Profits of Pharmaceutical Monopolies vs Peoples’ Lives: The Current Discussion

The governments of India and South-Africa backed by about 100 countries and counting are calling for a waiver on patents over COVID-19 related medicines and equipment. Headquarter countries of Big Pharma are opposing it. The debate is going on at the WTO and will be decided soon.


LYNN FRIES: As reported by MSF/Médicines Sans Frontières or Doctors Without Borders: “Monopolies are often an obstacle between people and the lifesaving health tools they need. [Intellectual property like]patents and other exclusivities limit supply and keep prices high. In this unprecedented global emergency, governments have taken an incredibly strong stance at the World Trade Organization (WTO), proposing to allow countries to temporarily waive the obligations of enforcing patents, trade secrets, and other types of intellectual property (IP) during the COVID 19 pandemic so that everyone everywhere has access to lifesaving treatments, vaccines, tests and medical tools needed to beat back this pandemic.”

MSF reports 99 of the WTO’s 164 Member States currently back the proposal and MSF calls on all governments to support the WTO waiver in forthcoming deliberations.

Case studies developed by Médicines Sans Frontières with Third World Network show IP obstacles impact access to essential medical products that go way beyond patents on vaccines and pose a barrier to COVID-19 technologies in both developed and developing countries.

SANGEETA SHASHIKANT, Legal Adviser to Third World Network: Diagnostic testing is critical when we are looking to contain the spread of COVID-19. And globally there have been shortages of testing materials. So in the Netherlands, there was a shortage of testing materials because often the diagnostic infrastructure, the testing or the diagnostic, is dependent on proprietary materials. And in the case of Netherlands early on  they were unable to ramp up the testing because Roche was unable to supply the relevant materials. And they refused initially to disclose the recipe for the testing material until there was public pressure and the European commission considered investigating the behavior of Roche. So this shows that the business as usual approaches of pharma companies is hindering access.

And another case in Italy, early on in the pandemic, an Italian hospital ran out of ventilator valves. And their regular supplier was unable to provide those valves. So two local engineers reverse engineered and 3D printed the valves. So the original price of the original valves was 11,000 Euros but the 3D printed valves were as low as $1. And they supplied the Italian hospitals. And the original manufacturer, it was reported that they refused to share the blueprints. It is also reported that the local engineers were unable to scale up to do more 3D printing because of potential legal issues arising from intellectual property rights.

In the US as well, the Governor of Kentucky urged 3M, the holder of the pattern for masks/ N95 masks to release its patent because 3M was unable to provide sufficient supplies. And the Governor of Kentucky was reported asking 3M that if you were to release the patterns there could be a manufacturing done by other manufacturers as well. But that has not happened. So there is a shortage there as well of N95 masks.

A major issue is a lot of the R&D [Research and Development] right now is being driven by public investment and there are no strings attached to this this investment. So pharmaceutical companies are accepting large amounts of sums from taxpayers and they don’t not have any commitments to share the technology, know how and related intellectual property.

FRIES: Opponents of the TRIPS Waiver say that it’s going to impede innovation.

SHASHIKANT: The case for intellectual property in this situation is rather weak. Because a lot of public funding, taxpayer money has gone into the R & D to support the development of these medical products. And if you look at the global pandemic, the development of medical products is actually a global collaboration; it’s through the participation of different actors.

For instance, globally countries have been sharing sequence data so the evolution of the virus may be tracked. Many, many countries are involved in different clinical trials so the safety and efficacy of the medical products can be tested. So it would seem unfair and unethical for pharmaceutical companies then to have dominance and proprietary rights over the knowledge and technology of these medical products.

FRIES: Those were comments by Sangeeta Shashikant, legal advisor to Third World Network, an international research and advisory network. We go now to featured clips from a discussion of the WTO Trips Waiver at a meeting convened by the South Centre, an inter-governmental policy, research and analysis institution of developing countries.

First, I should note a brief history of the WTO TRIPS Agreement can be found in “The Global Politics of Pharmaceutical Monopoly Power” published in 2009 and authored by the then director of MSF/Médicines Sans Frontières, Ellen ‘t . The book is available as a creative commons download. In the book, ‘t Hoen explains the TRIPS Agreement signaled a fundamental change, in that, for the first time global minimum requirements for the creation and protection of intellectual property rights we’re enforceable through the World Trade Organization. TRIPS is an acronym for Trade-Related Aspects of Intellectual Property Rights.

In the book, ‘t Hoen details how the high cost of AIDS medicines focused attention on the relationship between trade agreements that enforce intellectual property rights, like patent protection, and high drug prices. The historic trade dispute in South Africa, Big Pharma versus Nelson Mandela is among many examples chronicled in the book that show the devastating consequences for public health since the TRIPS Agreement came into force in 1995.

In the book, ‘t Hoen addresses important questions about how intellectual property rights got linked to world trade with the creation of the World Trade Organization, questions like: “What was an agreement that created monopolies, which inherently restrict free trade and competition, doing in an institution whose main purpose was to encourage free trade and global competition. What were the forces behind the adoption of the TRIPS Agreement?”

Fast forward to the present and ‘t Hoen, among other distinctions, is Director of Medicines Law and Policy. In an OPED, published by the WIRE October 12th,  “COVID-19 Crisis and WTO: Why India and South Africa’s Proposal on Intellectual Property is Important” ‘t Hoen commented how in 2001, the African countries’ proposal that addressed the IP issues concerning access to HIV medicines at the time of the HIV AIDS crisis was at first rejected by rich countries who claimed that such discussions would jeopardize strong patent protection needed to encourage innovation.

Today all intellectual property of World Health Organization recommended treatments for HIV are licensed to the WHO Medicines Patent Pool or MPP invented by Ellen ‘t Hoen. The Medicines Patent Pool has been a game changer that has ensured all countries, everywhere have affordable access to HIV AIDS medical products. Likewise, ‘t Hoen says, the WHO COVID-19 Technology Access Pool/C-TAP has the potential to effectively address vast shortages and the production and distribution of COVID-19 related medicines and medical products.

But ‘t Hoen says the success of C-TAP will depend on the political support it will receive. She explained this is because C-TAP is a voluntary mechanism. And those who own the rights and knowledge cannot be forced to collaborate. But ‘t Hoen notes, as we’ve seen with the Medicine Patent Pool they can be persuaded.

Ellen ‘t Hoen reported that 40 countries had so far endorsed the C-TAP initiative. For C-TAP to succeed persuasion in the form of demands placed on their funding recipients will need to come from governments and institutions that spend public resources on the development of new COVID-19 drugs and vaccines. Specifically that COVID 19 related IP and know-how created by virtue of that public funding be shared with the WHO C-TAP.

Ellen ‘t Hoen writes that unfortunately, despite the lofty promises of the vaccine as a global public good, wealthy nations are not making such demands. And it is therefore understandable that developing countries are also looking at non-voluntary measures, such as the proposal for a temporary waiver from certain provisions of the TRIPS Agreement for the prevention, containment, and treatment of COVID-19.

No doubt, ‘t Hoen says this will be met with opposition from wealthy countries and drug companies. But those countries and companies who refuse to make the C-TAP a success while telling developing countries that they’re not entitled to take measures to protect public health in the midst of a global health crisis are not credible.

VIVIANA MUNOZ-TELLES, Coordinator of the Development, Innovation and Intelletual Property Programme at the South Centre: This meeting relates to the proposal under discussion in the Council for the Agreement on Trade-Related Aspects of Intellectual Property Rights of the World Trade Organization for a temporary waiver to certain provisions of the TRIPS Agreement for purposes of the prevention, containment, and treatment of COVID 19.

The meeting aims to further inform delegations to the WTO and capital-based officials, also provide clarification and allow for frank exchange on the terms and implications of the waiver, in order to increase the support for the proposal with additional co-sponsorship. Increasing the number of co-sponsors for the proposal will strengthen the position of the group in favor of the waiver to seek agreement at the reconvened session of the Council for TRIPS later this month for forwarding it to the [WTO] General Council for its consideration.

CARLOS CORREA, Executive Director of the South Centre: Let me just focus on the question that has been raised. So, what are the problems that this waiver is addressing? The first substantive problem is the need to expand manufacturing capacity in order to address the COVID-19 crisis. This is particularly true for vaccines, as we know, but it’s also true for equipment and diagnostic kits. Let me just give as an example, the situation of vaccines.

As we know, if there is a possibility of controlling this disease it will necessarily to get vaccination to the world population. So this means to get vaccines for 7.8 billion people. And if there is a need of two doses, this means that it is necessary to produce more than 15 billion doses of the vaccine in a short time. This requires then access to technology. This requires to expand their manufacturing capacity. And in order to do this, it is necessary to have the tools. And the waiver is one of these tools in order to be able to use the technology that may allow the production of vaccines or other products which are necessary to address this disease. So this is one, one essential issue.

GURLEEN KAUR, Second Secretary of the Permanent Mission of India to the WTO: There are no signs yet of the pandemic abating anytime soon. So when you say what motivated the need for this waiver proposal; the concept for the waiver emerged actually in the early stages of the pandemic. So in the month of March and April when several countries were facing acute supply shortages of many medical products, such as ventilators, medical equipment, PPE [Personal Protective Equipment], et cetera. There were reports from different countries showing the real concerns that intellectual property rights hindered the response to COVID-19.  A few initial examples of intellectual property rights becoming a barrier in scaling up the production were on buffers used in test kits, the ventilator valves, et cetera.

So it became apparent that the concern that IP is a barrier to access was applicable to both the existing products as well as the products in pipeline. Many of the repurposed drugs are patent protected in different countries and exclusive voluntary licensing has failed to address their supply shortages. So amid all this international emergency situation, the thinking about the waiver emerged.

So it was felt that the remedies available under the TRIPS Agreement are not adequate to address the fast changing landscape of COVID-19. So why do I say so? Because, you know, we have a limited policy space available under the TRIPS Agreement to address the egregious known actions towards compulsory licenses. But this policy space would not be a feasible option in the pandemic of this scale and magnitude.

Invoking compulsory licenses across a wide range of medical products and that too on a country by country, case by case and product by product basis is a cumbersome and time consuming process, severely limiting their effectiveness in the context of products and technologies required for handling COVID-19.

Medical technologies are required for COVID-19 response are protected by multiple IP. And the understanding and implementation of TRIPS flexibilities in IPs other than patents are limited. So that limits the options available with developing countries to promote rapid scale up of local manufacturing. And furthermore, most countries do not have the necessary infrastructure or experience to use the existing TRIPS flexibilities. Many developing and least developed countries do not have the manufacturing capacity and neither do they have the institutional capacities to issue compulsory licenses. And Article 31bis of the TRIPS Agreement which allows export to such countries who have insufficient or no manufacturing capacity is subject to extremely cumbersome and lengthy procedures rendering meaningless and impractical to use.

So it was therefore felt very important that there is a need to revisit the legal framework for protection of inventions. Because COVID-19 is a threat to the world at large and no country can be immune to its effect. And inability of even one country to address the pandemic due to patent protection can have negative externality for the entire world.

So in the effort towards an effective response to COVID-19, I think main goal is not only to produce a safe and effective vaccine but the goal is to bring the pandemic to an end. And that can happen only after billions of doses are produced affordably. And made available to everyone and particularly to those in low and middle income countries.

So therefore when the first safe and effective vaccines and treatments emerge, we need to ensure that multiple manufacturers can immediately start producing them [inaud]. And so as to ensure that, our waiver proposal aims to remove intellectual property barriers and promote transfer of technology. The waiver will remove legal uncertainty. And it will create freedom to operate and collaborate for scaling up the production of COVID-19 products thereby facilitating timely, equitable and affordable access for such products for all.

I would also like to give a short state of play as to where the proposal stands at present. So the proposal was co-sponsored by India, South Africa, Kenya, and Eswatini was introduced at the TRIPS Council during the session held on 15, 16 October.

The proposal received an enthusiastic response at the TRIPS Council meeting.Around forty members engaged in substantive discussion which lasted more than three hours. And out of these thirty members and observers expressed support for the issue; with 15 members explicitly supporting the proposal from floor and the rest welcomed constructive engagement on the proposal while awaiting feedback from their respective capitals. And the proposal also received broad based support from international organizations like WHO/ World Trade Organization, UNAIDS, MSF/ Médecins Sans Frontières, DNDI/Drugs for Neglected Diseases Initiative and various other civil society organizations.

So what the waiver proposal does is it opens space for further collaboration, for transfer of technology and for more producers to come in to ensure that we have scalability in a much shorter period of time, which is [inaud].So once the production of vaccines and therapeutics is scaled up, it will lead to their timely and affordable access in those developing and least developed countries who may not have the wherewithal to sign a grand purchase agreement with a limited number of suppliers.

So, this is a temporary waiver that will last for a specific period as agreed by the General Council. And it will thereafter be reviewed annually by the members [WTO Member States] until its termination. For taking this proposal to its logical conclusion. It would be important that as many as possible members co-sponsor and support it.

Last but not least, I would say that given the global hardship arising from the pandemic, all members have a shared responsibility to translate into reality the promises of vaccines as a global public good by ensuring that the scientific benefits of the research that they fund from public money are shared as widely as possible to protect people’s lives, livelihoods, and health. I therefore request all members present here to support the adoption of this waiver at the TRIPS Council in the WTO. Thank you.

FRIES: As reported by SUNS/South North development monitor the WTO TRIPS Council will continue their discussion on the waiver proposal initiated by India and South Africa at its next formal meeting on December 10th with the aim of adopting a report on this matter, that can be submitted to the next WTO General Council meeting scheduled for December 16 to 17.

We have to leave it there. Special, thanks to guest contributor, Sangeeta Shashikant. And many thanks to the South Centre for convening the meeting featured in this report and to all meeting participants. And from Geneva, Switzerland thank you for tuning in to this segment of GPEnewsdocs.


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