After just four months in office, President Biden has already agreed to one of the worst trade concessions in American history. On May 5, the president and his Trade Representative announced that they would support a World Trade Organization (WTO) waiver gutting patent and intellectual-property (IP) protections for American COVID-19 vaccine producers. At first glance, this might seem like a generous humanitarian gesture aimed at expanding the supply of vaccines — but in reality, it is a bungled attempt at benevolence that could have tragic consequences.
This decision reflects a basic misunderstanding of the barriers to vaccine development and distribution. The limiting factor is not intellectual property; it’s the global supply chain and a raw-material bottleneck. The Pfizer vaccine, for example, requires 280 materials produced in 19 different countries. Only a year ago, no one had ever produced many of these materials on a commercial or industrial scale.
This complex and delicate web of producers could easily collapse under a steep rise in demand from countries trying to prop up fledgling vaccine producers. The manufacturers of these raw materials might in turn need to ration their products at raised prices. It would also encourage hoarding and a series of other market inefficiencies that would disrupt and delay vaccine distribution.
Although many nations would like to reproduce our vaccines, only a select few actually have the capabilities to succeed, including China. Yet other nations probably would not stop their efforts to replicate our vaccines on the cheap without proper safety and health measures in place. The result could both enrich China and poison millions. Neither outcome is desirable, acceptable, or remotely necessary.
America’s taxpayers invested $20 billion to develop, produce, and distribute safe, reliable, and effective vaccines. This investment paid off, and the United States pioneered three of the safest and most effective vaccines in history, all in record speed. Pfizer is now on the path to produce 3 billion vaccine doses by the end of 2021, Johnson & Johnson is expected to deliver 1 billion one-dose shots, and Moderna is projected to deliver between 700 million and 1 billion doses. All told, the United States can fully vaccinate our own people, and also vaccinate much of the world by the end of the year.
Instead of giving away our trade secrets, the Biden administration should arrange for other governments to buy what we are already on track to produce. In the case of desperately poor nations, we could give vaccines free of charge, in keeping with our long tradition of humanitarian generosity. This policy would leave essential supply chains intact and ensure the quality and safety of the vaccines. It would also have the additional benefit of creating American jobs and building skills for our nation’s workers.
President Biden still has ample time to reverse course — and I sincerely hope that he does. For once, the bureaucratic inertia of the WTO could play to our advantage, giving the president time to reconsider this imprudent error before it becomes gross negligence.
If the president does not reverse course, he will do immense harm to both the United States and the world. In these perilous times, we should put our confidence and our fate in our own hands. If we do, the nation that once was dubbed the “Arsenal of Democracy” can now serve as the Supplier of Recovery.