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Proposed IP Waiver Agreement Would Harm U.S. Manufacturers, Innovation

The U.S., EU, South Africa and India have reached a compromise on a troubling intellectual property rights waiver for coronavirus vaccines, POLITICO Pro (subscription) first reported and the Office of the U.S. Trade Representative confirmed.

What’s happening: As part of the purported draft agreement, developing countries could “be able to authorize the use of a patented coronavirus vaccine without the owner of the patent’s consent” and could even export that vaccine to other countries, according to the POLITICO article. The purported draft text:

  • Is much broader than traditional forms of compulsory licensing, allowing countries to use means such as executive orders to ramp up production of a vaccine without consultation or transparency;
  • Could be expanded beyond vaccines to other coronavirus-related products like diagnostic tests and treatments as quickly as six months; and
  • Is limited to developing countries that exported less than 10% of the world’s coronavirus vaccine doses last year, criteria that would exclude China but would include India, even though India’s low export numbers last year are the direct result of its failure to meet key global commitments to export vaccines.

What comes next: The purported draft text still requires agreement among the four negotiation partners, as well as the broader World Trade Organization membership, indicating that this deal is far from final. 
Why it matters: The outlines of the agreement to waive intellectual property rights for COVID-19 products would harm U.S. technology leadership and the well-paying jobs it provides, while doing little to get shots in the arms of more people worldwide, said NAM Vice President of International Economic Affairs Ken Monahan.

The last word: “As the pandemic has evolved, it is increasingly clear that the core challenge to delivering effective shots in arms around the world is not supply, but logistics, distribution and demand,” Monahan said.

  • “The world does not need politically driven solutions that ignore the most pressing COVID-19 challenges while sacrificing the power and potential of manufacturing innovation in the United States. Instead, the world needs effective, practical, broadly supported initiatives suited to best fight COVID-19 now, including stronger coordination to tackle supply chain bottlenecks and facilitate trade in health products.”
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