Decades of international collaborative research, much of it funded or conducted by governments including that of the United States, enabled the rapid development of highly effective COVID mRNA vaccines. The substantial public contribution to this scientific triumph has, however, not persuaded governments to treat the vaccines as global public goods—resulting in starkly inequitable distribution that should be remembered as an epic failure for humanity.
Vaccines have been available for almost two years, yet only 20 percent of people in low-income countries have had a first shot. And almost no people in low- and middle-income countries have access to the most effective mRNA vaccines, because their production and distribution are under the monopoly control of BioNTech/Pfizer and Moderna, companies to which governments have granted numerous patents and other intellectual property protections. The result has been a stark vaccine apartheid: shots and boosters of mRNA vaccines are easily available to people in wealthy nations while many people in the Global South continue to suffer the pandemic with no vaccines at all.
Governments are eager to be done with COVID, but continued outbreaks around the world—including in regions where populations of immune-suppressed people with HIV can harbor extended infections—mean a more deadly global variant could be just a few mutations away.
Access to vaccines remains crucial, but for a variety of reasons such as recent SARS-CoV2 variants’ ability to evade vaccines, attention has shifted to testing and treatment. Global policy makers need to radically change their approach to how they control the intellectual property regime not only for vaccines but also for COVID treatments and diagnostic tests. Otherwise, the moral and epidemiological failures that led to vaccine apartheid will occur again in treating and diagnosing COVID.
Consider that in clinical trials, Paxlovidreduced COVID mortality by 89 percent, and that the treatment is effective among high-risk groups, including people who are unvaccinated. A new report from the Veterans Administration health system found that treatment with Paxlovid was associated with reduced risk of long COVID regardless of vaccination status. In the United States, anyone who needs it can quickly get Paxlovid. President Biden, Anthony Fauci and many others have benefited from the drug. But if governments uphold intellectual property rules surrounding this and other antiviral treatments, hundreds of thousands of people will die unnecessarily, and multiples of that number will be severely affected by lengthy and damaging infections, hospitalization and lasting side effects. With Omicron variants that evade vaccine-induced immunity, even vaccinated people face repeated breakthrough infections.
Keeping infected people alive and out of hospitals is not only a moral imperative—it’s an economic one. Treatments and vaccines are critical for the livelihoods of billions of people in the developing world, where COVID has created increased income inequality. In these countries, people (and their families) who do not work, do not eat. It’s that simple. And there are global economic implications, of course. The spread of the new variants to China has worsened supply chain problems, exacerbating inflation around the world.
So what can be done to ensure global access to COVID treatments and tests? To start with, we cannot repeat the mistakes that fostered vaccine apartheid. To recap, a temporary waiver of the WTO’s Agreement on TRIPS (Trade-Related Aspects of Intellectual Property Rights, a pact that requires governments to ensure holders of patents and other intellectual property grants have monopoly control over production of protected products) was vital for saving lives. Despite this request at the beginning of the pandemic by South Africa, India and 100 other WTO member nations, as well as support from a global coalition of religious leaders, nonprofits and public intellectuals, the European Union, U.K. and Switzerland blocked it.
And in the case of vaccines, compulsory licenses—a critical tool permitted by the WTO and intended to make sure that critical medicines are available in the midst of an epidemic—proved ineffective. (In contrast to a “voluntary license,” which is issued by a company, a compulsory license comes from a government. It means that a patent holder will be compensated by other firms that produce its patented medicine, but it cannot block more production by denying licensing in order to limit supply and keep prices high.) COVID vaccines, especially the cutting-edge mRNA vaccines, have too many intellectual-property barriers—dozens of patents, copyrights, industrial-design and trade-secret monopolies and too-complex international supply chains—to be made in a timely fashion using compulsory licenses. For instance, the lipids that are a key component are made in just a few locations and are locked behind a web of IP protections, as are other elements of these complex biologic drugs.
Had there been an IP waiver for vaccine production, there is considerable evidence that, in spite of these complexities, some producers around the world would have entered. (The opposition to the waiver, that it would be ineffective because no one could produce the drugs, is ironic: If that were the case, there would be no downside for the drug companies. Moreover, governments that provided so much money for the development of the vaccine, and holding key patents, could have pressured the companies to transfer critical technology.) Remarkably, in spite of the evidence of supply shortages and vaccine apartheid, a WTO ministerial declaration issued in June failed to waive any IP barriers.
Avoiding Treatment Apartheid
There is however the possibility that even without a full waiver, using compulsory licenses for effective treatments like Paxlovid and the many other antivirals now in the pipeline can avoid the kind of discrimination that marked vaccine availability. Paxlovid has many fewer IP barriers than vaccines do. It is also simpler to make, so technology transfer from Pfizer is not necessary. Hundreds of generic manufacturers worldwide could make it.
Since the TRIPS agreement already has a provision allowing compulsory licenses, what’s the problem? Not surprisingly, the pharmaceutical companies never liked the idea of compulsory licenses, and so are doing everything they can to make them ineffective.
There are two problems. First, TRIPS did not adequately provide for compulsory licenses to be used to produce generic medicines that can be exported for use in other countries. So South Africa, Argentina, Chile and other countries that can produce do not have sufficient demand at home to gear up production just for domestic use while small countries like Botswana, Costa Rica or Jamaica are denied generic imports. And secondly, developing-country governments and drug companies have a long history of threatening governments that issue compulsory licenses.
The June WTO ministerial decision had one meaningful provision. Article 8 of the text makes it easier to export generic vaccines—but just vaccines—if only they could be produced using compulsory licenses. Extending that permission to export to treatments and tests could make a real difference in increasing access worldwide .
Just as happened when COVID vaccines emerged, wealthy countries pre-purchased the entire supply of Paxlovid. Under the current pharmaceutical IP regime, the same will likely occur with whatever effective COVID treatment surfaces next. Limited supplies and high costs restrict the flow of COVID-19 antivirals to low- and middle-income regions. In other words, there is great need for treatments in poor countries, but “demand” in the form of orders for Paxlovid has been crushed by a lack of supply and unaffordable pricing.
Consider the effect of Pfizer’s monopoly control over production of Paxlovid: Pfizer made a deal with the UN Medicines Patent Pool (MPP) to voluntarily license 35 firms in 12 countries to make generic Paxlovid that can be sold in 96 nations. But the company has barred sales of those generics in the other 100 countries of the world with 47 percent of the world’s population and the highest COVID infection rates where the firm may think profitable sales are possible.
In some instances, Pfizer has even barred sales in a country where it has issued a license. A Dominican Republic generics firm has a license, but cannot sell doses at home. Pfizer’s deal with all 35 licensees only allows sales in the poorest countries. In the Americas, that means only Guatemala, Haiti, Honduras, Nicaragua and Venezuela. Most African, Middle Eastern and Asian nations that are not Least Developing Countries are likewise excluded. That’s why it’s critical for companies all over the world to be able to make the treatment using a compulsory license and then export it easily.
Disappointingly, the U.S. played a negative role in the June WTO meeting: Over the opposition of most other WTO nations, the U.S. insisted the June WTO COVID deal only cover vaccines. Countries seeking a full waiver successfully pushed for the June Declaration to include a six-month timeline to decide whether to extend the export permission to treatments and disagnostic tests. Today South Africa, Indonesia, Egypt and other countries are pushing for the extension. Only a few countries flacking for Big Pharma, like Switzerland, specifically oppose it.
Immediate U.S. support will be the deciding factor. Recently, a large coalition of U.S. health, faith, consumer, human rights and labor organizations called on President Biden to support broadening the WTO deal to treatments and tests and to publicly declare that no country using compulsory licenses to produce COVID medical supplies will face U.S. threats, political attacks, or trade sanctions. Ironically, the U.S. government issued the most COVID-related compulsory licenses. Yet historically, the U.S. government has systematically attacked countries around the world that employ this WTO-authorized mechanism to improve access to affordable medicine.
The Biden administration should also work with the partners of the dozens of U.S. free trade agreements and bilateral investment treaties to suspend the terms of these pacts that empower corporations to skirt domestic courts and sue governments before a panel of three corporate lawyers—often rife with conflicts of interests and serving on an ad hoc tribunal—if they believe their property rights have been violated. Through this investor-state dispute settlement (ISDS) system, the lawyers can award the corporations unlimited sums to be paid by the country’s taxpayers, including for the loss of expected future profits. A pharmaceutical corporation need only convince the lawyers that a compulsory license or related policy violates some purported investor right granted in one of these pacts. The lawyers’ decisions are not subject to appeal and the amount awarded has no limit. ISDS tribunals have ordered governments to pay corporations more than a billion dollars in compensation.
This is not a hypothetical threat. Today in the Americas, applications for Paxlovid compulsory licenses have been filed in the Dominican Republic, Chile, Colombia and Peru, which each have free trade agreements with the U.S. that have ISDS enforcement. Pfizer, which holds the monopoly patents on the treatment, is fighting to preserve its monopoly and pricing, including by saying compulsory licenses would violate these trade agreements.
As the world pivots from vaccines to testing and treatment, there is a moment of hope and of frustration. But the “apartheid” that marked the era of vaccines will be avoided if and only if the international community insists on a WTO deal to ease exports of compulsorily licensed medicines that goes beyond vaccines and if the U.S. and other countries suspend the ability of the drug companies to sue under these noxious ISDS provisions. Without U.S. support, it won’t happen. And the U.S. can lead the way in agreeing to a trade “ceasefire” of not threatening countries that issue compulsory licenses. The many countries and companies that will be able to produce treatments and tests must be able to sell them to the myriad of countries that can’t get adequate supplies or can’t afford Pfizer’s monopoly prices.
The lives and livelihood of millions depend on it. And so does the moral authority of the West. During the pandemic, global democracies put profits over lives, in contrast to authoritarian regimes, which showed greater solidarity to people in the Third World. We now have a chance to redeem ourselves.
This is an opinion and analysis article, and the views expressed by the author or authors are not necessarily those of Scientific American.
ABOUT THE AUTHOR(S)
Joseph Stiglitz is a professor at Columbia University and serves as chief economist of the Roosevelt Institute. He was awarded the Nobel Prize in Economics in 2001. Follow Joseph Stiglitz on Twitter
Lori Wallach is the director of the Rethink Trade program at American Economic Liberties Project and Senior Advisor to the Citizens Trade Campaign, the U.S. national trade justice coalition. Follow Lori Wallach on Twitter