Pharma companies resist President Biden's move to waive coronavirus vaccine patent

The United States has supported India's proposal on COVID-19 patent waivers which means vaccine recipes can be unlocked. India was pushing for it for several months.

However, rich countries like the US, Canada and the UK had been blocking India's efforts at the World Trade Organisation. However, the situation has changed now as the Biden administration made a shift today.

"This is a global health crisis and the extraordinary circumstances of the COVID-19 pandemic call for extraordinary measures. The administration believes strongly in intellectual property protections, but in service of ending this pandemic, supports the waiver of those protections for COVID-19 vaccines," the US trade representative said in a statement.

Also, the pressure worked as 100 countries backed the proposal by India and South Africa.

America was under pressure to play ball and it has! India has welcomed the shift. New Delhi said it hopes the waiver can be approved quickly at the WTO.

Washington's decision had a domino effect as the European Union which was earlier blocking the resolution said it is "ready to discuss the matter".

"The European Union is also ready to discuss any proposal that addresses the crisis in an effective and pragmatic manner and that's why we are ready to discuss how the US proposal for a waiver on intellectual property protection for the COVID-19 vaccines could help achieve that objective," Ursula von der Leyen, president of the European Commission, said.

Germany said it is ready for a dialogue which is far from any commitment but it's a start, nonetheless.

France announced its support to a waiver, so has New Zealand even China has weighed in with a cryptic statement.

Beijing said that it expects an "effective and balanced" result from the discussions around the proposed waiver.

The WHO chief Dr Tedros has called it a monumental decision.

However, there are more diplomatic hurdles since the WTO operates on the basis of consensus. It has 164 countries as members for the resolutions to pass all 164 countries must agree.

In the last seven months, the WTO has held as many as 10 meetings on the original proposal - all of them failed with no agreement.

Australia, Brazil, Canada, European Union, Japan, Norway, Switzerland, United Kingdom have been holding back the waiver. Critically, for the resolution to pass all these countries must change their stand.

India and South Africa will now present a revised proposal next month, reports say.

However, details about the revised proposal are unclear but it's expected to focus on some key points, namely how the new production sites can get vaccine patents and how countries must commit to a transparent regulatory framework to manufacturer these vaccines.

The proposal is also set to detail how pharma companies can be compensated for waiving patents.

The stocks of pharma companies plummeted after America's announcement. Pfizer and Moderna stocks were down by more than three per cent. BionTech, the company that made the Wuhan virus vaccine with Pfizer fell by almost 17 per cent.

Curevac, another German company that is making a shot, was down by around 16 per cent. The prospect of losing out on profits is making them bleed but they haven't given up.

Pharma lobbies have swung into action and have been quick to condemn President Biden's decision.

The pharmaceutical research and manufacturers of America is the lobbying arm of the industry and its CEO called the waiver an "empty promise".

He said the waiver "does nothing to address the real challenges to getting more shots in arms, including last-mile distribution and limited availability of raw materials."

The group was the third-highest spender on lobbying in America. It spent more than $25 million on influencing lawmakers. Now it's not playing out as they planned, so they had to complain.

Same with the United Kingdom. Pharma lobbyists are up in arms.

Richard Torbett, chief executive of the association of the British pharmaceutical industry, said "intellectual property rights are the lifeblood of this industry without it, businesses simply can't invest. We are disappointed about the news coming out of the US. We think it will do more harm than good."