The India South Africa Proposal: Strengths & Weaknesses

By October 29, 2020 November 3rd, 2020 TRIPS

On October 2, 2020, India and South Africa jointly tabled a proposal titled Waiver From Certain Provisions Of The Trips Agreement For The Prevention, Containment And Treatment Of COVID-19  (IP/C/W/669) to the Council for Trade Related Aspects of Intellectual Property Rights.

In paragraph 11 of the document, both countries have noted that “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.”

It is a fact that the onset of COVID-19 has altered the face of global trade. Pre-COVID, trade dictated public health – efforts to protect public health was considered a barrier to trade. The significance of COVID-19 is the realization that public health dictates trade. Indeed, trade will and has been one of the biggest casualties of a tethering public health which ultimately threatens to obliterate the objectives of the trade regime. Hence, global solidarity to ensure collaboration in research, innovation, distribution and sharing of intellectual properties and technology will represent an important milestone of globalization, which is what the trade regime envisaged. Such global collaboration has become a necessity given the circumstances which India and South Africa, as leading developing countries, have recognized.

As both countries point out in paragraph 10, developing countries indeed face institutional and legal difficulties. The use of TRIPS flexibilities – including the Doha Declaration – has been met with unilateral pressures and threat of sanctions. Unfortunately, it is a fact that the WTO has nurtured and sustained both institutional as well as legal difficulties, thus becoming one of the International barriers to access medication. In in our forthcoming book on the subject, I assert that the WTO has been responsible for seven important barriers to access medication which includes:

  1. Prioritizing market of access over domestic issues,
  2. Prioritizing trade over public health,
  3. Sustaining International bargaining parities causing industry lobbies to take over trade agenda indirectly,
  4. Normative as opposed to a realistic interpretation of international treaties ((by the DSU of the WTO) which goes against conventional reading of international instruments,
  5. Soft treading on unilateral actions of powerful members which resulted in exacerbation of the international reach of an administrative body such as the USTR,
  6. Inbuilt inefficiencies of the WTO system leading to its inability to work in synch with bodies such as the UN, WHO, etc., resulting in FTAs, bilateral agreements and TRIPS-Plus arrangements.

Each of the deficiencies highlighted above has adversely affected developing countries. The WTO has shown a high propensity to ignore epidemics be it AIDS, SARS or Ebola. The WTO’s record in working the TRIPS flexibilities in a manner preserving global public health has been, at best, abysmal.

Consequently, the failings of the WTO thus far have affected public health in poor countries, in turn, affecting economic productivity, which in turn, has affected national and global trade. Both India and South Africa stand on strong grounds when they allege that institutional and legal difficulties, some of which is national but much of which is also owed to trade terms, detrimentally affects its ability to effectively deal with COVID-19.

Global reactions have ranged from national actions such as policy amendments, funding innovation, call for coalition and finally, cries to be a part of global networks and WHO programs such as C-TAC. Germany, France, Israel, UK and Canada, for instance, have passed legislations to compulsorily license underlying technologies. Costa Rica was the first to appeal for a global coalition. India and a few other countries tried to negotiate voluntary licenses. But, it is becoming increasingly clear that there is a need for cohesive coalitions, harmonized policy approaches such as suspension of intellectual property rights to fully address the issue to present viable, efficient solutions to address COVID -19 health products in an accessible and affordable manner.

Compulsory license is one of the most viable tools to ensure access and availability of medication. Price control, minimizing regulatory burdens such as data protection, suspending intellectual property rights, especially on patents are important and required at this time. Compulsory licenses form a subset of the flexibilities that TRIPS Agreement offers. It is worth pointing out that in 2001 when a mere 200-plus Americans were infected from an unknown white substance with anthrax, the very first solution that the United States turned to was compulsory licensing.

As for voluntary licenses, initially, Gilead offered such licenses when Remdesivir remained a viable possibility but even that was not offered uniformly, nor was it offered to all countries, which in itself showcased some of challenges of entering into a voluntary licensing regime. While several companies have entered into the race to create a vaccine, the issues with the vaccines are unfolding. For example, Johnson & Johnson and Eli Lilly have both suspended clinical trials over the vaccine in the past week. The Oxford-Serum-Astra Zeneca vaccine have entered into difficulties. In the US, recently Moderna has agreed to share its technology and patents after it became clear that the company benefited from over $800 million in public funding. Recently, Knowledge Ecology International (KEI) used a FOIA request to obtain Other Transaction Agreements of the DHS with Moderna and Astra Zeneca: both agreements are disturbing and seem to justify the fears outlined by India and South Africa that creating private rights will result in disparate access to COVID-19 health products. Considering the extent of public funding that the respective companies seem to receive, coupled with the fact that the intellectual property provisions were redacted from public-view, creates a strong suspicion that that private ownership was facilitated over public-funded research-output.

As pointed out by India and South Africa in paragraph 5 of the submission, “[A]n effective response to COVID-19 pandemic requires rapid access to affordable medical products including diagnostic kits, medical masks, other personal protective equipment and ventilators, as well as vaccines and medicines for the prevention and treatment of patients in dire need.”

It is important to note that both countries have not sought a general waiver or suspension of intellectual property rights. Instead, what has been asked is very reasonable. Both countries have requested the TRIPS Council to consider “a waiver from the implementation, application and enforcement of Sections 1, 4, 5, and 7 of Part II of the TRIPS Agreement in relation to prevention, containment or treatment of COVID-19.” Of these, sections 4 and 5 of Part II of TRIPS relates to patent protection and industrial designs, while section 1 of Part II of TRIPS deals with copyright issues which may be important for transfer of technology and section 7 of Part II of TRIPS deals with regulatory protection of data, which is absolutely essential at this time. For example, the US had a mere 80,000 cases of COVID-19 cases, the FDA granted Gilead’s Remdesivir an orphan drug status in March 2020, which was finally withdrawn after a public outcry from KEI. Orphan drug status would have granted 7 years of additional market exclusivity – in addition to the patent term of 20 years over Remdesivir, data protection for 5 or 3 years as the case is, which is granted at the time of filing the new chemical entity. To avoid such circumventions, Avoiding such issues will be achieved if section 7 of Part II of the TRIPS Agreement is suspended, which is what India and South Africa has sought.

It is interesting that both countries have not specifically asked for transfer of technology. In fact, the preamble of the TRIPS Agreement envisages the facilitation of technology transfers. Other agreements, such as the convention on biological diversity support the need for transfer of technology. It is also commendable that the note has not sought a general suspension of intellectual property rights. Given the above, the proposal from India and South Africa is reasonable, required and even necessary to deal with the pandemic.

About the Author

  • TradeRx Report Coordinator & Advisor
    Professor of Law and Director of India Programs, Texas A&M University School of Law.