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‘TRIPS Agreement’

  • Category
    Economy
  • Published
    13th Oct, 2020

India and South Africa have presented a draft proposal to the World Trade Organization (WTO)

Context

India and South Africa have presented a draft proposal to the World Trade Organization (WTO) for waiver of some provisions of its TRIPS Agreement on intellectual property (IP) protection to fight the novel coronavirus disease (COVID-19) pandemic; it might be a good move, but begs a few questions.

Background

  • On October 2, WTO published the text of a joint submission by the two countries to the WTO TRIPS Council, seeking the waiver for the prevention, containment and treatment of COVID-19.
  • It was welcomed by public health activists who have been at the vanguard of the struggle to provide access to medicines.
  • They have always held that patents are the major block to providing inexpensive medicines.
  • With the SARS-CoV-2 virus wreaking havoc across the world, the World Health Organization had put together the COVID-19 Technology Access Pool (C-TAP).
  • It is an initiative of Costa Rica aimed at making vaccines, tests, treatments and other health technologies accessible to all to fight the pandemic.
  • Launched at May-end, it garnered the support of 30 countries and a clutch of international partners and institutions. But beyond the high-sounding rhetoric, nothing concrete has come of it.
  • The India-South Africa initiative comes as COVID-19 cases are nudging 35.35 million (October 6, 2020) and fatalities have crossed one million.

Analysis

What is in the Joint Submission?

  • The decision to make the joint submission was taken with the objective of making Covid drugs and vaccines “affordable as well as accessible” for developing and least-developed countries or LDCs, as they are referred to in trade parlance.
  • The idea is to ensure that Covid drugs and vaccines, once available in the market, should not come under “unnecessary” regulation that delays their procurement.
  • Under the joint submission, India has sought removal, or waiver, of Sections 1, 4, 5, and 7 of Part II of the TRIPS Agreement that pertain to copyright, industrial designs, patents and protection of undisclosed information or trade secrets, for drugs and vaccines aimed at Covid-19.

What is the need of waiver?

  • There were several reports about intellectual property rights hindering or potentially hindering the timely provisioning of affordable medical products to Covid-19 patients.
  • A particular concern for countries with insufficient or no manufacturing capacity were the requirements for the cumbersome and lengthy process of the import and export of pharmaceutical products.
    • The variation in the price of Remdesivir which costs less than USD 1 but is sold in India between Rs 4,000 and Rs 5,400 as an example of how licenses incapacitate Indian companies to supply in middle-income countries.
  • Various initiatives to facilitate access to medical products for Covid-19 responses such as ACT-Accelerator, COVAX facility or CTAP so far failed to ensure technology transfer and local production.
  • Instead of facilitating technology transfer, ACT-Accelerator and COVAX Facility reinforce the IP regime and delay the disseminating of technology

TRIPS Agreement

  • The TRIPS Agreement has been in force since 1995 and is to date the most comprehensive multilateral agreement on intellectual property.
  • The TRIPS Agreement introduced global minimum standards for protecting and enforcing nearly all forms of intellectual property rights (IPR), including those for patents.
  • International conventions prior to TRIPS did not specify minimum standards for patents. At the time that negotiations began, over 40 countries in the world did not grant patent protection for pharmaceutical products.
  • The TRIPS Agreement now requires all WTO members, with few exceptions, to adapt their laws to the minimum standards of IPR protection.
  • In addition, the TRIPS Agreement also introduced detailed obligations for the enforcement of intellectual property rights.

WTO members & compulsion

  • The World Trade Organization (WTO) is the international organization dealing with the rules of trade between nations.
  • As in 2020, WTO has 164 members and 24 observer governments.
  • In becoming Members of the WTO, countries undertake to adhere to the 18 specific agreements annexed to the Agreement establishing the WTO.
  • They cannot choose to be party to some agreements but not others (with the exception of a few "plurilateral" agreements that are not obligatory).

Doha Declaration on the TRIPS Agreement

  • In November 2001, WTO members adopted the Doha Declaration on the TRIPS Agreement and Public Health, which is categorical that every member has the right to grant compulsory licences (CLs) and the freedom to determine the grounds upon which such licences are granted.
  • The Doha Declaration did not require any amendment to the text of the TRIPS accord because the grounds for CLs were listed in the original text. The Declaration merely served to reinforce that logic.
  • India, as the leader of the developing world, was expected to make full use of these provisions.
  • But it has been loath to do so for fear of upsetting the US and other big trading partners.
  • After issuing one CL in 2008, it has stepped back and refused to issue any more.
  • This is despite the urgent need to provide life-saving drugs at a reasonable cost to a people who are forced to bear the brunt of medical expenses. 

Conclusion

India will have to do some hard-nosed diplomacy here to swing the proposal its way. If accepted, this proposal will be historic and enable countries to access Covid medicines and vaccines easily, as and when they are available.

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