US, allies adopt diversionary tactics to block TRIPS waiver

Geneva, 7 Dec (D. Ravi Kanth) – Despite the rapidly worsening COVID-19 pandemic as well as growing concerns over the so-called “us and them” framework being adopted for access to new vaccines, the United States and its allies seem to have adopted “diversionary” tactics to block the passage of a waiver sought by many developing countries for suspending several provisions of the WTO’s TRIPS Agreement to address the pandemic, trade negotiators told the SUNS.

At an informal meeting of the WTO’s TRIPS Council on 3 December, the proponents of the proposal for a waiver from the provisions of the TRIPS Agreement, South Africa, India, Kenya, Eswatini (formerly Swaziland), and Pakistan, provided a robust response to various questions posed by the US, the European Union, Japan, Switzerland, Canada and Australia, said a negotiator, who asked not to be quoted.
The chair of the WTO’s TRIPS Council, Ambassador Xolelwa Mlumbi-Peter from South Africa, informed members of the ongoing consultations, suggesting that there appears to be an emerging consensus around the need to provide a “neutral and factual” communication to the WTO General Council.
Due to the limited engagement among members on the waiver proposal since the last formal TRIPS Council meeting in October, followed by another informal TRIPS Council meeting on 20 November, several delegates underscored the need for further discussions on the waiver and appeared to support a request to the General Council to enable members to discuss the issue in the coming days and months.
Members are currently drafting a proposal to ensure that it could be adopted at the TRIPS Council meeting on 10 December, and subsequently, to be taken up at the General Council on 16-17 December, said a person who asked not to be quoted.
The “extraneous and intransigent” questions raised by the US, the EU, Japan, Canada, Brazil, the United Kingdom, and Australia among others seem to be part of a “diversionary” attempt to block the progress of the waiver that is gaining international support, the negotiator said.
The developing countries are increasingly coming to terms with the prospect of non-availability of the new vaccines as major developed countries seem determined to use them for their own patients and not for the developing countries, the negotiator added.
Significantly, the concerns expressed by many developing countries at the TRIPS Council meeting were also echoed by the World Health Organization (WHO) director-general Dr Tedros Adhanom Ghebreyesus during the United Nations General Assembly’s first high-level session on the pandemic held on 3-4 December.
While the world “can begin to dream about the end of the pandemic” from the coronavirus vaccine trials, rich and powerful nations must not trample the poor and marginalized “in the stampede for vaccines,” said the WHO director-general, according an agency report on 5 December.
Dr Tedros cautioned that while the virus can be stopped, “the path ahead remains treacherous.”
“We cannot and must not go back to the same exploitative pattern of production and consumption, the same disregard for the planet that sustains all life, the same cycle of panic and meddling and the same divisive politics that fueled this pandemic,” Dr Tedros told the UN General Assembly.
Vaccines “must be shared equally as global public goods, not as private commodities that widen inequalities and become yet another reason some people are left behind,” Dr Tedros said.
He acknowledged that the WHO’s ACT-Accelerator program to quickly develop and distribute vaccines fairly “is in danger of becoming no more than a noble gesture,” without major funding.
At the UN meeting, the UN Secretary-General Antonio Guterres also made a strong appeal, while expressing concerns about funding and the likelihood of unequal access to vaccines.
In short, the concerns expressed by the WHO chief and the UN Secretary-General appear to have strengthened the underlying rationale of the waiver which seeks to suspend obligations in the WTO’s TRIPS Agreement concerning the implementation and enforcement of copyrights, patents, industrial designs, and the protection of undisclosed information until members are able to address the COVID-19 pandemic.
At the TRIPS Council meeting, South Africa and India systematically dealt with the questions raised by the US, Brazil, and Canada, said another negotiator, who asked not to be quoted.
To start with, the US and Brazil, which has now become an apparent convert to the protection of IPRs compared to its earlier opposition in 2000, raised questions such as (i) “could the proponents provide data that establishes that the identified TRIPS obligations have systematically hindered or blocked the prevention, containment or treatment of COVID-19;” (ii) “no explanation why compliance with each of the identified TRIPS obligation creates an identifiable and undue hardship such that waiver is necessary;” (iii) “elaborate the rationale for industrial designs in the proposal (by Brazil);” and (iv) “further specify the cases in which waiver in copyright could be pertinent for preventing, and containing or treating COVID-19.”
Acknowledging that several questions were raised as to why the scope of the waiver extends to patents, trade secrets, copyrights and industrial designs and what is the evidence that the waiver from these aspects are important to contain, prevent and treat Covid-19, the South African delegate Mr Mustaqeem Da Gama said “in formulating the proposal, the starting point was to consider what products are needed to curb COVID-19 and what are the barriers to diversifying suppliers and scaling up manufacturing.”
Given the need “for N95 masks and other personal protective equipment, diagnostics, therapeutics and vaccines” and that “global shortages of these medical products have been widely reported,” as well as the alarming shortage of vaccines, the South African delegate offered various examples of shortages of therapeutic medicines such as remdesivir developed by Gilead Sciences, a therapeutic drug for COVID-19, or anti-body treatments such as Regeneron among others to show the “disparity in access” which is the ugly reality of the pandemic that members cannot ignore.
“We have provided concrete evidence of the staggering inequality in access to essential products between developed countries and less developed countries,” the South African delegate argued.
Da Gama cited a UN Conference on Trade and Development (UNCTAD) study which says that “since the onset of the pandemic, each resident of high-income countries has benefited, on average, from an additional US$10 per month of imports of COVID-19 related products” while “this number is much lower for middle-income countries – at about US$1, and lower still for low-income countries – a mere US$0.10.”
“In other words, per capita imports of the medical goods essential to mitigate the COVID-19 pandemic have been about 100 times larger in high-income countries in comparison to low-income countries. While it should be expected that the increase of per capita imports of COVID-19 products would be larger for wealthier countries, the sheer difference is staggering,” the South African delegate said.
Maintaining that a global solution to this challenge is to diversify and increase production and supply processes, the South African delegate said it “requires addressing the legal barrier of IP that prevents diversification and production.”
He argued that for preventing, containing, and treating Covid-19, and more specifically for the medical technologies required, the relevant categories of IP are patents, trade secrets, industrial designs and copyrights.
As to the need to include industrial designs in the waiver, the South African delegate pointed out that industrial designs and copyright protection can become barriers to reproduction of products, as witnessed in Italy, where “two local engineers 3D printed ventilator valves to supply a local hospital as the regular supplier could not supply the valves, had faced IP barriers.”
The fundamental problem with the TRIPS Agreement, according to the South African delegate, is that even though it sets minimum standards for patents, trade secrets, copyrights and industrial designs, such “standards do limit the policy space available for countries to take the measures necessary to collaborate, manufacture and supply, addressing the shortages mentioned.”
Due to the stringent conditionalities attached to implementing the TRIPS provisions since 1995, the “developing countries have faced constant pressures from their trading partners to limit the use of flexibilities, often criticizing actions that may be taken to simplify the use of flexibilities.”
The South African delegate also provided a graphic account of the difficulties faced by developing countries for availing of compulsory licenses (CL) or Article 31bis of the TRIPS Agreement (which are territorial and used on a case-by-case basis), suggesting that the challenges faced by all countries need to be addressed on a global basis.
Emphasizing that the challenges being faced due to the COVID-19 pandemic are “novel” because of an unknown pathogen, Da Gama said “nationally as well governments are experimenting with different measures, to see what works and what does not, adapting and modifying as lessons are learned and new information becomes available.”
In fact, most measures are applied randomly without demonstrable evidence as to the efficacy of the measures. Even on the necessary use of face masks, there are evolving opinions, the South African delegate said, arguing that “early on in the pandemic several WTO members such as Canada, Germany, Hungary took pre-emptive steps to amend their law to simplify the procedures for issuing CL, (and) should they need to use it to override the patent barrier.”
Several other countries such as Chile, Colombia and Ecuador have issued resolutions or decrees to set the stage for the issuance of compulsory licenses, the South African delegate said.
In essence, the “waiver opens up policy space for WTO members to take steps required to initiate manufacturing of pharmaceutical products,” the South African delegate argued.
When IPRs such as patents are not a barrier and a country has manufacturing capacity, generic manufacturing can and does take place, the South African delegate pointed out.
As regards how countries can use the waiver, the South African delegate said “each country will need to decide what is needed nationally to curb Covid-19 and the parameters of implementation of the waiver.”
The South African delegate challenged a suggestion from an opposing country that the waiver proposal implicates suspension of at least 34 provisions of the TRIPS Agreement, arguing that “this misrepresents the waiver proposal.”
He clarified further that the “waiver proposal is very specific to Covid-19, its prevention, containment and treatment; and therefore, is proportionate” and “it does not apply to other diseases, although we are aware of severe access challenges in other disease areas as well.”
The waiver does not apply to other sectors, he said.
“In short, the waiver is very narrow and specific to the circumstance of COVID-19 and the key aspects of the TRIPS Agreement that can affect a country’s ability to prevent, contain and treat COVID-19,” the South African delegate said, observing that “we all agree that Covid-19 presents an extraordinary, unprecedented challenge for the world, and no one is safe until everyone is safe, hence the call for a waiver from certain TRIPS obligations with respect to Covid-19.”
Commenting on the questions raised by the opponents of the proposal with regards to the use of TRIPS flexibilities and the COVAX mechanism (being put in place by the Geneva-based Global Alliance for Vaccines and Immunization), the South African delegate said that for the global population of 7.7 billion people, “the insufficiency of the WHO’s Accelerator-A and COVAX is apparent with the current wide disparity in access between developed countries and the developing countries.”
The disparity in access to vaccines is more stark as COVAX only aims to provide up to 20% of the needs of developing countries, which is insufficient to build global immunity, he said.
“In addition, to date only 15% of the needed funding has been raised. ACT-A and Covax also do not extend to other tools needed during a pandemic such as masks, ventilators etc,” the South African delegate argued.
Da Gama said that “an effective response to the COVID-19 pandemic requires access to various commodities and various types of intellectual property, that is patents, copyrights, industrial designs and trade secrets”, which may pose a barrier to the manufacturing and supply of these commodities.
In response to questions raised by the US on issues such as whether members’ commercial and economic interests will be negatively impacted due to the waiver and whether the waiver is a proportionate response to the COVID-19, India provided comprehensive answers by giving an account of how countries are being affected by the COVID-19 pandemic.
Citing the ILO’s recent studies, the Indian delegate said that the informal economy and hundreds of millions of enterprises worldwide are being affected by the COVID-19 pandemic.
According to the ILO estimates, the global labour income has declined nearly 11% or US$3.5 trillion in the first three quarters of 2020 and as a result, the World Bank estimates that as many as 150 million people could be pushed into extreme poverty by 2021, the Indian delegate argued.
Even the losses suffered by the MSMEs (micro, small, and medium) enterprises, including in the pharma sector, have been hit hard by the pandemic.
The MSMEs which have manufacturing capacity in the pharmaceutical sector are being “hindered by IP barriers; they are not able to manufacture and supply Covid-19 medical products,” India said.
With the uncertain duration of the pandemic and the consequent measures such as lockdowns and quarantine, national and global economies will continue to suffer, with many more millions pushed into poverty, India argued.
“Our proposal for waiver from certain provisions of TRIPS Agreement, is one part of this effort,” India said, arguing that “it is, therefore, in our mutual interest to collaborate, to help diversify and expand the supply of vaccines, therapeutics and other Covid-19 health products to curb this pandemic as soon as possible.”
Even as some of the opponents of the proposal may consider that they will be safe because of the large quantities of vaccines that they had already pre-booked, India said “if COVID-19 remains unaddressed in any one country, it will affect all other countries, with serious consequences for society and the economy.”
India debunked the argument that the IPR system provides incentives to invest and innovate, arguing that “without the huge state funding, these vaccines would probably not have been developed so speedily.”
“Therefore, it is not the IP system that has delivered, but the public funding and institutional support in terms of research contributions by public universities and the global sharing of sequence and public health information that has led to the development of successful vaccines in record time,” India emphasized.
The time has come to respond to the COVID-19 pandemic “with cooperation, solidarity, and equity.”
“The aim of the waiver,” said the Indian delegate, “is to restrain the spread of Covid-19, and in the context of the current scale of devastation, the impact of the waiver would be positive.”
“The current “business as usual” approach which is narrowly focused on supplying a few rich countries artificially limiting global supplies and competition is a greater threat to WTO members’ social, economic and commercial interests,” India said.
Replying to the question on whether “the waiver is a proportionate response to Covid-19,” India said that every “country has been taking extraordinary and unprecedented measures, unheard of before. This includes requiring weeks and months of lockdowns, imposing quarantine, nationalising private hospitals, mandating wearing of masks, seeking military help etc.”
“So, the waiver is definitely a proportionate demand,” India said.
Responding to a long question raised by Brazil as to how the “waiver can be a global solution if some countries do not implement it,” India said “if a waiver is adopted, all WTO members would be encouraged to utilize it,” suggesting that “the proposal we have made follows what is allowed within the parameters of Art. IX of the WTO Agreement.”
India said that the use of a compulsory license implemented on the ground in most of the developing countries “does not present an expedited solution.”
“Millions of lives can be saved, if Members here agree to a temporary waiver from certain provisions, which can then be made use of by Member countries using emergency legislative provisions at their disposal to address the challenges posed by once in a millennium pandemic like COVID,” India said.
Exposing the seemingly diversionary tactics adopted by the opponents to the waiver through “extraneous and intransigent” questions, India turned the tables by posing the following questions to the opponents:
1. Do the opponents have any data regarding how the waiver would demonstrably have negative impact on Members’ economies, if any?
2. Public funding has been driving COVID-R&D. In addition, billions of dollars are spent on purchasing the vaccine. Given the demand volumes, pharma companies will anyway make profits. So why is there a need for IP as an incentive, in a global pandemic situation?
3. Can the opponents provide data as to how voluntary licensing approaches and existing global cooperation mechanisms, including ACT Accelerator, the Covax facility and Covax AMC, would be sufficient to address the vaccine requirements of 7.8 billion people in the world?
4. If voluntary mechanisms work, why has the pharmaceutical industry collectively rejected participation in the WHO COVID-19 Technology Access Pool (C-TAP), an initiative that encourages voluntary contribution of IP, technology and data to support global sharing and scale-up of manufacturing and supply of COVID-19 medical and pharmaceutical products?
India said the proponents are ready to engage with the members if they have any further questions, emphasizing that “the objective, as stated earlier, is to reach a common ground as early as possible, so that a large proportion of world population is not left behind in the quest for a timely, equitable and affordable access to successful vaccines and therapeutics.”
More importantly, “WTO Membership needs to act now to ensure that the pandemic should not be needlessly prolonged, only because we fail to act collectively at this juncture,” India said.
Pakistan said much of the assertions made by the US, the EU, Japan, Brazil, and Switzerland about easy access to new therapeutics and vaccines are divorced from reality as nine months into the pandemic affordable supply or IP-sharing is either non-existent or insufficient.
Kenya, Sri Lanka, Jamaica and Argentina also took the floor to express their support for the waiver. The US, however, appeared to remain unconvinced with the responses provided by South Africa, India, and Pakistan.
It argued that significant investments were made by governments to facilitate and accelerate the development, manufacturing and distribution of COVID-19 vaccines, therapeutics and diagnostics.
The US delegate repeated the earlier argument made at the last informal TRIPS Council meeting that governments cannot develop these products by themselves as they do not have the required expertise, technical and logistical know-how, manufacturing capabilities and experience.
Getting products quickly to the market requires the contribution of the private sector both financially and in terms of research and development, the US said.
The US maintained once again that the IP framework provides the necessary legal and commercial incentive to drive private entities to undertake the risks and make the appropriate investments.
Without effective intellectual property protection, the development and commercialization of those products would likely not happen in an effective, efficient and timely way, the US said.
The EU along with the other members of the Ottawa Group, which are introducing a proposal for negotiations on trade and health, defended the existing mechanisms such as COVAX facilitation, even though it has failed to deliver any immediate results until now.
In conclusion, the US and other developed countries stood exposed as their questions are not intended to find a common solution, the negotiator said.
If anything, the US, the EU, Japan, Brazil, Switzerland, Australia, Chile, Canada, and Mexico among others seem determined to stall the progress towards the waiver, the negotiator added.
(Published in SUNS #9249 dated 8 December 2020) – Third World Network