Even as the World Trade Organisation (WTO) had to call off its meeting as the emergence of the Omicron variant made the world scramble on travel restrictions and Covid curbs, India and South Africa remained in touch over their contingency plans to pilot their joint proposal for a waiver in the TRIPS agreement, reports said. As the world wakes up to the importance of vaccine equity to partially eradicate the dangerous effects of the pandemic, technology transfer, relaxation of patent laws and more is required to lift an ‘intellectual fog’ currently clouding virus efforts in developing nations, experts argue.
India, South Africa, and Indonesia are requesting a waiver from certain provisions of the World Trade Organization’s agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) in order to provide more affordable access to vaccines and medicines to combat the pandemic. However, big pharma, and a group of high-income countries including the European Union (EU), the United Kingdom and Switzerland are dogmatically opposed to the proposal, which has stayed stalled for a year, posing a serious threat to combating the pandemic – which needs global vaccination and Covid infrastructure to make sure more dangerous, virulent variants of the virus do not emerge.
The most recent version of the proposal put forth lays out a broad-based waiver of the rules governing intellectual property rights outlined in Sections 1, 4, 5, and 7 of Part II of the TRIPS Agreement, as well as enforcement of those rules. This includes copyright, industrial designs, patents, and confidential information (e.g., trade secrets). Such a waiver would allow countries to temporarily waive their domestic intellectual property laws that protect this type of knowledge and innovation. Domestic producers could begin manufacturing and selling patent-protected products in countries where IP protection is waived, for example, without negotiating a licence with the originator firm and without fear of domestic or international legal repercussions, according to reports.
The waiver would also apply to any “health products and technology…[for] the prevention, treatment, or containment of COVID-19.” Diagnostics, therapeutic medicines, vaccines, devices, personal protective equipment, and “all materials and components, as well as methods and means of manufacture” are all included. The proposed waiver would be in effect for three years, with annual reviews by the WTO General Council and a final review at the end of the three years to determine whether the “exceptional circumstances” still apply and whether the waiver should be extended.
Why are Some Opposing the Waiver?
Big pharmaceutical companies and many small, rich nations are vehemently opposed to the move, which they claim will stifle innovation at a time when it is most needed.
A group of US IP lawyers had raised worries of a scenario where once the limited waiver was approved, the WTO was unable to revoke it due to a lack of consensus. They called the waiver “extraordinarily broad” because it seeks to waive not only patents related to COVID-19 vaccine technology, but all technologies that impact the treatment and care of COVID-19-related illnesses, according to a report by Down to Earth.
According to the European Commission, intellectual property (IP) is also not a barrier to scaling up production of vaccines or other health products required for the Covid-19 response, implying that sharing IP would not immediately speed up production.
But What are the Flaws With Such Arguments & What Can be a Possible Road Ahead?
Arguing against the EU’s arguments against a TRIPS waiver, the Human Rights Watch explains that manufacturers in Bangladesh, Canada, Denmark, and Israel with the capacity to produce additional Covid-19 vaccines and other health products exist, but are unable to do so because they do not yet have the necessary licences.
“As a result, intellectual property is a barrier for them. Many other concrete examples of how IP enforcement has blocked, delayed, or limited production of chemical reagents for Covid-19 tests, ventilator valves, Covid-19 treatments, and elements of Covid-19 vaccines have been presented. IP constraints have not only resulted in vaccine shortages, but also in shortages of critical raw materials such as bioreactor bags and filters,” the international body states.
Another human rights body Médecins Sans Frontières/Doctors Without Borders has called recently for an urgent TRIPS waiver amid the emergence of Omicron.
However, in a report published by think tank Brookings, Vice President of the Niskanen Center Brink Lindsey has refrained from distinguishing a black and white argument, explaining how the pros of patent laws in terms of innovation stand short when in comes to pandemics and other public health emergencies.
He explains the ‘basic bargain’ offered by patent law: “encourage the creation of useful new ideas for the long run by slowing the diffusion of useful new ideas in the short run. The second half of the bargain, the half that imposes costs on society, comes from the temporary exclusive rights, or monopoly privileges, that a patent holder enjoys.”
Under US patent law, no one else may manufacture or sell the patented product without the permission of the patent holder for a period of 20 years. This enables the patent holder to exclude competitors from the market or extract licencing fees before allowing them to enter, and thus charge customers above-market prices. Patent rights, by limiting output and raising prices, thus slow the diffusion of a new invention, Lindsey explains.
But he argues that for pandemics and other public health emergencies, patents’ mix of costs and benefits is misaligned with what is needed for an effective policy response. “The basic patent bargain, even when well struck, is to pay for more innovation down the road with slower diffusion of innovation today. In the context of a pandemic, that bargain is a bad one and should be rejected entirely,” he says, adding that the imperative in this situation is to accelerate the diffusion of vaccines and other treatments, not slow it down.
Talking of a long-term solution, he calls for the ‘right balance’ on patent law. He argues that policymakers are caught in an ideological fog that conflates “intellectual property” with actual property rights over physical objects, causing patent law to have unintended consequences.
Exclusive rights should be valuable enough to encourage greater innovation, but not so easily granted or broad in scope or term that this encouragement is offset by output restrictions on the patented product and discouragement of downstream innovations that rely on access to the patented technology, he says.
He also says that during a public health crisis, direct government support is the most effective approach. Lindsey calls for public funding of R&D, advance purchase commitments by the government to buy large numbers of doses at set prices, and other related payouts.
…And the Need for More
Vaccines, unlike most drugs, are large-molecule biological products that require a great deal of information and know-how to manufacture—information that is not disclosed through patents. As a result, simply waiving patent rights will not allow new manufacturers to enter the market, the American Society of International Law argues in a report.
The initial text of India and South Africa’s proposed waiver recognises the critical role that know-how plays in vaccine manufacturing capacity, the report says. However, unlike with patent rights, the proposed waiver contains no clear, easy fix, and pharmaceutical companies are likely to vigorously oppose such technology transfer and without knowledge transfer, which will make it extremely difficult for Low and middle income countries to begin COVID-19 vaccine production, regardless of the TRIPS waiver’s removal of patent barriers, the body argues.
Through its objectives, the TRIPS Agreement recognises the importance of technology transfer, and Article 66.2 of TRIPS states that “developed country Members shall provide incentives to enterprises and institutions in their territories for the purpose of promoting and encouraging technology transfer to least-developed country Members in order to enable them to create a sound and viable technological base,” the report says.
It explains how the WHO has established an mRNA technology transfer hub to facilitate the sharing of know-how related to the manufacture of mRNA vaccines, but that none of the technology holders have yet engaged with the hub. This reflects the WHO’s broader efforts to facilitate the transfer of technology from established vaccine manufacturers to new manufacturers in developing countries, the body argues.
Ellen ‘t Hoen, the the director of Medicines Law & Policy, argues in a report that the Covid-19 pandemic has shown that there are important areas in dire need of regulation before a health crisis takes place. “In particular, the world needs rules to ensure that pandemic countermeasures such as vaccines become global common goods. It requires new rules on sharing of know-how and IP and sufficient financing for the research and development of these products,” she says.
She, like Lindsey, makes the case for governments to use advance purchase agreements to de-risk the costs associated with the development of new products by committing to buy a certain amount of a product still in development.
She also demands for leaders to commit to making funding available for expanding pandemic countermeasures production capacity in regions that are currently underserved in order to ensure that there is sustainable vaccine production capacity in every region of the world. Calling the WHO and Medicines Patent Pool a step in the right direction, she argues for more capacity building.
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