MOTION FOR A RESOLUTION on meeting the global COVID-19 challenge: effects of the waiver of the WTO TRIPS Agreement on COVID-19 vaccines, treatment, equipment and increasing production and manufacturing capacity in developing countries

B9‑0307/2021

European Parliament resolution on meeting the global COVID-19 challenge: effects of the waiver of the WTO TRIPS Agreement on COVID-19 vaccines, treatment, equipment and increasing production and manufacturing capacity in developing countries

(2021/2692(RSP))

The European Parliament,

– having regard to Rule 132(2) of its Rules of Procedure,

A. whereas the COVID-19 pandemics represents an unprecedented global emergency and challenge that has triggered devastating health and economic consequences worldwide; whereas new and more transmissible variants of the virus continue to emerge and are causing a devastating surge of infections in low and middle-income countries;

B. whereas the human cost of COVID-19 has continued to mount, with more than 167.3 million cases confirmed globally and more than 3.5 million people known to have died;

C. whereas recent empirical evidence puts the real impact of the pandemic in the range of 7 to 13 million excess deaths worldwide;

D. whereas next to the overwhelming dead toll, the consequences of long COVID affect 10 % of patients globally, resulting in long-term illness which can lead to job loss, poverty and overall stark socio-economic vulnerability, especially in countries without adequate social security safety nets[1];

E.  whereas several vaccines have been developed in record time and approved for use, triggering a race to vaccinate populations and reach herd immunity;

F. whereas as of early June 2021, at least 1.8 billion doses of vaccines against COVID-19 have been administered around the world; whereas only 0.3 % of the vaccine doses administered globally have been given in the 29 poorest countries, home to about 9 % of the world’s population;

G. whereas the ongoing COVID-19 emergency has triggered different initiatives aiming at addressing global disparities in terms of access to COVID-19 related vaccines, therapeutics and equipment, among which, initiatives aiming at aggregating advanced public procurement such as COVAX, or providing funding and donations or waiving certain multilateral provisions as regards intellectual property (IP);

H. whereas COVAX has only been able to deliver 71 million vaccine doses to over 100 countries as of 25 May 2021, barely enough to cover 1 % of the combined populations of those countries, and is facing a predicted shortfall of 190 million vaccine doses due to export restrictions in India;

I. whereas pursuant to the Article IX of the Agreement Establishing the World Trade Organization (WTO), in exceptional circumstances, a waiver from certain obligations under WTO treaties, such as the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), can be decided on at the level of the WTO Ministerial Conference; whereas any such waiver needs to contain a justification on the basis of the exceptional circumstances, the conditions of the waiver and the time at which it terminates; whereas waivers of longer than one year have to be reviewed by the WTO Ministerial Conference annually until their termination; whereas according to WTO legal provisions, a decision to grant a waiver is supposed to be reached on the basis of consensus of all WTO members and if consensus cannot be reached, a decision can be taken by a majority of three quarters;

J. whereas a WTO TRIPS waiver proposal was submitted by India and South Africa in October 2020 (IP/C/W/669) and revised (IP/C/W/669/Rev.1) in May 2021 with the support of 63 countries; whereas on 5 May 2021, the United States Trade Representative issued a statement in support of negotiations on a waiver of TRIPS rules for COVID-19 vaccines;

I. The urgency of getting the COVID-19 pandemic under control

1. Is strongly alarmed that the COVID-19 pandemic continues unabated in spite of progress achieved in vaccination, mainly in developed countries; is deeply concerned by the epidemiological situation in several regions of the world and in particular in South Asia and Latin America;

2. Regrets the fact that the international community was utterly unprepared to address the threat of a new global pandemic despite repeated warnings by prominent experts and the WHO over the past years and despite recent worrying alarm signals such as SARS-CoV-1; points out, furthermore, the negative consequences of austerity policies over the last decades which have severely affected public investment in the health sector and ultimately undermined the capacities and preparedness of several countries to tackle an acute health emergency;

3. Is deeply concerned by reports from India according to which crematoriums and burial grounds cannot cope with the sheer numbers of corpses, and oxygen supplies are running out, leaving patients dying, gasping for breath, as desperate families loot supply lines and hospitals; points out with strong regret that such a situation was entirely predictable as the same underlying patterns occurred several weeks or months earlier in Latin America, where the crisis has also intensified in several countries, as well as in North America, Europe and the Middle East before that;

4. Strongly emphasises that business as usual is not an option; underlines thereby that the international community has the overarching and urgent mission of getting the COVID-19 pandemic under control; emphasises that the means for addressing the situation exist, which indicates that joint action to address the crisis is not being taken; emphasises that remedial action is imperative to minimise the humanitarian disaster unfolding around the world; recalls the declaration of President Von Der Leyen, according to which COVID-19 vaccines should be considered as a global public good; points out that it is imperative that other essential medical products are considered in the same manner;

5. Points out that 11 billion doses are needed to vaccinate 70 percent of the world’s population, the rough threshold needed for herd immunity, but that only a fraction of that amount has been produced; is concerned that, according to the IMF, global production will miss that target with only 6 billion doses expected to be produced by the end of the year;

6. Notes with strong concern that the vast majority of COVID-19 vaccine doses manufactured in developed economies so far have mainly been produced for internal consumption, as is the case for the US, or else for both internal consumption and export to other developed economies; underlines in that respect that only around 10 % of EU global exports have been shipped to less developed economies and that the bulk of EU-made doses have been sold to OECD countries;

7. Underlines that under current projections as regards production and financing, the gap in vaccination rates is expected to continue rising and to peak towards the end of 2021 with differences in rates of close to 50 percentage points, leading to a genuine global vaccine apartheid; emphasises that disparities are likely to get much worse long before they get better, as optimistic estimates predict that such disparities will only be eliminated in 2023;

8. Strongly regrets the fact that global vaccine manufacturing capacity was originally planned to mainly supply Western markets; notes with concern that COVAX, which is the main multilateral initiative to provide vaccines to the global South, is expected only to deliver 2 billion doses, or 20 % of the needs of the 92 poorest countries; notes, however, that leaving aside the question of the coverage of the remaining 80 % of the populations of those countries, it seems that even delivering on this commitment is an ambitious medium-term prospect, given recent supply shortages and export restrictions in India;

9. Emphasises that vaccines are a textbook case where huge positive externalities require free public provision at both national and global levels; notes that in developed countries, all citizens are getting free vaccines; points out that it would be ethically unconscionable if that principle did not apply to much poorer people in developing countries; insists, therefore, that every person in the world must receive free vaccines as soon as they can be produced;

10. Underlines that current estimates indicate that COVAX should be funded by additional grants of between USD 75 billion and USD 150 billion, depending upon the cost of a vaccine dose; notes that at the high end, such funding would represent less than 0.4 % of the combined GDP of the G7 countries, or just 3.8 % of what G7 countries spent on discretionary fiscal stimulus in response to the COVID-19 crisis in 2020;

11. Points out that initiatives such as COVAX put in place mechanisms that revolve around the demand side of the equation without tackling the inadequacy of global production capacities; points out that by doing so, they end up competing on a ‘first come, first served’ basis with other stakeholders, notably high income countries, while the supply side of the equation remains constrained in the absence of an integrated global strategy for scaling up production capacities worldwide;

12. Emphasises that the more time is taken to achieve global herd immunity, the higher the probabilities are that new variants of the COVID-19 virus for which current vaccines are less effective will spread worldwide; points out that the prospect of having to develop and deliver COVID-19 related vaccines on a regular or even on yearly basis is becoming material; notes with concern, however, that under the current constraints, such a situation would mean a continuation of current underlying global imbalances;

II. Tacking the obstacles to expanding the global supply of vaccines, treatments and equipment to address the ongoing pandemic

13. Commends the unprecedented speed with which pharmaceutical companies managed to make COVID-19 vaccines available and the technological achievements that made this possible; emphasises at the same time the key role played by public sector resources and publicly funded academic research, which allowed pharmaceutical companies to de-risk the whole vaccine value chain by means of ex ante funding and large subsidies for research and development (R&D), as well as by large-scale advance purchase agreements;

14. Underlines the fundamental contribution of healthcare workers, patients, COVID-19 survivors and the general public that have participated in clinical trials and other R&D related activities on different therapeutics and vaccines; is therefore of the opinion that innovations underpinning these vaccines should not be privatised by means of exclusive IP rights or be subject to technology transfer barriers; notes with concern, therefore, that contrary to AstraZeneca, which committed to produce at cost, Pfizer/BioNtech, Moderna and Johnson & Johnson are expected to gain very meaningful profits from their COVID-19 vaccine deliveries;

15. Takes notes of the announcement made by Western vaccine manufacturers at the Global Health Summit on 21 May 2021 that they plan to deliver 1.3 billion vaccine doses at cost price for least developed countries and at ‘low prices’ for other developing countries by the end of 2022, but underlines that this initiative remains largely insufficient;

16. Stresses that the only way around zero-sum competition for the limited vaccine supply is to greatly expand global supply capacity for vaccines as well as other health related global public goods, on a permanent basis;

17. Points out also that such a dynamic illustrates that an approach based on charity, whereby funding or surplus vaccine doses are pledged, after developed countries have met their own needs, in order to meet the needs of the poorest on an undefined time scale, is not a workable and just global approach for addressing the ongoing crisis;

18. Points out that the TRIPS waiver application submitted by India and South Africa, as well as leading science journals and civil society organisations, provided extensive documentation and evidence to show that the current multilateral framework protecting intellectual property rights has represented an obstacle for addressing the COVID-19 crisis and that the existing WTO-TRIPS flexibilities which are based on procedurally complex, country-by-country, product-by-product and prior negotiations with patent holders, were not fit for purpose for tackling previous global health emergencies and are not up to the challenge of the current one;

19. Points out, furthermore, that past experience regarding the implementation of existing TRIPS flexibilities shows that individual countries often felt fearful of either retaliatory action by developed countries or the reputational costs of issuing compulsory licenses; underlines that compulsory licensing only applies to patents as one category of intellectual property rights (IPR), but that other IPR categories, such as data protection and trade secrets, which represent potential hurdles to the scaling-up of production of needed medical products, are beyond the scope of compulsory licences;

20. Underlines that such inadequacies in existing TRIPS flexibilities constitute a strong reason for adopting an additional temporary waiver in order to broaden their scope and avoid burdensome conditions and administrative procedures that represent a hurdle for expanding production capacities;

21. Notes in particular that Bolivia has recently signed an advance purchase option agreement with the Canadian company Biolyse with a view to importing millions of doses of a generic version of the ‘one shot’ Johnson & Johnson vaccine to cover a significant part of its population, should Biolyse be authorised to produce that vaccine under a compulsory licence under current TRIPS flexibilities; points out, however, that the implementation of this purchase option may take a disproportionate amount of time and resources due to the procedural complexities underpinning these ‘flexibilities’; underlines that this example illustrates that IPR issues indeed represent a barrier to the further expansion of global vaccine production capacities;

22. Emphasises that a new COVID-19 related TRIPS waiver is only one of many conditions for addressing the current emergency; underlines that it is also indispensable that current vaccine manufacturers share their technology and production methods to the extent that waivers are akin to making available a complex recipe, while technological transfers are akin to sharing the know-how and skills required for implementing it;

23. Welcomes in this context the declarations of WTO Director-General Ngozi Okonjo-Iweala at the meeting of Parliament’s Committee on International Trade of 20 May 2021, according to which the existing TRIPS flexibilities are too burdensome and more flexibility is needed; notes, however, that a new TRIPS waiver is not enough as there is a pressing need for a holistic strategy which includes, inter alia, enhanced technological transfers with potential manufacturers;

24. Underlines that contrary to what it is often claimed by the industry, and as highlighted in a recent WTO-organised meeting[2] on vaccines, the scaling-up of production capacities can be credibly implemented by developing countries such as Brazil, Argentina, India, Thailand, South Africa, Pakistan and Bangladesh, as they meet at least one of two conditions: firstly, that companies located there already have the know-how to manufacture some of the currently available vaccines (as with the AstraZeneca vaccine in Brazil and India) or they have developed the technology domestically (as with the Bharat Biotech vaccine in India); and secondly, that these countries have a critical mass of pharmaceutical companies with manufacturing capability;

25. Underlines that the Commission has so far solely focused on encouraging Western vaccine manufacturers to share technology and licences on a purely voluntary basis; strongly regrets, in that respect, that so far, none of the pharmaceutical companies producing vaccines have shared their technology, know-how and research results with the COVID-19 Technology Access Pool (C-TAP) or WHO COVID-19 mRNA Vaccine Technology Transfer Hub, highlighting the insufficiency of voluntary and industry-controlled approaches;

26. Requests that the Commission use all powers and options at its disposal, including coercion if necessary, to ensure that companies share technology and know-how related to COVID-19 medical products such as therapeutics, diagnostics and vaccines with potential manufacturers worldwide, particularly in low and middle-income countries;

27. Notes with strong concern that recent evidence has been provided that current producers of authorised COVID-19 vaccines have refused offers to expand production from several potential generic pharmaceutical producers in the EU and abroad;

28. Is concerned by different types of direct or indirect export restrictions for vaccines or key raw materials and other inputs by the main manufacturing countries and emphasises that this endangers the rapid global scaling-up of vaccine production capacity; urges the Commission to engage with producing countries to rapidly eliminate export barriers and to replace its own export authorisation mechanism with export transparency requirements; insists on receiving timely and comprehensive access to such data; deplores the fact that the Commission has used the Transparency and Control Mechanism in order to block exports to third countries, as this could lead to domino effects which compromise open global supply chains;

29. Emphasises that a TRIPS waiver could also be instrumental for diversifying the production and supply of raw materials such as lipid nanoparticles and bioreactor bags, for which production and supply has been strained;

30. Underlines that if the vaccines against COVID-19 and its variants are considered as a global public good, it is therefore urgent that multilateral endeavours be focused on rapidly and permanently increasing global production capacities and on ensuring binding technology transfers; calls for the establishment of structural platforms for the rapid scaling up of vaccine production in more countries;

31. Is of the opinion that the EU should, with that aim in mind, urgently foster multilateral arrangements at WTO level, including a treaty on pandemics, as recently proposed by the President of the European Council, as part of the ‘Health and Trade Initiative’ to be adopted in November 2021 during the twelfth Ministerial Conference, as well as at the next WHO general assembly; underlines that this initiative is a complement to and not a substitute for a TRIPS waiver;

32. Urges the EU, in coordination with other partners such as the US and proponents of the COVID-19 TRIPS waiver proposal, to convey a joint multilateral initiative for the drawing up of a detailed plan between Western pharmaceutical companies and their counterparts, supervised and underwritten by the relevant governments, in order to boost global supply of vaccines;

33. Is of the opinion that the EU can and should unilaterally contribute to such an endeavour by making sure that future advance purchase agreements are fully disclosed and integrate binding provisions as regards open and non-exclusive global licensing, patent pools, sharing of know-how, non-applicability of trade secrets, proprietary data and commitments on technology transfers;

34. Urges the Commission to support the WHO C-TAP and to proactively undertake efforts to make sure that vaccine manufacturers share IP and technology through this multilateral mechanism; asks the Commission to identify and support potential manufacturers that have expressed interest in scaling up production of vaccines and other COVID-19 related medical products in order to allow these manufacturers to be granted non-exclusive licences and start producing as soon as possible; asks the Commission to report to Parliament by September 2021 on the outcome of these endeavours;

35. Welcomes the decision of the Biden-Harris Administration in the US to support the waiving of intellectual property protections for COVID-19 vaccines; points out that governments should proceed under the expectation that the WTO rules relevant to patents, trade secrets and other key intellectual property needed to support production and supply will not be a barrier to improving access to COVID-19 vaccines and that this expectation should be confirmed by the adoption of a ‘standstill’ political declaration whereby countries will refrain from taking any action related to vaccines during the pandemic;

36. Urges the EU to constructively and proactively engage in text-based negotiations for a temporary TRIPS waiver for all products and technologies including vaccines, treatments and diagnostics needed to respond to the COVID-19 pandemic and to issue, with that purpose, a negotiation mandate in the framework of paragraph 9 of Article 218 of the Treaty on the Functioning of the European Union; urges all WTO members to conclude the negotiations as soon as possible, and by the next WTO Ministerial Council in November 2021 at the latest, and to achieve meaningful progress during the next TRIPS Council meetings of June and October 2021;

37. Urges the EU to forswear any recourse to legal proceedings in the WTO or under free trade and investment agreements against countries that infringe on TRIPS provisions when adopting policy measures to expand access to COVID-19 related medical products; asks the EU, therefore, to propose, as an interim measure before agreeing on a COVID-19 related TRIPS waiver, an immediate WTO political declaration on a ‘standstill’ on any action relating to vaccines and other essential medical products to tackle the pandemic;

III. Putting in place the conditions for improving preparedness for future global health emergencies

38. Stresses that international trade governance has an important role to play in the swift development of medical treatments and vaccines, the fast scale-up of production, the development of resilient global supply chains and equitable market access for the whole world; underlines that the current pandemic must provide the impetus for strengthened international cooperation against and global preparedness for future health emergencies; urges the Commission to address the root causes identified by the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) in its reports on biodiversity and pandemics, and in particular the far-reaching impact of ever deeper global supply chains on biodiversity depletion and biosphere degradation and their instrumental role as regards the increased frequency and intensity of zoonoses;

39. Points out, furthermore, that as it is likely that new variants of COVID-19 and other zoonoses may become regular occurrences over the coming years, it is urgent and crucial to develop a funding model for the development and distribution of global public goods such as vaccines and other essential health technologies; stresses that this model should revisit the global framework for intellectual property rights for future pandemics and shift from a model based on exclusive rights to innovative approaches such as ‘prize models’ based on the decoupling of the serial production of goods from the costs related to research and development;

40. Underlines that any future multilateral arrangement for improving preparedness for future global health emergencies should encompass, on the one hand, a needs oriented demand side approach, providing joint financing and globally coordinated advance purchases, and on the other hand, an integrated and coordinated supply side strategy for scaling up the whole value chain, on the basis of open science, open and non-exclusive global licensing and binding mechanisms for technology transfers;

41. Calls on the Commission to re-evaluate the TRIPS+ commitments in EU trade agreements in the light of lessons learned, as these provision are more restrictive than the TRIPS agreement; asks the Commission and the Council, furthermore, to opt back in to Article 31bis of the TRIPS agreement so as to be in a position to make full use of TRIPS flexibilities in case of future need;

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42. Instructs its President to forward this resolution to the European Council, the Council, the Commission, the World Trade Organization and the World Health Organization.