About the co-authors: Abhinav is a fourth year law student at National Law University in Jodhpur and Hardik Malik is a fourth year law student at National Law School of India University in Bangalore.
Photo by NIH, available here.
Introduction
The TRIPS Waiver Proposal stems from the TRIPS Agreement and thus, before expounding on the waiver, it becomes pertinent to shed some light on the agreement itself. TRIPS is short for the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights, which came into effect on January 01, 1995. As the WTO puts it, the TRIPS Agreement continues to be the most comprehensive multilateral agreement on intellectual property. Much of the debate on the TRIPS Waiver Proposal focuses on global inequalities in the manufacture and distribution of vaccines. Developing countries argue that lacking domestic infrastructure and insufficient foreign support has made the waiver necessary to boost vaccine production. They rely on recent data that only 0.3% of global vaccine administration was carried out in the 29 poorest countries which make up 9% of the world population. The opponents (mostly, developed countries) downplay the role of intellectual property in limiting vaccine production, and blame overburdened supply chains and the complex technologies necessary to manufacture new mRNA vaccines. For example, the European Union’s counter-proposal to the waiver focuses on fixing global supply chains and recommends compulsory licensing for producing “vaccines and therapeutics” against COVID-19. However, on closer inspection of the waiver’s text and statements by India and South Africa at the WTO, it is clear that the waiver goes beyond vaccines — it targets IP in the broad range of “products and technologies…for the prevention, treatment or containment of COVID-19.” This encompasses IP waivers for PPE kits, medical-grade masks, ventilators, oxygen concentrators, and even dialysis machines. This article focuses on non-vaccine products embedded in the proposed waiver by discussing its legal validity and responses to contentions raised by the anti-waiver bloc.
The WTO Agreement recognizes the right of any member-state to request a “waiver of its obligations” under the WTO or other recognized agreements (including TRIPS). Thus, the request for a waiver of TRIPS obligations is legally valid. Additionally, past WTO jurisprudence requires waivers to be temporary, exceptionally granted, and narrowly interpreted. On a prima facie level, TRIPS meets these conditions and the member-state consensus is the only remaining (and most challenging) hurdle to its approval.
Criticisms of TRIPS Agreement
This brings us to two common criticisms levied by the anti-waiver bloc. First, the TRIPS flexibilities offer impracticable alternatives (particularly, compulsory licensing) as opposed to an outright waiver of IP. Second, the proposal does not solve the more serious problems of undisclosed technologies and complex supply chains. However, these criticisms are unfounded for the non-vaccine products under the waiver.
a) Lack of Effective Alternatives
The TRIPS Agreement permits member-states to temporarily waive Intellectual Property Rights without the right-holder’s permission, and allows third-parties to make patented products for domestic use, or to export to countries in need. Unfortunately, compulsory licensing is a lengthy, procedurally inefficient and extremely narrow flexibility under TRIPS — making it unsuitable for a time-sensitive global emergency. Further, compulsory licensing requires application on a product-by-product and case-by-case basis, and imposes complex requirements before approval. This rule makes import through compulsory licensing extremely challenging for non-vaccine products. Essentially, a member-state must replicate compulsory licensing procedures for every product and technology, and it must also demonstrate an “insufficient manufacturing capacity” in each of these products. This creates challenges on two fronts: First, comprehensively assessing domestic shortages for each product without any TRIPS guidance will likely prove to be difficult because flow of information regarding such shortages cannot be effectively achieved without guidance from the TRIPS Agreement. Without it, intellectual property rights could act as a barrier to sharing such information. Second, it only analyses capacity and not efficacy — the prevailing capacity may be numerically sufficient but not as efficacious as the patented technology to improve the offered healthcare. For instance, Indian manufacturers mass produced ventilators in 2021 creating an excess supply — however, many hospitals have refused to accept these ventilators citing serious malfunction issues and compromised patient care. Even when serious malfunctions are not found, nations may still want to substitute existing products with better-equipped technologies. The degree to which TRIPS will factor in the efficacy of existing manufacturing capacity while granting licenses is unknown.
There are other, more fundamental challenges to the suitability of compulsory licensing for non-vaccine products. The most prominent are the limitations under the import route to pharmaceutical products. “Pharmaceutical products” includes any synthesized, biological or other chemical product (like drugs, medicines, etc.) or even an active ingredient necessary for the manufacture of such drugs or medicines. However, this definition of pharmaceutical products entails that non-vaccine products like ventilators, medical-grade masks, and PPE kits, among others, do not fall within the ambit of such products. A developed country may not be permitted to export these products under the compulsory licensing provisions. Additionally, it is still unclear how WTO Panels may choose to define “pharmaceutical products”, and the uncertainty itself complicates matters for countries that are hoping to benefit from these provisions.
Lastly, member-states are reluctant to use compulsory licensing due to backstage pressures (including trade sanctions) from developed countries. These prevailing forces will intensify for non-vaccine products — as these products are not COVID-specific and may be employed for a wide range of medical applications that function even after the pandemic subsides. These right holders will lobby against the grant of compulsory licenses to protect their future profitability. The waiver will disarm these backstage pressures and allow member-states to freely function towards efficacious medical support for COVID-19 patients.
The General Council’s August 30, 2003 decision itself noted that WTO members labouring with lack of sufficient manufacturing capacities in the pharmaceutical sector could face obstacles in utilizing compulsory licensing, and thus justified the waiver of obligations set out in Articles 31(f) and (h) of the TRIPS Agreement. This provides sufficient justification as to why a TRIPS waiver (and not compulsory licensing) is the way ahead for optimum production and utilization of non-vaccine products to combat the COVID-19 pandemic.
b) Undisclosed Technologies
The second criticism to an IP waiver is the issue of undisclosed technologies. Vaccine production involves complex manufacturing processes and systems which the majority of firms do not have, and the waiver does not help in their procurement. However, these issues are not as common for non-vaccine products — firms have successfully reverse-engineered many products by relying on 3-D printing and past industry experience. Non-vaccine products precede the pandemic and their functionality has already been extensively studied. Even components required for manufacture of non-vaccine products are more accessible as opposed to supply chain risks in vaccine production.
There have been instances where entities in possession of technologies and raw components could not produce essential medical relief products because of IP protections. For instance, an Italian start-up developed replacement ventilator valves using 3D printers to help intensive care patients, but the original manufacturer is now threatening legal action against the start-up. In yet another instance, Kentucky Governor Andy Beshear and the US Federal Government urged multinational company 3M to release its patent for N95 respirators, direly needed to protect against COVID-19, with the Governor remarking that “the procurement (of the respirators) is incredibly difficult, as is the manufacture because it’s under patent.” The US Federal Government even decided to invoke the Defense Production Act to ensure hassle-free procurement of the N-95 respirators, which indicates the strain that patent protection imposes on accessing such non-vaccine products. In the same vein, South Africa and India have deduced that firms refrain from producing patented products such as medicines and medical equipment due to imminent threats of infringement lawsuits. Once the waiver is announced, capable firms will proactively search for a reliable supply of components and deliver patented goods that can improve any nation’s chances at preventing and treating COVID-19 infections.
Although a waiver offers extensive leeway to domestic and exporting firms in production of medical relief, there are very real obstacles to its acceptance at the WTO. The waiver requires consensus of all member-states, but currently, developed nations are opposed to its approval. US backing for the waiver offers some respite, however its support is only for “waiver of COVID-19 vaccines” and not the non-vaccine products mentioned in the India-South Africa proposal. Even if developed countries agree to negotiate on the text, we may witness dilution of the proposal into a toothless resolution that fails to generate the necessary upscaling of global production. Moreover, the upcoming meeting of WTO member-states is scheduled in December and such delays could impede a timely resolution.
To conclude, the non-vaccine component will become a highly contested issue as deliberations on the IP waiver intensify. Ongoing criticisms against the waiver are not applicable to non-vaccine products. The compulsory licensing mechanism is unsuitable for these products, and technology transfer as well as deficient supply chains pose significant obstacles once a waiver is granted. The ultimate goal is saving lives, any other contradicting interest is — as TA Ghebreyesus says, morally indefensible, epidemiologically self-defeating, and clinically counterproductive.