886. First, I take this opportunity to commend you in the effective manner in which you are steering this very import Council's preceding since assumption of your role recently.
887. Also let me thank and appreciate immensely India, South Africa, Kenya and other newly joined co-sponsors for presenting their extremely relevant and timely proposal for a Waiver from certain provisions of TRIPS Agreement for Prevention, Containment and Treatment of COVID-19.
888. At the outset, let me notify Sri Lanka's strong and unequivocal support for the proposal circulated in document IP/C/W/669 and presented by the co-sponsors.
889. The COVID-19 was declared a pandemic by the WHO on 11 March 2020. It is widespread, affecting almost all WTO Members. After experiencing a very brief initial period of COVID pandemic, Sri Lanka is now experiencing a second waive, where the epidemiologists and virologists have detected the COVID-19 virus, which is more severe in affect than what we experienced before and able to spread among large sets of community groups vigorously in a given period. This has necessitated the authorities to double their efforts in containing the virus to minimize the health and socio-economic impact on our poor population.
890. In this situation, ensuring timely access to essential commodities by overcoming acute shortages faced by countries due to high demand and disruptions in the supply chain is critical. There is no vaccine or medicine yet to prevent or treat COVID-19. Hence, there is an urgent need to speed up development of new vaccines, treatments and diagnostics, at scale, and make these widely available.
891. An effective response to COVID-19 pandemic not only requires timely access to affordable medical products, but access to diagnostic kits, medical masks, other personal protective equipment and ventilators is also vital. However, as the crises persist, there has been a rapid increase in demand with many countries facing acute shortages, constraining the ability to effectively respond to the outbreak. Importantly, timely access to affordable vaccines and medicines for the prevention and treatment of patients in dire need is another major concern, as the COVID-19 global crisis deepens. Given the disruptions in supply chains and severe shortages, local/regional production is a critical solution, may be the only solution for small economies such as mine.
892. Efforts to contain the COVID-19 spread has led to serious concerns about the impact of IPRs, such as patents, industrial designs, copyright and trade secrets on the availability and affordability of medical products. Global demand for medical products can only be met with global production of products needed to contain, treat and prevent COVID-19. Apart from availability, affordability is another concern that needs to be addressed, an aspect of which is very important and relevant for Sri Lanka.
893. In view of the above reasons, Sri Lanka considers that the Proposal is timely and importantly necessitated in the current context:
894. In the proposal, the co-sponsors are calling for the WTO Members to agree to temporarily waive certain provisions of the WTO TRIPS Agreement related to the obligations on protection and enforcement of patents and other intellectual property rights to support the global COVID-19 pandemic response.
895. In addition to patents, other forms of IP rights, such as, copyrights, industrial designs, and trade secrets can also apply to products and technologies required for responding to COVID-19. This necessitates enabling a broader application of flexibilities beyond patents to such other forms of IP rights. Accordingly, the proposal requests wavering of specific obligations of the TRIPS Agreement on protection and enforcement, namely, (1) patents, (2) copyright and related rights, (3) industrial designs and (4) protection of undisclosed information during the COVID-19 pandemic.
896. As elaborated in the proposal, the waiver would absolve all countries from implementing the referred obligations for a limited time period, extending policy space for governments and extending freedom to operate to parties without risk of infringing such intellectual property rights, while ensuring legal certainty that actions are compliant with WTO TRIPS rules.
897. As argued in the proposal, the adoption of this proposal will overcome potential obstacles that above categories of intellectual property rights may create to get timely and unfettered access to technologies and products needed to address the pandemic. It will not affect, however, the enforcement of other categories of rights covered by the TRIPS Agreement, nor its full implementation in relation to matters unrelated to the prevention, containment or treatment of COVID-19. Therefore, the adoption of this proposal is critical to ensure availability of medical products at affordable price for the prevention, containment and treatment of COVID-19.
898. Why Sri Lanka supports the proposal: Sri Lanka's government total expenditure on health sector is around USD 1.32 Billion, which is a share of 1.7% of the total GDP of Sri Lanka in 2019. Total bill on import of medical and pharmaceuticals is USD 552.6 million, which is a share of 2.8% of total imports in 2019 and is now on the rise due to the current crisis. At present, 80% of the country's drug requirement is met through imports. At present, Sri Lanka is the largest importer of drugs in the Asian region and it is high time that Sri Lanka turns the tables in its favour.
899. Sri Lanka is a country which is proud of having a universal free medical access programme securing free access to health facilities & Treatment for its population, which is also enshrined in its Constitution as a fundamental right of its citizens. When the country is inundated with balance of payment difficulties exacerbated by the COVID Pandemic, the Government is seeking to reduce import bills including the expenditure on medical and pharmaceutical products through other means.
900. A disturbing development witnessed by Sri Lanka during the current pandemic is the gradual increase of domestic prices of essential medicines sold in the market by the Pharma Companies when our regulatory authorities' attention has been drawn in containing the spread of pandemic. There are investigations going on to these alleged anti-competitive practices by the regulatory authorities.
901. Recently, Government informed that its plans to increase production with a view to meeting the country's total drug requirement and to ensure the supply of high quality drugs at affordable low prices and to enhance the export production capacity of nascent items in COVID-19 product range. Sri Lanka has also decided to establish a free trade zone to accommodate such investments in the pharmaceutical sector. Through this, the Government is intending to meet at least 50% of country's current pharmaceutical requirements. In terms of the plan, 25 medium and small scale companies are prepared to invest USD 300 million to meet the local demand.
902. This proposal is, therefore, in line with Sri Lanka's policy goal for exploring avenues for increasing domestic value addition in productive sectors, particularly by building production capacity of Domestic Pharmaceutical and Medical Devices sector.
903. Unless there is an unambiguous clarity that any domestic production of COVID-related patented drugs and medical devices, PPE products etc can be carried out in Sri Lanka for meeting the domestic demand and with plans to export to third countries, without any IPRs related legal impediment, it is highly risky to invest in new ventures if it is otherwise.
904. A research institute in Sri Lanka, namely, Sri Lanka Institute of Technology (SLINTEC), has ventured in to innovate and commercialize two new products with high export potential in the USA and the EU. These products are SLINTEC Swabs and SLINTEC Sterile. The SLINTEC has reverse engineered COVID-19 testing swabs and has been producing them in-collaboration with the Medical Research Institute of Sri Lanka, the Lady Ridgeway Hospital, and Hi-Fashion Holdings Pvt limited.
905. It indicates that these items are already under patents and though they are now made in Sri Lanka in generic form and intended to be exported under Sri Lanka brand name, there is a likelihood of overriding the patent holders' rights in the importing countries. Sri Lanka has found such new product lines and intends to capitalize on the export potentials, so that in addition to catering to our local demand, Sri Lanka can supply to those countries, who require them to deal with the current pandemic, which is going to stay in the world for many years. But, Sri Lanka may not be able to export them to those countries due to the possible IPRs infringements. If so, it not only deprives Sri Lanka generating most vital foreign exchange, but also deprives the countries which require them desperately.
906. The WTO waiver proposed in the proposal will, therefore, provide the required legal certainty to Sri Lanka in the interim period, until it is able to address those IPRs related legal impediments in the long run.
907. Currently, Sri Lanka has few provisions in Sri Lanka's National Intellectual Property Act, No. 36 of 2003 that provide such exceptions, particularly Section 86 of the Act, which unfortunately bundles the important exceptions provided under 'exhaustion of rights (parallel imports) and Compulsory licences (CL) and offers less clarity in their application.
908. Further, Sri Lanka is yet to amend its National Intellectual Property Legislation to introduce the complaint provisions necessitated by the Amendment to the TRIPS Agreement (under Article 31bis of the TRIPS Agreement), which is overdue. This amendment is particularly important to Sri Lanka, as it lacks domestic manufacturing capacity and would, therefore, be dependent on imports to meet its medical needs.
909. Many developing countries, including Sri Lanka may also face legal, technical and institutional challenges in using TRIPS flexibilities due to the lack of ambiguity in the existing legal provisions. This is especially true for countries, such as Sri Lanka that have never utilised flexibilities such as compulsory licences (CL). National patent laws may not even have the necessary provisions to issue compulsory licences in the public interest or government use licenses.
910. In some countries, including Sri Lanka the issuance of compulsory license may not be possible until the expiration of three-four years following the grant of patent. Sometimes, provisions on compulsory licensing in national legislation are subject to specific processes and as such the issuance of compulsory license may involve lengthy processes that are time-consuming.
911. As explained above, a few countries have introduced or are in the process of introducing simplified procedures for issuing compulsory licences in times of a public health crisis. This however may not be an option for Sri Lanka, where legal and technical capacity maybe lacking and the passing of national legislation is often a very long process.
912. In order to support these efforts, Sri Lanka is in the process of carrying out a gap analysis on the Sri Lanka's existing National IPRs Legislation to ascertain the areas where further improvements are necessary to ensure that the production can commence on those products protected under IPRs enabling the long-term survival of those investments and projects.
913. While the process of amendments will be time consuming on a variety of IP rights that are relevant in the fight against COVID-19, Sri Lanka along with other like-minded countries have been working on a joint proposal, initiated by India and South Africa, which has now been submitted to the WTO TRIPS and the General Council seeking a more integrated approach to address the public health concerns/challenges of COVID-19 pandemic, through TRIPS flexibilities that include other various types of intellectual property (IP) rights including copyrights, industrial designs and trade secrets.
914. The use of TRIPS flexibilities in other areas of intellectual property, beyond patents, is less understood at the national level. In fact, in other fields of IP, National IP laws may not even provide for sufficient flexibilities to address issues of access.
915. In view of the above forgone and justifiable reasons, Sri Lanka calls for support for the multilateral solutions, more particularly this joint proposal which is before us in assuring and delivering fair access to COVID-19 treatments for all those in need in the developing countries and the LDCs.