K.M. Gopakumar speaks to Shalini Yog Shah about global vaccine monopoly, TRIPS Agreement and hurdles in vaccine production
What is the TRIPS Agreement and why are its flexibilities not enough to ensure fair and just access to vaccines worldwide? Why is the COVID-19 Vaccines Global Access (COVAX) facility not enough?
KM Gopakumar: The Agreement on (TRIPS) creates a legal obligation and sets minimum standards on members of the WTO to protect and enforce various intellectual property (IP) rights such as patent, trade secrets, copyrights, industrial designs and trademarks. Except for the least developed countries (LDCs), all WTO members are to adhere to the minimum standards prescribed under the TRIPS Agreement.
One of the TRIPS obligations adversely impacting people’s health is the compulsory patent protection on pharmaceutical inventions. As a result, all WTO members, including developing countries like India, are under an obligation to provide patent protection to medicines, vaccines, diagnostics and so on, and this legal monopoly prevents other companies from producing the said patented pharmaceutical products. Often this monopoly is abused by the patent holder, which leads to charging higher prices for pharmaceuticals, thereby preventing the people and governments from buying the newly efficacious medicines. In other words, the high prices of medicines restrict the developing countries to fulfill their human rights obligations pertaining to the right to health and the right to science.
Another TRIPS provision that has a direct impact on access to medicines and vaccines is trade secret protection. The current regulatory framework for the marketing approval of generic production of vaccines and biotherapeutics insists on following the manufacturing process of the originator – the company that first obtained the marketing approval of the vaccine/ biotherapeutics – to waive the clinical trial requirements.
Since the originator companies protect the manufacturing process as a trade secret, generic vaccine and biotherapeutic producers end up in repeating the clinical trials, which involve considerable money and time. Although originator companies submit the details of the manufacturing process to the medicine regulatory agencies in the dossiers submitted for the marketing approval, the TRIPS Agreement prevents regulatory agencies from disclosing such information without taking measures against unfair commercial use. The only exception to the above rule is when such disclosure is necessary to protect the public. However, there is no clarity about the scope of the exception, i.e., if the regulator agencies can provide the information to potential manufacturers to fast track the production. Thus, these provisions of the TRIPS Agreement cumulatively aid in creating the monopoly of power to the pharmaceutical transnational corporations (TNCs).
In a pandemic, we need to develop new products, and the IP can have a chilling effect on innovation...
Nonetheless, the TRIPS Agreement contains certain provisions to prevent abuse of monopoly or provide medicines at an affordable price, commonly known as flexibilities. One of the most important flexibilities is the use of patents without the authorisation of the patent holder known as compulsory license (CL), which allows other manufactures to produce the patented medicines without the permission of the patent holder. Generally speaking, there are two types of compulsory licenses – compulsory license granted on the request of the private entities and compulsory license initiated by the government (government use license). The use of these flexibilities enables other companies to manufacture the product to ensure economic accessibility and meet the demand. Thus, the flexibilities are critical to ensure access to medicines and other health products.
However, these flexibilities have only a limited utility in a pandemic situation due to the several reasons. First, the range of health products such as diagnostics, therapeutics, vaccines, personal protective equipment (PPE) and ventilators required to respond to COVID-19 is enormous and many of them are protected with different IP rights including patents, trade secrets and copyrights. The use of TRIPS flexibilities in the public health context is limited to patents and many countries do not have CL provisions for copyrights, trade secrets and industrial designs. Further, products like vaccines are protected with a large number of patents while many patents are in the pipeline. Issuing CL at this stage may raise enormous pressures from the patent holders and developed countries too. Further, the patent is given on a case to case basis and is product-specific. In a pandemic, we need to develop new products, and the IP can have a chilling effect on innovation, because innovators who do not own the IP in a particular technology might be reluctant to use the IP-protected technology for innovation. Therefore, new approaches are required to remove the IP barriers to scale up the production of COVID-19 health products. Currently, there is inequitable access to various COVID-19 health products, including vaccines. Countries having high income are getting vaccinated 30 times faster than the low income.
COVAX, the international mechanism to ensure equitable access to vaccines, could not fulfill its promise of providing timely access to 2 billion doses covering 20 per cent of the population living in the low and middle income countries (LMICs). It is worthwhile to note that this 20 per cent vaccine coverage is not enough to provide effective protection to the population in LMICs, as it requires vaccination of 80 to 90 per cent of the population.
The current situation demands taking urgent measures to remove the monopoly in vaccine manufacturing and scale up the production of vaccines. Waiver of TRIPS obligation for the protection and enforcement of IP rights facilitates the removal of an important barrier to the local production or replication of IP-protected health products or technology.
What is the importance of the patent waiver proposed by India and South Africa at the WTO? Please explain its significance for developing countries like India in terms of local production and distribution of vaccines.
KM Gopakumar: The TRIPS waiver proposal, if adopted, would provide the required policy space to WTO members to do away with protection and enforcement of copyrights, industrial designs, patents and trade secrets. It would also enable the local producers in Global South to produce the therapeutics, vaccines, diagnostics and other health products required for COVID-19 response without the fear of IP infringement.
However, three WTO members – the EU, the UK and Switzerland – are blocking the progress in the negotiation stating that they do not believe in the idea of waiver.
Currently, the production and supply of these products are concentrated in a few countries. Five countries produce 75 per cent of COVID19 vaccines. As a result, the existing producers are not in a position to meet the demand or provide these products at affordable prices. The waiver could enable the removal of the legal barriers for the scaling up of the production of health products through the diversification of manufacturing.
The WTO members are currently engaged in text-based negotiations to finalise the decision of the waiver. The US has declared its support for the waiver of IP rights in the context of COVID-19 vaccines and this announcement resulted in the support of a few more developed countries.
However, three WTO members – the EU, the UK and Switzerland – are blocking the progress in the negotiation stating that they do not believe in the idea of waiver. These three WTO members do not support the idea of diversification of COVID-19 vaccine production without the control of originator companies and, therefore, are pushing for technology transfer through voluntary licensing, which gives the control to the originator companies.
Further, the EU submitted a draft proposal for a ministerial declaration reiterating the existing flexibilities related to the CL provisions under Article 31 of the TRIPS Agreement, which was already clarified as part of the Doha Declaration on the TRIPS Agreement and Public Health 2001. For instance, the EU proposal seeks to clarify that present pandemic constitutes a national emergency and therefore there is no requirement of prior negotiations before the issuance of a compulsory license. Under Article 31 (b) of the TRIPS Agreement, a CL can be issued without prior negotiations in the case of national emergency or other circumstances of extreme urgency or in cases of public non-commercial use. However, Para 5 (c) the Doha Declaration in 2001 states: “Each member has the right to determine what constitutes a national emergency or other circumstances of extreme urgency, it being understood that public health crises, including those relating to HIV/ AIDS, tuberculosis, malaria and other epidemics, can represent a national emergency or other circumstances of extreme urgency.” Thus it is clear that a WTO member has the right to issue a CL without a prior negotiation in the current and future pandemic. Further, the EU demands treating its draft proposal at equal footing with the waiver proposal, which was initiated as a separate agenda item under Article IX of the Agreement Establishing WTO. Article IX allows the WTO General Council to temporarily waive the obligation under any WTO Agreements.
How can the pharmaceutical companies monopolise COVID-19 vaccine production given that these companies have received large amounts of public funds for their research?
KM Gopakumar: One of the conventional justifications for IP protection is that it is a mechanism to facilitate the recouping of research and development (R&D) costs by preventing the free-riding of the invention. However, in the case of COVID-19, these vaccines were developed with the aid of huge public funding to the tune of US$93 billion. Many governments provided financial support to fund R&D expenditure and manufacturing costs through advanced market commitments. Thus, there was complete de-risking of the COVID-19 vaccine development, production and distribution. For instance, Moderna received nearly 100 per cent public funding. Similarly, the AstraZeneca vaccine received 97 per cent public funding. Although Pfizer did not receive any financial aid for the vaccine development, its partner Bion-tech received public funding from the German government. Moreover, Pfizer received an initial advanced market commitment worth US$1.95 billion to support the vaccine development.
Apart from the IP barriers, there are other bottlenecks to scale up the production such as the supply of raw materials, equipment and machinery for vaccine production.
Irrespective of public funding, these companies refused to share the technology to scale up the production, which is necessary to address the unmet demand. Many governments that provide the money to develop vaccines are not taking effective measures to facilitate the diversification of the production base. This shows that governments need to put access friendly conditions such as open licensing and affordable price to fund innovation in health products. There is an urgent need to revamp the governance of the health innovation system to prevent the socialisation of risks and privatisation of profit.
What are some of the other roadblocks to equitable global vaccine supply in addition to the patent waiver?
KM Gopakumar: A patent is one of the IP barriers. Apart from patents, trade secrets also play an important role in the scaling up of the production of the vaccines. The details of the vaccine production process, including chemistry and control mechanisms, are kept as a trade secret. The current regulatory framework for providing the marketing approval often insists on the replication of clinical trials if a generic vaccine producer is not following the manufacturing process of the originator. This is a time and resource consuming process that exacerbates the cost of the generic product.
Therefore, lifting the trade secret is also an important step to end the vaccine monopoly. In the Indian context, the government has to take measures by sharing the manufacturing process with potential manufacturers to scale up the production. Apart from the IP barriers, there are other bottlenecks to scale up the production such as the supply of raw materials, equipment and machinery for vaccine production. However, these bottlenecks can be addressed with various policy measures such as financing. The scaling up of the product can also result in the enhancement of raw material supply and equipment. However, the IP barrier cannot be addressed effectively at the national level because it is emanating from an international obligation to protect and enforce IP rights.
India has been at the forefront of multilateral vaccine diplomacy efforts, as have China and Russia. While the efforts are appreciated on humanitarian grounds, would you agree that economic or geopolitical interests drive the distribution of these vaccines to friendly lower-income countries? Corollary to this, in the absence of a coordinated international vaccine distribution policy, irrespective of who produces, many poor and vulnerable countries in Africa, Latin America and the MENA region are being left behind and waiting for vaccines. Should vaccine distribution be left to the impulses of economic and political interests?
KM Gopakumar: In April 2020, the UN General Assembly adopted a resolution, which entrusted the UN Secretary-General to work with WHO to develop an equitable framework for vaccine distribution. This was followed up with the World Health Assembly resolution in 2020, which entrusted the WHO Director-General to develop an equitable framework for the global vaccine distribution. As per this global allocation framework, 20 per cent of the population were prioritised, which includes health workers, senior citizens and people with comorbidities.
However, developed countries did not adhere to this framework and started grabbing vaccine doses using advanced market commitments, i.e. giving bulk orders in advance during the development stage of the vaccine. Countries like Canada accumulated vaccine doses to the extent of providing 9 doses per person. This complete disregard to the global framework left the developing countries without adequate doses even to cover 20 per cent of the population. Further, these developed countries allowed their vaccine manufacturers to enjoy monopoly profit. This huge supply gap in developing countries is being filled up by supplies from Russia, China and India. Russia not only supplied vaccines, but also provided liberal technology transfer to facilitate production in developing countries. The reluctance of developed countries to treat COVID-91 vaccines as a global public good and their quest to protect the commercial interest of their vaccine makers resulted in this situation. Therefore, the role of China, Russia and India should not be dismissed as vaccine diplomacy. Ideally, the vaccine should be treated as a global public good and there should be a legally binding mechanism to ensure the availability and affordability of vaccines, especially to meet health emergencies.
Let us have a look at the global vaccination rollout and how it is connected to the economic recovery of countries. Please share your views. In addition, what is the status of the Indian vaccination rollout, and what it spells?
KM Gopakumar: The inequity in vaccines production and supply defeats the very purpose of vaccination, i.e., the effective response to COVID-19. There should be substantial coverage of the world population at the shortest possible time to have the desired effect of the vaccination. The current inequity results in the denial of vaccination to a substantial percentage of the population, especially those who live in developing countries. This inequitable access would result in new variants of the virus and can even threaten the safety of those already vaccinated. Thus, nobody is safe until everybody is safe. Further, people in developing countries with little social security need to restart their normal economic activities. This could be possible only through massive vaccination. Thus, vaccine inequity compromises both the economic and health securities of people.
This inequitable access would result in new variants of the virus and can even threaten the safety of those already vaccinated.
Although the first dose of administered vaccine crossed 420 million in India, the number of people who obtained the required two doses is only 90 million, which is a very small percentage of the population. India needs to achieve nearly 1,900 million doses to cover 70 per cent of the population for any meaningful level of vaccine protection. This means another 1,500 million doses are to be administered. The stumbling block in this regard is the availability of required doses. Currently, there is a duopoly in the market and these two companies with their optimum capacity are not in a position to meet the requirements. The Government of India needs to take urgent steps to scale up vaccine production. Towards this purpose, it has facilitated the technology transfer of Covaxin to six firms but there is an urgent need to take proactive steps to facilitate the technology transfers of various COVID-19 vaccine to all potential manufacturers.
COVID-19 has been a wake-up call for countries concerning their healthcare systems. How do we in India prepare for equally exceptional circumstances in the future, as certainly, this is not the last pandemic?
KM Gopakumar: COVID-19 reinforces the urgent need to have a robust healthcare system, which is the backbone of any health emergency preparedness and response. In the absence of a publicly funded functioning healthcare system, the government is incapacitated to respond to COVID-19 eventualities. Currently, the healthcare system in India is dominated by private actors and nearly 70 per cent of the ailments are treated in private hospitals. The COVID-19 situation requires inpatient care to a certain percentage of the infected population. The lack of a functioning public healthcare system slowed down the prevention, control and treatment efforts. Moreover, the dependency on private healthcare facilities resulted in the overcharging of COVID-19 diagnostic and treatment.
Similarly, lack of public health infrastructure prevents the government from stepping up the track, trace, test and treat mechanism. Apart from the healthcare system, lack of administrative infrastructure to reach out to people also affected the ability of the government to provide the required social security during the pandemic. For instance, though there is free provisioning of food through the public distribution system, lack of ration cards or other documents prevents a large section of the people from availing the benefit. Likewise, the government needs to invest in public health and administrative infrastructure. Currently, the public investment in health is around 1 per cent of the GDP, which needs to be enhanced to 5 per cent to 6 per cent without any further delay. Despite promises, this has not happened, and the people had to pay the price for it. There is no other shortcut.
This interview is part of series Democratising vaccine and its production -A perspective from India and South Africa . It is Jointly produced by Heinrich Böll Stiftung Capetown office & Heinrich Böll Stiftung Regional Office New Delhi.