COVID-19, TRIPS Waiver, and the Vaccine Patent Dispute (Ichiro NAKAYAMA)
The last time I was in charge of this column was at the end of May 2020, when the new coronavirus infection (hereinafter referred to as "COVID-19") was introduced. This is the early days of the pandemic. In my previous column, which was also immediately after the WHO resolution in May 2020, I asked whether patent rights for vaccines and other patents should be restricted through compulsory licenses[1], or whether access to medicines can be ensured even if it is left to the voluntary efforts of patent holders. I introduced the situation in which the discussion is beginning.
In this column, I will introduce the "unexpected" development after that[2].
TRIPSThe appearance of the Weaver proposal
The initial (traditional) debate on whether to pursue compulsory licenses or voluntary initiatives has since changed drastically. In October 2020, the Agreement on Trade-Related Aspects of Intellectual Property Rights (hereinafter referred to as the "TRIPS Agreement") was established. A proposal to waiver the obligation to implement a wide range of provisions has been submitted to the TRIPS Board by India and South Africa. In consideration of the objections to this proposal, an amendment proposal with a somewhat limited scope of exemption was subsequently submitted in May 2021 (hereinafter referred to as the "original proposal", the amendment proposal as the "amendment proposal", and the two together as the "waiver proposal"). ）。
The waiver proposal comprehensively exempts member states from their performance obligations (e.g., Section 5 of Part 2 of the TRIPS Agreement in the case of patents) of the broad provisions of the TRIPS Agreement, and restricts intellectual property rights beyond compulsory licenses. In other words, in the case of a compulsory license, etc., remuneration is paid to the patent owner (Article 31 (h) of the TRIPS Agreement), but in the waiver proposal, intellectual property can be used free of charge, and payment to the patent owner is not required. In addition, the conditions required by Article 31 of the TRIPS Agreement for granting compulsory licenses, such as the scope of permission and the limitation of the period, are not required by the waiver proposal. Furthermore, while compulsory licenses covered patent rights, waiver proposals covered not only patent rights but also trade secrets, design rights, and copyrights.
It was expected that developed countries, which had been reluctant to even consider compulsory licenses, would naturally oppose the waiver proposal, which was more "radical" than compulsory licensing. However, in May 2021, the U.S. expressed its support for the Weaver proposal. It is not hard to imagine that the support of the United States, which was seen as a representative of the pro-patent, would have emboldened the supporters of the waiver proposal.
In response to this, in June 2021, the EU proposed a counterproposal. The point of the EU proposal is that, on the premise of the flexibility of the TRIPS Agreement, which was confirmed in the Doha Declaration [3], as a response to access to medicines during the COVID-19 pandemic, the TRIPS Agreement should be based on compulsory licenses recognized in Article 31 of the TRIPS Agreement, rather than on the broad waiver of the TRIPS Agreement. In short, it is necessary to clarify and review the operation.
TRIPS Ministerial Meeting Decision ~ Is it really appropriate to call it a waiver?
Negotiations continued at the WTO, and in June 2022, the TRIPS Ministerial Conference Decision was adopted. In conclusion, although the decision does indeed use the word waiver, its content is far from the waiver proposal proposed by India and South Africa, and is closer to the EU proposal based on compulsory licenses.
First of all, looking at the basic framework, the decision of the TRIPS Ministerial Conference is based on the eligible member countries[4]The Agreement states that patent rights can be restricted in accordance with Article 31 of the Agreement, and that the decision confirms and waives them in the application of Article 31 (paragraph 1). In other words, the exemption is part of Article 31 of the TRIPS Agreement, and the basic stance is based on the premise that the government will respond by compulsory licensing based on the same article. In addition, the intellectual property to be covered is basically only patented inventions[5]. Thus, the TRIPS Ministerial Decision differs significantly in its basic concept from the Weaver proposal by India and South Africa, which comprehensively exempted them from the obligation to implement a wide range of provisions of the TRIPS Agreement and allowed them to use a wide range of intellectual property other than patented inventions free of charge.
Furthermore, looking at the specific content of the TRIPS Ministerial Meeting's decision, there are many parts that can be considered to clarify the interpretation of Article 31 of the TRIPS Agreement. For example, the "national laws and regulations" on which the member states establish compulsory licenses, etc., under the same Article can be of any form (paragraph 2), prior consultation with the patentee is not required (paragraph 3(a))[6], and in the calculation of the appropriate remuneration to be paid to the patentee, the vaccine distribution program that aims to provide equitable access to the vaccine (although it is not specified) It is considered to refer to initiatives such as COVAX [7]. (paragraph 3(d)).
On the other hand, the decision of the TRIPS Ministerial Conference exempts the obligation of Article 31(f) of the TRIPS Agreement, which limits the licensing of compulsory licenses, etc., primarily to the country, to the export of products manufactured under this decision by an eligible member to other eligible members, and that such exports are part of a joint international and regional initiative (although not expressly expressed) to ensure equitable access to vaccines. It is also considered to refer to initiatives such as COVAX. It is also specified that it is subject to an exemption from obligation under Article 31(f) (paragraph 3(b)). In addition, in principle, re-export of products produced under a compulsory license for export purposes is prohibited, but in exceptional cases, re-export is possible for humanitarian and non-commercial purposes (Footnote 3).
Such compulsory licenses for export purposes to which Article 31(f) of the TRIPS Agreement does not apply have already been recognized in Article 31-2, which was newly established in response to the Doha Declaration para 6 issue[8]. Allowing the export of COVID-19 vaccines by eligible member states[9] and allowing them to do so through initiatives such as COVAX or re-export in exceptional cases is a new waiver.
However, even though the new exemptions (waivers) are basically just to enhance the usability of compulsory licenses, etc. The decision of the TRIPS Ministerial Meeting is based on the premise of compulsory licensing under Article 31, and at best aims to improve its operation. Therefore, it is completely different from what India, South Africa and others have advocated as a Weaver proposal, and it raises the question of whether it is appropriate to refer to the TRIPS Ministerial Meeting decision as a Weaver anymore.
It should be noted that the decision of the TRIPS Ministerial Meeting is limited to COVID-19 vaccines (para. 1), and it will be decided whether or not to add diagnosis and treatment to the scope of the decision within June (para. 8). The decision is for a period of five years and is reviewed annually, but can be extended (para. 6).
mRNAPatent disputes over vaccines
While the WTO debate over the waiver proposal is coming to a halt, a patent dispute has emerged over a COVID-19 vaccine using mRNA technology.
In August 2022, Moderna, the developer of the COVID-19 vaccine that is widely distributed worldwide, filed infringement lawsuits in the United States and Germany, alleging that Pfizer and BioNTech, which also manufacture and sell widely distributed COVID-19 vaccines, infringe patent rights related to mRNA technology ( August 26, 2022 press release).
Moderna and Pfizer were each filed with Alnylam Pharmaceuticals in a patent infringement lawsuit in the United States in March 2022 (press release on March 17, 2022).
BioNTech was also sued by CureVac in Germany in July 2022 for patent infringement (press release on July 5, 2022).
Despite the complexity surrounding patent disputes, these patent disputes have one interesting commonality. According to the press releases of the companies, the patent owners are only seeking damages, not an injunction. In other words, the distribution of mRNA vaccines has not been stopped, but only monetary payment is sought[10].
How do we understand this point? One way to look at it is that the pharmaceutical companies, which are the patent holders, have decided not to stop the distribution of vaccines in light of their social mission. To put it more crudely, they may have feared a decline in their social reputation. Or, if they are unable to meet all vaccine demands, they may have decided that it is reasonable to claim only damages[11].
Regardless of how one understands the intentions of the pharmaceutical company that is the patent owner, claiming only damages without requesting an injunction is not much different in substance from granting a compulsory license (the amount of money paid to the patent owner is a different matter). It is unclear how the WTO debate triggered by the Weaver proposal converged on the decision of the TRIPS Ministerial Conference on compulsory licenses, etc., and how it affected the behavior of pharmaceutical companies that are patent holders. Nevertheless, it is safe to say that the vectors of the two should point in the same direction in that the distribution of vaccines should be respected, but the patent holders should be paid the appropriate money.
The end of the first act and the beginning of the second?
Thus ended the first act of the debate over the Weaver proposal, and the Weaver's proposal for a broad exemption from the obligation to implement the TRIPS agreement seems to have been derailed for the time being.
However, even though it has not been adopted so far, it is certain that the Weaver proposal has changed the face of the debate. However, with the advent of more "radical" exemption proposals than compulsory licenses, etc., the debate at the WTO has been based on whether compulsory licenses are insufficient and whether the obligation to implement the TRIPS agreement should be more boldly exempted (Waiver proposal) or whether In other words, it was discussed whether the EU proposal should be based on compulsory licensing while reviewing the operation, and the decision of the TRIPS Ministerial Conference adopted a proposal similar to the latter. Here, compulsory licenses are positioned as relatively moderate measures, and compared to before the Weaver proposal, the debate has shifted from whether patent rights should be restricted to how patent rights should be restricted. In this sense, the Weaver proposal succeeded in shifting the center of gravity of the discussion. The decision of the TRIPS Ministerial Conference can be said to be more moderate than the Weaver proposal, but from the pharmaceutical industry, which has been reluctant to use compulsory licenses, etc., the decision of the TRIPS Ministerial Conference, which advocates the use of compulsory licenses, etc., will remain dissatisfied[12].
Supporters of Weaver's proposal will be dissatisfied as well. Proponents of the Weaver proposal, believing that the TRIPS Ministerial Meeting decision has watered down the Weaver proposal, may try to roll back and use various forums to advocate for a broader Weiver proposal again.[13]
We must also keep an eye on the fate of the vaccine patent dispute. In addition, the June deadline to decide whether to add COVID-19 diagnosis and treatment to the scope of the TRIPS Ministerial Meeting decision will also arrive on December 17 this year, and the decision will be closely watched.
How will the second act end?
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[1] A compulsory license is a license granted by the government to a third party without the permission of the patentee. In Japan, there are provisions in Articles 83, 92 and 93 of the Patent Law, and since the license is established by the ruling of the Minister of Economy, Trade and Industry or the Commissioner of the Patent Office, it is also called an adjudication license. In addition, there is a similar system for government use. Government use is limited by the government itself (including a certain range of third parties, such as those delegated to do government work). There are legislative precedents in the United States and other countries (e.g., 28 U.S.C. § 1498). Compulsory licenses (arbitrage licenses) and government use have in common the fact that they allow the patented invention to be used without the permission of the patentee and that money must be paid in such cases, and Article 31 of the TRIPS Agreement stipulates the procedures and conditions for both under the concept of "other uses" that include both. In this column, compulsory licenses (adjudication licenses) and government use are collectively referred to as "compulsory licenses, etc."
[2] For details, see Ichiro Nakayama, "Various Aspects of the Debate on Patent Protection and Access to Medicines under the COVID-19 Pandemic," in Ryu Takabayashi = Keiichi Mimura = Tatsuhiro Ueno, eds., Annual Report on Intellectual Property Law 2021-2022 (Japan Hyoronsha, 2022), p. 14 (However, in relation to the timing of writing, the discussion is limited to the situation from the Weaver proposal to the EU's counterproposal.) ）。
[3] Doha Declaration (official name: "TRIPS Agreement and Declaration on Public Health")https://www.mofa.go.jp/mofaj/gaiko/wto/wto_4/trips.html) was adopted at the WTO Doha Ministerial Conference in November 2001. At that time, AIDS (HIV/AIDS) was spreading mainly in developing countries in Africa and other countries, and while it became a serious public health problem, the economic burden of anti-AIDS drugs was heavy on developing countries, and there was criticism that patents were hindering access to medicines in developing countries. The point of the Doha Declaration is to affirm the flexibility of the TRIPS Agreement, specifically that it does not prevent countries from taking necessary measures for public health, but that each country is free to decide under what circumstances compulsory licenses are granted, and that it is exempt from the obligation to consult with rights holders in advance, which is usually required before granting compulsory licenses. It was also confirmed that each country can decide what it is. In short, the Doha Declaration affirmed that in an emergency situation such as the spread of infectious diseases such as HIV/AIDS, each country can grant compulsory licenses at its own discretion without prior consultation with the right holder (see my short column at the time).
[4] All developing countries are eligible members (TRIPS Ministerial MeetingDecision Note 1). However, developing countries that currently have the capacity to produce COVID-19 vaccines are encouraged to voluntarily opt out.
[5] The subject matter of a patent to which the TRIPS Ministerial Decision applies includes the ingredients and methods required for the production of COVID-19 vaccines (Footnote 2). On the other hand, with reference to non-patents, the TRIPS Ministerial decision states that the protection obligations required by Article 39(3) of the TRIPS Agreement with respect to undisclosed (clinical) trial data do not prevent the rapid approval of COVID-19 vaccines by eligible Member States (para. 4). However, this part is considered to be limited to confirming the content of Article 39, Paragraph 3 of the TRIPS Agreement, which stipulates that the obligation to protect undisclosed data is exempted "when necessary for the protection of the public."
[6] In the first place, in the case of a national emergency or other extreme emergency, the requirement for prior consultation is waived (Article 31(b) of the TRIPS Agreement). The decision of what constitutes a "national emergency" is left to the judgment of each country, as confirmed in the Doha Declaration in Note 4.
[7] COVAX is an international initiative in which developed countries jointly procure COVID-19 vaccines and distribute them to developing countries.
[8] The Doha Declaration para 6 issue is that developing countries with insufficient or insufficient pharmaceutical production capacity do not have companies to establish compulsory licenses in their countries. Therefore, if a drug produced under a compulsory license in a foreign country is exported to those developing countries, there is a risk of violating Article 31(f) of the TRIPS Agreement, which requires that the compulsory license be licensed mainly for supply to the domestic market. In this regard, the TRIPS Agreement was subsequently amended to include a new provision (Article 31-2) that the obligations under Article 31(f) do not apply under certain conditions, and the amendment came into effect on January 23, 2017https://www.mofa.go.jp/mofaj/press/release/press4_004197.html.
[9] Article 31-2 of the TRIPS Agreement, which provides for compulsory licenses for exports, applies to "pharmaceuticals," which are necessary to address public health issues under paragraph 1 of the Doha Declaration (Annex 1(a) of the TRIPS Agreement). Therefore, COVID-19 vaccines also fall under the category of "medicines" under the same article, and it is considered that the same article can be applied (the EU proposal seems to understand it that way). ）。 However, in view of the fact that the decision of the TRIPS Ministerial Conference does not refer to Article 31-2, it can be understood that the decision establishes a new compulsory license for exports by developing countries on the assumption that they will export to developing countries, unlike Article 31-2 (the actual benefit of this is the relaxation of the conditions required by Article 31-2 and the Annexes). ）。
[10] In addition, Moderna has not claimed damages for its sales to 92 low- and middle-income countries through COVAX. Previously, Moderna had a policy of not enforcing patent rights against vaccine manufacturers while the pandemic lasted, but in March 2022 it revised its policy and will not enforce patent rights for the production of vaccines supplied to 92 low- and middle-income countries through COVAX, but in countries other than the above-mentioned 92, vaccine supply is no longer a barrier to access. It expects those who use the company's patented technology to respect the company's intellectual property (March 7, 2022 statement). Moderna's lawsuit appears to be in line with the revised policy.
[11] I owe this to the point made by Professor Ken Maeda of Kobe University. However, even if the ultimate goal is to obtain money, it is considered that it is easier to obtain a large amount of money by negotiating under the threat of injunction. If the aforementioned pharmaceutical companies only claimed damages from the beginning and did not seek an injunction because they were concerned that they would be labeled as patent trolls by requesting an injunction, it seems that they were also concerned about their social reputation.
[12] The Japan Pharmaceutical Manufacturers Association has expressed great disappointment with the decision of the TRIPS Ministerial Meetinghttps://www.jpma.or.jp/news_room/release/news2022/220620.html. Similarly, the International Federation of Pharmaceutical Manufacturers' Associations expressed deep disappointment.
[13] In fact, IP waivers were one of the topics on the agenda at an informal meeting in October 2022 held in conjunction with the WHO's "pandemic treaty" initiative.
〈 Ichiro Nakayama (RC)〉