When India and South Africa jointly proposed a temporary waiver of intellectual property rights for COVID-19 vaccines and related treatments at the World Trade Organisation in October 2020, they had a straightforward argument: the world was in a once-in-a-century pandemic, and the formulas needed to produce life-saving vaccines were legally locked behind patent protection. Vaccine manufacturing capacity existed in India, South Africa, Bangladesh and other countries. What did not exist was the legal right to use it without the patent holders’ permission. The proposal attracted 64 co-sponsors and significant public support. After nearly two years of negotiations, the WTO adopted a <a href="https://corporateeurope.org/en/2022/07/trips-waiver-failure-eu-betrayal-global-south-vaccine-access-obscured-lack-transparency” rel=”nofollow noopener” target=”_blank”>watered-down compromise in June 2022 that covered only vaccine patents, excluded therapeutics and diagnostics, and bore little resemblance to what India and South Africa had originally proposed.
The episode revealed something larger than a public health failure. It exposed how the ownership of knowledge has become one of the most consequential economic and political questions of this century and how the rules governing that ownership were designed at a moment when the countries now challenging them had the least power to shape them.
A patent gives an inventor the exclusive legal right to make, use, sell or license an invention for a limited period — typically twenty years from the date of filing. The economic rationale is straightforward: developing a new medicine or technology requires years of research and enormous investment. Without legal protection, a competitor could copy the invention immediately and sell it at marginal cost, making the original investment unrecoverable. Patents, in theory, provide the incentive that makes private investment in innovation possible.
Critics have long argued that this logic has limits, particularly when patents cover products that function as public goods, such as medicines and vaccines, or when, most critically, the innovation itself was and is substantially funded by public research. During the 1990s and early 2000s, the price of antiretroviral HIV medicines in sub-Saharan Africa illustrated this tension with brutal clarity: the drugs existed, the epidemic was killing hundreds of thousands of people a year, and patent-protected prices made treatments completely inaccessible to most of those who needed them. Indian generic manufacturers produced affordable versions under compulsory licensing provisions, the legal mechanism allowing countries to override a patent in specified circumstances, eventually saving millions of lives.
How Global Rules Were Rewritten
Before 1995, individual countries had considerable flexibility over how they structured patent laws. The Agreement on Trade-Related Aspects of Intellectual Property Rights — TRIPS, which came into force when the WTO was established, changed this. Minimum standards for intellectual property protection became mandatory for all WTO members. Countries that did not adopt them faced trade sanctions.
Ha-Joon Chang, in his analysis of how today’s wealthy countries industrialised, has documented that Britain freely copied Dutch textile technology in the eighteenth century, the United States routinely ignored European patents throughout the nineteenth century, and Japan and South Korea built their industrial bases partly by copying and adapting foreign technologies before developing their own. When these countries finished industrialising, they became advocates of strong intellectual property protection — pulling up the ladder, as Chang puts it, once they had climbed it. TRIPS institutionalised this position as the universal standard, required of all countries regardless of where they sat in their developmental trajectory.
Beyond Medicines: Where IP Shapes Development
The reach of intellectual property in the modern economy extends well beyond pharmaceutical drugs, and in each domain it raises structurally similar questions about who captures value and who pays for it.
Qualcomm, which holds patents on the basic communications standards used in virtually every smartphone on Earth, collects royalties from every phone manufacturer that uses those standards — regardless of where the phone is made. Countries trying to build semiconductor or smartphone manufacturing capacity find themselves paying ongoing licensing fees to firms whose inventions may predate their industrial ambitions by decades. In renewable energy, solar, wind and battery storage technologies are protected by extensive patent portfolios concentrated in a handful of countries, creating licensing costs that complicate domestic manufacturing for the countries in the global south that need these technologies most urgently to manage their energy transitions.
The United States receives more in royalties and licensing fees annually than it pays out — in 2023, that surplus exceeded $100 billion. For most developing countries, the balance runs the other way: they pay far more to use others’ intellectual property than they receive for their own. This reflects the fact that the majority of the world’s valuable patents are held by corporations headquartered in a small number of wealthy countries, whose governments designed and continue to enforce the international rules governing them.
The Question the Waiver Made Visible
Joseph Stiglitz has argued that intellectual property rules, as currently structured, function as a tax on knowledge transfer — a mechanism allowing the owners of ideas to collect rents long after the original investment has been recovered. The TRIPS Agreement was negotiated at a moment when pharmaceutical companies and technology firms in the United States and Europe had direct access to their governments’ trade negotiators. The countries that would later challenge these rules had considerably less leverage.
India’s generic pharmaceutical industry operated for decades under national patent laws that did not permit product patents on medicines, allowing manufacturers to produce affordable versions of essential drugs — precisely the kind of developmental flexibility that TRIPS reduced. The 2001 Doha Declaration reaffirmed countries’ right to use compulsory licensing in health emergencies, but each licence requires individual legal proceedings, invites diplomatic pressure, and is subject to conditions that make it cumbersome in practice.
The question the patent system ultimately poses is not whether innovation deserves reward. It clearly does. The question is how long, how broadly, and over what range of products legal monopolies should operate and whether the answer should be identical for a multinational pharmaceutical company collecting returns on a blockbuster drug and a developing country government trying to produce a vaccine during a pandemic. The current rules give one answer. The COVID waiver negotiations made visible just how hard it is to change it.
Utkarsh Mishra is a journalist based in Ranchi writing on law, labour rights, and the environment. His work has appeared in Feminism in India, The India Forum, Down to Earth, The Policy Circle, Verdicto News and Zee News.
Intellectual Property Rights, Knowledge Creation, Patents, Utkarsh Mishra
