Corporate greed and COVID-19

Why refusal to support waiver of WTO intellectual-property rules could prolong the pandemic

COMMENT | JOSEPH E. STIGLITZ AND LORI WALLACH | The only way to end the COVID-19 pandemic is to immunise enough people worldwide. The slogan “no one is safe until we are all safe” captures the epidemiological reality we face. Outbreaks anywhere could spawn a SARS-CoV-2 variant that is resistant to vaccines, forcing us all back into some form of lockdown. Given the emergence of worrisome new mutations in India, Brazil, South Africa, the United Kingdom, and elsewhere, this is no mere theoretical threat.

Worse, vaccine production is currently nowhere close to delivering the 10-15 billion doses needed to stop the spread of the virus. By the end of April, only 1.2 billion doses had been produced worldwide. At this rate, hundreds of millions of people in developing countries will remain unimmunised at least until 2023.

It is thus big news that U.S. President Joe Biden’s administration has announced it will join the 100 other countries seeking a COVID-19 emergency waiver of the World Trade Organisation intellectual-property (IP) rules that have been enabling vaccine monopolisation.

Timely negotiations of a WTO agreement temporarily removing these barriers would create the legal certainty governments and manufacturers around the world need to scale up production of vaccines, treatments, and diagnostics.

Last fall, former President Donald Trump recruited a handful of rich-country allies to block any such waiver negotiations. But pressure on the Biden administration to reverse this self-defeating blockade has been growing, garnering the support of 200 Nobel laureates and former heads of state and government (including many prominent neoliberal figures), 110 members of the U.S. House of Representatives, ten U.S. Senators, 400 US civil-society groups, 400 European parliamentarians, and many others.

An Unnecessary Problem

The scarcity of COVID-19 vaccines across the developing world is largely the result of efforts by vaccine manufacturers to maintain their monopoly control and profits. Pfizer and Moderna, the makers of the extremely effective mRNA vaccines, have refused or failed to respond to numerous requests by qualified pharmaceutical manufacturers seeking to produce their vaccines. And not one vaccine originator has shared its technologies with poor countries through the World Health Organisation’s voluntary COVID-19 Technology Access Pool.

Recent company pledges to give vaccine doses to the COVID-19 Vaccines Global Access (COVAX) facility, which will direct them to the most at-risk populations in poorer countries, are no substitute. These promises may assuage drug companies’ guilt, but won’t add meaningfully to the global supply.

As for-profit entities, pharmaceutical corporations are focused primarily on earnings, not global health. Their goal is simple: to maintain as much market power as they can for as long as possible in order to maximise profits. Under these circumstances, it is incumbent on governments to intervene more directly in solving the vaccine supply problem.

A Commonsense Solution

In recent weeks, legions of pharmaceutical lobbyists have swarmed Washington to pressure political leaders to block the WTO COVID-19 waiver. If only the industry was as committed to producing more vaccine doses as it is to producing specious arguments, the supply problem might already have been solved.

Instead, drug companies have been relying on a number of contradictory claims. They insist that a waiver is not needed, because the existing WTO framework is flexible enough to allow for access to technology. They also argue that a waiver would be ineffective, because manufacturers in developing countries lack the wherewithal to produce the vaccine.

And yet, drug companies also imply that a WTO waiver would be too effective. What else are we to make of their warnings that it would undermine research incentives, reduce Western companies’ profits, and – when all other claims fail – that it would help China and Russia beat the West geopolitically?

Obviously, a waiver would make a real difference. That is why drug companies are opposing it so vehemently. Moreover, the “market” confirms this thinking, as evidenced by the sharp decline in the major vaccine-makers’ share prices just after the Biden administration’s announcement that it will engage in waiver negotiations. With a waiver, more vaccines will come online, prices will fall, and so too will profits.

Still, the industry claims that a waiver would set a terrible precedent, so it is worth considering each of its claims in turn.