EU Offers Alternative to COVID-19 IP Waiver That Supports Innovation and Addresses Supply Chain Problems

By Steve Brachmann
June 8, 2021

“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.’”

https://depositphotos.com/66396855/stock-photo-european-flags-in-brussels.htmlOn 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.

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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.

Image Source: Deposit Photos
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Copyright:jorisvo 

The Author

Steve Brachmann

Steve Brachmann is a freelance journalist located in Buffalo, New York. He has worked professionally as a freelancer for more than a decade. He writes about technology and innovation. His work has been published by The Buffalo News, The Hamburg Sun, USAToday.com, Chron.com, Motley Fool and OpenLettersMonthly.com. Steve also provides website copy and documents for various business clients and is available for research projects and freelance work.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 5 Comments comments. Join the discussion.

  1. Anon June 8, 2021 6:34 pm

    Abundant false equivalencies and outright fallacies in the comparisons here.

    For example, the supposed “supply chain” fix won’t do anything in regards to the example of India stopping its exports. Let’s say for a moment that the “net gain” of shots in arms for the zero sum amount of raw material is “X.”

    That “X” does not change based on whether India stopped the exports in order to use the raw materials for a larger share of its portion of “X,” or simply suffered more internal catastrophe, but alleviated some other nation’s share of their portion of “X.”

  2. Max Drei June 9, 2021 4:56 am

    Here in Germany, the problem is vaccine supply. The public is demanding to be vaccinated and the government is responding by removing any restrictions on which sectors of the population the doctors are allowed to vaccinate, but there simply isn’t the vaccine available yet.

    As we all know, patent rights are irrelevant to that present shortage. Vaccine production lines are all running at full capacity (and, if not, it’s because they lack glass vials, or some other vital ingredient).

    If the government in rich Germany can’t get enough vaccine to meet demand, what chance do the poor people of India have, to get vaccinated? When our representatives in Parliament go on about patent waivers and IPR licences, it is to distract people from the real problem. The solution, almost unattainable, is world-wide co-operation, to distribute the available vaccine doses optimally, to suppress the virus all over Planet Earth. Unattainable because the voters of the rich countries simply won’t stand for it.

    One hopes that C19 has taught us all a great lesson about the risks of a pandemic and that it will be better next time around.

    Meanwhile, I imagine that all corporations with the ability to make C19 vaccine are already doing everything they can, to make and sell just as many doses as is humanly possible.

  3. Anon June 9, 2021 10:28 am

    What the H does this even mean?

    The solution, almost unattainable, is world-wide co-operation, to distribute the available vaccine doses optimally, to suppress the virus all over Planet Earth.

    What exactly is “optimally?” Who is deciding this?

    Also, you point out that Germany does not have enough (and I pointed out India does not have enough), and yet you spew claptrap like:

    Unattainable because the voters of the rich countries simply won’t stand for it.

    What voters are standing against what?

    It’s beyond sad that you want to virtue signal when you have nothing intelligent to say. But somehow, you “know” that this is all the fault of voters in rich nations….

  4. MaxDrei June 9, 2021 1:03 pm

    The (admittedly paltry) vaccine supplies that the less developed parts of the world are getting originate from China and Russia, not from the democracies of the West. China is investing heavily in infrastructure all over Eurasia. In the battle for world-wide influence and power, China is winning.

    President Biden’s imminent trip to Europe (Bravo!) is to stimulate international co-operation and thereby rally support for democracy. And to work out how, with vaccines, to stop C19 killing people, first in countries other than the USA and Germany and then, when the mutations get more deadly, also in the USA and Germany.

    Here, parents are demanding their school-age children be vaccinated. The vaccine is better deployed to older people in other countries but, in a democracy, the voices of all those parents decide whether politicians lift a de facto ban on the export of vaccines.

  5. Anon June 9, 2021 1:57 pm

    You are quite evidently not in touch with how “voices” and “votes” work here.

    Further, what China and Russia may or may not be doing is an absolute tangent to the points that I pushed back at you; namely, what exactly is “optimally?” and who is deciding this?

    Not a tangent, and perhaps your attempt to answer that ‘optimally” question, you seem to think that a Sovereign inoculating their children is somehow ‘bad’ (or at least, not the optimal path to be taking).

    You STILL miss the point that the number of shots in arms is a Zero Sum game. Those arms being children do not matter to the virus. Sure, there is a morbidity factor that does — and should — be taken into consideration, but THAT is not at point in the propagation of mutating variants, which does NOT check their human host for their age. YOU have decided that “old people” should receive priority, but you misapprehend the difference between mortality and mutation. It is NOT those with higher mortality considerations that drive mutation rate risk higher. So while I can easily see the ‘humanity’ that flavors your choice of “optimally,” I also see that your choice is flawed for the End result that you suggest is the driver.

    The larger point here in the article was NOT ‘wealthy nation” as the focal point for its ‘solution’ being proffered outside of an IP waiver path. If you noted, the article panned India for its restrictive activity.

    You attempted to insert some ‘class’ level nonsense – and is only MORE of the smokescreen and virtue signaling, and simply does NOT address what a “real” solution might entail.

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