Compulsory Licensing: How Developing Countries can access the COVID Vaccine

By: Adara Manamperi

With the recent news of the World Trade Organization delaying “a decision on a proposal to waive intellectual property rules for COVID-19 drugs and vaccines amid ongoing opposition from wealthy countries,”[1] there are still ways for WTO member countries to get COVID-19 vaccines if they do not have the capacity to manufacture through using the provisions within TRIPS[2], interpreted as it was to be through the Doha Declaration in 2001[3], and the Implementation Decision in 2003[4], in order to have the vaccine compulsory licensed to be imported into their country from other member states who have the capacity to manufacture.

Compulsory licensing is when a “government allows someone else to produce a patented product or process without the consent of the patent owner or plans to use the patent-protected invention itself.” [5]  Compulsory licensing is permitted through TRIPS Art. 31. However, the type of compulsory license that these countries would need was introduced through the Implementation Decision. The implementation decision provided that when “countries needed to turn to the option of compulsory licensing to produce needed affordable pharmaceuticals, producers overseas can step up and supply that need, even if a compulsory license is needed in that country.”[6]  The kind of compulsory license under the Implementation Decision is one that is for “production in one country, for export, to meet the public health needs of one or more other countries.”[7] Additionally, Article 31 provides guidelines as to when, where, and how countries can implement compulsory licensing for patents.

In terms of how a developing country would be able to justify its need to compulsory license the vaccine, we would look to TRIPS Art. 31(b), and use the Doha Declaration to help with clarified interpretation. TRIPS Art. 31(b) states, in part, that: “such use may only be permitted if, prior to such use, the proposed user has made efforts to obtain authorization from the right holder … This requirement may be waived by a Member in the case of a national emergency or other circumstances of extreme urgency or in cases of public noncommercial use.”[8] From this provision alone, we can see that these countries would most likely be able to justify their use of the compulsory license for the vaccine through the national emergency carve-out.

To understand what classifies as a national emergency, we look to the Doha Declaration. Art. 5(b) states that “[e]ach Member has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted,”[9] and Art. 5(c) states that “[e]ach Member has the right to determine what constitutes a national emergency or other circumstances of extreme urgency, it being understood that public health crises … can represent a national emergency or other circumstances of extreme urgency.”[10] Clearly from the Declaration’s interpretation and the permission granted by TRIPS, it would seem that these countries would be permitted to issue a compulsory license for the COVID-19 vaccine under the guise of a national emergency, in this case a public health crisis, and would be able to do so without question.

The next issue, which originally stemmed from Art. 31(f) of TRIPS, is that countries who could manufacture the compulsory licensed pharmaceutical product were not allowed to export that product to other least developed countries who could not because of the “domestic market” use requirement within the article.[11] However, the Implementation Decision was put in place in order to solve the issue of these countries what are unable to make effective use of compulsory licenses themselves because of their lack of manufacturing capacity. [12]Assuming that a country is a least developed country, they should be able to have the limitations of Art. 31(f) waived through the Implementation Decision.

However, even with this in place, there would be some conditions which these countries must follow under TRIPS Art. 31. The scope and duration of the compulsory license’s use must be limited to which it was authorized for[13] (a.k.a. for use only of the national emergency), and the license must also be non-exclusive[14] and non-assignable[15].  In addition, the government must comply with Art. 31(h), meaning that they should be paying the right holder for the vaccine adequate remuneration.[16] The issue of adequate remuneration is not really clear, as to what would be “adequate,” however, the WTO website does state that the decision as to what is adequate is “for the authorities in the country concerned,” and does state that the “patent owner must be given the right to appeal as well.”[17] Therefore these countries should make some sort of arrangements in order to meet this requirement.

In addition, the government for these countries must comply with the (more procedural) terms set out in Art 2(c) of the Doha Declaration. This article states:  

The exporting Member shall notify (8) the Council for TRIPS of the grant of the licence, including the conditions attached to it (9). The information provided shall include the name and address of the licensee, the product(s) for which the licence has been granted, the quantity(ies) for which it has been granted, the country(ies) to which the product(s) is (are) to be supplied and the duration of the licence. The notification shall also indicate the address of the website referred to in subparagraph (b)(iii) above.[18]

Again, this requirement is more procedural for the government to do to ensure that it is complying with the terms that allows them to have the TRIPS Art.31(f) waiver.

In sum, if there is no decision from the WTO to waive IP rights for the COVID-19 vaccine, developing countries can possibly seek out a compulsory license for the COVID-19 vaccine in the method described above, through the waiver granted by the Implementation Decision, and by following the requirements as outlined by TRIPS Art. 31.

Image Credit: © Kyrylo Matukhno

#COVID19Vaccine #DevelopingNations #CompulsoryLicensing #Manamperi #International #Law #BlogPost

[1] Emma Farge & Stephanie Nebehay, WTO delays decision on waiver on COVID-19 drug, vaccine rights, Reuters, Dec. 10, 2020, https://www.reuters.com/article/us-health-coronavirus-wto-idUSKBN28K2WL.

[2] TRIPS: Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, 1869 U.N.T.S. 299, 33 I.L.M. 1197 (1994) [hereinafter TRIPS].

[3] Declaration on The TRIPS Agreement And Public Health, WTO Ministerial Conference, WT/MIN(01)/DEC/2, (Nov. 2001) [hereinafter Doha Declaration].

[4] Implementation of paragraph 6 of the Doha Declaration on the TRIPS Agreement and public health, Decision of the General Council, WT/L/540, (Aug. 2003) [hereinafter Implementation Decision].

[5] WTO, Compulsory Licensing of Pharmaceuticals and TRIPS https://www.wto.org/english/tratop_e/trips_e/public_health_faq_e.htm

[6] Id.

[7] Id.

[8] TRIPS Art. 31(b).

[9] Doha Declaration Art. 5(b)

[10] Id. Art. 5(c).

[11] TRIPS Art. 31(f).

[12] Daniel C.K. Chow & Edward Lee, International Intellectual Property 493-94, 3rd ed. (2017).

[13] Id. Art. 31(c).

[14] Id. Art. 31(d).

[15] Id. Art 31(e).

[16] Id. Art. 31(h)

[17] WTO, supra note 4.

[18] Implementation Decision Art. 2(c).