US backs plan to suspend Covid vaccine patents during pandemic

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,” said Tai in a statement. 

Shares of the major coronavirus vaccine companies were hit by the decision on Wednesday. Moderna, BioNTech and Novavax’s shares fell by between 5 and 7 per cent, while Pfizer’s stock price fell by almost 1 per cent.

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.”

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.