“The final key element in the EU’s alternative [to the proposed COVID-19 IP waiver] focuses on intellectual property and recognizes that ‘voluntary licenses are the most effective instrument to facilitate the expansion of production and sharing of expertise.’”
On June 4, the European Commission submitted to the World Trade Organization (WTO) its proposal for improving access to COVID-19 vaccines and treatments in countries suffering from vaccine shortages. The plan was submitted as an alternative to other proposals that would eliminate international patent and other intellectual property (IP) rights for COVID-19 vaccines and treatments under the premise that such action would improve vaccine access in poorer countries. While the EU alternative contemplates the possible use of compulsory licensing, it addresses supply chain issues that will help to inoculate the entire globe against COVID-19 much more quickly than any patent waiver could ever hope to accomplish.
EU’s Alternative Has Three Key Elements, Supports Voluntary IP Licensing
The EU’s proposal to the WTO regarding COVID-19 vaccine access focuses on three key elements. The first element focuses on international supply chain issues, advocating for countries producing vaccines to increase international exports and to avoid any trade restrictions on vaccines or their raw materials that could hinder the supply chain either for countries in need or the global COVAX Facility initiative. Supply chain issues have a real and devastating effect on unvaccinated communities, as evidenced by the recent news that Thailand government officials acknowledged delays and reductions for a promised shipment of 17 million doses of Thai-produced AstraZeneca vaccines to the Philippines. One of the biggest supply chain issues facing the unvaccinated world right now is the decision of India’s government, which along with South Africa proposed the patent waiver at the WTO, to stop exporting vaccines manufactured by the Serum Institute of India, the world’s largest vaccine manufacturer, in order to address India’s own exploding COVID-19 infection rates. For its part, the United States under President Joe Biden recently announced an increase of 20 million doses to the country’s planned COVID-19 vaccine exports.
The second key element in the EU’s proposal requests that governments support vaccine manufacturers and developers to ensure affordable vaccine supplies. This portion of the EU’s proposal acknowledges the beneficial impacts of licensing, which ensures that developers and manufacturers enter into agreements that those companies are incentivized to uphold because they promote business interests. The EU’s proposal notes that the vaccine developers Pfizer, BioNTech, Johnson & Johnson and Moderna have all committed to agreements to deliver a combined 1.3 billion doses through 2021 at no profit to low-income countries and at low cost to middle-income countries.
The final key element in the EU’s alternative focuses on intellectual property and recognizes that “voluntary licenses are the most effective instrument to facilitate the expansion of production and sharing of expertise.” While compulsory licensing could be available without voluntary licensing due to the extraordinary nature of the COVID-19 pandemic, the EU advocates for using existing mechanisms for compulsory licensing under the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). While the EU is currently drafting a communication dedicated to intellectual property rights which it plans to submit to all WTO members, the governmental body was clear on its thoughts regarding the India-South Africa proposal backed by many governments, including the Biden Administration:
As regards the broad waiver proposed by a number of WTO members, the European Commission, while ready to discuss any option that helps end the pandemic as soon as possible, is not convinced that this would provide the best immediate response to reach the objective of the widest and timely distribution of COVID-19 vaccines that the world urgently needs.
TRIPS Patent Waiver for COVID-19 Vaccines: A Bad Idea That the Endless Frontier Act Could Prevent
The forces urging the world towards waiving international patent rights under TRIPS for COVID-19 vaccines are about as legion as they are misguided. On June 7, the WTO announced that it had received a petition signed by 2.7 million people around the world calling for the suspension of patent rights on COVID-19 vaccines. Currently more than 60 nations have publicly supported the India-South Africa proposal to waive patent rights under TRIPS for COVID-19 vaccines. However, as the EU’s proposal indicates, developing effective responses to international supply chain issues regarding vaccines do not have to stoop to dismantling the system for encouraging the investment in pharmaceutical R&D that produced the vaccine in the first place. In fact, the EU’s proposal recognizes that properly respecting IP rights and encouraging voluntary licensing, while making some allowances for Article 31 of TRIPS, will be a much more effective answer than a political stance that creates more problems than it solves by reducing medical innovation at exactly the time that the world needs it the most.
In supporting the waiver, the Biden Administration has arguably abdicated one of its first promises: that it would be an administration guided by science and truth. There is no science that exists to show that patents are barriers to vaccine access. That is a fact that has been acknowledged by the World Intellectual Property Organization, the UN’s agency for intellectual property rights, since the beginning of the COVID-19 pandemic. The sentimentality driving those supporting the TRIPS waiver for COVID-19 vaccines won’t solve supply chain issues in manufacturing capacity, which the EU’s alternative does address, but it will do a great job at decreasing investment into medical R&D because weak patent rights decrease economic productivity. Decreased investment in medical R&D will slow down the research needed to cure new COVID-19 variants that continue to appear across the world, and needless human death will continue.
While it remains to be seen whether the EU’s more economically principled alternative will gain much traction at the WTO, analysts believe the pushback from the EU on the proposed patent waiver may prevent it from coming to fruition despite the waiver’s support from the United States. Further, that U.S. support might never be fully realized if the Senate passes the Endless Frontier Act into law, which it was set to vote on today and was being considered on the Senate Floor as of the time of writing. Although that bill includes a pair of amendments regarding patent law that have been opposed by inventor and small business advocates, Senate Amendment 1919 would prevent the U.S. Trade Representative from proposing or supporting any proposed waiver of international patent rights under TRIPS related to COVID-19 vaccines.
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