Will This Trade Deal Block Some Generic Drugs from the U.S.?
Policy + Politics

Will This Trade Deal Block Some Generic Drugs from the U.S.?

The prospect of a bipartisan deal on trade between the Republican-led Congress and President Obama has Democrats and consumer advocates worried. A big concern is the deal’s treatment of pharmaceutical patent protections that could make generic drugs harder to bring to market.

When the current Congress was seated in Washington in January, Sen. Mitch McConnell (R-KY), the new Senate Majority Leader, was cautiously optimistic that the GOP-controlled legislature could find common ground with a Democratic president. He didn’t promise the moon, but he said there was substantial room for agreement on certain issues. One of those was the Trans-Pacific Partnership, a 12-nation trade deal that has been under negotiation for the last five years.

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Now, Republicans in Congress are pushing to approve legislation that would “fast-track” the TPP agreement once negotiations are finished – and the president is supporting them. What that means is this: Lawmakers would only be allowed an up-or-down vote on the entire package – rather than being able to get under the hood of the deal and perhaps challenge certain provisions.

The point of fast-track authority is two-fold. First, it gives the 11 other countries confidence that Congress won’t start rewriting the deal once it’s been completed. Second, it makes ultimate passage through Congress much more likely – individual lawmakers would, presumably, be less likely to challenge small provisions if the only way to do so entailed scuttling the whole thing.

The deal is a source of concern for any number of reasons. Organized labor worries it will send even more U.S. jobs overseas. Environmentalists say it doesn’t seem to have adequate protections against pollution and climate change. Pharmaceutical firms worry it could extend patent protection for lifesaving medicines, or raise new barriers to the introduction of generics – meaning higher prices for consumers and for government-run health care programs.

The concerns are difficult for the deal’s opponents to articulate because of the extreme secrecy of the deal’s negotiations. However, documents leaked to The New York Times and the international transparency advocacy organization Wikileaks earlier this year suggested that industry groups, including pharmaceuticals companies, have privileged access to and influence over the talks – something refused even to members of Congress.

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“The last thing we need is another trade deal negotiated behind closed doors and rushed through Congress,” said Sen. Sherrod Brown (D-OH) at a rally opposing the deal on Tuesday.

The closed nature of the talks – the details are considered “classified” by the U.S. government – makes it hard for concerned parties to ferret out details. That hasn’t stopped some high-profile advocates from weighing in.

In an op-ed in The New York Times several months ago, Nobel Prize-winning economist Joseph E. Stiglitz wrote, “If big pharmaceutical companies hold sway — as the leaked documents indicate they do — the T.P.P. could block cheaper generic drugs from the market. Big Pharma’s profits would rise, at the expense of the health of patients and the budgets of consumers and governments.”

The consumer advocacy group Public Citizen says this: “Provisions in the TPP would expand patent monopoly rights, limit flexibilities, and facilitate abuse of the patent system. Longer, broader, and stronger monopolies mean reduced generic competition and higher drug costs for families and national health programs.”

It’s not really up for debate that extensions of patent monopolies increase costs for consumers and health plans and boost the profits of pharmaceuticals firms. But there is a vigorous argument about just how much patent protection drug firms deserve.

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For their part, drug companies claim that without substantial protection of monopoly rights, they wouldn’t have the incentive to invest tens or even hundreds of millions of dollars necessary to bring a new drug to market.

Consumer advocates don’t argue against patent protection per se. They argue that current rules that give as much as 20 years of protection, which can be extended even further through legal wrangling, are excessive, particularly with lifesaving medications.

The secretive nature of the negotiations means that practically nobody outside the actual participants knows what the final deal might wind up looking like. That’s what has consumer advocates, and health plan administrators, more worried than most.

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