Temporary Waiver of Certain TRIPS IP Protection Obligations in Response to COVID-19. August 2021
The World Trade Organization (“WTO”) members agreed to schedule a meeting on September 14th, 2021, to continue consideration of the proposal for a temporary waiver of certain TRIPS IP protection obligations in response to COVID-19. Accordingly, the chair of the WTO’s TRIPS Council, Ambassador Dagfinn Sorli from Norway arranged the meeting on the set date.
The proposal (IP/C/W/669) was initially submitted (October 2020) by South Africa and India and has since been co-sponsored by Egypt, Kenya, Eswatini, Mozambique, Pakistan, Bolivia, Venezuela, Mongolia, Zimbabwe, the African Group, the Least Developed Countries (LDC) Group, and most recently the Maldives, Fiji, and Namibia — a total of 60 WTO members.
The proposal requests the WTO’s TRIPS Council that they recommend, as early as possible, to the General Council a waiver from the implementation, application, and enforcement of Sections 1, 4, 5, and 7 of Part II of the TRIPS Agreement in relation to prevention, containment, or treatment of COVID-19. The waiver should continue until widespread vaccination is in place globally, and the majority of the world’s population has developed immunity.
One of the arguments included in the request is: “The outbreak of COVID-19 has led to a swift increase in global demand with many countries facing acute shortages, constraining the ability to effectively respond to the outbreak. Shortages of these products have put the lives of health and other essential workers at risk and led to many avoidable deaths. It is also threatening to prolong the COVID-19 pandemic. The longer the current global crisis persists, the greater the socio-economic fallout, making it imperative and urgent to collaborate internationally to rapidly contain the outbreak.”
Furthermore, the proposal states: “As new diagnostics, therapeutics and vaccines for COVID-19 are developed, there are significant concerns; how these will be made available promptly, in sufficient quantities, and at an affordable price to meet global demand. Critical shortages in medical products have also put patients suffering from other communicable and non-communicable diseases at grave risk patients to meet the growing supply-demand gap, several countries have initiated domestic production of medical products and/or are modifying existing medical products for the treatment of COVID-19 patients. The rapid scaling up of manufacturing globally is an obvious crucial solution to address the timely availability and affordability of medical products to all countries in need.
The current TRIPS legal framework allows the countries to impose compulsory licenses of the vaccine to increase its availability. Issuing compulsory licenses, would still require the sovereign entity to compensate the innovator for his right to royalty. The waiver of the IPR of the innovator of the Covid-19 vaccine, would deprive the innovator from his entitlement to royalty.
In requesting a waiver of protection of IPR for the innovator of the Covid-19 vaccine, we need to acknowledge three issues. The first issue is that the World continues to need innovators to develop vaccines for the variants of Covid-19. To deny the innovators royalty, would discourage them from developing vaccines for the variants. Astra Zeneca has restricted its royalty to the amount that would cover its costs. But to deny the royalty completely is tantamount to penalizing the innovator for developing the vaccine unless the innovator has already covered its research and development costs. The second issue that we need to acknowledge is that even if the production of the vaccine is royalty-free, we need to make available manufacturing facilities that are capable of producing the vaccine in the required quantities. The question then becomes, would we allow such manufacturing facilities profits? The third issue that we need to acknowledge is when the vaccine would be available worldwide in sufficient quantities, how will we be able to provide the required logistics to distribute it? It is therefore important to deal with the problem from the three aspects which present a challenge to the worldwide availability of the vaccine and not to solely treat the challenge as a royalty problem.
Egypt is one of the countries that has carried out urgent legal steps to speed up issuing compulsory licenses. The Prime Minister Decree No. 251/2020 formed the Ministerial Committee that shall examine the requests and issue the CL approval. Issuing the CL itself is the responsibility of the Egyptian Patent Office (“EPO”) according to article (23) of the Egyptian IP Law 82/2002.
Egypt has currently four major local manufacturers of biological pharmaceutical products that can produce vaccines:
- The Holding Company for Biological Products and Vaccines – Egyptian Company for Production of Vaccines, Sera and Drugs (“EGYVAC”) – VACSERA.
- Medical Union Pharmaceuticals (“MUP”).
- EL Nile company for pharmaceuticals and chemical industries (“EL-Nile”).
- South Egypt Drug Industries Co. (“SEDICO”).
Also, Egypt imports from a number of generic biological manufacturing companies worldwide including – but not limited to: PT Bio Farma – Persero, (Indonesia), Changchum Changsheng Life Sciences (China), Human Biological Institute – (India), Arab Company for Pharmaceutical Products – Arabio (KSA), Berna Biotech Korea Corporation – (Korea) and Biological E Limited – (India) and Serum Institute of India PVT. LTD. (India).
Egypt has the capacity to produce Covid-19 vaccines domestically. It will also benefit from producing the vaccines without paying the royalties to the innovator. But Egypt does not have an interest to arrest innovation, nor will it expect the private sector companies to produce the vaccine for free. Even then, we need to deal with the cost of logistics.