaque licensing agreements and varying levels of prices being charged by Big Pharma in developing countries, he quoted the WHO director-general who said that “the international community cannot allow a handful of companies to dictate the terms or the timeframe for ending the pandemic.”

The WHO DG also said that “vaccine nationalism combined with a restrictive approach to vaccine production is in fact more likely to prolong the pandemic – which would be tantamount to medical malpractice on a global scale,” according to Mr Da Gama.

Therefore, members “need to enter into text-based discussions around a waiver and to allow the manufacturers and governments a time-limited freedom to operate so that we can leverage the global capacity that exists,” Mr Da Gama said.

He challenged the claims made by the opponents that even “if the waiver is approved tomorrow, there are no companies in the developing world than can produce any number of products relevant to COVID-19, including mRNA vaccines.”

“This is gross misrepresentation of reality,” the South African official said, arguing that “in fact developing countries have advanced scientific and technical capability as would be demonstrated by the licensing agreements entered into by various pharmaceutical companies with the producers in the developing world.”

He said that 72 out of 154 pre-qualified vaccines by the WHO are being manufactured by companies in the developing countries through restrictive licensing agreements that come with stringent conditions.

Besides, these vaccines are originating from various developing country manufacturers including from India, China, Brazil, Cuba, Thailand, Senegal, and Indonesia among others, Mr Da Gama said.

“There is lack of sufficient policy intervention and transfer of technology on COVID-19 medical tools and technologies to developing country manufacturers,” he said, cautioning that “if this situation continues to prevail, production in the developing world will remain limited.”

“We need to lift legal barriers and further leverage the existing capacity in developing countries,” he argued.

Mr Da Gama pointed out that the co-sponsors of the TRIPS waiver proposal have debunked claims by the opponents that the waiver will impede innovation and endanger investment in R&D, arguing that “if anything, what this pandemic has demonstrated is that it is completely possible to accelerate research and development (R&D) primarily driven by public health and public funding.”

According to news reports, Pfizer and AstraZeneca have made tens of billions of dollars of profits from the COVID-19 pandemic.

“Those countries that continue to oppose the waiver most vociferously are indeed the ones that have secretly bought up the available production and continue to collude with pharmaceutical companies under the veil of secrecy,” the South African delegate said.

Without naming the EU, Mr Da Gama said “we have now seen the chicks come home to roost, where the veil of secrecy has been lifted and one member has taken measures to restrict exports from its territory.”

“Yet this Member is a proponent of free trade and the non-application of export restrictions,” the South African delegate said, criticizing the EU’s apparent double standards and hypocritical positions, according to participants present at the meeting.

“This very member (the EU) has posed pointed questions to the opponents yet does everything it can to undermine global solutions being sorted, even in light of the fact that it proclaims itself to be a major donor to such global initiatives (like the COVAX),” Mr Da Gama said.

“Secrecy is at the heart of the matter, and even under these dire circumstances, while millions of lives of this Member (the EU) are at risk and vaccine supplies having been re-prioritized away from this member, it still refuses to face the situation,” the South African delegate argued.

Mr Da Gama said that “the EU has gone down a slippery slope, the consequence of its export authorization scheme, which is de facto an export restriction, will have manifold implications for all of us and may launch an avalanche of further trade restrictive measures by other members.”

Moreover, he pointed to “the shortage of production and supply caused by the inappropriate use of intellectual property rights by right holders themselves, who enter into restrictive agreements that serve their own narrow monopolistic purposes putting profits above life.”

Citing the restrictions imposed by the EU, he said that it is a clear example of how manufacturing control “can concretely and artificially restrict supply options at the global level,” adding that the waiver proposal does not suggest suspending the whole IP system.

In his second intervention, he urged members “that are still questioning the need for this waiver to have an open mind”. “We need to act and act fast given the inequality that we see in access to vaccines,” Mr Da Gama said.

In their respective interventions, the proponents and supporters of the TRIPS waiver – India, Egypt, Nigeria, Jamaica on behalf of the ACP (Africa, Caribbean, and Pacific) group, Tanzania on behalf of the African Group, Zimbabwe, Kenya, Venezuela, and Sri Lanka among others – drove home the message that the time has come for the opponents to demonstrate whether they are genuinely interested in ensuring equitable access to pandemic- related medical products and vaccines.

Many proponents came down heavily on the European Union for its recent decision to impose export controls, expressing their alarm over Brussels’ action.

Even the industrialized countries have suffered a major hit due to the lack of transparency in the modus operandi of some pharmaceutical companies, the proponents suggested.

THE OPPONENTS OF THE TRIPS WAIVER

The opponents, however, stuck to their “stonewalling” tactics all over again, refusing to support the TRIPS waiver.

The opponents said they share with all WTO members the objective of the global fight against COVID-19 pandemic by rapidly developing and manufacturing safe and effective therapeutics and vaccines and by distributing them equitably around the world. They acknowledged that the views on the waiver remain far apart.

Despite substantial evidence that IPRs are the barriers for equitable production and distribution of COVID-19 medicines and vaccines, the EU claimed that the TRIPS Agreement and the principles of the Doha Declaration (on the TRIPS Agreement and Public Health) or the paragraph six mechanism can play an important role in balancing the protection of IPRs as well as access to new vaccines and medicines.

Brussels maintained its earlier stance that the concerns raised by the proponents can be addressed through the combination of licensing and expanding manufacturing capacity via manufacturing agreements as well as the framework of the TRIPS Agreement and the flexibilities it offers.

In the face of growing criticism over the EU’s recent controversial actions, the EU official said that investment in manufacturing capacity is not only to guarantee vaccines for the EU citizens but also so that vaccines are more rapidly available to everyone, everywhere.

The EU admitted that Brussels is facing “significant difficulties” during these first weeks of 2021, expressing hope that there would be a turnaround in the situation, especially with more vaccines coming to the market and more production of the already approved vaccines materializing.

The EU justified its export controls on grounds that there was a breach of contract that the pharmaceutical company (AstraZeneca) signed with the EU, as doses that were initially targeted for the EU may have been exported to third countries.

The EU said this is clearly an unacceptable violation of legal obligations by the companies in question, while delaying the vaccination of EU citizens.

The EU official said that to avoid such violations, the European Commission has decided that all vaccine manufacturers should declare their exports to third countries. These obligations are strictly targeted to vaccine manufacturers and are applicable until end of March 2021.

In its statement, the US highlighted the Biden administration’s collective global response to COVID-19, including its commitment to provide generous funds to the COVAX facility being implemented by the Geneva-based GAVI.

This includes the $4 billion in COVID-19 supplemental funding that the United States approved for GAVI, to prevent, prepare for, and respond to coronavirus, including for the procurement and delivery of COVID-19 vaccine doses to lower-income economies.

While it is committed to work with international partners for ensuring proper distribution and access of vaccines, the US reiterated that “the intellectual property framework provides critical legal and commercial incentives to drive private entities to undertake the risk and make the appropriate investments.”

According to the US, IPRs ensure “efficient commercialization and rapid manufacturing of the product. Without effective intellectual property protection, the development and commercialization of those products would likely not have happened in an effective, efficient, and timely way.”

Other opponents to the TRIPS waiver such as Canada, the United Kingdom, Switzerland and Japan also restated their earlier positions, suggesting that there is no concrete indication that intellectual property rights have been a genuine barrier to accessing COVID-19 related medicines and technologies.

The opponents said they are flexible on the presentation of a status report of the TRIPS Council to the General Council, scheduled to meet on 1-2 March, based on the state of discussions, in a factual and succinct manner. They also said that they stand ready to engage in the discussions following the suggested format of small group consultations.

THE CHAIR’S CONCLUSIONS

Given the impasse on advancing the TRIPS waiver proposal, the chair of the TRIPS Council, Ambassador Xolelwa Mlumbi-Peter from South Africa, acknowledged that differences continued to remain in members’ approaches to the waiver proposal.

She said that positions on the waiver proposal have not changed significantly, emphasizing that a number of delegations indicated their openness to hearing concrete evidence of any IP-related challenges that would be related to or arising from the TRIPS Agreement.

She suggested that members are eager to seek “consensual, proportionate and commensurate” solutions to any such problems where necessary.

Ambassador Xolelwa said the co-sponsors also indicated that they were ready to consider the contours, the scope and the timeframe of the waiver proposal, and indicated that they would once again reach out to delegations individually for further discussions.

The chair said that she will convene a formal TRIPS Council meeting on 23 February to discuss a “neutral and factual” draft report to the General Council reflecting members’ preference for continued consideration of the waiver proposal in the TRIPS Council.

The draft report will be circulated to members in the coming days in order for delegations to provide any comments on the suggested language in writing, she said.