By Sapna Kumar, Law Foundation Professor of Law at the University of Houston Law Center
While COVID-19 cases continue to drop in the United States, many countries are fighting resurgences of the virus and struggling to obtain vaccines and medical supplies. Back in October, India and South Africa petitioned the World Trade Organization (WTO) to waive all IP protection surrounding drugs and medical products needed to combat the pandemic. The petition also called for “the unhindered global sharing of technology and know-how.”
Existing safeguards regarding IP rights during public health emergencies have some issues. TRIPS Article 31 permits countries to issue compulsory licenses of patented technology, but the process for importing patented drugs is cumbersome under Article 31bis. Countries must also pay “adequate remuneration in the circumstances of each case” to the patent holder. Moreover, the U.S. government has a lengthy history of punishing countries that utilize compulsory licensing with trade-related sanctions.
It was therefore significant that President Biden announced on Wednesday that he will support waving IP protections for COVID-19 vaccines. U.S. Trade Representative Katherine Tai released a statement noting that “the extraordinary circumstances of the COVID-19 pandemic call for extraordinary measures,” and pledging to help expand vaccine manufacturing and distribution. This reversal in the Biden Administration’s position may be in response to increasing pressure from various groups and the unfolding crisis in India.
However, many questions still remain. First, will a waiver pass in the WTO? Although the European Union has stated that it is willing to reconsider the proposal, Germany remains staunchly opposed. Germany helped fund the Pfizer/Bio-N-Tech vaccine and has expressed concern that a broad waiver could undermine innovation. Chancellor Angela Merkel’s government has also noted that the real obstacle to widespread vaccination is production capacities.
Another issue relates to the know-how surrounding the COVID-19 vaccines. As I and others have written, vaccines are notoriously difficult to reverse-engineer because they are derived from living organisms and are structurally complex. One of the keys to rapid production is for the manufacturers to share proprietary knowledge regarding manufacturing processes that are typically protected as trade secrets. However, neither TRIPS nor U.S. law appear to provide mechanisms for compelling unwilling companies to do so. Nor are there any contractual provisions in the funding agreements under Operation Warp Speed that require such a disclosure.
It is also unclear whether a waiver of IP rights will make a difference. Take, for example, India, which has underinvested in health care for decades. Just a few months ago, India was giving away millions of vaccine doses in an attempt to compete with China in vaccine diplomacy, falsely believing that India had achieved herd immunity. In April, Prime Minister Narendra Modi was speaking unmasked before packed crowds at political rallies. An argument can be made that complacency is playing a far greater role than IP rights in India’s second wave.
Furthermore, as others have pointed out, IP rights are only a piece of what is needed to produce vaccines. There is currently a global shortage of raw materials and proper manufacturing facilities. The spoiled vaccines from Emergent BioSolutions’ plant in Baltimore furthermore illustrate the difficulties of bringing new manufacturing facilities online. Because the Moderna and Pfizer vaccines both require storage at low temperatures and utilize novel mRNA technology, they pose further challenges in countries that lack necessary infrastructure for manufacturing and for distribution of vaccine doses.
Ultimately, any waiver of TRIPS obligations that passes is likely to be modest in reach, perhaps reducing the procedural burdens currently surrounding the use of compulsory licensing. It is unlikely that Biden will somehow force U.S.-based vaccine manufacturers to turn over know-how. Overall, the greatest benefit of the Biden Administration’s support for the waiver is that it signals a departure from the prior approach of punishing countries facing health crises and that it might spur pharmaceutical companies to voluntarily increase out-licensing and donations of vaccines.
* Image above comes from the plague of Ashdod, 1630, Artist Nicolas Poussin
Guest Post: Pandemic drug shortages: Is compulsory licensing the answer?