Forced Technology Transfer Ahead, Warns U.S. Chamber

Patrick Kilbride
Former Senior Vice President, Global Innovation Policy Center, U.S. Chamber of Commerce

Published

September 20, 2022

What’s happening: The World Trade Organization will begin (and could quickly conclude) discussions on expanding its waiver of intellectual property (IP) rights on COVID vaccines to also include COVID-related therapeutics and diagnostics.

Gathering storm: The U.S. Chamber of Commerce, in a letter to the Secretary of Commerce and U.S. Trade Representative, warns that if an expanded waiver is agreed upon, no cutting-edge technology is safe from expropriation.

What’s next: UN Secretary-General António Guterres recently said, “Removing obstacles to knowledge sharing and technological transfer - including intellectual property constraints - is crucial for a rapid and fair renewable energy transition[…] renewable energy technologies, such as battery storage, must be treated as essential and freely available global public goods.”

Cognitive dissonance: The U.S. Chamber called out the Biden administration, which recently published an executive order aimed at securing U.S. preeminence in biotechnology: 

“We are confused by the administration’s contradictory stance on this issue. On the one hand, the administration has prioritized domestic investment in cutting-edge technologies and innovative manufacturing. As President Biden frequently says: “‘Make It in America’ is no longer just a slogan; it’s a reality in my administration”… On the other hand, expanding the TRIPS waiver would undermine those investments by abrogating IP rights and expediting the transfer of U.S. innovative technologies to foreign governments.”

Why it matters: The U.S. Chamber reminded Secretary Raimondo and USTR Tai that private sector innovators succeeded in delivering breakthrough COVID vaccines and treatments in record time based on a robust U.S. innovation ecosystem supported by intellectual property rights:

“[Weak IP] is a disadvantage in a global economy where productivity advances are increasingly driven by innovation, know-how, information flows, and data. It contributes to a deep global imbalance in innovative and creative output, as well as access to the same. The U.S. Chamber International IP Index notes, “[W]eak IP protection stymies long-term strategic aspirations around innovation and high-tech economic development.” [1] In a weak global IP environment, forced technology transfer becomes the preferred method of gaining access to new technology.

“The recent decision by the WTO to waive IP rights related to COVID-19 vaccines reflects the frustration of those who remain outside the innovation ecosystem and a cynical effort by some to appropriate innovations that are the fruit of others’ investments. However, the diminishment of IP rights would only serve to reinforce the imbalance. While early U.S. support for a waiver signaled a willingness to endorse “extraordinary measures” amid a global health crisis, the waiver’s realization came long after its ostensible purpose was mooted by a large and growing surplus of COVID-19 vaccine supplies.”

Solutions: The U.S. Chamber recommends developing an effective, shared knowledge economy infrastructure, engaging through platforms such as the administration’s proposed Indo-Pacific Economic Framework. With a solid IP foundation, countries can position themselves as stakeholders in an innovation ecosystem, delivering not just COVID-19 solutions but technological breakthroughs for the world’s greatest challenges like climate change, energy shortages, food equity, and access to health. 