[Ip-health] 23 February 2021: South Africa’s interventions at the WTO TRIPS Council

Paul Fehlner pfehlner at revisiontx.com
Sun Mar 21 13:59:54 PDT 2021


The More I Hear About TRIPS Waivers, the More Convinced I Am About C-TAP

Everything about the TRIPS waiver efforts with respect to COVID-19 reinforces that voluntary technology pooling is the way to move ahead with speed. And we still need speed: to manage variants, particularly the P.1 variant that seems infectious even for people exposed earlier to other SARS-CoV-2 variants; to accelerate vaccination globally; and to manage long COVID, which has the potential to challenge people who have recovered from infection with SARS-CoV-2, whether symptomatic or not, with health problems for months and possibly even years. The existing IP regime is up to these challenges, with or without cooperation of developed countries and multinational biopharmaceutical companies (MNCs) if interested parties deploy efforts creatively and collaboratively.

The World Health Organization’s COVID-19 Technology Access Pool (C-TAP) has potential to accelerate solutions to COVID-19, probably the most effective international effort to do so. Moreover, while greatest success depends on private sector participation, it’s not essential that the incumbent multinational biopharmaceutical companies participate if there is sufficient technical capability by linking existing clinical, development, and manufacturing technology in the developing countries (and my guess is a substantial participation of the cadre of public benefit companies, non-profit research institutions, and maybe a few interested traditional biopharmaceutical companies from the developed countries). Wouldn’t that pooled capability more than match the capabilities of a Pfizer-BioNTech or J&J? If the impact of open innovation on the software industry is any guide, C-TAP could be the model for a new paradigm of drug development that could deliver treatments for any conditions plaguing the developing world, including ones that also plague the developed world, and competitively challenge the status quo.

In contrast, forcing technology transfer will likely cause delay. It appears that the Global South has manufacturing capability and feels like it needs IP rights. Why? How would suspending IP rights suddenly open up access to proprietary manufacturing technology? Conversely, if manufacturing capability exists, why does a piece of paper that happens to say “patent” prevent using it? The shortage of needed vaccine supports compulsory licensing and other IP exceptions under TRIPS by any reckoning. Patent rights are neither necessary nor sufficient.

Access to enabling technology is both. Combining the Global South's clinical, development, and manufacturing expertise in an open access technology pool (C-TAP?) has the potential to achieve that critical mass of capability. In all probability, that critical mass is sufficient to challenge the incumbent biopharmaceutical industry. In other words, a C-TAP that just involves the stakeholders of the developing states could still be a powerful force — even if these stakeholders are sovereign nations and national companies in sometimes competition with each other. Which is why any effective open innovation platform needs rules to ensure collaboration of the participants (and disadvantage non-participants). Specifically, enforceable agreements based on foundational IP rights facilitate open innovation technology sharing, as competitor private sector companies in the software industry has demonstrated. So not only will suspending IP rights have little if any positive impact on COVID-19 vaccines and therapies, it could also slow open innovation efforts.

As South Africa has pointed out in its interventions in February reported below, philanthropy cannot buy equality. Taking technology from multinational corporations cannot, either. Collaboration is critical, as there is no reason to believe that suspending IP rights will motivate collaboration. On the contrary, attacking IP will provoke resistance and delay. Trying to compel disclosure of confidential manufacturing technology would further polarize the US, Europe, Japan, and other developed countries in defense of the biopharmaceutical companies. The diversion of time and energy battling for disclosure of confidential technology cannot have any result but to slow the response to COVID-19. 

Indeed, attacking the private sector misses the mark. The private sector does what it gets paid to do, and right now governments and investors pay for private sector profitability. Take the example of project Warp Speed. The US government failed to negotiate price when it took on substantial development and commercial risk for COVID vaccines; no venture capitalist would fund R&D with no expectation of financial benefit. Whatever the rhetoric, developed country government policy protects high biopharmaceutical prices. And if governments won’t negotiate for direct economic benefit when investing in commercial vaccines, what pressure is there for a private sector company to provide its confidential manufacturing technology to manufacturers in developing markets?  

Criticism of the private sector misses the mark for another reason: the private sector has done a remarkable job of collaboration in response to the public health emergency. Is it everything it could be? Probably not. Is it a step towards more effective collaboration, a paving stone on the path to the ideals of C-TAP? It very much is. Reinforcing progress has greater power to motivate performance than castigation, as any mentor, teacher, or coach knows. Incremental change, building on willingness to suspend patent enforcement (Open COVID pledge; Moderna’s commitment), share data and resources (GISAID, COVID Therapeutics Accelerator), and work closely with government funders (project Warp Speed) has led to fast solutions. The goal should be to go faster, not slow things down through conflict.

Finally, the article below hints that developing country access is not the only goal. To successfully engage the private sector, access to enabling technology should be about enabling manufacturing for underserved markets, not access to western markets. The following quote suggests that the latter is an imperative: “If you don’t allow, for example, an Indian producer to sell in the U.S. because of some stupid rules and regulations, even though the product is identical to a U.S. product, you’re going to have a supply situation.” I read “stupid rules and regulations” here as health authority regulatory review. There is no question that regulatory review prevents marketing of competitive products more effectively than patents: without approval, there is no possibility to market, whereas there is always a chance to beat a patent in court or administratively or by decree. That difference results from important public policy concerns; regulatory barriers are in place to guarantee safety and quality. Legal exclusivities incentivize new product development. In any event, at the end of the day, strict regulation and regulatory exclusivity burden the US market and US taxpayers (generally the ultimate payer for medicines through taxes, direct and indirect insurance premiums, and co-pays). Thus, both the problem and its impact affect the US, and have nothing to do with underserved markets.



> On Mar 1, 2021, at 2:42 AM, Thiru Balasubramaniam <thiru at keionline.org> wrote:
> 
> https://www.keionline.org/35453
> 
> --
> 
> 23 February 2021: South Africa’s interventions at the WTO TRIPS Council
> Posted on March 1, 2021 <https://www.keionline.org/35453> by Thiru
> <https://www.keionline.org/author/thiru>
> 
> On 23 February 2021, South Africa delivered two detailed statements at the
> WTO TRIPS Council’s most recent deliberations on a waiver from certain
> provisions of the TRIPS Agreement for the prevention, containment and
> treatment of COVID-19 (IP/C/W/669 <https://www.keionline.org/34061>).
> 
> South Africa did not mince words, taking aim at the current donor-driven
> model of the COVID-19 response.
> 
> Irrespective of the amount of money any of the donor country may throw at
> the problem, the model of donation and philanthropic expediency cannot
> solve the fundamental disconnect between the monopolistic model it
> underwrites and the very real desire of developing and least developed
> countries to produce for themselves. Madam Chair, the problem with
> philanthropy is that it cannot buy equality. Yesterday the DG of WHO warned
> that: “Money is not the only challenge we face. If there are no vaccines to
> buy, money is irrelevant. Even if we have the funds, we can only deliver
> vaccines to poorer countries if high-income countries cooperate in
> respecting the deals COVAX has done, and the new deals it is doing.” Even
> in light of all the additional pledges of monetary support, the ACT
> Accelerator still faces a gap of at least 22.9 billion dollars to fully
> financed.
> 
> In response to WTO Members who interrogated South Africa on the vaccine
> manufacturing capacity of the Global South, South Africa provided the
> following riposte.
> 
> 
>   I would once again like to thank all delegations that took the floor
>   today. Some delegations wanted more details of manufacturing capacity that
>   exist in the developing world. As we have pointed out at the last session,
>   out of the 158 prequalified vaccines under WHO’s PQ program 72 vaccines are
>   produced by vaccine manufacturers from developing countries. Similarly,
>   LMIC countries have a substantial share in prequalified finished
>   pharmaceutical products, active pharmaceutical ingredients and vaccines.
>   This shows that significant quality manufacturing capability does exists
>   including in developing countries and to ensure global supply, these have
>   to be leveraged.
> 
> 
>   Some delegations suggest countries who have unused manufacturing
>   capacity on vaccine to pursue voluntary license agreement with vaccine
>   developers for local production. Yet, what we have observed is that among
>   some countries who do not support the waiver proposal, they have
>   experienced difficulties in seeking local production licenses from vaccine
>   developers. It shows, once again, that relying on voluntary license is not
>   sufficient in this pandemic. Canada has just shared their experiences with
>   originators having been rejected by several companies when approached for a
>   voluntary license. Canada’s experience shows relying on voluntary licenses
>   may be highly problematic and evidences the selective approach applied by
>   originators and rights holders. Perhaps Canada can disclose the terms of
>   its license agreement with Novavax to back up its claim that IP is not a
>   barrier to access?
> 
> When Singapore and Switzerland used The Guardian’s paean to Adar Poonawalla
> <https://www.theguardian.com/global-development/2021/feb/14/we-took-a-huge-risk-the-indian-firm-making-more-covid-jabs-than-anyone>to
> assert that there were no IP or know-how barriers to scaling up manufacture
> of COVID-19 vaccines, South Africa unearthed Sarah Wheaton’s July 2020
> profile (Meet the Indian drug mogul who’s challenging the West over
> vaccines, Adar Poonawalla is seizing on the COVID-19 fight to try to break
> down the policies protecting Big Pharma
> <https://www.politico.eu/article/adar-poonawalla-meet-the-indian-drug-mogul-whos-challenging-the-west-over-vaccines/>)
> which provided a counter-narrative to Singapore’s and Switzerland’s claims.
> 
> We heard Switzerland and Singapore quote Dr. Poonawalla of the Serum
> Institute. In a recent interview with Politico, Dr. Poonawalla believes
> that the sheer urgency of the virus — and the fact that coronavirus
> anywhere is a threat to people everywhere — should prompt a reassessment of
> patent and intellectual property laws that limit access to immunizations in
> the developing world, while simultaneously jacking up their price in
> wealthier countries. “That’s become very evident today in the Covid
> crisis,” “If you don’t allow, for example, an Indian producer to sell in
> the U.S. because of some stupid rules and regulations, even though the
> product is identical to a U.S. product, you’re going to have a supply
> situation.” “And guess what,” he continued. “When you’ve got low supply and
> high demand, what happens to the price? It skyrockets.”
> 
> South Africa’s statements are reproduced in full below.
> ------------------------------
> 
> South Africa’s intervention at the formal TRIPS Council meeting of 23
> February 2021
> 
> Thank you Madam Chair for giving us the floor we thank you for your report
> on the activities of the TRIPS Council’s consideration of the Waiver
> Proposal and further consultations you held in small group formation as
> well as the details put forward in the proposed oral report to be presented
> to the General Council in March 2021. We would like to welcome the African
> Group and LDC Group to the fold of cosponsors, the increase number of
> delegations in our ranks demonstrate the growing importance of the Waiver
> Proposal and the need to scale up access in order to ensure equitable and
> timely access to COVID-19 medical products, including vaccines,
> therapeutics, diagnostics and other equipment.
> 
> Moving forward, discussions cannot continue to be mired in the evidentiary
> loop that we have been engaged in over the last few months, Cosponsors have
> also made it clear that we want to move to text-based discussions, we stand
> ready to discussion the scope and duration of our proposal in light of
> comments and observations that Members have made.
> 
> A pandemic like COVID-19 has not been seen in a century, and much remains
> unknown and evolving about the situation and the virus that causes it.
> While many regard the virus as a sort of black swan, it was not entirely
> unexpected and was preceded by several other viruses and semi-global
> pandemics in recent times. As much as we may hope that something like this
> will not happen again, the probability is there that the next event may be
> even more cataclysmic. Many of the most serious global threats today
> involve a high degree of uncertainty. Under such conditions, people are
> notoriously unwilling to make sacrifices for others when the benefits are
> uncertain. A good example of this type of behaviour is vaccine nationalism,
> which denotes self-prioritization to the exclusion of others, as many rich
> government have done on the assumption that individual action can yield
> results on its own. However, this is not the case, the idea that a vaccine
> rollout will be the deus ex machina is misplaced, we cannot put the virus
> back into its bottle, we just cannot go back to the old normal.
> 
> According to available data, US, UK and the EU account for about 50% of the
> over 200 million vaccines administered globally as at 22nd Feb. Countries
> opposing the TRIPs waiver proposal account for 60% of the globally
> administered COVID-19 vaccines. Reportedly, just 10 countries have
> administered 75 per cent of all COVID-19 vaccines. More than 130 countries
> have not received a single dose. The WTO has to pay need to the caution of
> the Director General of WHO: “The longer it takes to suppress the virus
> everywhere, the more opportunity it has to change in ways that could make
> vaccines less effective – an opportunity to mutate”.
> 
> Sir Jeremy Farrar, the head of Wellcome Trust has also highlighted that
> “Immunising a lot of people in a few countries while leaving the virus
> unchecked in large parts of the world would simply allow more variants to
> emerge in these places. And the more that happens, the higher is the risk
> that the virus will evolve to an extent that our vaccines, treatments and
> tests are no longer effective” adding that “We’ve got to understand this is
> a global problem that must be dealt with globally.”
> 
> Our TRIPS Waiver offers a global solution. The world is facing its worst
> ever crisis since perhaps World War II, and the response of WTO members
> opposing the waiver proposal is to engage in “business as usual”
> approaches, and for WTO to do nothing to address IP monopolies around the
> technology and know-how, to scale up production and to bring this crisis to
> an end.
> 
> Many of the opposing WTO members, under pressure from their pharmaceutical
> industry have for more than two decades, been known to dissuade developing
> countries from incorporating TRIPS flexibilities in their national law and
> using such flexibilities to promote access, and yet now insistently assert
> that such sufficient flexibilities exist, although we have presented
> concrete arguments against it.
> 
> These same WTO members stress on “business as usual voluntary licensing” as
> the way out of this pandemic and yet one year on, this “business as usual”
> approach premised on voluntary, secretive, limited and restrictive
> licensing has failed to leverage global expertise and capacity to scale-up
> manufacturing and deliver equitable access. Instead this approach has
> limited competition, and is artificially constraining global supply. These
> “business as usual” approaches championed by opposing countries is not the
> global solution but really the root cause of why to date we have
> vaccinations that are “wildly uneven and unfair” as pointed out by the UN
> Secretary General. At the current vaccination rate, it will take an
> estimated 4.8 years to cover 75% of the population with a two-dose vaccine,
> according to Bloomberg on the path to immunity around the world. And sadly,
> this is probably an optimistic scenario. Cosponsors have often called for
> the open sharing of vaccine manufacturing technology, IP and know-how
> through the COVID-19 Technology Access Pool (CTAP).
> 
> Madam Chair, we want to clarify that as Cosponsors of the Waiver Proposal,
> we have always said that we welcome global multilateral cooperative
> initiatives such as the ACT-Accelerator. The objective of COVAX, its
> vaccine arm, is laudable, as are financial contributions from WTO Members
> to this end. However, we have to confront the limits of the architecture of
> such an approach, it is not meant to address all the needs of developing
> and least developed countries. A rather large gap exists between what COVAX
> or ACT-A can deliver and what is required in developing and least developed
> countries. In this case demand-side requirements outstrips supply-side
> constraints. Irrespective of the amount of money any of the donor country
> may throw at the problem, the model of donation and philanthropic
> expediency cannot solve the fundamental disconnect between the monopolistic
> model it underwrites and the very real desire of developing and least
> developed countries to produce for themselves. Madam Chair, the problem
> with philanthropy is that it cannot buy equality. Yesterday the DG of WHO
> warned that: “Money is not the only challenge we face. If there are no
> vaccines to buy, money is irrelevant. Even if we have the funds, we can
> only deliver vaccines to poorer countries if high-income countries
> cooperate in respecting the deals COVAX has done, and the new deals it is
> doing.” Even in light of all the additional pledges of monetary support,
> the ACT Accelerator still faces a gap of at least 22.9 billion dollars to
> fully financed.
> 
> The Waiver Proposal constitutes a very real compromise that will
> immediately enable countries to tap into unused production capacity by
> accessing spare capacity in the developing world which will satisfy the
> ongoing demand for COVID-19 vaccines (including therapeutics and
> diagnostics) and will also negate the need for any donations from rich
> countries. Take the Africa continent for example, as a whole Africa
> currently imports more than 80 per cent of its pharmaceutical and medical
> consumables. This is unsustainable and puts the continental population of
> 1.3 billion people at the mercy of a few monopolistic companies. This is a
> recipe for disaster as we have witnessed not only with the COVID-19
> pandemic but with all other diseases and pandemics that continue to affect
> the continent.
> 
> We recalled in our intervention of 4 February 2021, in which we quoted a
> study commissioned by the international Chamber of Commerce (ICC) Research
> Foundation which found that the global economy stands to lose as much as
> $9.2 trillion if governments fail to ensure developing country economies
> access to COVID-19 vaccines. We have already argued that there are good
> moral and legal grounds, as recognized under the TRIPS agreement, to pass
> the waiver proposal. In addition, this study underscores the importance of
> ensuring access by developing countries to effective vaccines in order to
> mitigate the economic social and have consequences in the years ahead. We
> have already indicated that the artificial shortage of vaccines is
> primarily caused by the inappropriate use of intellectual property rights,
> this cannot be allowed to continue. It is now apparent that poor countries
> would have to wait a long time to access vaccines, during this time the
> virus will mutate giving rise to strains that will undermine the efficacy
> of existing vaccines. COVID-19 does not respect national borders; nor does
> it care about the gross domestic product of a country, no country in the
> world can insulate itself, even the best plans will be laid to waste. Let
> us ensure that everyone has access to effective vaccines in the shortest
> possible time.
> 
> In closing, as many cosponsors have reiterated, we are ready to go to a
> text-based discussion in order to arrive at an immediate solution. This
> will not only save lives but also enable us to return to a situation of
> relative normalcy. No one is safe until everybody is safe.
> ------------------------------
> 
> Second intervention
> 
> I would once again like to thank all delegations that took the floor today.
> Some delegations wanted more details of manufacturing capacity that exist
> in the developing world. As we have pointed out at the last session, out of
> the 158 prequalified vaccines under WHO’s PQ program 72 vaccines are
> produced by vaccine manufacturers from developing countries. Similarly,
> LMIC countries have a substantial share in prequalified finished
> pharmaceutical products, active pharmaceutical ingredients and vaccines.
> This shows that significant quality manufacturing capability does exists
> including in developing countries and to ensure global supply, these have
> to be leveraged.
> 
> Some delegations suggest countries who have unused manufacturing capacity
> on vaccine to pursue voluntary license agreement with vaccine developers
> for local production. Yet, what we have observed is that among some
> countries who do not support the waiver proposal, they have experienced
> difficulties in seeking local production licenses from vaccine developers.
> It shows, once again, that relying on voluntary license is not sufficient
> in this pandemic. Canada has just shared their experiences with originators
> having been rejected by several companies when approached for a voluntary
> license. Canada’s experience shows relying on voluntary licenses may be
> highly problematic and evidences the selective approach applied by
> originators and rights holders. Perhaps Canada can disclose the terms of
> its license agreement with Novavax to back up its claim that IP is not a
> barrier to access?
> 
> It is also worth noting that some of the non-vaccine producers have
> recently been brought into vaccine production in Europe and Japan, such as
> Bayer and JCR pharmaceutical in Japan. This has yet happened in developing
> countries at large. While this kind of arrangements were made under
> selective agreements between companies, this shows that it is practical to
> explore and leverage the manufacturing capacity even beyond the usual
> vaccine producers. Yet, relying on originator company’s voluntary
> willingness is not sufficient. Leveraging the full capacity requires true
> global collaboration of all countries so that both technological and legal
> barriers to ensure scale up production and supply can be guaranteed. The
> waiver proposal provides a legal enabler to facilitate this to happen.
> 
> We thank the EU for its statement, the facts and actions spoken about
> remain vague. The EU does not support the waiver proposal, nor does it take
> any action to ensure technology sharing and transfer by companies operating
> in EU. It does not commit that it will no longer suppress developing
> countries from using compulsory license and other flexibilities as it did
> in its IP enforcement in third country report. It has not followed through
> its rhetoric of treating vaccines as a global common good but rather
> continue its inward-looking strategies in vaccine access including
> activating an export authorisation scheme.
> 
> We heard Switzerland and Singapore quote Dr. Poonawalla of the Serum
> Institute. In a recent interview with Politico, Dr. Poonawalla believes
> that the sheer urgency of the virus — and the fact that coronavirus
> anywhere is a threat to people everywhere — should prompt a reassessment of
> patent and intellectual property laws that limit access to immunizations in
> the developing world, while simultaneously jacking up their price in
> wealthier countries. “That’s become very evident today in the Covid
> crisis,” “If you don’t allow, for example, an Indian producer to sell in
> the U.S. because of some stupid rules and regulations, even though the
> product is identical to a U.S. product, you’re going to have a supply
> situation.” “And guess what,” he continued. “When you’ve got low supply and
> high demand, what happens to the price? It skyrockets.”
> 
> Some delegations continue to argue that Article 31bis could be used by
> countries have no or insufficient manufacturing capacities to seek supply
> under compulsory license for export issued by another country. Yet, as we
> have heard from various developing country delegations, the current
> provisions and requirements of Art 31bis are not fit for purpose during a
> pandemic of this nature. The waiver proposal provides a quicker and easier
> option in the pandemic.
> 
> On the question posed by Norway on a revised proposal from the Cosponsors,
> the reason we called for a text-based discussion is because this will help
> us to understand direct questions that members have on our proposal. We
> invite delegations to raise particular concerns on elements they may have
> concerns about and suggestions as to how we can arrive at a common landing
> zone, including at the regular TRIPS Council meeting of 10 March 2021 and
> subsequent informal and informal meetings. We once again call for our
> deliberation to move to a text-based discussion.
> 
> END
> 
> 
> -- 
> Thiru Balasubramaniam
> Geneva Representative
> Knowledge Ecology International
> 41 22 791 6727
> thiru at keionline.org
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