COVID No-IP-In-Team: The U.S. Injects Progress into a Global Vaccine IP Rights Waiver to Boost Supply

May 14, 2021

2 min read

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What's going on here?

Enraging the pharmaceutical industry, the U.S has backed a suspension of intellectual property rights for COVID-19 vaccines across the world, calling for a team effort in a bid to stymie the crisis.

What does this mean?

According to the Biden administration’s top trade adviser, Katherine Tai, the global health crisis and the extraordinary circumstances of COVID-19 necessitate extraordinary measures. As such, a temporary waiver would entitle countries to ignore patent rights, theoretically enabling quicker and more widespread development of COVID-19 vaccines. Initially recommended by the World Trade Organisation after being proposed by India and South Africa in October, the idea received backing from 60 countries. However, Europe, the UK and the U.S. have, until recently, been reluctant to join the ranks. Pharmaceutical companies have been quick to respond, stating that the lack of vaccines across the globe isn’t a consequence of a lack of technological or biological know-how, but rather a problem of supply chains and production. The U.S. has addressed this by confirming that it will actively work to increase the raw material supply needed to produce vaccines. Soumya Swaminathan, WHO’s chief scientist, has said that this waiver could be a game-changer in the global fight against COVID-19.

What's the big picture effect?

To a significant extent, pharmaceutical companies are only able to produce medication because of the protections afforded to them by IP rights. IP rights enable exclusive creation, invention and production of medicines which allow pharma companies to reap financial rewards. Without such financial rewards, it is argued that pharma companies would cease to be as effective, or perhaps even exist. IP rights such as patents provide pharma companies with a temporary monopoly on the production of their creation, which covers the research and development phases of production with added investment returns. 

This production and revenue-generating system has historically operated with relative ease. Primary periods of ethical concern, however, include the HIV/Aids crisis, when it was argued that medicines should be available across the world at affordable prices. This raised a moral quandary. Our emotional response was that everybody should be entitled to receive treatment, but logically it was argued that pharma companies couldn’t operate without reaping financial returns. This preserves their efficiency and efficacy. IP rights maintain this balance, which has been questioned once more in relation to the COVID-19 pandemic.

Pharma companies have lobbied the U.S. Government, even tapping into the U.S. vs. China and Russia discourse, stating that setting aside patents for COVID-19 vaccines risks handing over technologies to those Eastern states; a rhetoric which would have irked U.S. administrations gone by. More practically, pharma companies have blamed bottlenecks in trade barriers for low vaccine distribution numbers, deflecting the onus onto international governments rather than their accounting books.

WTO Chief Ngozi Okonjo-Iweala was clear in saying that if vaccine manufacturers fail to supply the world with vaccines, they would have to supply the know-how. With the U.S. now involved, the eyes of the world look to the EU’s response.

Report written by Matt Bryan

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