The WTO Becomes the Nerve Center for Pandemic Response

Newsletter Edition #54 [The Friday Deep Dives]

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Hi,

In these dark times, symbolism matters and must be celebrated.

So although some skeptics may have already dismissed the US support to the TRIPS Waiver negotiations as mere symbolism, we are relieved that this process will definitively spur a faster production of medical products. More lives will be saved as a result.

Undoubtedly the momentum generated at the highest levels has permanently elevated the discussions and the fight for access to medicines. It is perhaps unwise to underestimate the potential spin-offs from this new kind of politics that will shape the access debate in months and years to come. It may well be the beginning of a new phase in the way global health and international trade will be collectively addressed.

COVID-19 has been the ultimate disruption, and it should perhaps not surprise us, that its disruptive impact has also transformed global health diplomacy forever.

It has been a very interesting journey to document the evolution of these discussions. We strung together a dozen-odd stories on the TRIPS Waiver talks that we have reported on over the last few months. Have a look! It has been an extremely instructive experience to watch the ebbs and flows in these discussions. And yet, a long fight is likely going forward.

Also sharing a link to the high-level dialogue on the TRIPS Waiver, which we moderated earlier this week. You can watch it here, a discussion that was rich in perspectives from a former head of state, a US congresswoman, a member of the European Parliament, ambassadors and a trade union leader.

Write to us with your thoughts on the significance of these discussions for global health.

Exceptionally, given the overwhelming public interest in these developments, this story today will be freely available to all readers.

As always, our request is readers must support this initiative by helping us meeting our reporting costs in these crucial months ahead. We have all hands on deck to report on these negotiations. We urge you to sign up and become paying subscribers.

Until next week!

Priti

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Story of the week:

The WTO Becomes the Nerve Center for Pandemic Response

In the late evening of the 5th May, here in Geneva, the international trade community was jolted from its end-of-the-day fatigue with the news of the US support to the waiver of intellectual property protection for COVID-19 vaccines. While the news was cheered among the global health community that has long faced the specter of vaccine shortages and rising deaths from COVID-19, it perplexed the trade lawyers. After all, in one stroke, the US had upended its long-entrenched position on the primacy of the protection of intellectual property, in the 25 plus years of the existence of the TRIPS Agreement.

Irrespective of the outcome and the intent of the move by the USTR, this is quite clearly a watershed moment, going beyond mere political symbolism.

“That the US has opened the door to even discuss a proposal that seeks a blanket waiver on intellectual property protection, is unprecedented. This opens up possibilities to negotiate,” a trade official said.

Clearly, the disruption caused by COVID-19 is evident, not only in the crematoria and even streets in India aglow with the incessant funeral pyres, it has surely disrupted diplomacy in both trade and health circles. Trade sources familiar with the discussions at WTO told Geneva Health Files that they learned of the announcement from the USTR, “like the rest of you”, said one official.

The ‘twitterati’ in global health that comprises experts, academics, activists and journalists dispersed globally, were abuzz with excitement, microblogging their thoughts on the development late into the night, here in Europe.

Image credit: Photo by Sebastian Voortman from Pexels

AN EARLY WIN FOR NGOZI OKONJO-IWEALA?

The way this announcement was made reveals a new way of back-room diplomacy at WTO that caught even insiders off-guard, and it possibly underscores a win for the new DG Ngozi Okonjo-Iweala.

“It is hard to imagine that the WTO DG did not know well in advance that this announcement was coming,” one official said on the condition of anonymity.

In hindsight the meeting last month, convened by DG Okonjo-Iweala on April 14th, that saw manufacturers and some WTO members engage in discussions on ways to address vaccine shortages, seemed to have spurred more engagement and might have pushed members to find solutions. For one, it certainly revealed the existence of spare manufacturing capacity that could be exploited to meet production shortages highlighted by the DG and others in recent weeks.

At the time, this “activist” role of the DG to play a deliberate role in bringing members and the industry together was criticised by some. But now, the convening powers of the WTO DG, some would say, has already yielded results. “The DG can rightfully claim that she pushed the discussions towards finding a solution, including getting members around the table for text-based negotiations on the TRIPS waiver. It is becoming clear that some members look up to her,” one Geneva-based trade official said.

While many of us might have been caught off-guard by this unexpected change of stance from the US government on the waiver proposal, others argue that the signs were there to see.

The statement by USTR on April 14th, on the eve of the meeting with manufacturers, where Ambassador Katherine Tai referred to “market failure” of the industry was a distinct signal, some say. In addition, the discernible change in position was noticed as the discussions on the waiver progressed across informal and formal meetings of the TRIPS council over seven months. From outright opposition, the tone gradually transitioned into a more accommodating one indicating a willingness to engage in discussions, sources present in these consultations told Geneva Health Files.

Sources also said that the DG had been pushing for members to come together for text-based negotiations for the TRIPS waiver proposal first submitted in October 2020 by South Africa and India (IP/C/W/669). She believes that the only way these divergences between members will be resolved is through sitting down for text-based negotiations, official said. “It is very likely she knew about the US position, without which she would not have pushed for text-based negotiations,” one source said.

A day before the USTR announcement, DG Okonjo-Iweala told WTO members at the General Council meeting, “I am firmly convinced that once we can sit down with an actual text in front of us, we shall find a pragmatic way forward, acceptable to all sides that allow the kinds of answers that our developing country members are looking at with respect to vaccines, whilst at the same time looking at research and innovation and how to protect them.”

In a briefing at WHO earlier this week, where Gordon Brown, former Prime Minister of the UK, spoke on financing issues to address the pandemic, he clearly emphasized the change in position on the waiver in many countries.

THE BREAKING OF THE DAM: WHAT NEXT?

The US move itself is being seen as a culmination of a variety of forces coming together from high level political support from former leaders, Nobel laureates, to entire regiments of civil society activists the world over, pushing for a dialogue on ways to lift barriers due to protections on intellectual property, and on trade secrets, copyrights and others, that have been found to impinge on faster and equitable access to medical products needed to quell the pandemic.

It is also important to note the significant counter-offensive launched by lobby groups on either side of the Atlantic and elsewhere, to fight the TRIPS waiver proposal in Washington DC, Brussels and Geneva. (See The Commission's pharma echo chamber: from Corporate Europe Observatory)

Despite the wave of optimism that this change of position of the U.S. has generated, there is recognition on the uphill battle that is to follow in bringing on board other WTO members including the European Union, the UK, Canada, Switzerland, Japan and others opposed to the proposal. Further, the actual process of negotiations, redefining the scope of the original proposal in a way that attracts consensus of all members will be a long-drawn negotiation, experts say.

In recent days, WTO officials emphasised the importance of consensus-driven decision-making at WTO and the difficulty in launching negotiations among its members at the rule-making organization.

(Some experts believe that this could be problematic. Writing in Politico, on the USTR announcement, Germán Velásquez, Special Adviser, Policy and Health at the South Centre said.. “Another troubling element is the reference to the “consensus-based nature of the institution. “This is a clear message to those countries dared to hope the decision would be decided by a vote, at the WHO or elsewhere. This is not the first time that the U.S. has used the concept of “consensus” to basically give itself a veto…”)

A number of countries hitherto, opposed or uncommitted to support the proposal have since articulated a perceptible change in position including Norway, China, New Zealand and others, based on public statements in their reaction to the announcement by the U.S., and those made at the General Council meeting in WTO this week.

Even as pressure is building up within the European Union and on the European Commission, it will be important to see how the biggest European countries, including Germany which has voiced its disagreement with the Biden administration on the waiver proposal, will coalesce around a common position at the WTO.

Even before the US announcement, WTO officials had noted the shared objective among WTO members to ramp up production of vaccines. In a briefing this week, they had articulated that a proposed revision of the waiver suggested by South Africa and India, had generated optimism and that it was likely to have even broader support. The waiver proposal already has 60 co-sponsors and increasing willingness and support from other members.

“Many members believe that addressing the pandemic is one of the most important challenges facing WTO today,” a WTO official told journalists. As many as 42 delegations took the floor on the waiver proposal at the General Council meeting this week.

The co-sponsors of the proposal will share a revised text this month. The next TRIPS Council meeting is scheduled for June 8th-9th. The co-sponsors hope that the text-based negotiations will be undertaken in good faith.

While many actors in global health quickly applauded the US support for negotiations on the proposal, some clearly also demanded that the waiver must be accompanied by agreements on technology transfer to ensure production of vaccines.

“An important component, alongside the waiver of intellectual property rights, will be the transfer of technology, so that manufacturers can receive the know-how to scale up production quickly. This equally applies to therapeutic products such as monoclonal antibodies, which could be an important tool in the COVID-19 response,” Unitaid said in a statement this week.

WHO AND THE TRIPS WAIVER

With the US support to the negotiations on the TRIPS Waiver, the World Trade Organization will become the nerve centre of the international response to the pandemic over the coming weeks and months.

As the leader in responding to this international health emergency, WHO stands vindicated with the US position on the waiver. DG Tedros has peppered his weekly briefings and numerous public statements unflinchingly calling for the need for the IP waiver.

What is important to note, the Gates Foundation, one of the traditional donors of WHO, has hitherto stood, in direct opposition to the idea of sharing technology to boost vaccine production. The donor is also a part of the technology transfer hub that is underpinned by the model of bilateral arrangements to address production shortages. Following the USTR announcement, the Gates Foundation reversed its stance on the issue. (In an interview, less than two weeks ago, Bill Gates had said, that vaccine recipes should not be shared.)

This dissonance in one of WHO’s most important donors, of course, has not stopped DG Tedros from supporting the waiver, even as the expense of taking a stand against those WHO member states who oppose the waiver proposal at the WTO.

On other trade measures for addressing the pandemic:

Calling vaccine policy as economic policy, DG Okonjo-Iweala suggested that members must share vaccines through the COVAX facility or other mechanisms. She added that “Those who have raw materials should allow these to flow through supply chains so that all who can manufacture can take advantage of this.”

On exports restrictions and supply chains she said, “When we listened to manufacturers at the 14 April event that many members have referred to, it was clear that we need to be mindful to the issue of allowing supply chains to work. Otherwise, no matter what capacity we have we will still not be able to manufacture what is needed.”

On working with manufacturers to mobilize existing capacity, she said, “We heard from countries like Pakistan, Bangladesh, India, South Africa, and so on, Indonesia, Senegal, that there is some existing capacity that can be turned around in some months to be able to allow us to manufacture the kinds of doses we may need to go from the 5 billion doses produced in the world today to the 10.8 billion being forecast for this year to 15 billion, in particular if we need booster doses.”

“Countries like Russia, China, Brazil, Cuba, who have vaccines under development or who are already sharing their vaccines with others, should look at ways to boost supplies so we can increase the volume of vaccines in the world. Those who need to get Emergency Use Authorization from the WHO to enable access to their vaccines should do so”, Okonjo-Iweala said.

TAIL PIECE [circa 2003]:

We asked WTO officials on the significance of this moment in the context of the new support from the US towards negotiations on the waiver proposal, especially in comparison with 2003, which was the last time a waiver was introduced in WTO.

(“In August 2003, WTO members agreed to remove an important obstacle to affordable drug imports: they waived the limitation in the TRIPS Agreement to predominantly supply the local market when generic medicines are produced under compulsory licence,” WTO explains. Subsequently in 2005, it was agreed that this decision would be permanently incorporated into the TRIPS agreement, an amendment which finally took effect in 2017 )

This week, Keith Rockwell, director information and external relations at WTO shed light on the events surrounding the 2003 waiver decision in comparison to discussions today:

“…The provision from 2003 [was for] in cases where there is no domestic production capacity, [the question was] can developing countries import certain drugs. They were specifically named to be for malaria tuberculosis and HIV AIDS.

At that particular time, the United States was the only country that was objecting and as you know, [the WTO] it's a consensus based system. So they were holding it up. There was quite a lot of pressure on the US. It was the summer before the Cancun ministerial meeting and there was a meeting, a Saturday meeting of the General Council when the US joined the consensus. I remember it very well... The situation then was also different in that the drugs that were being considered for generic production had been under production for some time and there was capacity in place. It was a question mostly of ensuring that there was confidence on the part of developing countries that they could partner with someone else elsewhere if they lack the capacity themselves. So that's what that was all about.

What what's happening today is different because it is a waiver of the TRIPS agreement beyond patents, it deals with trade secrets, it deals with trademarks deals, with the production of ventilators and other diagnostics, and therapeutics… anything that can be used to combat the pandemic.

What we have seen today is and I would characterize the mood as being very different. I think I said yesterday that the discussions were quite constructive clearly, there is change in the atmosphere. It does not guarantee that there's going to be agreement but without this kind of change, an agreement would not be possible. We don't tend to come up with agreements by magic. These agreements tend to arise when we have when we have a text from which to negotiate.

You are seeing very clearly in fishery subsidies… a much better atmosphere, and much more traction in the talks, as a result of the text coming out last summer. So that's an example.

[On TRIPS waiver] So there has been a text, it was not accepted, it wasn't just the US. That's an important thing to say it other countries....Brazil… Switzerland, Norway, Singapore..and others. So that's a big difference right there.

What would happen next is…depends very much on what happens with the revised text. That [revised] text from South Africa and India not clear when it's coming up...there have been calls for there to be an informal meeting of the trips Council in the latter part of this month at which, perhaps this new text could be unveiled and discussed.

And then you have pledges from the United States, an obviously important player in the WTO context who says they will sit down and negotiate and New Zealand said that too. So once you sit down and start negotiating, there's all manner of possibilities that could emerge. But it's a very different, very different dynamic to what we had at that time [2003].

Other reading:

In "monumental" decision, US expresses support for TRIPS waiver: TWN

Also see this thread: The Geneva Health Files stories on the TRIPS Waiver

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