Biz groups lament lost drug protections in trade deal
Business groups are expressing disappointment over the intellectual property (IP) protections in President Trump’s new North American trade deal, even as they largely urge lawmakers to pass the agreement.
“The USMCA is a good deal for American workers and will help grow our economy. However, this bipartisan deal is not perfect,” said Phil Cox, co-chairman of Trade Works for America, a group advocating for the U.S.-Mexico-Canada Agreement, which updates the North American Free Trade Agreement (NAFTA).
“Future trade agreements should include provisions to protect U.S. innovators. This is deeply personal for me and the millions of Americans who know that pharmaceutical innovations mean life-saving cures,” he added referring to the elimination of drug IP protections in the deal.
Speaker Nancy Pelosi (D-Calif.) announced Tuesday that she and President Trump had reached a deal to secure passage of Trump’s USMCA after months of negotiations.
In their agreement, Democrats were able to eliminate language which would have given a certain class of drugs, biologics, 10 years of patent protections, in a blow to the pharmaceutical industry. The absence of that measure means Congress can more easily act to reduce protections for those drugs, allowing generic versions to the market sooner.
Democrats cheered the move, saying it could help lower drug prices. The pharmaceutical industry though has long argued that the protections are necessary to incentivize companies to spend money on high-cost research and development and recoup their investments.
One trade group backed by a number of industries and trade advocates, the PASS USMCA Coalition, which has been vocal in pushing for passage of the trade deal, on Wednesday said it was dropping its stance in favor of the agreement. The group cited the changes to drug IP protections to explain its stance.
“The unnecessary decision to strip certain intellectual property protections is particularly concerning, as it puts American scientists and creators at a serious disadvantage abroad,” the group said.
“The Coalition will not release any more statements and has no position on the USMCA as it’s written now,” a spokeswoman for the group told The Hill.
Other major groups which spent big advocating for USMCA this year, the National Association of Manufacturers (NAM), U.S. Chamber of Commerce, and Business Roundtable (BRT), are still backing the deal even as they voiced frustration that it did not retain IP protections for drugs that were in NAFTA.
“To be sure, as with any agreement of this nature, not every objective that we sought was met. For instance, we are extremely disappointed that the agreement missed an opportunity to set the gold standard for the protection of American-made lifesaving innovations and inventions,” NAM CEO Jay Timmons said in a press release on Tuesday.
Timmons added, “Protection of intellectual property is a key principle and critical for the long-term vitality of the manufacturing industry and the men and women who work in our sector.”
NAM, which has been a vocal voice in pushing for passage of USMCA, stressed its support for the trade deal.
The U.S. Chamber of Commerce, which has also led on efforts to pass USMCA, said it plans to step up its work to ensure that the loss of IP protections in the deal isn’t a template for future trade agreements.
“[We] are seriously disappointed by the removal of certain intellectual property provisions, including but not limited to the biologics provision,” CEO Thomas Donohue said in a statement released on Wednesday.
Donohue said claims that the protections raised drug prices were based on a “false assumption.”
“In fact, the original biologics provision would have resulted in more funding for innovative medical research with no additional cost to U.S. consumers,” Donohue said.
“Now, the only beneficiaries will be foreign governments and consumers who will continue to free-ride on the benefits of American research into new cures without contributing to their development.”
BRT has officially thrown its support behind USMCA, but also addressed those concerns.
BRT CEO Josh Bolten said in a meeting with reporters on Wednesday that the group likes “most of the model,” but that the pact removes or weakens important intellectual property protections.
“Those protections, particularly for biologics, have been eroded,” Bolten said.
Copyright 2023 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.