The Compromise Text on the TRIPS Waiver Will Undermine Vaccine Donations
Newsletter Edition #130 [The Curated Primer]
Today we bring you an update on the TRIPS Waiver discussions. At this point it seems, these negotiations could be plunging into further uncertainty, given the alleged hesitancy of key WTO members on owning and signing off on an emerging compromise text. This could have two implications: members settling for what is being widely seen as a bad outcome; or it could result in long drawn negotiations to improve the text to defend the original intention of the waiver proposal.
With a third of the world not vaccinated yet, the relevance of a waiver of IP provisions continues to remain strong. Read on, to also see just one example that illustrates the devil in the details in the current compromise text.
Thank you for you reading.
Until next week!
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I. POLICY UPDATES
STORY OF THE WEEK
Current Compromise Text on the TRIPS Waiver Will Undermine Vaccine Donations
Global health is determinedly governed in silos. Once in a while though, policy questions seep through these porous boundaries. Somewhat problematically for powers that be.
Take the so-called compromise text - a result of discussions on the TRIPS Waiver proposal between four WTO members.
A provision in the current text that was creatively leaked a few weeks ago in Brussels, seeks to curtail re-exportation of unused doses. This, as it stands, will undermine vaccine donations – a key policy for Gavi’s COVAX Facility. Donations have also been an important geopolitical and diplomatic tool for many countries, especially those that hoarded more vaccines than they needed, often without having specific plans on how to donate.
Gavi - The Vaccine Alliance has never really fully supported the TRIPS Waiver, in line with its most powerful backers including the US government, and the Bill and Melinda Gates Foundation. It is therefore interesting to see that this shrunken form of the TRIPS Waiver, as it currently stands, will actually threaten an important facet of Gavi’s strategy to meet the unmet demand for COVID-19 vaccines – namely donations of doses.
This flies in the face of the original TRIPS Waiver proposal, that actually sought to boost local manufacturing of COVID-19 medical products. It is striking that this version of the compromise text actually impedes even the less-than-preferable policy option such as the donation of vaccine doses. (Also note that donations have not really had the intended effect, mired with problems of short-shelf lives of vaccines and logistical problems.)
A Gavi spokesperson responded to our queries:
“Gavi, as an international private-public partnership, does not have a role in a TRIPS waiver process which is a decision for WTO Member States to take. Gavi welcomes any decision by governments that expand global equitable access to COVID-19 vaccines.
We also recognise the importance of countries’ commitments to ensure free movement of vaccines and removing any barriers that get in the way of equitable access. This is why we urge that all countries also support technology transfer efforts so that not only IP but also know-how is put to use to diversify manufacturing and boost global production, both in the mid-term and in preparation for the next pandemic.”
Legal experts have pointed out that the current text has several TRIPS-plus provisions (provisions that seeks to impose stronger obligations to protect intellectual property than those mandated by the WTO TRIPS Agreement).
HOW DOES THE COMPROMISE TEXT THREATEN DONATIONS?
In the leaked text, a provision reads:
“3 (d) Eligible Members shall undertake all reasonable efforts to prevent the re-exportation of the COVID-19 vaccine that has been imported into their territories under this Decision. All Members shall ensure the availability of effective legal remedies to prevent the importation into their territories of COVID-19 vaccines produced under, and diverted to their markets inconsistently with, this Decision.”
A Geneva-based legal expert who has parsed through the legal implications of the leaked text told us:
“The prevention of re-exportation can prevent donations of unused doses imported under this decision by an eligible member. This will also prevent re-exportation of such doses to COVAX.”
Sources familiar with the discussions suggest that this provision was favored by the EU and by the US. (The Quad process brokered by DG Ngozi Okonjo-Iweala since December 2021, involved discussions between the EU, US, India and South Africa)
Explaining the EU’s support for the provision, the expert suggested:
“The EU has sought to waive Article 31(f) [of the WTO TRIPS Agreement], and may perceive this as an implied waiver of Article 31bis and its annex. In that context, they probably also wanted to not waive the clause in 31bis prohibiting re-exportation under that system.” (See footnotes on text of Articles)
Article 31(f) says such authorizations will predominantly be for the supply of the domestic market of the country that authorizes the use without the consent of the patent holder. The current text waives this provision. However, by seeking to prevent re-exportation it defeats the purpose of waiving this Article 31 (f) and introduces the restriction on re-exportation which does not exist in Article 31(f).
As a result, the implication is that if an eligible member exports any part of the vaccine batches produced under a regular compulsory license in accordance with the waiver of Article 31(f), the limitation on re-exportation under Article 31bis will still apply on the importing country, the source explained.
Article 31bis is a mechanism for compulsory licenses for exports, with conditions, such as on eligible importing Members - countries with insufficient or no pharmaceutical manufacturing capacity. This mechanism has proved to be cumbersome and mostly an unworkable arrangement for WTO members.
Activists say that the current text runs counter to the reality of the current pandemic where speedy transfer of unused doses through re-exportation will be critical to save lives given the speed at which variants have spread.
The current text also “creates a business opportunity for the patent holders to undermine the system through their little donations and platforms that promote such charity business,” the expert said.
Another expert suggested that such a provision will also affect procurement of vaccine doses by smaller countries, especially those that procure in bulk for a region.
This provision illustrates one of the many short-comings of the current text. (See: MSF comments on the reported draft text of the TRIPS Waiver negotiation)
THE CURRENT STATE OF PLAY IN THE DISCUSSIONS AT WTO
At an informal meeting of the WTO General Council earlier this week, it emerged that there is no agreement yet on the leaked text. Apart from the EU, other members of the Quad text appear hesitant to lend their names to this leaked proposal.
South Africa is reported to have suggested that the current proposal is being internally assessed.
Reuters reported earlier this week, that there was no agreement on the compromise text citing comments from US Trade Chief Katherine Tai. She was responding to questions from the members of the House Ways and Means Committee.
“Tai called the text the "concept" of a compromise developed during discussions facilitated by WTO Director General Ngozi Okonjo-Iweala between the United States, the European Union, India and South Africa,” according to Reuters.
In the meantime pressure continues to build on the EU and the WTO to reject the current text. Civil society groups called to “refrain from rushing WTO members to rapidly adopt a purported proposal on intellectual property rights and COVID-19.”
“The text under consideration by some WTO members contains problematic and contradictory elements and remains largely insufficient as an effective pandemic response. Further negotiations are needed to ensure an effective outcome in a multilateral manner, responding to the needs expressed by many WTO members and civil society,” the letter said.
Activists are also calling for an immediate inclusion of therapeutics in the current text that is now limited only to include a waiver of patents on vaccines. They also suggest that access to trade secrets is key for both therapeutics and vaccines.
THE ALLEGED MOTIVATIONS AROUND THE LEAKED TEXT
Observers in Geneva said that the purported leak was meant to discredit the co-sponsors of the TRIPS Waiver proposal, and to put pressure on India and South Africa to own the proposal before it is taken to the wider WTO membership for consideration.
The leaked text continues to be discussed in small groups at the WTO. “Perhaps one strategy is to let countries let the steam off, in such small group meetings, before bringing this proposal to the wider membership at the TRIPS Council”, one developing country diplomat told us.
“At the TRIPS Council, such deliberations are public, and often have a record. They want to avoid an ugly debate at the Council, and hence the process has been deliberately slow.” The diplomat added.
With more than 60 WTO members supporting the original TRIPS Waiver proposal, there is pressure now to widen these discussions and bring the outcome of the Quad process to the TRIPS Council.
“This text should now be brought forward as a facilitator’s text and should be open for debate and negotiation among all members. The DG must own this and bring it to the wider membership”, a lawyer working on the access to medicines told us.
In the meantime, dates for the WTO 12th Ministerial Conference are now scheduled for June 12-15th. This could in turn give an impetus to conclude the resolution on these discussions.
(Proponents of the waiver proposal have maintained that the mechanism can be approved even without a ministerial conference. A General Council decision can be adopted by WTO members. However, for some members, this complicates and lessens the leverage with quid pro quos across other deliverables that typically characterize such negotiations around a ministerial conference.)
Observers anticipate deep implications for developing country alliances at the WTO. It is arguable if it was a strategic error on the part of the co-sponsors, and other members of the WTO, to let the discussions within the Quad proceed for nearly four months.
But recall that discussions at the technical level even between these four members had reached a dead-end by mid-2021. While there was momentum in these discussions in the run-up to the Ministerial conference in December 2021, the abrupt postponement of the event put a spanner in these negotiations. A window to push these discussions to a political level among the four key members, was then opened by the DG. This, observers say has contributed to the weakening of the original proposal.
“Geneva-based diplomats were shut off from the process, and they decided this at a political level. It resulted in a fait accompli” one observer said.
“What signal does it send for future negotiations in the trade diplomacy?” the person asked.
It is likely that other co-sponsors could pressure to widen these discussions and improve the text, even as opponents to the waiver proposal will also make their displeasure known.
(The Ukrainian crisis also continues to muddy the waters for discussions at the WTO. The Geneva Observer reported that the BRICS countries are fighting back.)
What is clear is that the discussions on the TRIPS Waiver are far from over. Hardened activists anticipate negotiations to “go down to the wire” in the coming weeks. “This is the period where deals will be done”, MSF’s Leena Menghaney said this week.
“We cannot settle with a bad outcome, for it sets precedence. The waiver proposal is an “open agenda item” at the TRIPS Council. There is should be no pressure on the co-sponsors to agree to a weak proposal” an activist told us.
What happens at the WTO on the waiver proposal, will have implications beyond the pandemic and have echoes in other forums. Most immediately, at the WHO in the context of the pandemic treaty discussions where developing countries want a waiver-like approach to ensure access to medical products in the context of health emergencies.
 Article 31(f), WTO TRIPS Agreement: Other Use Without Authorization of the Right Holder
Where the law of a Member allows for other use (7) of the subject matter of a patent without the authorization of the right holder, including use by the government or third parties authorized by the government, the following provisions shall be respected: (f) any such use shall be authorized predominantly for the supply of the domestic market of the Member authorizing such use;
 Art. 31bis and annex: “3. In order to ensure that the products imported under the system are used for the public health purposes underlying their importation, eligible importing Members shall take reasonable measures within their means, proportionate to their administrative capacities and to the risk of trade diversion to prevent re-exportation of the products that have actually been imported into their territories under the system. In the event that an eligible importing Member that is a developing country Member or a least-developed country Member experiences difficulty in implementing this provision, developed country Members shall provide, on request and on mutually agreed terms and conditions, technical and financial cooperation in order to facilitate its implementation.”
II. WHAT WE FOUND INTERESTING
How should the world respond to the next pandemic? The Guardian
The BRICs Are Back—And They Are Challenging The West: The Geneva Observer
Putin’s War Is Complicating India’s Middle Path Among Powers: New York Times
Financing the future of WHO: The Lancet
III. PODCAST CORNER
On the heels of World Tuberculosis Day:
Global Health Matters podcast episode 1: Research in the time of COVID-19
This podcast episode featured Dissou Affolabi of Benin’s National Tuberculosis Programme, who shared insights on keeping TB programmes running during the pandemic. Guests from Somalia and India also spoke about how researchers have adapted to the pandemic and the innovative approaches they have taken to continue their work amid the crisis.
Garry Aslanyan is the host and moderator of the Global Health Matters podcast. You can contact him at: firstname.lastname@example.org
This podcast promotion is sponsored by the Global Health Matters podcast.
If you wish to promote relevant information for readers of Geneva Health Files, for a modest fee, get in touch with us at email@example.com.
IV. WHAT WE ARE WATCHING
Working group on strengthening WHO preparedness and response to health emergencies: 28–30 March
Informal consultation on the Standing Committee on Health Emergency Prevention, Preparedness and Response (organized by Austria): 1 April
Informal consultation on clinical trials (organized by the United Kingdom and Argentina); 1 April
Informal consultations related to amending the IHR (2005), (organized by United States of America): 5 April
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