The United States International Trade Commission (USITC) is investigating the impact of expanding the waiver of intellectual property commitments on COVID-19 vaccines to diagnostics and therapeutics under the World Trade Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).
The Pharmaceutical Research and Manufacturers of America (PhRMA) submitted a brief to the USITC regarding its Section 332 investigation, “COVID-19 Diagnostics and Therapeutics: Supply, Demand, and TRIPS Agreement Flexibilities,” outlining risks from the TRIPS waiver that PhRMA believes undermine the pandemic response and future preparedness.
The brief outlines five key points that emphasize PhRMA’s belief that the USITC should not focus on IP waivers, but should instead focus efforts elsewhere. PhRMA noted that: (1) the biopharmaceutical industry innovated and produced safe and effective vaccines and treatments to combat COVID-19 in record time; (2) industry’s success in combatting COVID-19 was founded on intellectual property protections, including the baseline protections provided by the TRIPS Agreement; (3) extending the waiver would jeopardize the innovation underway to develop new COVID-19 treatments; (4) extending the waiver to COVID-19 therapeutics and diagnostics would weaken American medical innovation and leadership, outsource American jobs, and diminish America’s ability to respond to future pandemics and health crises; and (5) focus on issues impacting distribution and administration of COVID-19 vaccines and therapeutics.
With respect specifically to the importance of the intellectual property protections in manufacturing the COVID-19 vaccines and therapeutics, PhRMA notes that innovation takes resources and if there is no likelihood of return, few would make the investment. However, intellectual property protections allow innovators to recover costs – and potentially make a profit – before others are allowed to make a similar product. PhRMA also points to laws, government agencies, institutions, policies, and programs, that are built on the concept that intellectual property drives innovation.
PhRMA further notes that the TRIPS Agreement promotes access to medicine by establishing a baseline of critical intellectual property rights protections that must be afforded to World Trade Organization (WTO) members. The TRIPS Agreement then provides legal framework needed to incentivize global investment in innovation for new vaccines and therapeutics.
PhRMA also noted that the TRIPS Agreement “establishes a common baseline, not a ceiling for IP-protection” and that members can protect intellectual property “to a greater extent than that required under the TRIPS Agreement.” The United States, among others, have entered into legal agreements to provide a more robust protection, such as the United States-Mexico-Canada Agreement. Without even the baseline protection, manufacturing or even exporting an innovative product outside of the United States puts the innovator at risk of unauthorized copying by competitors, which can stymy medical innovation throughout the world.
In addition to the brief, PhRMA Vice President of International Policy Kevin Haninger made an oral hearing statement to the USITC on March 29, 2023. Haninger’s oral statement was in line with the brief submitted by PhRMA, focusing on the five points.