IPR waiver will be long term gain for the south

The proposed waiver of intellectual property rights for vaccines is likely to be a gamechanger for developing countries that are unable to access sufficient quantities for their people. But this benefit will accrue in the long term as it may take over a year for a decision to be taken and then even more time for the vaccine producers to transfer technology and actually ramp up output. In the short term, the world will have to rely on higher production by the existing manufacturers to meet the goal of vaccinating the entire global population. Even so, the proposal made by India and South Africa at the World Trade Organisation is an initiative in the right direction. They have sought a waiver of TRIPS (Trade Related Aspects of Intellectual Property Rights), the intellectual property treaty of the WTO, in order to allow compulsory licensing of Covid vaccines. They have also sought the same concession for drugs and medical equipment needed to treat Covid but this element of the proposal has not yet found favour with major stakeholders.

What is significant is that the U.S. has agreed to support the waiver, going against its long held policy opposing any dilution of intellectual property rights in the pharmaceuticals industry. The U.S. has in the past even threatened sanctions against countries like Brazil which were changing patent laws to ensure available of drugs to treat HIV/AIDS. It has thus been a remarkable turnaround for the Biden administration though it comes seven months after it was initially mooted at the WTO.

This does not mean the move will be easily approved by the WTO. Under the rules of the organization, all decisions have to be passed by consensus among the 164 members. So far, about 100 countries have backed the proposal. On the other hand, several key countries are strongly opposed to the waiver. These include members of the European Union, Switzerland, Norway Australia, Canada, Japan and the U.K. The negotiations at the trade body are thus likely to take several months, with a possible decision only at the end of the year.

In addition, the powerful global pharma lobby has already begun efforts to pressurise western nations to stall the move which is likely to benefit countries of the South. The argument being made is that providing technology to manufacturers in developing economies will stifle innovation and prevent drug companies from reaping the fruits of their investment in research and development. They are also taking the stance that vaccine production processes are extremely complex and difficult to replicate by other pharma companies.

These arguments really cannot be justified in the middle of a pandemic that has raged like a holocaust throughout the world. First, on a purely humanitarian basis alone, pharma companies should be good global citizens and transfer technology purely to help humanity overcome a disastrous event that occurs once in a lifetime.

Second, as far as Covid vaccines are concerned, the financing of the research and rapid development has been possible through billions of dollars poured into these companies by several governments. The U.S. launched Operation Warpspeed which allocated as much as ten billion dollars for producing a vaccine, while Germany and the UK also provided huge funding. It has only been due to this massive financing effort that a Covid vaccine was developed in less than a year, a process that earlier used to take from five to ten years. Public rather than private funds have been used for developing the Covid vaccine. It is thus in the fitness of things that these companies must now use their resources for the public good.

Third, the pharma companies that launched the vaccines have seen a huge rise in share values over the past year. These include Pfizer, Moderna, Astrazeneca and Johnson and Johnson, apart from others which have vaccines under development. The recent U.S. decision brought a sudden dip in stock valuations of these companies and this came into the public eye. But the rise in profitability over the past year has not been highlighted at all.

And finally, while it is indeed correct to say that vaccine production is a complex process, it is certainly within the capability of vaccine manufacturers in developing countries to replicate the process. For instance, currently India has large unutilised capacity for vaccine production. There are as many as 24 vaccine manufacturers in this country which are capable of producing the Covid vaccines, even the new mRNA variety that requires storage in extremely cold conditions.

The good news is that these vaccines need no longer be stored in hyper – cold conditions of minus 80 degrees, though they would still need minus 15 to minus 25 degree temperatures. The advantage of this comprehensive waiver at the WTO will be that it will apply to all member countries. This is in contrast to the existing provision for compulsory licensing for local firms that is available to individual countries in times of crisis. It also includes a provision for imports by countries with inadequate manufacturing capacities to deal with HIV/AIDS, malaria, tuberculosis and "other epidemics".

At this point, however, with Covid raging throughout the world, it would be time-consuming process for individual countries to seek compulsory licensing approvals. Hence the proposal by India and South Africa for a blanket waiver for vaccine production as well as for Covid related drugs and medical equipment. The latter element may not have been supported by the Biden administration but these are also critical requirements of poorer countries to deal with the Covid surge.

The waiver issue may be a long term solution but is definitely a move in the right direction. Covid has not yet disappeared from most countries including India which is facing a disastrous second wave. A third wave has also been predicted and this country as well as others needs to be prepared by vaccinations. This process will be given an impetus by the waiver which will enable enhanced output of vaccines. Ultimately, one can only hope that a speedy decision is taken on the issue so that inequity between rich and poor countries disappears while reaching the goal of universal vaccination against the Covid virus.