On 6 July 2022, Members of the World Trade Organisation Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS Council) agreed to waive the previously well understood and agreed principles of patent law for vaccines manufactured to prevent COVID-19. It was also agreed to begin discussions on a further possible extension to cover patents for the production and supply of COVID-19 diagnostics and therapeutics (within 6 months after further submissions). The purpose of the decision was to ensure the equitable access of eligible Members to the COVID-19 vaccine covered by the authorisation and to increase the supply of COVID-19 vaccines in dealing with the pandemic.
By way of background, the TRIPS Agreement¹ is widely held as an instrument of great strategic importance to Australia's national interests in terms of innovation, technology transfer and public welfare. It sets minimum standards (for Member countries acceding to the TRIPS Agreement) of protection for patents, trade marks, copyrights and related rights, geographical indications, industrial designs, integrated circuit layout designs, and undisclosed information. The TRIPS Agreement also plays a central role in the enforcement of intellectual property rights through civil actions for infringement, resolving trade disputes over IP, and in regard to copyright piracy and trade mark counterfeiting.
Having certainty over implementation of the minimum standards espoused in the TRIPS Agreement (as enacted in domestic legislation of the Member countries) is therefore integral to the purpose of the agreement, despite Members being free to determine the appropriate method of implementing the provisions of the TRIPS Agreement within their own legal system and practice.
Less well understood however, is the function of the TRIPS Council whose responsibilities include monitoring the implementation of the TRIPS Agreement and providing a forum in which WTO Members can consult on intellectual property matters, and carrying out the specific responsibilities assigned to the Council under the TRIPS Agreement.
It is therefore of concern that under the provisions of Article 31 of the TRIPS Agreement, the TRIPS Council at its 12th Ministerial Conference on 6 July 2022 resolved to limit the exclusive rights of patent owners conferred under Article 28 by authorising the use of certain patents² required for the production and supply of COVID-19 vaccines without the consent of the patent owner to the extent necessary to address the COVID-19 pandemic. The Ministerial Decision has a duration of 5 years, notwithstanding domestic legislation. In addition, the decision makes clear that Members may not challenge any measures taken in conformity of the decision and Members will decide whether to extend the waiver to cover the production and supply of COVID-19 diagnostics and therapeutics (within 6 months after further submissions).
The Ministerial Decision clarifies that "an eligible Member may authorize the use of the subject matter of a patent under Article 31 without the right holder's consent through any instrument available in the law of the Member such as executive orders, emergency decrees, government use authorizations, and judicial or administrative orders, whether or not a Member has a compulsory license regime in place. For the purposes of this Decision, the "law of a Member" referred to in Article 31 is not limited to legislative acts such as those laying down rules on compulsory licensing, but it also includes other acts, such as executive orders, emergency decrees, and judicial or administrative orders".¹
Moreover, the decision specifies that an eligible Member need not require the proposed user of the subject matter of a patent to make efforts to obtain an authorisation from the right holder (as is required for compulsory licences). The decision also waives certain other compulsory licensing provisions in Article 31 that authorised use be predominantly to supply its domestic market and may allow any proportion of the products manufactured under the authorisation in accordance with this Decision to be exported to eligible Members, including through international or regional joint initiatives that aim to ensure the equitable access of eligible Members to the COVID-19 vaccine covered by the authorisation.
However, by agreeing to the waiver of long held and agreed principles of patent law, and the possibility of extending the waiver to the subject matter of other types of patents, it remains to be seen whether the waiver will achieve its stated objectives. This is even more so given the apparent over-production of COVID-19 vaccines in the developed world and where the inequity in access of eligible Members to the COVID-19 vaccine appears to largely be a distribution issue.
It also remains to be seen whether such waivers and march-in rights will provide a disincentive to researchers and pharmaceutical companies to invest in developing the future methods and products designed to combat the COVID-19 pandemic, or indeed any other areas where the TRIPS Council chooses to intervene. Depriving the world of next generation pharmaceuticals resulting from the erosion of patent rights are increasing difficult choices for Government decision makers dealing with important health care choices.
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