The US has backed a temporary suspension of intellectual property rights for Covid-19 vaccines in a move likely to enrage the pharmaceutical industry, which strongly opposes a so-called waiver.
Joe Biden’s top trade adviser Katherine Tai said that while the US administration “believes strongly” in IP protections, it would support a waiver of those rules for vaccines.
“This is a global health crisis, and the extraordinary circumstances of the Covid-19 pandemic call for extraordinary measures,” Tai said in a statement.
Shares of the major coronavirus vaccine companies were hit by the announcement on Wednesday. Moderna, BioNTech and Novavax’s shares fell by between 5 and 7 per cent in New York trading, while Pfizer’s stock price fell by almost 1 per cent before recovering.
The companies did not immediately respond to request for comment.
A measure to allow countries to temporarily override patent rights for pandemic-related medical products was proposed at the World Trade Organization by India and South Africa in October, and has since been backed by almost 60 countries.
Donald Trump’s administration firmly opposed the waiver at the WTO, along with the UK, EU and Switzerland, but Tai had rattled US pharmaceutical companies by putting that position under review.
Tai said the US would “actively participate” in text-based negotiations at the WTO, but that those negotiations would take time given the consensus-based nature of the institution and the complexity of the issues involved.
“As our vaccine supply for the American people is secured, the administration will continue to ramp up its efforts — working with the private sector and all possible partners — to expand vaccine manufacturing and distribution,” Tai said.
“It will also work to increase the raw materials needed to produce those vaccines,” she added.
Tai and her staff have in recent weeks discussed the WTO’s IP rules with the chief executives of pharma companies and vaccine makers, trade unions, advocacy groups and Seth Berkley, chief executive of the UN-backed vaccine alliance Gavi.
In a speech to a WTO meeting on vaccine equity earlier this month, Tai said that both the government and the private sector would need to do their part to “live up to” the “spirit” of the Trade-Related Aspects of Intellectual Property Rights (Trips) agreement, which was born out of the HIV crisis.
Gregg Gonsalves, assistant professor of epidemiology at the Yale School of Public Health, welcomed the announcement on Wednesday as “a start”.
He added: “We need the writing of the text of this waiver to be transparent and public. But as we have always said we need tech transfer now and the US to use the $16bn already appropriated in the American Rescue Plan to lay the groundwork for international and domestic scale-up of manufacturing. There is no going back.”
Earlier this week, Anthony Fauci, the president’s chief medical adviser, said he was “agnostic” on the question of whether there should be a waiver, but warned of the political implications of backing such a move.
He said: “Going back and forth, consuming time and lawyers in a legal argument about waivers — that is not the endgame. People are dying around the world and we have to get vaccines into their arms in the fastest and most efficient way possible.”
His comments provoked a backlash from Biden’s liberal supporters however, especially when he was questioned by the journalist Mehdi Hasan on his online television show.
Saikat Chakrabati, president of the leftwing think-tank New Consensus, responded to Fauci’s comments in a tweet: “Waiving Covid patents is in no way mutually exclusive with giving vaccine doses to countries now.”
He added: “You don’t get the privilege of being ‘agnostic’ when you are the chief medical adviser to the president. There is no such thing as agnostic. Agnostic means doing the status quo, which is itself a decision.”
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