State of the Union: Obama’s fast-track trade plans divide pharma

By Fiona BARRY contact

- Last updated on GMT

Barack Obama gives his 2015 State of the Union Address (Image: White House)
Barack Obama gives his 2015 State of the Union Address (Image: White House)

Related tags: Pharmaceutical industry

President Obama in his State of the Union address has called for the power to personally make stronger trade agreements – bringing divisive EU deal TTIP closer to adoption and angering campaigners for drugs access.

Obama asked Republicans and Democrats in Congress to grant him Trade Promotion Authority – a temporary power that allows the President to fast-track trade negotiations. It gives Congress the choice only to say “yes” or “no” to potential deals, but not to amend them.  

The take-it-or-leave-it power would let the President forge “strong new trade deals from Asia to Europe,​” he said on Tuesday.

TPA would make the US more reliable in the eyes of the countries it negotiates with and would give a leg-up to passing the controversial free trade deal TTIP (Transatlantic Trade and Investment Partnership) with the EU.

TTIP – to be the biggest trade deal in the world if it passes – would open up US and European markets to each other and enshrine intellectual property rights. The agreement has received broad support from the pharma industry but opponents say it will strengthen monopolies and keep drug prices high.

SOCMA response

The Society of Chemical Manufacturers and Affiliates (SOCMA) praised the trade strategy outlined in the State of the Union.

Until now the President’s outward support for trade policy, specifically Trade Promotion Authority (TPA), has been lacking,​” said SOCMA President Lawrence Sloan.

He described TPA as key to signing both the Transatlantic Trade and Investment Partnership (TTIP) with the EU and the Trans Pacific Partnership (TPP) with Asia-Pacific countries.

Passing TPA will signal to our trading partners that there is a path forward for these trade agreements to be concluded, considered and passed.​”

Pharma industry groups have previously shown strong support for TTIP. PhRMA (Pharmaceutical Research and Manufacturers of America) has claimed it has “tremendous potential to benefit patients in our markets and around the world.​” The deal would speed access to medicines and spur innovation by strengthening IP claims, said EFPIA (European Federation of Pharmaceutical Industries and Associations).

Pharma ‘wish list’ is ‘unethical’ say campaigners

But TTIP has received scathing criticism from other quarters.  

The European Public Health Alliance described its strong patent protections as “particularly worrisome​” while Health Action International, an advocacy group promoting medicines access, said TTIP’s clauses on trade secrets will delay generics’ market entry, pushing pharma prices higher.

James Love, Director of NGO Knowledge Ecology International and a campaigner for fairer access to drugs, told in-Pharmatechnologist.com TTIP is anti-competitive and would have “a very negative affect on the ability to protect consumers in areas involving intellectual property rights​.”

He described the potential agreement as a “wish list​” by pharma companies that would “expand and strengthen their monopolies​” on branded drugs.

Love claimed the deal would lower standards needed to grant patents, make them harder to revoke, and add at least five more years to patent lives’ current twenty.

Crucially, he said, it would also create property rights around safety testing data and put restrictions on other countries’ ability to negotiate drug prices.

Evidence about biopharmaceuticals’ safety and effectiveness submitted in standard regulatory dossiers would become an intellectual property right, Love said.

Which makes it hard for a generic drug company to register a drug because they can't just point at published scientific information about whether a drug is going to help patients or not, they have to go out and replicate it even though the experiments have already been performed and the results are already well-known.

They have to – in a way that's contrary to medical ethics – repeat experiments on humans to prove something that's already been proved.​”

This barrier to entry would have a chilling effect on biosimilars makers, he said, and ultimately keep biologics prices high.

Related topics: Markets & Regulations, Biosimilars

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