On 10 March 2021, the World Trade Organization’s (WTO) TRIPS Council addressed the proposal for a waiver from certain provisions of the TRIPS Agreement for the prevention, containment and treatment of COVID-19 (IP/C/W/669) under agenda item 12. This proposal is co-sponsored by 57 WTO members. The Chair of the TRIPS Council, Ambassador Xolelwa Mlumbi-Peter (South Africa) opened the deliberations on the waiver stressing the urgency of the COVID-19 pandemic confronting humanity. “The world is in desperate need of solutions. It can not be business as usual. This is an issue of life and death. People are dying as we speak. We need to engage in discussions to find solutions.”
In terms of procedure, she reminded WTO Members that the next formal meeting of the TRIPS Council would be held on 8 June 2021 to 9 June 2021; she proposed dedicated sessions on 15 April 2021 and 22 April 2021 to consider the TRIPS waiver proposal noting this work would serve as positive guidance to prepare for future pandemics.
After interventions by India, Maldives, Zimbabwe, Qatar, Pakistan, Egypt, Nepal, Bangladesh, and Vanuatu, South Africa took the floor to deliver a lengthy opening statement at the WTO TRIPS Council’s negotiations on a waiver from certain provisions of the TRIPS Agreement for the prevention, containment and treatment of COVID-19 (IP/C/W/669).
In terms of the way forward, South Africa proposed the following pathway for text-based negotiations.
In closing, we would once again call that we move to a text-based discussion. We have come a long way since October, we all agree that COVID-19 is an exceptional circumstance that requires common and inclusive actions. As you indicated Madam Chair, there are common understandings that are emerging, which could be captured in documentary form. We all realize that our destinies are intertwined and that we have to find better ways to collaborate, though we continue to disagree on how this can be done in the best way.
Based on past practice of convening meetings in various formats and configurations, we expect that this practice will continue. Cosponsors will soon start a process to discuss possible approaches to the draft Waiver text which may lead to an amendment of the current text. We look forward to continue this engagement with all Members as a priority, we need to pass this Waiver as soon as possible. Let’s get it done and save lives.
In relation to exhortations to use compulsory licenses and other TRIPS flexibilities, South Africa reminded the Council of the realpolitik world of sanctions and other trade pressure being brought to bear against countries the world over.
Madam Chair,
We keep on hearing the refrain from various Members that TRIPS flexibilities are available and should be use. The Vice President of the European Commission, Mr. Dombrovskis stated in a reply to a question from the European Parliament that “[If] voluntary solutions fail and IP becomes a barrier to access to treatments or vaccines, the TRIPS Agreement provides for a possibility to grant compulsory licences.” However, this is not a reality for many developing countries, whenever such flexibilities are invoked, political and other sanctions are used to counter such efforts.
So far, we have had an extensive exchange in this Council on the importance of TRIPS flexibilities for safeguarding public health and the challenges of solely relying on mechanisms such as compulsory license for government use to manage IP challenges in this pandemic which is a multifaceted issue as we elaborated under IP/C/W/673.
In the recent USTR Special 301 review process in late January, multinational pharmaceutical industry associations PhRMA and BIO have both submitted their comments on IP issues in other countries including those in the COVID19 pandemic. In these submissions, countries have been criticized simply because they have either used TRIPS flexibilities, or adapted emergency rules to facilitate the use of TRIPS flexibilities in the pandemic:
— Russia and Hungary are criticised for their legitimate use of compulsory licenses on COVID19 medicine in a pandemic;
— Hungary, Colombia and Indonesia, are criticised for their emergency regulations to ease the procedure of using compulsory license for government use in the pandemic
— Netherlands is criticised for some legislative discussions on using compulsory license in the pandemic
— European Commission/European Union is criticised for its consideration to improve effective use of compulsory license for access to medicines in its IP action plan
— Chile is criticised for the Chilean Chamber of Dispute’s calling for the use of compulsory license in the pandemic
— South Africa and India for our legitimate use of WTO law to submit the current waiver proposal.
Madam Chair, we recall our questions under IP/C/W/674 and would appreciate delegates of the US and the EU to shed a light on whether the final report of Special 301 review this year and the upcoming EC report on IP enforcement in third countries will both refrain from criticising countries legitimate actions of using and discussing TRIPS flexibilities for public health safeguarding.
The full text of South Africa’s opening statement is reproduced below.
Madam Chair, thank you for giving us the floor. We would like to commend you for your stewardship of this very important matter.
As indicated in previous meetings, 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. Cosponsors executed an intensive schedule of bilateral meetings with various Members during the last two weeks. These meetings included not only Members that support the waiver proposal but also those that have raised concerns. We would like to thank Members for the positive spirit in which these discussions took place and we hope that this will spill over into broader discussions under the auspices of this Council. We therefor endorse your call to shift gears and to move to a more solution-oriented approach.
In respect of the arrangements going forward, the practice of convening both formal and informal meetings, both in small and big group format has worked well. Thank you for confirming 15 and 22 April as possible dates for further meetings, my delegation feels that we may have to resume some meetings sooner than the dates indicated. Cosponsors will reach out in this regard.
In a global pandemic, lifting IP monopolies will give governments and manufacturers full freedom to operate and allow collaboration for the development, production and supply of COVID-19 medical products including therapeutics and vaccines, without being restricted by big corporation’s “voluntary” willingness. The current ad-hoc, secretive and restrictive business as usual voluntary licensing practices is limiting production and artificially constraining supply with detrimental consequences for public health, society, livelihoods and the economy globally. It is an abuse of the intellectual property system for it has in the past one year failed to leverage global production capacity. Passing this waiver makes ethical, epidemiological, and economic sense.
Dr Tedros DG of the WTO proclaimed that A me-first approach might serve short-term political interests, but it is self-defeating and will lead to a protracted recovery, with trade and travel continuing to suffer (Op-ed Guardian, 5 March 2021). Flexibilities in trade regulations exist for emergencies, and surely a global pandemic, which has forced many societies to shut down and caused so much harm to business – both large and small – qualifies. We need to be on a war footing, and it’s important to be clear about what is needed.
We have on several occasions raised concerns about relying on VLs as the main tool for expanding supply for timely access. As with every effort to contribute to dealing with COVID-19, all contributions are welcome. Madam Chair, our experience with VLs is however less than positive. Some key concerns with VLs are first the lack of transparency as the terms of the license are usually confidential; second is the limited geographic scope that even excludes many developing countries from being supplied under the license agreement or allows for manufacturing only for purposes of export; third is that the license is only offered to very specific manufacturers presumably aiming to limit supply; fourth are the restrictive terms on the source and production of active pharmaceutical ingredients (APIs). These and other problematic terms and conditions that restrict production were a commonplace even before the pandemic. They have been a challenge for access prior to the pandemic and such approaches will not deliver to address the access needs of this devastating pandemic. Disparity in access is certain unless concrete steps are taken to address intellectual property barriers.
We have to learn from past mistakes and ensure that the experience of ad hoc, secretive, limited and restrictive VLs does not repeat itself. The pandemic has shone a harsh light on the skewed and unsustainable business models with which the pharmaceutical industry maximises its profits at expense of legitimate public interests. Despite generous contributions from tax-payer money and pre-order purchases, companies are still allowed to decide on critical elements such as the scale of production (and now conveniently complain that demand outstrips supply) while setting ever higher prices that cannot be justified on any rational basis.
It is well reported that South Africa has paid $5.25 a dose for a version of the vaccine manufactured in India while it seems that the European Commission paying only $3.50 per shot. Uganda seems to have paid $8.50 a dose. Some of the explanations given for such price differentials include arguments that high-income countries have a lower price because they have invested in the research and development. However, none of these explanations adequately explain why such large price differentials can be justified. There are already suggestions by pharmaceutical companies of post-pandemic hyper pricing strategies.
Prime Minister Rowley of Trinidad and Tobago said the following: “History is littered with instances of destructive behavior, disrespectful dominance, imbalances and other forms of man’s inhumanity to man. But on this rare occasion, when we are all yoked to an invisible destroyer, it is my hope and plea that when the journal of this experience is written, it would deviate from what is mostly the norm and record that on this occasion, the rich took care of the poor. And the small and impecunious were not trampled with disdain by those who could have done so simply because they had the wherewithal to do it.”
He called for global vaccine distribution based on models of “sharing and caring” that provide equitable access to small countries like his and “benefit of all humankind and not just the privileged, well-heeled few.” We would do well to heed this call.
Madam Chair,
We keep on hearing the refrain from various Members that TRIPS flexibilities are available and should be use. The Vice President of the European Commission, Mr. Dombrovskis stated in a reply to a question from the European Parliament that “[If] voluntary solutions fail and IP becomes a barrier to access to treatments or vaccines, the TRIPS Agreement provides for a possibility to grant compulsory licences.” However, this is not a reality for many developing countries, whenever such flexibilities are invoked, political and other sanctions are used to counter such efforts.
So far, we have had an extensive exchange in this Council on the importance of TRIPS flexibilities for safeguarding public health and the challenges of solely relying on mechanisms such as compulsory license for government use to manage IP challenges in this pandemic which is a multifaceted issue as we elaborated under IP/C/W/673.
In the recent USTR Special 301 review process in late January, multinational pharmaceutical industry associations PhRMA and BIO have both submitted their comments on IP issues in other countries including those in the COVID19 pandemic. In these submissions, countries have been criticized simply because they have either used TRIPS flexibilities, or adapted emergency rules to facilitate the use of TRIPS flexibilities in the pandemic:
— Russia and Hungary are criticised for their legitimate use of compulsory licenses on COVID19 medicine in a pandemic;
— Hungary, Colombia and Indonesia,are criticised for their emergency regulations to ease the procedure of using compulsory license for government use in the pandemic
— Netherlands is criticised for some legislative discussions on using compulsory license in the pandemic
— European Commission/European Union is criticised for its consideration to improve effective use of compulsory license for access to medicines in its IP action plan
— Chile is criticised for the Chilean Chamber of Dispute’s calling for the use of compulsory license in the pandemic
— South Africa and India for our legitimate use of WTO law to submit the current waiver proposal.
Madam Chair, we recall our questions under IP/C/W/674 and would appreciate delegates of the US and the EU to shed a light on whether the final report of Special 301 review this year and the upcoming EC report on IP enforcement in third countries will both refrain from criticising countries legitimate actions of using and discussing TRIPS flexibilities for public health safeguarding.
In closing, we would once again call that we move to a text-based discussion. We have come a long way since October, we all agree that COVID-19 is an exceptional circumstance that requires common and inclusive actions. As you indicated Madam Chair, there are common understandings that are emerging, which could be captured in documentary form. We all realize that our destinies are intertwined and that we have to find better ways to collaborate, though we continue to disagree on how this can be done in the best way.
Based on past practice of convening meetings in various formats and configurations, we expect that this practice will continue. Cosponsors will soon start a process to discuss possible approaches to the draft Waiver text which may lead to an amendment of the current text. We look forward to continue this engagement with all Members as a priority, we need to pass this Waiver as soon as possible. Let’s get it done and save lives.