Coronavirus vaccines and the World Trade Organization

Covid-19 has introduced several far-reaching changes in the global order. Some of these are in management of global trade. The division among countries over flexibilities to be allowed in the World Trade Organisation’s intellectual property rules, for global production and distribution of vaccines, is an indication of the turmoil that global trade management and the WTO would encounter in the days to come while nearly hundred vaccines are being developed around the world, nearly ten are in advanced stages of clinical trial with some of these having advanced to human trials too. The race for vaccines has focused attention on which of these will become available for whom, and by how much. In this respect, the issue of national affordability has become significant. There are rising concerns that countries capable of paying more for vaccines will be among the early ones to distribute doses to their national populations.Concerns over low-income populations in several countries missing out on vaccines have been highlighted by findings of a recent study by Oxfam (https://bit.ly/34w9WJX). Based on five vaccines that are in the most advanced stages of trials—Moderna, Pfizer, AstraZeneca, Gamaleya and Sinovac—and the deals struck by their developers for distribution, just above half of the estimated 5.9 billon doses of the five vaccines have been pledged to developed countries that account for only 13% of the global population. The fact that richer countries would have an upper hand in accessing vaccines is clear from the fact that most vaccine developers would look to recover development costs fast, and also make profits from early sales. This would lead to vaccines being priced at costs beyond means of several countries. Richer countries would prioritise purchase of vaccines, irrespective of the prices charged by developers.Much as one appreciates the importance of businesses recovering the high research costs of developing vaccines, Covid-19 is an exceptional situation. It needs to be responded to as a global public health emergency, and calls for balanced distribution of vaccines across the world. This is where the WTO and global trade rules have a major role to play.The intellectual property rules of the WTO have tried balancing a couple of fundamental, but conflicting, objectives. On one hand, they try to encourage innovation and new knowledge, by pledging protection of intellectual property, through various legal standards for trademarks, industrial designs, copyrights and patents. On the other, they have tried to incorporate operational flexibilities for ensuring less ‘rent-seeking’ by owners of knowledge, and concomitant greater access of poorer countries to major knowledge products at affordable rates. In the process, the rules have driven wedges between specific groups in the domain of international trade.Rich countries with businesses endowed with large funds to invest in R&D for new knowledge have been wary of the lack of commercial prospects in WTO member markets that have eligible situations for employing flexibilities to deviate from obligatory IP protection. On the other hand, the latter group of members have been suspicious of ulterior commercial motives of businesses of richer countries, intending to ‘exploit’ the poorer ones by earning rents on the IP they hold.The Covid-19 pandemic and the huge global demand for vaccines have shed new light on these divisions. They have drawn new attention to the ‘rich-poor’, ‘developing-developed’, ‘north-south’ wedge in global trade, largely responsible for patchy progress on the Doha Development Agenda. As access to vaccines become a global public requirement, it has become important to reflect on how such vaccines can be effectively traded across borders to reach people. The problem will assume huge proportions if the flexibilities in the current WTO IP rules do not allow producers, particularly from developing countries, to bypass IP restrictions, and produce branded vaccines for their domestic markets. For a country such as India, which is expected to play a major role in supplying affordable vaccines to the rest of the world, these flexibilities need to be extended to its producers for exporting to other WTO member markets.

South Africa and India urge WTO to waive IP rights, widen access to Covid-19 drugs and vaccines:

As Covid-19 continues to spread across the globe, the governments of India and South Africa have asked the World Trade Organization to waive some provisions in a trade agreement governing intellectual property rights so that medical products can be more easily accessed, especially by low-income countries.The two countries argued that unless a waiver is issued, there are “significant concerns” that diagnostics, medicines and vaccines will not be “available promptly in sufficient quantities and at affordable prices to meet global demand,” according to a submission filed with the WTO’s Council for Trade-Related Aspects of Intellectual Property Rights.The move comes as several wealthy nations — notably, the U.S., the U.K., Germany, and France — have signed deals with various drug makers for hundreds of millions of doses of vaccines that are still being tested but poorer countries lack the means to place such orders and global health officials fear that inequitable access will cause further immeasurable suffering and the coronavirus will not be contained. “It is crucial that other member governments of the WTO support this as we need to ensure that vaccines, drugs, and other medical tools needed for tackling COVID-19 can be scaled up by countries and their manufacturers without facing protracted negotiations for licenses that in most cases exclude many high burden countries,” said Leena Menghaney, who heads the Doctors Without Borders access campaign in South Asia, in a statement. Specifically, India and South Africa proposed waiving rules that govern patents, industrial designs, copyrights, and protection of undisclosed information, a reference to trade secrets. They proposed the waiver “should continue until widespread vaccination is in place globally, and the majority of the world’s population has developed immunity to Covid-19,”. “Internationally, there is an urgent call for global solidarity, and the unhindered global sharing of technology and know-how in order that rapid responses for the handling of Covid-19 can be put in place on a real time basis.” The Indian and South African governments urged the WTO General Council adopt the proposal for an unspecified number of years.If the WTO issues a waiver, countries around the world “could ignore the WTO rules” and look to manufacture lower-cost products, explained Jamie Love of Knowledge Ecology International, an advocacy group that focuses on access to medicines and patent rights. “They would still have to deal with their local laws, and lack of know-how but it would be significant, if adopted, for some products.” The submission occurs as the World Health Organization attempts different mechanisms to ensure greater access to Covid-19 medical products in poor countries.The WHO is working with Gavi, the Vaccine Alliance, and the Coalition for Emergency Preparedness Innovations, or CEPI, to establish Covax, a vaccine purchasing pool in which 172 countries exchange expertise. The plan is to pool economic resources of its member countries to enable vaccine developers to make high-risk investments and subsidize vaccine costs for lower and middle-income countries. The U.S., however, has not joined.In July, the Africa Union, which represents dozens of countries, urged its members to work with the WHO to obtain a vaccine, but not let pharmaceutical patents remain an obstacle. The AU called for “equitable and timely distribution” of a Covid-19 vaccine by partnering with Covax, but also suggested its members consider pursuing compulsory licensing, a right that is noted in the same WTO deal.It appears that this welcome proposal seeks to put the right to health of all people before the profits of a handful of pharmaceutical corporations and should be widely supported. World leaders have said Covid-19 vaccines and treatments must be global public goods but today they remain the private property of pharmaceutical companies. Sharing research and data at this time of unprecedented global crisis is the fastest route to a people’s vaccine and to scale up its production for all.”The WHO, by the way, also launched a Technology Access Pool, which would collect patent rights, regulatory test data, and other information that could be shared for developing drugs, vaccines, and diagnostics to combat Covid-19. However, the International Federation of Pharmaceutical Manufacturers & Associations opposes the effort.

Reading between the lines:

PreQ: Consider the following statement in connection with Corona Virus Vaccine:

1. Moderna, Pfizer, AstraZeneca, Gamaleya and Sinovac vaccines are in the most advanced stages of trials.
2. 4 virtual summit, co-organized by the European Union (EU), Britain, Norway, Saudi Arabia, Japan, Canada, South Africa and several other countries and non-governmental organizations collectively pledged $8 billion to research, manufacture and distribute possible vaccines and treatments for Covid-19

Which of the statements given above is/are correct?

(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

MainsQ: Critically examine the World Trade Organisation’s role for global production and distribution of vaccines?