New developments on the waiver of IP rights for Covid-19 products

As the Covid-19 is still raging on across the entire globe, it’s important that the proposal on the waiver of the IP rights for Covid-19 products got taken to the debate table once more. It has been nearly 2 years since the proposal came out but there is still little progress. However, in the last 2 months, there have actually been some positive, new developments on the waiver of IP rights for Covid-19 products, most importantly on the Covid-19 vaccines. 

In March 2022, after 18 months of constant debates over the good and the bad of the waiver was passed, finally, India, South Africa, the United States, and European Union reached a compromise on the matter, marking new developments on the waiver of IP rights for Covid-19 products.

Some information about the proposal for the waiver of the IP rights for Covid-19 vaccines

In October 2020, South Africa and India called for the World Trade Organisation to waive patents on COVID-19 vaccines, tests, and treatments for the duration of the pandemic to enable them to start their own large-scale manufacturing of generics.

The objective of the proposal was to help fight the Covid-19 pandemic by increasing drug and vaccine production globally and addressing the problem of inequitable access to these products between rich and poor countries.

However, this waiver, like any other agreement must be accepted by the WTO’s 164 member countries in order to be adopted.

The most important aspect of the proposal is the rights revolving around the Covid-19 vaccines which at the time, and even now, are still in short supply. 

But unlike real estate or gold – the elements that don’t diretly affect the people’s lives, Covid-19 vaccines might actually be the dose between life and death for billions of people.

New developments on the waiver of IP rights for Covid-19 products

Back in March, USTR spokesperson Adam Hodge said that South Africa, India, the European Union, and the United States had agreed in principle to waive certain provisions of the World Trade Organisation’s Agreement on Trade-Related Aspects of Intellectual Property Rights or TRIPS.

This is a welcoming movement for India and South Africa – the 2 countries that have been devastated by the Covid-19 pandemic in the past and arguably still are in the present. 

However, the USTR spokesperson also noted that the final wording of the compromise hasn’t been agreed and at the moment, the parties are still working on the wording of a final text.

For opposers of the proposal, they can rest assured that the compromise does not aim to dismantle the current intellectual property system but to facilitate the granting of “compulsory licenses”. The main purpose of this proposal and the compromise is not to face the Covid pandemic head-on but also about future health crises.

Another important keynote is that the compromise only covers patents and Covid-19 vaccines, not the Covid-19 treatments or tests, and contained limitations that would likely exclude big manufacturing countries like China to be involved.

Under the WTO agreements, a compulsory license exists, making it possible for public authorities to use a patent without the authorization of its holder.

Currently, the compromise on the table would only be applicable to developing countries. To be more specific, developing countries accounting for less than 10% of annual world exports of vaccines against Covid may authorize the manufacture of a patented vaccine to vaccinate its citizens without the patent owner’s permission.

Although the compromise is a great step forward, the tentative agreement among the four World Trade Organization members still needs formal approvals from the parties before it can be considered official

Expert opinions on the supporter side of the waiver

For obvious reason, the supporter side of the waiver has a pretty basic logic: To save lives. 

Even the worse person in the world can’t argue publicly that the cause for saving the life of people is a bad cause. 

Therefore, with the core reason to allow the less developing countries to have the means to authorize the production of generic Covid-19 products and technologies without facing negative consequences, the supporter has a strong case in terms of morals. 

Compulsory licenses provide authorization to companies to manufacture a product as the need arises, without permission from the patent holder and with certain conditions.

Although there are still mixed opinions, the compromise has been welcomed as “a major step forward” by World Trade Organisation Director-General Ngozi Okonjo-Iweala, who vowed to work to ensure that it obtains the support of all WTO members.

Expert opinions on the opposer side of the waiver

Although this is a good signal for the supporters of the waiver, there are still many mixed opinions about whether or not the waiver will actually have a positive impact on the overall fight against the Covid-19 pandemic. 

Kristian Robinson, managing director of Spruson & Ferguson Asia stated: “Covid-19 vaccines should be made available to as many people as possible globally given they have been found to provide high protection against severe illness from all the coronavirus variants. Testing and diagnosis tools are further support for important anti-epidemic measures and the protection of the general public. It is questionable however whether a free license on patents would much support this goal of providing protection to as many people as possible across the world.”

Pravin Anand, the managing partner at Anand & Anand in Noida, is another expert who is having a somewhat different opinion on the effects of the waiver. 

From his point of view, at the moment, there is little to no evidence that the patent rights, or IP rights on the Covid-19 products, or vaccines, are the main reason behind the uncontrollable spreading of the Covid-19 worldwide.

He stated other factors that might have been the causes of our current situation: bottlenecks resulting from the highly technical process of producing a vaccine, dearth of production facilities, low financing, tight supply of crucial pharmaceutical ingredients, inadequate distribution networks wherein proper handling of vaccines at a certain temperature cannot be assured in low- and middle-income countries.

Pravin Anand clearly expressed that the world is having a bizarre way of looking at IP rights due to the recent Covid-19 pandemic. However, this point of view is not correct. Instead of incongruities, IP rights should be considered as a way moving forward to promote innovation and as the necessary tools to help the world develop.

He also voiced his disbelief regarding the outcome of the proposal. Specifically, Anand stated that even if the waiver is passed through, third-party manufacturers from developing countries won’t have a nearly as safe and productive vaccine production chain as the current pharmaceutical companies in the world as this requires a highly sophisticated manufacturing process, sound infrastructure, and sophisticated distribution chains.

Anand stated: “Each stage of the vaccine manufacturing process requires significant investment and know-how, requiring deep expertise in the subject matter and years of experience. In addition to the same, the novice firms with no past expertise in manufacturing vaccines may end up wasting crucial ingredients, which are already limited in number.”

Besides, there is also a rising concern that the innovators who feel like their hard work is distributed freely to the world will not be motivated to invent and contribute any more to the world. Not just hard work but to be able to create and invent something as big as the Covid-19 vaccines, the innovators have had to invest a huge amount of research, monetary and technical resources involved with no assurance of success.

Therefore, it is not surprising that a large portion of the innovators might feel betrayed or some kind of mistreatment, unfairness, or inequity.

Is the proposal really a step moving forward or is it just a hoax?

Although the compromise on the waiver seems to be a good signal in the fight against the Covid-19 pandemic, marking the first and potential future compromises. 

However, some experts have pointed out that this might not be the case. 

In reality, it might actually be some kind of hoax to completely stop the progress of the waiver of IP rights for Covid-19 products. 

Tarun Khurana, a partner at Khurana & Khurana in New Delhi gave out opinions on the compromise: “While on the Covid-19 vaccines front a waiver on patent rights may have some degree of positive impact, a waiver on patent rights over testing and diagnostic tools would have created a dramatic improvement in the situation,” 

Regarding this point of view, Anand has further explained why there is some kind of ambiguity in the compromise: “If the waiver only applies to patents and vaccines, a patent holder may not necessarily be under any obligation to transfer associated but crucial technological or manufacturing know-how. The same assumes crucial importance in the development of vaccines, especially mRNA vaccines, which are difficult to reproduce. A patent will thus, not comprise the technical know-how, trade secrets, etc. and there appears to be no mechanism in place for any government to force transfer trade secrets even under such a waiver.”

Jayati Ghosh and Nobel Memorial Prize winner Joseph Stiglitz along with Oxfam’s Africa director Peter Kamalingin have clearly expressed their point of strong condemnation of the compromise in a letter to Ramaphosa: “We support you fully in rejecting this misleading and ineffectual proposal, which represents the European Union’s belligerent blockade of any actual waiver of IP barriers and the United States’ insistence that the IP waiver it supports be limited to vaccines.” 

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