From ... in Health — Jun 3, 2021

Seven Reasons the EU is Wrong to Oppose the TRIPS Waiver

As the Covid-19 pandemic has devastating human rights, social, and economic consequences across the globe, European Union (EU) representatives have repeatedly stated their commitment to the idea that Covid-19 vaccines should be a universal common good and that no one is safe from Covid-19 unless everyone is safe. Yet the EU has consistently opposed India and South Africa’s proposal at the World Trade Organization to temporarily waive certain intellectual property rules under the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement), a measure that would expand access to lifesaving vaccines and other health products. Human Rights Watch is among the hundreds of civil society organizations around the world urging support for the TRIPS waiver.

The arguments used by the European Commission to justify its opposition are inaccurate, misleading, and misguided. We address them individually here, focusing on the following seven truths: The European Commission claims that intellectual property (IP) is not a barrier to scaling up the manufacturing of vaccines or other health products needed for the Covid-19 response, suggesting that sharing IP would not immediately speed up manufacturing. Right now, there are manufacturers with capacity to produce additional Covid-19 vaccines and other health products at factories in Bangladesh, Canada, Denmark, India, and Israel, but they are unable to contribute because they do not yet have the right licenses. So, IP is a barrier to them.

The TRIPS waiver proposal sponsors and experts at the leading science journal Nature, Médecins Sans Frontières (MSF) Access Campaign, the Third World Network, and others have presented many other concrete examples of how enforcement of IP rules blocked, delayed, or limited production of chemical reagents for Covid-19 tests, ventilator valves, Covid-19 treatments, and elements of Covid-19 vaccines. IP constraints have not only led to vaccine shortages but have also led to shortages of key raw materials like bioreactor bags and filters. Rather than manufacturers being held back by an inherent lack of manufacturing and technological capability, studies have shown that transnational claims to IP impede new manufacturers from entering and competing in the market.

The same dynamics are playing out today with Covid-19.

The waiver by itself will not automatically result in widespread and diversified manufacturing, but it will ease complex global rules governing IP and exports and give governments freedom to collaborate on technology transfers and exports without fearing trade-based retaliation. It will help reduce the dependence on any one country or region for medical products and mitigate the risks of export restrictions. With new variants emerging and some evidence that repeat vaccine boosters may be needed, the waiver will enable governments around the world to be prepared for a long-term response to Covid-19. Experts have mapped out plans for how the manufacturing of mRNA and other vaccines, could be dramatically expanded in a relatively short period of time. Waiving certain IP rules in the TRIPS agreement over the next three years could help create diverse regional manufacturing hubs and protect the EU and the rest of the world from future pandemics, supply chain disruptions, and resulting economic disaster. Concerns that widening the universe of producers may lower or compromise quality standards are unfounded because stringent regulatory authorities and the World Health Organization (WHO) would continue to play their existing role as arbiters of quality and safety for vaccines, which have a very stringent process for approval.

The European Commission points to its participation in COVAX to suggest that it is effectively leading efforts to promote equitable access to vaccines. Individual member states have begun to use COVAX to share some of the doses they prebooked with countries in need. However, COVAX currently only aims to provide vaccines for 20 percent of participants’ populations, far from the coverage needed to end the pandemic. Vaccine supply shortages have already hampered COVAX’s ability to reach that target.

The facility began delivering vaccine doses in late February, but has only been able to deliver 71 million vaccine doses to over 100 countries as of May 25, 2021 barely enough to cover 1 percent of the combined populations of those countries. Further, COVAX is heavily dependent on AstraZeneca’s vaccines manufactured at the Serum Institute of India. Because of the huge surge in Covid-19 in India, the Indian government has currently restricted export of vaccines, and COVAX is facing a shortfall of 190 million vaccine doses. Serum Institute of India recently announced that it expects to resume supplying COVAX only by the end of 2021. Finally, COVAX only applies to procurement and allocation of vaccines. India and South Africa’s proposal would cover a broader range of health products and technologies needed for the Covid-19 response including tests, treatments, personal protective equipment, and more.

The devastating recent surge in infections and deaths in India, Brazil, and Nepal shows that we need more than vaccines to save lives. Pharmaceutical companies and their lobbying groups claim that patent monopolies to commercialize their inventions spur innovation and that waiving such monopoly rights during a devastating global pandemic, “would jeopardize future medical innovation, making us more vulnerable to other diseases.” The UN Committee on Economic, Social and Cultural Rights stated in April 2020 that “[P]andemics are a crucial example of the need for scientific international cooperation to face transnational threats ... [i]f a pandemic develops, sharing the best scientific knowledge and its applications, especially in the medical field, becomes crucial to mitigate the impact of the disease and to expedite the discovery of effective treatments and vaccines...

The Committee reiterates that ultimately, intellectual property is a social product and has a social function and consequently, States parties have a duty to prevent unreasonably high costs for access to essential medicines.” It is a disservice to humanity to claim scientists and researchers would have no interest in developing lifesaving vaccines and drugs without the promise of patent monopolies. Jonas Salk, the inventor of the polio vaccine, did not claim any monopoly over it and gave it away for free. When he was asked who owned the patent for his vaccine, he reportedly said, “Well, the people, I would say.

There is no patent. Could you patent the sun?” Economists Mariana Mazzucato and Jayati Ghosh, and public health activist Els Torreele, argue that IP rights were never designed to be used during pandemics. “Patents erect barriers against competitors when what is needed is technological co-operation, harnessing our global scientific and technological capabilities to fight the virus together,” they explain.

The 1994 Marrakesh Agreement, which established the WTO allows for waivers in exceptional circumstances. What could be a more exceptional circumstance than a global pandemic that has claimed the lives of 3.5 million people? Dr. Tedros Adhanom Ghebreyesus, the director-general of the WHO, supported the waiver, asking poignantly: “If not now, when?” The argument that we need market-based incentives like patents to spur innovation also ignores the fact that billions of Euros of public money have funded research, development, and delivery of Covid-19 vaccines and other health technologies. For example, a recent study found that public money from government and philanthropic sources accounted for 97.1 to 99 percent of the funding toward research and development of the Oxford-AstraZeneca vaccine. Johnson & Johnson received an estimated US$1 billion (€820 million) in funding from the US government for development of its Covid-19 vaccine; Moderna’s vaccine was also significantly funded by public money from the US government. Even where public money was not directly given for research and development, experts say that governments’ advance market commitments significantly de-risked the investments of pharmaceutical companies, by providing them a guaranteed market even before their vaccines were proven to be safe and effective. Public money fueled the development of the health technologies needed for the Covid-19 response, and that public money should be used to maximize public good.

The European Commission has not required pharmaceutical companies to disclose measures they have taken to refrain from using any public funds received from any government authority or through COVAX to support stock buybacks, executive bonuses, dividends and other practices that disproportionately benefit shareholders. One part of the EU’s planned “third way” proposal would aim to simplify the use of compulsory licenses under the TRIPS Agreement and the 2001 Doha Declaration, which affirmed that under global IP rules governments could issue licenses for patents during a public health crisis. Human Rights Watch supports governments’ use of existing flexibilities under the TRIPS Agreement, such as the Bolivian government’s decision to seek a compulsory license for the Canadian company Biolyse Pharma to produce 15 million doses of Johnson & Johnson’s Covid-19 vaccine. But there are significant barriers to making compulsory licenses a practical solution to the severe supply shortages the world is facing now. Scholars in the United Kingdom recently published an extensive legal analysis of the TRIPS waiver proposal and determined, “existing TRIPS flexibilities around compulsory licensing are incapable of addressing the present pandemic context adequately, both in terms of procedure and legal substance.” The MSF Access Campaign also published a new report explaining that compulsory licensing is burdensome and time-consuming because it must be applied on a product-by-product and country-by-country basis, and there are often significant regulatory obstacles to overcome.

The Doha Declaration only addresses one form of IP: patents.

The TRIPS waiver proposal, in contrast, would cover not just patents but other forms of IP, too. Experts have mapped the complex IP behind Covid-19 vaccines, highlighting the need for a TRIPS waiver that covers more than patents. A recent analysis of mRNA-based Covid-19 vaccines showed that each vaccine involves a complex web of patents owned by multiple companies, and found that “Webs of intellectual property claims underpin the marketing of many vaccines. For example, the underlying technology used to develop a vaccine can be protected by patents, while manufacturing methods and techniques (know-how) can be protected by trade secrets.” The landscaping study did not include patents and other forms of IP underlying bioreactor bags, filters, glass vials, and cold storage containers. Even where compulsory licenses are issued for patents, pharmaceutical companies may bring legal cases against them, and continue to lobby for trade-based measures against governments that use them. For example, Gilead recently sued the Russian government for issuing a compulsory license to manufacture remdesivir, a drug used to treat Covid-19.

The Russian Supreme Court ruled against Gilead. Pharmaceutical industry associations lobbied against the Hungarian government’s compulsory license for remdesivir, as part of their submission to the United States Trade Representative’s “Special 301 Report.” Voluntary licensing is the practice where the developer of the vaccine or drug decides to whom and on what terms the IP can be licensed to enable manufacturing.

The past year has shown that we cannot rely on the pharmaceutical industry to take voluntary action to scale up manufacturing of health products at the pace and scale needed to address the pandemic. Tedros Adhanom Ghebreyesus, director-general of the WHO, recently commented that voluntary licensing agreements “tend to be exclusive and nontransparent, compromising equitable access.” The supply delays and production challenges several pharmaceutical companies faced have been exacerbated by restrictive or exclusive licensing practices. Efforts to license vaccines have been slow. For example, Biolyse Pharma, a Canadian company, reported unsuccessfully requesting licenses to manufacture its Covid-19 vaccine from multiple companies. Numerous other manufacturers say they are willing to manufacture and are awaiting the right licenses, as explained above. Voluntary corporate commitment to open and nonexclusive licensing has been low, making government use of regulatory tools essential to ensure vaccines and health products are widely available and affordable for all. Numerous companies have signed the Open Covid Pledge issuing open and nonexclusive licenses, which experts say promote an “open innovation model.” But the Open Covid Pledge is dominated by technology companies. Only a handful of companies making health products are a part of it. To date, the EU has not brought any major pharmaceutical company operating within the EU to join the WHO’s Covid-19 Technology Access Pool (C-TAP), a platform launched over a year to ago to enable the voluntary sharing of IP, data, and knowledge with qualified manufacturers. No company has voluntarily joined this initiative either. Only a few EU member states have endorsed the C-TAP Solidarity Call to Action. While the Spanish National Research Council has reportedly promised that it will provide its diagnostic tests under a nonexclusive license to C-TAP, to date, no company marketing vaccines has agreed to join the WHO Covid-19 mRNA Technology Transfer Hub. Since the start of the Covid-19 pandemic, the US has introduced export restrictions on raw materials for vaccine production, and the European Commission and India have introduced rules that restrict the export of Covid-19 vaccines, too. European leaders have cited export restrictions as a major impediment to access to medicines for the Covid-19 response, and one part of the EU’s forthcoming plan will focus on trade and export restrictions. While export restrictions have complicated global access to medicines, policies to ease restrictions do not eliminate the urgent need to expand and diversify manufacturing through the sharing of IP and open, nonexclusive licensing. Indeed, any given country or region’s export restrictions would be far less consequential or potentially damaging if we had larger and more diversified global manufacturing capacity.

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Seven Reasons the EU is Wrong to Oppose the TRIPS Waiver

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