The coronavirus pandemic is a global emergency that pertains to health but threatens to destroy trade. While many economists are panicking to ensure that short-sighted export controls do not shut-off trade, others are pointing to the Great Depression and how the global economy would falter and even crumble if protectionist policies are established.
If there is one thing that the globe, fueled by the trade regime of the WTO missed, it is that trade was always couched on the fragile platform of global health. When AIDS ravaged remote parts of the globe, during the SARS or MERS crises, the effects of health in any part of world affected all of global trade adversely. But, COVID-19 is different. It has showed the world that trade is sub-servient to health and not vice-versa. Alas! the story of the trade regime that deals with health and medication miscalculated this for over 25 years!
While the establishment of the World Health Organization (WTO) was the high-point for the liberalization of global trade, it also represents the low-point for access to medication globally. In fact, the WTO’s trade regime on intellectual property protection for health independently created severe barriers to public health. First, the WTO systematically erected barriers to public health in the form of harmonized patent rights, while reluctantly giving in to create minimal flexibilities, to protect private rights at the cost of public health. Further, the WTO supported regulatory protections to already protected materials. This added another layer of barrier to access health. Regulatory protections that stood on shaky legal grounds were empowered by bilateral agreements and the likes of the USMCA. Furthermore, innovation became the choice rhetoric used to justify the barriers for limiting access to medication. At local levels, trade and innovation was the excuse used to justify ever-greening of patents, diverting public money to create private rights, unbridled pharmaceutical pricing of life-saving medications to finally morph access to medication into a luxury. Gilead’s attempts to get orphan drug status for Remdesivir, originally created using $70 million of public money and the FDA’s blessing of the same at a time when the US had 80,000 patients with COVID-19, with infection rates rising exponentially, is telling of this phenomenon.
Several recent historical instances including AIDS and SARS exemplified the role public health. These are instances where public health flexed its powers to show how trade can be a casualty to health economics. But, greed and an ideological affinity that erased realism to instead, induce a normative reading of the WTO texts, blind-sided the globe. Soon, powered by short-sighted policies that relegated health to a secondary position firmly posited innovation as the barrier to health. While innovation remains important, over the years it became the choice rhetoric to undermine access to medication, albeit unnecessarily. Realistic renditions of local realities were brushed aside as mere poor-country sob-stories to help lose sight of the importance of health for robust trade. It was always policies and not poverty that erected barriers to trade in the form of denied access to health. By the time COVID-19 descended on it, the globe had created an entire class of society, segregating those with access to healthcare from those without.
Even as COVID-19 ravages countries, it is the WTO’s silence that is deafeningly loud in the background of the cries of the WHO to restore public health. World leaders and bodies, unfortunately, egged the WTO on for years to minimize health-related flexibilities to intellectual property rights. As we decry trade today, it is worth recapturing that countries that genuinely prioritized health policies to protect public health have been bastardized by the WTO. The classic example is the yearly bashing of India since 2006 until now by the United States, in the name of innovation and trade, for enabling a cancer-medication which was originally priced by Bayer at a cost per month that exceeded 5 times the annual income of the top 5% of Indians. Traditionally, the WTO turns a blind eye while the United States routinely resorts to unilateral resolutions over poorer nations using trade as the stick to undermine public health.
It is time to appreciate that enabling access to medication globally is the ONLY solution to recreate a robust trade amidst COVID-19. Cooperation in health-related technologies and instituting trade and health policies that enable access remains the unique solution to innovation of the next century. Costa Rica’s plea to the WHO is showing the way forward for the globe. Relaxing the export controls and trade protectionism on goods especially those that relate to medical equipment is an important step ahead to ensure that healthcare workers are protected. Imminent steps include instituting compulsorily licensing patents over technologies relating to testing and treatment of COVID. Similarly, regulatory protections such as data, market and other exclusivities should be halted to enable testing of possible treatments across the globe and to enable collection of data to prevent future crisis. Public funds should be diverted to do research that belongs to open-science and ultimately should feed into medicines patent pool.
Trade precipitated talent capital that helped the globe progress to the next level. But, it is not talent but COVID-19 that is educating us on the short-sightedness of a trade regime that systematically undermined the role of access to health to relegate it as the least common denominator. Turns out, health was the highest common denominator and the western part of the globe miscalculated it.