The Folly of Expanding the TRIPS Waiver
Some countries hope the World Trade Organization (WTO) will make a big announcement by December 17. They want a recent "waiver" on intellectual property for Covid-19 vaccines to be expanded to include diagnostics and therapeutics. Other countries are against this, arguing it would only benefit the proponents' industrial policy ambitions and do nothing to facilitate access. Indeed, an expansion would set an untenable precedent, and leave the world less prepared for the next pandemic.
Last June, at a meeting of trade ministers in Geneva, the WTO agreed to a five-year waiver on Covid-19 vaccine patents. The original draft of the waiver included diagnostics and therapeutics. But to get a deal done, an agreement was reached to separate these out and take them up within six months. There is some disagreement about whether an actual vote, or simply a commitment to talk more, is due by December 17. Regardless, WTO members now find themselves less than two months out from this date.
At the WTO, various types of intellectual property, like patents, trademarks and copyrights, are covered under the Agreement on Trade-Related Aspects of Intellectual Property Rights, known as TRIPS. The waiver concluded in June is thus called the "TRIPS waiver." The text of the waiver raises more questions than it answers. Talk of how and why the waiver should be expanded is even less grounded in data. It's a political narrative that sells, but is untethered to current or future needs.
Proponents of the waiver argue that intellectual property keeps patients in developing countries from Covid-19-related medicines and treatments. The South Centre, for example, fears the rise of what it calls "vaccine nationalism," says intellectual property "is currently a barrier," and urges that the waiver doesn't do enough. Public Citizen likes to quote civil society and academic experts who call the waiver "the lowest common denominator," an "abomination" and "worse than nothing," particularly because it doesn't cover diagnostics and therapeutics.
Critics counter that the waiver isn't needed to fight Covid-19. The U.S. Chamber of Commerce, for example, raises "serious concerns" about the TRIPS waiver, calling it a "cynical effort by some to appropriate innovations that are the fruit of others' investments." The Biotechnology Innovation Organization also voices "strong opposition to any form of expansion of the WTO TRIPS waiver," pointing out that 87% of treatments and 25% of antivirals in development are "repurposed or redirected drugs," and wouldn't be on hand without intellectual property. The United States Council for International Business agrees, explaining that "no nation has more to lose from weakened intellectual property rules than the United States."
The TRIPS waiver is a solution in search of a problem, and expanding the waiver to therapeutics and diagnostics simply doubles down on the flawed rationale that intellectual property is a barrier to access. The facts show exactly the opposite. Intellectual property underpins the more than 140 voluntary collaborations, spanning the globe, which are ensuring that supply of vaccines and treatments far exceed demand. Moreover, because many investigational Covid-19 therapies may also be useful for other diseases, expanding the waiver to therapeutics and diagnostics threatens to undermine not only our ability to develop new technologies to combat Covid-19, but also other health emergencies.
Simply put, intellectual property is enabling the rapid development and manufacturing of safe and effective tools to combat Covid-19. Undermining intellectual property rights, including through compulsory licenses, hampers the ability of innovators to respond to the pandemic and other health conditions. Indeed, compulsory licenses are rarely used tools which do not improve access to medicines or achieve other critical public health goals. They do not necessarily lower prices, speed access in the short term, or provide sustainable or comprehensive solutions to longer-term challenges. Moreover, they do not address systemic barriers to access.
Access to medicines is influenced by many factors, such as tariffs and taxes, the availability of doctors and clean water, distribution channels, refrigeration, and education, among others. All are correlated with wealth. Take tariffs, for example. More than 20 developing countries, including India, have no upper limit on their pharmaceutical tariffs, looking to generate revenue. The average on vaccine inputs is 28.6%. The WTO says 23 of the 27 top vaccine manufacturing countries have tariffs of at least 5% on five of the 13 ingredients needed to make vaccines. India's are at least 5% on all 13. Developing Countries could increase access to medicines tomorrow by joining the so-called "zero-for-zero" agreement at the WTO, a pact that has worked to end pharmaceutical tariffs for almost 30 years.
The U.S., Europe and other WTO members want a reality check before weighing an expansion of the TRIPS waiver. Better late than never. The problem is that proponents of expanding the waiver start their analyses taking Covid-19 vaccines, diagnostics and therapeutics as given, whereas critics of the waiver insist that these wouldn't exist without the promise of intellectual property in the first place. To buy into a political narrative, rather than engage in careful analysis, would be tragic: immense: it's impossible to make a generic version of … nothing.
Marc L. Busch is the Karl F. Landegger Professor of International Business Diplomacy at the Walsh School of Foreign Service, Georgetown University. Follow him on Twitter @marclbusch.
