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SOUTHNEWS

 
No. 385, 19 October 2021

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South Centre working session at the WTO Public Forum 2021 discussed the future of the TRIPS Agreement post COVID-19

 


 

On 29 September, the South Centre organized a working session on “The Future of the TRIPS Agreement Post COVID-19” at the 2021 WTO Public Forum. Over 130 participants joined the hybrid session. Dr. Yuanqiong Hu, MSF Access Campaign, Geneva, Prof. Hyo Yoon Kang, University of Kent, UK, Dr. Dean Baker, Center for Economic Policy and Research, Washington DC, and Dr. Carlos M. Correa, Executive Director of the South Centre, joined in a panel discussion moderated by Dr. Viviana Muñoz-Tellez, Coordinator of the Health, Intellectual Property and Biodiversity Programme of the South Centre.
 
The Role of TRIPS in the COVID-19 Pandemic

The COVID-19 pandemic has reiterated the longstanding tension between the protection of intellectual property (IP) and public health. Having in view the TRIPS flexibilities, the panel discussed pitfalls of the IP-based innovation system for access, which included the failure of voluntary licenses to achieve global equitable access to vaccines and other medical products. It then discussed the need for approval of the targeted and reasonable temporary TRIPS waiver proposal at the WTO, given the limitations of the existing compulsory license (CL) mechanisms and areas such as trade secrets and non-disclosure agreements. The session also highlighted areas where countries can already amplify the use of TRIPS flexibilities, including the expansion of exceptions to patent rights, the use of antitrust law to ensure transfer of know-how, CLs for trade secrets, and the use of a national security exception under Article 73(b), TRIPS.
 
Dr. Yuanqiong Hu, based on MSF’s experience, highlighted the barriers generated by IP as a legal monopoly, responsible for the failure of voluntary licensing to adequately ensure global equitable access, since power is concentrated in the hands of pharmaceutical companies. This is a systemic issue since all outcomes related to COVID-19 vaccines are based on the power exerted by such companies, including the management of the supply chains. mRNA vaccines by Pfizer and Moderna can be replicated quickly, at low-cost, and many developing countries could produce them, and yet no deep technology transfer agreements have been signed. This is not exclusive to vaccines: Roche, for example, has therapeutics [casirivimab and imdevimab; IL-6 receptor blockers (tocilizumab or sarilumab)] recommended by the WHO for severe and hospitalized COVID-19 patients[1], but refused to share the technology to produce biosimilars. To end the pandemic, voluntary licenses have not proven sufficient.
 
Dr. Dean Baker noted the pitfalls of IP as an incentive for innovation during and beyond the COVID-19 pandemic. He stressed that COVID-19 vaccines were largely funded by public resources: Moderna received 450 million USD for the research to develop the vaccine and then 450 million for clinical trials, as well as advance purchase agreements (similar to Pfizer). Oxford/Astra Zeneca had over 90% of public sector financing. This highlights that IP as a necessity for innovation is factually untrue. But with IP, all decisions rely on IP holders, leading to the almost obscene situation we are in: a disproportionate share of vaccines which went to Europe and USA and boosters to healthy people being inoculated before frontline workers in developing countries. The risk of new variants as the virus continues to circulate and impacts to global supply chains in other sectors therefore remain.
 
Prof. Carlos Correa pointed out that the proponents of the TRIPS Agreement had argued that it will bring about benefits to developing countries in terms of innovation, technology transfer and foreign direct investment (FDI). Such promises were not fulfilled. Empirical evidence shows that increased standards of IP protection over 40 years in developing countries have not led to more innovation.[2] In relation to transfer of technology, IP has actually provided more room for technology holders not to share, instead of facilitating it – the mRNA COVID-19 vaccines are an example in that regard. Similarly, there is no evidence that increased levels of IP protection attracted FDI. Therefore, we need rethinking of the arguments concerning TRIPS and its alleged role in supporting transfer of technology and FDI.
 
Prof. Hyo Yoon Kang discussed the proposal of the temporary waiver of certain provisions of the TRIPS Agreement currently being discussed for over a year at the WTO, defining it as a targeted and proportionate measure that amplifies freedom to operate and can be suitable to national contexts. The existing mechanisms, especially compulsory licensing mechanisms (Arts. 31 and 31bis of TRIPS), are insufficient and limited, and do not address the need for technology transfer. For this reason, over 180 IP specialists have endorsed a research paper delineating these issues.[3]

 


Need for Review of TRIPS

Dr. Viviana Muñoz-Tellez asked the panel whether WTO Members should review the existing TRIPS flexibilities or create new ones.

Dr. Yuanqiong Hu was of the view that the pandemic calls for a long-term reform of the TRIPS and/or national laws, as the flexibilities were enacted without knowledge of a pandemic such as the present one. Some flexibilities have not been fully utilized, often due to cumbersome procedures and limitations – which is the case of Article 31bis (CLs for exports to countries without manufacturing capacity)[4] currently being attempted by Bolivia and Biolyse, a company in Canada.[5] Similarly, access to technical information and biological materials which are claimed as private rights by companies need to be established. Finally, how can FTAs be prevented from removing such flexibilities, given different negotiating power and capabilities of countries negotiating.

Prof. Hyo Yoon Kang highlighted the need to review the treatment of undisclosed information, which can be disclosed to protect the public under Article 39.3 of TRIPS, but such disclosure is impeded due to a power divergence between private commercial interests and national and global interests. Some have proposed how public interest disclosure can be protected and implemented, including through CLs for trade secrets[6], although concrete detail depends on the willingness of Member States to cooperate at the multilateral level.

Dr. Dean Baker stressed that TRIPS was in fact a protectionist agreement, and that there is no evidence that IP has led to greater technology transfer. He highlighted the necessity to discuss the legality of non-disclosure agreements (NDAs) such as the ones signed between companies and engineers who could be willing to share their knowledge with companies in developing countries to produce mRNA vaccines. He argued (as a possible normative principle) that NDAs linked to public invested inventions should be a WTO violation.

Prof. Carlos Correa noted that amending the TRIPS Agreement may be a difficult and long task, but that countries can already take concrete action, and that experimentation in TRIPS implementation can take place. The following examples were highlighted: (i) Art. 30 of TRIPS, on exports: the EU has recently adopted an exception for supplementary protection certificates (SPC), related to the manufacture and export of pharmaceuticals during the lifetime of SPCs.[7] This can be applied to Art. 30 of the TRIPS Agreement in relation to patent rights, and could be further explored to overcome the difficulties of Art. 31bis; (ii) involuntary transfer of know-how or CL of know-how[8] - CLs are only prohibited under the TRIPS Agreement for trademarks, so CL mechanisms for trade secrets/undisclosed information can be envisioned, despite complexities for their implementation; (iii) antitrust authorities can require transfer of know-how (as occurred in the US); (iv) implementing Article 73(b), the national security exception, is another option available to WTO Members.[9]
 
Areas where further research is needed were presented, including alternative innovation models, more avenues for issuing compulsory licensing, the regulation of private actors, the creation of commitments of companies in publicly funded R&D, questioning the legality of NDAs, the misrepresentation by companies at regulatory approval of medicines and the idea of a periodic standard review of TRIPS.


During Q&A, speakers reiterated that voluntary licenses have not proven sufficient during the pandemic, and that no interest by companies have been manifested towards the WHO C-TAP initiative to pool technologies.[10] It was also recalled that innovative ways of implementing TRIPS need to envisioned. In parallel, while companies such as Moderna and Pfizer created fully operational mRNA manufacturing facilities in 6 months – had technology transfer been undertaken at the time of the proposal of the TRIPS waiver in October 2020, other facilities would already be producing. Finally, it should be recalled that IP is the legal structure which underpins markets, and that the current state of IP law has been a structural barrier to access to health. In this light, the panelists generally shared the conclusion that it is important to question the premises of the TRIPS Agreement.

The full recording of the session is available at: https://www.youtube.com/watch?v=wVsJElxsY1k

The South Centre provides no-cost technical assistance for developing countries on IP and public health-related matters. For more information, see: https://ipaccessmeds.southcentre.int/
 


[2] See Cassandra Sweet & Dalibor Eterovic, "Do patent rights matter? 40 years of innovation, complexity and productivity," World Development, vol. 115 (March 2019), pages 78-93. Available from https://ideas.repec.org/a/eee/wdevel/v115y2019icp78-93.html.
[3] See Siva Thambisetty, Aisling McMahon, Luke McDonagh, Hyo Yoon Kang and Graham Dutfield, “The TRIPS Intellectual Property Waiver Proposal: Creating the Right Incentives in Patent Law and Politics to End the COVID-19 Pandemic”, LSE Legal Studies Working Paper No. 06/2021 (May 24, 2021). Available from https://ssrn.com/abstract=3851737.
[4] See Carlos Correa, “Will the Amendment to the TRIPS Agreement Enhance Access to Medicines?” Policy Brief, No. 57 (Geneva, South Centre, 2019). Available from https://www.southcentre.int/policy-brief-57-january-2019/.
[5] See Muhammad Zaheer Abbas, Canada’s Political Choices Restrain Vaccine Equity: The Bolivia-Biolyse Case, Research Paper, No. 136 (Geneva, South Centre, 2021). Available from https://www.southcentre.int/wp-content/uploads/2021/09/RP136_Canadas-Political-Choices-Restrain-Vaccine-Equity-The-Bolivia-Biolyse-Case_EN-1.pdf.
[6] See Olga Gurgula and John Hull, “Compulsory Licensing of Trade Secrets: Ensuring Access to COVID-19 Vaccines via Involuntary Technology Transfer”, Queen Mary Law Research Paper No. 363/2021 (June 23, 2021); forthcoming, Journal of Intellectual Property Law & Practice (2021). Available from https://ssrn.com/abstract=3872796.
[7] See, for more information Pascale Boulet, Christopher Garrison and Ellen ‘t Hoen, “Data Exclusivity in the EU: A Briefing Document(Medicines Law and Policy, June 2019). Available from https://medicineslawandpolicy.org/wp-content/uploads/2019/06/European-Union-Review-of-Pharma-Incentives-Data-Exclusivity.pdf.
[8] See also Olga Gurgula, “Accelerating COVID-19 Vaccine Production via Involuntary Technology Transfer”, Policy Brief, No. 102 (Geneva, South Centre, 2021). Available from https://www.southcentre.int/wp-content/uploads/2021/09/PB102_Accelerating-COVID-19-Vaccine-Production-via-Involuntary-Technology-Transfer_EN.pdf.
[9] See Frederick Abbott, The TRIPS Agreement Article 73 Security Exceptions and the COVID-19 Pandemic, Research Paper, No. 116 (Geneva, South Centre, 2020). Available from https://www.southcentre.int/research-paper-116-august-2020/.
[10] See https://www.who.int/initiatives/covid-19-technology-access-pool.

Author. Vitor Henrique Pinto Ido is Programme Officer of the Health, Intellectual Property and Biodiversity Programme (HIPB) of the South Centre. 
SOUTHNEWS is an e-newsletter service of the South Centre providing information and news on topical issues from a South perspective.

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For more information, please contact Anna Bernardo of the South Centre: Email bernardo@southcentre.int, or telephone +41 22 791 80 50.
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