Negotiations on COVID-19 vaccine waiver at WTO, with Minister & Deputy Ministers (DTIC & DIRCO)

Meeting report

Opening remarks
The Chairperson welcomed Members and everyone on the platform. The Chairperson of the Portfolio Committee on International Relations and Cooperation was not available, so the joint meeting was chaired by the Chairperson of Trade and Industry.

The Chairperson noted that the Agenda showed input from the Department of Trade and Industry (dtic) on current negotiations regarding a waiver of the Covid-19 vaccine rights at the World Trade Organisation (WTO). The Department of International Relations and Cooperation (DIRCO) will also give input on the matter.

The Portfolio Committee Health was not in attendance as that Committee had scheduled public hearings for the day.

Minister Patel apologised that he would have to leave at 11:00.

The Chairperson noted that Ms Aneliswa Cele, Acting DDG for the Department of Health, was in attendance together with the Director for Affordable Medicines.

Mr B Nkosi (ANC) reminded the Chairperson that there was a plenary at 11:00.

The Chairperson said that the meeting would finish as soon as possible. He noted that the concept document had been circulated. He assumed that the Members had studied the document. Owing to the limited time available, he would not address the document in the meeting.

Presentation to the Joint DTIC and DIRCO on the TRIPS Waiver – dtic
Minister Patel made the presentation. (TRIPS - Trade-Related Aspects of Intellectual Property)

By 30 May 2021, 1.8 billion vaccine doses were reported to have been administered globally, with 426 million people “fully” vaccinated.  ±75% of all vaccines has been delivered to just 10 countries.

Object of the Waiver
In order to overcome the supply-challenge, SA and India had proposed a waiver of certain provisions of the TRIPS Agreement at the World Trade Organisation (WTO). The objective of the Waiver was to promote universal access by removing legal impediments to sharing and using intellectual property required for the
production of vaccines, diagnostics, and therapeutics. It would improve supply and access for countries with insufficient or no manufacturing capacity.

At the WTO in March 2021, the Minister of Trade, Industry and Competition had proposed five measures:
- Scaled-up production on a voluntary basis, with transfer of technology; production of the drug substance; production of the vaccine through a ‘fill and finish’ process; and distribution rights.
- A waiver of IP rights in specified areas, to enable production without the veto of IP-holders.
- Transparency on contract terms and price fairness and stability.
- No resort to vaccine nationalism through export controls, agreed at global level; and
- An automatic provision in TRIPS to apply in future pandemics.

Aspen was producing the J&J vaccine in Gqeberha. It had the most advanced capacity in Africa; Biovac, a Cape Town-based company with significant shareholding by the SA government, was also able to produce vaccines and was engaged with global vaccine IP holders.

Currently 63 WTO Members had co-sponsored the proposal and about 50 others had indicated their support. President Ramaphosa had engaged Heads of State in a number of fora, and bilaterally, on the waiver proposal. That included the previous week’s State Visit discussions with President Macron. Co-sponsors of the waiver proposal intend to initiate text-based negotiations on the details of the waiver but required broad consensus amongst WTO Members.

Ms T Msane (EFF) stated that the International Relations Committee had not received the Minister’s presentation.

The Chairperson requested that the secretariat ensure that all Members had the presentations. He was concerned that Members would not have had the opportunity to prepare for the discussion.

Presentation to the Joint DTIC and DIRCO on the TRIPS Waiver - DIRCO
Ms Candith Mashego-Dlamini, Deputy Minister of International Relations and Cooperation, made the presentation. She indicated that in the interest of time, she would not make opening remarks. As the relevant official from DIRCO was not online to present, the Deputy Minister presented the slides. She omitted the background information as that had largely been covered by the Minister.
 
The Department of Trade, Industry and Competition was leading on the TRIPS Waiver initiative, through the participation of the South African Trade Mission in Geneva to the World Trade Organisation. The initiative was strongly supported by DIRCO which had effectively used its footprint around the world to conduct lobbying outreach through its Missions for support of the waiver. Of priority was to garner more co-sponsors in support of the waiver in order to build political pressure at the WTO. The African, Caribbean and Pacific (ACP) group and members of the Caribbean Community and Common Market (CARICOM) had not yet signed onto the waiver proposal.

Parliament was instrumental in advancing South Africa’s priorities through its engagements in the international parliamentary platforms. It was proposed that the Speaker of the National Assembly should engage her counterparts on the waiver. The Parliamentary Portfolio Committee could provide support to the process by engaging its counterparts, in both developing and developed countries on the importance and benefits of supporting the temporary TRIPS waiver.

DIRCO believed that there was no room for nationalism or profitability in decision-making about access to vaccines, essential tests and treatments, and all other medical goods, services and supplies that were at the heart of the right to health for all. Intellectual property rights should not override States’ obligations to protect and fulfil the right to health

Discussion
The Chairperson asked whether there were any comments on the next step before the discussion began. The Department of Health had not presented but he welcomed a comment from the Department of Health.

Ms Aneliswa Cele stated that the Department of Health had not prepared a presentation but were observing the meeting and would take any guidance provided by the meeting.

Mr T Mpanza (ANC), the ANC whip on the Portfolio Committee on International Relations and Cooperation, said that he was also speaking on behalf of the Chairperson as they shared the same point of view. (His input was distorted by a poor digital connection). They had witnessed President Ramaphosa’s engagement with French President Emmanuel Macron the previous week. They also supported the joint initiative between SA and India in WTO in pursuing a call for humanity and human rights in that every nation should be able to vaccinate its citizens. One of the United Nations (UN) Sustainable Development Goals (SDG) was to ensure healthy lives and promote well-being for all, at all ages. The initiative by India and SA called for a patent waiver for Covid-19-related health products to allow countries with capacity to produce the vaccine in Africa and other under-developed countries. It was not a time to fold one’s arms and watch the vaccine apartheid unfold before their eyes. He added his voices to support the noble partnership.

Ms J Hermans (ANC) spoke on behalf of the ANC component of the Trade and Industry Committee in supporting the views expressed by the DIRCO ANC whip. The ANC component of the Trade & Industry Portfolio Committee greatly supported the call for a waiver to ensure a universal right to vaccine. She asked Parliament to use all the international platforms at its disposal to obtain a consensus in the WTO to agree to the TRIPS waiver.

The Chairperson asked whether any other Chairpersons or whips wished to make comments.

Mr D Macpherson (DA) reminded the Chairperson that there were no Committee whips, only ANC whips or DA whips, etc. so he was puzzled as to why other Members had to wait for the ANC whips to speak. He had noted the colourful language, especially from Mr Mpanza regarding the importance of not folding one’s arms but doing something. The terms “vaccine apartheid” and “vaccine nationalism” had been used and so on but the truth was that SA had sat on its hands and had not done anything about vaccines while the rest of the world was buying vaccines and producing vaccines and putting money into Research and Development (R&D).

Instead, in SA, people were selecting clothing to buy and measuring the temperature of chickens. The Executive was totally occupied with beating and shambokking citizens instead of putting money into buying and developing vaccines as many other countries had done. It was rather a false sense of outrage that was being exhibited in the meeting. He wondered whether such a conversation would have been necessary if government had performed its constitutional obligation to provide health care services for South Africans and fulfilled its duty to secure vaccines when it should have. Government should have been paying the deposits for vaccines on time, instead of missing the dates.

Mr Macpherson asked about Covax that had been seen by the government to be the silver bullet. He had heard nothing more about Covax. He was bewildered by the false ambivalence between an attempt to abrogate the country’s responsibilities and a complete failure of leadership by the Executive to procure vaccines and blaming it on everyone else, nationalism, apartheid, and call it what one will.

He asked Minister Patel what the trade-off was between the TRIPS waiver and private industry that had put money into research and development. That was the lifeblood in finding a solution in an historic pandemic. How was Intellectual Property (IP) going to be protected and rewarded going forward or would it just be disposed of?

Mr F Mulder (FF+) stated that he agreed with much of what Mr Macpherson had said. There were a lot of “could have beens”. SA could only blame itself for not manufacturing vaccines. SA could have done better; government could have done better, but now it was important to get into a situation as quickly as possible where the country was able to manufacture vaccines. He asked Minister Patel, in the light the of the immense scale of corruption taking place in government, even involving Covid-19 funds, and even in the Department of Health, whether SA would be able to support the local manufacture of vaccines, who would make them and who would benefit from them?

Mr M Cuthbert (DA) concurred with Mr Macpherson and asked if the country could not have used the money stolen by Digital Vibes, the Mitha and Mather families and the rest of the cadres who had decided to take money from the public purse for their own benefit, to pump into research and development of SA’s own vaccine. That question remained because the cases were outstanding. Should that money not be recouped so that it could be poured into trying to obtain more vaccines?

He asked what the Minister’s position was in getting the private sector involved because obviously the private sector was far more efficient and effective at delivering services and could roll out vaccines more efficiently.  Was it not time to acknowledge the shambles that government had created and call on the private sector to help government out of the mess it had made of protecting lives and livelihoods and for the country to return to a sense of economic normality?

Ms Msane supported the waiver but it had been seen that without a proper roll-out plan, it would be a wasted effort. The vaccines had not reached the people who needed them. What was the manufacturing capacity of Aspen which was producing J&J vaccines? India was producing Sputnik. Why was SA not looking at producing Sputnik while waiting for the waiver process to take place?

She asked whether SA had the required resources and raw materials to manufacture vaccines, Where did SA plan to get the raw materials from as the supply of the raw materials was also a war of the richest versus the poorest? Most countries, such as US, were refusing to allow other countries to manufacture vaccines because they did not want other countries to access the raw materials that were in short supply.

Ms Msane noted that the Minister had spoken of obtaining additional machinery for the manufacture of vaccines. How long would it take SA to obtain the necessary machinery to manufacture the vaccine? Machines took years to acquire. How much money had been allocated to the manufacture of vaccines as a lot of the funds had been looted by politicians? SA would now not have sufficient funds for machinery or vaccines.

She stated that the Caribbean countries were not in complete support of the waiver as they were looking at the Cuban vaccine. With the little money that SA had, the country could have started the process of manufacturing. Why was SA not pushing for the development of the CDC vaccine in Africa? How many African countries had SA lobbied to support the TRIPS waiver? BRICS had not been active in saving lives and supporting the waiver. Brazil did not support the waiver and Russia was under the EU where they were only interested in economics.

Ms Msane noted that Mr Macpherson supported Covax but that programme had not benefitted SA. SA was prepared to engage with vaccine nationalist countries in order to promote trade and the economy. How had Covax assisted SA? And how had it supported African countries other than Ghana? The European Union (EU) had funded the vaccine itself, so how could the EU support the waiver? How had Covax helped SA?

She stated that the Inter-Parliamentary Union had met the previous week for its 142nd Assembly but SA had not participated. Instead, because SA had excess money, it pumped money into bodies such as inter-parliamentary unions but no one went there and no one bothered to participate.

Mr W Faber (DA) noted Minister Patel had said it would take three years for all SAs to be vaccinated but Europe would have been fully vaccinated by November 2021, whereas in SA, vaccine of under 60-year-olds would not have started. So, could corruption money not be recuperated and then SA and Africa could get orders into the manufacturers for delivery of vaccines when Europe was no longer in need of vaccines, i.e. after November.

Ms B Swarts (ANC) appreciated the presentation which showed that the waiver was a good test of SA’s economic diplomacy and it should ensure that it used its soft power to the fullest. What institutional mechanisms were in place for DIRCO and dtic to deliver on government’s economic priorities as provided for in the MTEF priorities? To what extent did economic diplomacy go beyond the TRIPS waiver discourse at WTO, especially at bilateral levels of engagement? What was the ratio of foreign economic representatives to DIRCO officials deployed to SA missions abroad? To what extent were foreign missions in SA being engaged by the two Departments on the TRIPS matter, in particular, and on trade issues in general? Could one safely say there was an economic approach to diplomacy?

The Chairperson noted that the Committees had to also look at the way forward. He invited the Minister to respond.

Response by Minister Patel
Minister Patel said Mr Mpanza made an important point around the urgency of the matter and he appreciated his and Ms Hermans’ support for the waiver request. He supported Ms Hermans’ call for the SA Parliament to use all international platforms at its disposal.

He noted that Mr Macpherson had not missed the opportunity to score political points at a time when there were significant issues at stake. He pointed out that vaccine nationalism was not colourful language used only in SA; it was used by all countries, including developed and developing countries. He urged Mr Macpherson to join the world and to come out of the little isolation he was digging himself into.

It was important to consider how to ensure a research facility in medicine and other matters was sustained and supported. He would look at the facts. In that particular instance, every vaccine that had been developed had benefitted enormously from public resources worldwide. There had been unprecedented support from public funds to support R&D. Many countries had contributed. SA had participated in the trials to assist the vaccine manufacturing companies in the necessary human trials for R&D. Financial and non-financial support was necessary, so it was not only the shareholders that had contributed. Even governments in developed countries recognised that companies were getting their profit in developed countries.

He added that the waiver would be time-bound and limited and would therefore not discourage private and public funds being put into R&D. As the virus mutated, more R&D would be necessary. He believed that SA was getting the balance right to save human lives.

Minister Patel explained that Covax was a global effort to combine buying power so that different pharmacological companies were assured that they had off-take commitments, i.e. guarantees that if they got the formula right, they would have buyers for the product, as that gave them leverage in terms of loans and investment. A particular challenge for SA was that the vaccine that would have had the greatest volume available for SA and which had been very successful in countering the original strain of Covid-19, was not particularly successful and not as effective against the 501 2B strain first identified in SA.

Mr Macpherson had made meal around SA placing orders earlier. He pointed him to the European and US public spat about the true market for orders of the vaccine. The EU and UK had said quite a bit on the matter and he would not repeat those points. However, he hoped that parliamentarians and public figures could support the compelling moral argument made for global solidarity in the matter of the vaccine and hence the plea for a patent waiver so that humanity pooled its knowledge and made vaccines available by increasing the manufacture of vaccines.

He thanked Mr Mulder for recognising the link between the waiver and the manufacture of vaccines. He had asked, as had others had, about corruption. The Minister asked Mr Mulder to recognise that a waiver would enable private sector players in different countries to utilise the Intellectual Property and the underlying technologies to produce vaccines.

President Ramaphosa and President Macron of France had addressed a hybrid conference at the University of Pretoria the previous week. Local and international scientists and medical regulators had attended the conference. People from across the world had recognised the facilities of Aspen and Biotech. Well before the onset of the pandemic, Aspen had worked with government to enable the development of a state-of-the-art facility in 2018/19. That development had been announced at the Investment Conference. He had heard people from across the world speak with respect of Aspen’s capacity, including President Macron and the German Chancellor. Ministers from other African countries wanted to set up meetings with Aspen so that they could share in the knowledge of Aspen. A number of African countries had the capacity to manufacture vaccines if they received assistance. He wanted to open up such opportunities. Aspen had the capacity to manufacture 300 million doses a year at its plant in Gqeberha.

Minister Patel told Mr Cuthbert that a waiver did not solve all the problems through the supply of the vaccine. SA, countries in Africa and other developing countries had to get the system of roll-out correct. Members who had raised that point made a valid point. It was an important part of the process: connecting the supply of vaccines with citizens across the world who needed those vaccines. He did not have the details but public-private partnerships were in place in SA and his colleagues responsible for the roll-out could supply details of state-private sector collaboration in the roll-out.

He thanked Ms Msane for the support on the waiver. He had already said that his colleagues could provide more information on the roll-out plan. SA was rolling out, principally, the Pfizer vaccine which was built off the technologies of a German company called BioNTech. SA was in discussion with BioNTech. Government was awaiting the regulatory unblocking of the J&J vaccine. That was an interesting example of the challenges of vaccine production. The drug substances used for the manufacture of J&J vaccine had been produced in a factory in Baltimore, USA. That factory had had difficulties in maintaining the quality standards at one point and that had paused the manufacture of J&J while regulators checked that the raw material contamination had been cleared up. J&J had asked for assistance from a SA company to provide technical support to the American supplier. Minister Patel noted that the entire world was in the situation together and countries had to assist each other in resolving their problems by sharing technically skilled people because an American life was as important as a SA life, which, in turn, was as important as a Ghanaian life, a Russian life or a Chinese life. Life was precious.

Regarding Sputnik, the Minister of Health was dealing with it through the South African Health Products Authority (SAHPRA), the Regulator that had to approve the use of all medicines in SA. Processes were taking place at the current time. When it was certified, it would enable production. Production of vaccines in SA had to be off formulations that had been approved by the Regulator.

On the resources for Aspen and Biovac, the Minister stated that he had had a very interesting discussion with French and German delegations the previous week. The CEO of one of SA’s big pharmaceutical companies had said that finance was not the fundamental problem but technology transfer and the off-take commitments for purchases over the next couple of years, so that investors were prepared to make investments in the company. Technology transfer was the key and that was being dealt with, including via the discussion at the WTO. Current capacity existed in Biovac and Aspen but would have to be extended if production were to be expanded. Machines took many years to make and so the companies were working with various organisations in seeking innovative solutions. Companies had requested support in the off-take commitments and the technology transfer. If Covax could agree to buy a certain portion of the vaccine from African suppliers; that would greatly enhance the business case for those manufacturers.

Caribbean countries supported SA in the issue of the waiver, but were not yet co-sponsors. A co-sponsor was a country that signed off on the document. SA did have support in the Caribbean but was hoping to upgrade Caribbean countries to becoming co-sponsors. SA had lobbied African countries for support. President Ramaphosa was the African champion for vaccines and he had put in a huge effort, working tirelessly to get support. He had personally engaged African Heads of State. Within a short period of time, a significant collaboration had been secured on the waiver. It was an extraordinary short period of time to gain such a level of support on an issue in the WTO. BRICS, however, was a coalition and all countries in BRICS did not support all initiatives of the other countries in BRICS. There were other issues that united the coalition.

The Minister explained to Mr Faber that one had to recognise that the world was in uncertain territory in respect of the pandemic. No one knew whether there would be a need for booster shots or new vaccines for mutations of the virus and, if there was such a need, those would have to be produced in the same facilities. Therefore the manufacturers might still have work in Europe. There were some new and exciting technologies being explored but they needed to be validated and approved by Regulators. The order situation was constrained by the manufacturing capacity. 75% of the vaccines administered had gone to 10 countries; generally wealthy countries. Developing countries knew that they would be getting vaccines but were concerned that they had been placed at the end of the queue in the last quarter of 2021 or in 2022. The order situation was constrained by the pharmaceutical companies. Pharmaceutical companies had created that particular order as they were looking at the price being paid for the vaccine and future long-term prospects and markets that had the greatest ability to pay in future years.

Ms Swarts had raised issues around the broader inclusive approach. SA had made solid strides in bringing on board other representatives of other countries in SA and in Geneva.

In closing, he said that it was an extraordinary time and he hoped that everyone could unite behind the waiver request, even though they might differ on other issues.

Concluding remarks
The Chairperson stated that the Committees supported the SA-India temporary waiver and a statement would be issued at the end of the meeting to conclude the process. He thanked everyone for connecting and joining the meeting.

The Portfolio Committee on Trade and Industry had a meeting on the following day and would receive a report from the Competition Commission, as well as consider several sets of minutes and the Committee Programme for the Third Quarter.

The meeting was adjourned.