House Democrats Ask US Trade Representative to Drop Biologics Language From USMCA

More than 100 House Democrats this week wrote to US Trade Representative Robert E. Lighthizer to ask him to drop language from the United States-Mexico-Canada Agreement (USMCA) trade agreement that would give 10 years of marketing exclusivity for biologic drugs.

The biosimilars industry has been working since earlier this year to convince legislators to join them in opposing a pharmaceutical intellectual property provision in the renegotiated trade agreement with Canada and Mexico, which they say will create higher drug prices in the United States.

In the letter, the legislators say that the proposed language would prevent Congress from having the ability to “adjust the biologics exclusivity period, instead locking the US into policies that keep cancer and other drug prices high while exporting this model to Mexico, which has no additional exclusivity period for biologics, and to Canada, which has an 8-year period.”

In a statement, the Association for Accessible Medicines said it hopes that an agreement is reached in time for a vote in the fall. Innovator biotechnology firms and pharmaceutical industry groups, such as the Biotechnology Innovation Organization, known as BIO, and the Pharmaceutical Research and Manufacturers of America, known as PhRMA, approve the intellectual property language currently in the agreement.

The president had secured agreements with Canada and Mexico last year on the USMCA, an updated version of the North American Free Trade Agreement, but since then, Democrats have taken control the House of Representatives.

In a joint statement, Representatives Jan Schakowsky, D-Illinois and Rosa DeLauro, D-Connecticut, both members of the House Democrats working group tasked with trying to work with Lighthizer, praised the trade representative’s efforts, but added, “unless and until President Trump instructs Ambassador Lighthizer to remove the biologics exclusivity language from the text of the United States-Mexico-Canada trade agreement, as well as other parts of the text that would hinder Congress’ ability to lower prescription drug prices for American families, his talk about wanting to lower drug prices is just that: talk.”

Last month, Schakowsky and DeLauro introduced HR 3379, which would shorten the exclusivity period for brand name biological products from 12 to 5 years.

Separately, in Canada, there are fears that the USMCA language could raise drug prices there, as well. A report in a benefits newsletter cited a Parliamentary Budget Office (PBO) report that says a new agreement, as it currently stands, would cost Canadians millions in higher drug costs. Estimating average annual costs from 2015 to 2023, the PBO said protection for 16 biologics worth CAN $422.4 million of the CAN $1.26 billion in prescription sales in 2015 were set to expire in the shorter 8-year time frame, or an average of CAN $52.8 million per year. Consumers and drug plans would pay an additional $23.8 million per year in that time period because of the longer protections.