Special 301 submission calls for a level playing field for American innovators

Megan Van Etten
Megan Van Etten March 13, 2019


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The Office of the U.S. Trade Representative (USTR)’s 2019 Special 301 Report – scheduled to be released this spring – brings critical attention to overseas intellectual property (IP) and market access challenges that harm American innovators, patients and workers. In our 2019 Special 301 submission, PhRMA encourages the Administration to take a tough stance in addressing the negative, unfair practices of certain countries.

The 2018 Special 301 Report established the Administration’s commitment to leveling the playing field for American companies, particularly those, such as biopharmaceutical innovators, that rely on IP rights. PhRMA’s submission to this year’s report calls for continued work by the Administration to hold our trading partners accountable to mutually-established obligations.

The submission highlights many concerns in overseas markets – such as the deterioration of IP rights, discriminatory market access barriers and non-transparent pricing and reimbursement practices.

In Japan for example, pricing regulations, such as premium pricing rules and flawed health technology assessments, significantly erode the value of United States IP. These policies were developed with little stakeholder engagement and transparency. PhRMA specifically calls on USTR to take urgent action to address the concerns in Japan, along with lingering issues in Canada, Korea and Malaysia.

These countries not only put the 4.7 million American workers supported by the biopharma sector at a distinct disadvantage. They throw the global innovation ecosystem out of balance, threatening the critical incentives needed to promote innovation—especially biopharmaceutical innovation, which is highly risky and time intensive. That’s why proposed policies, like the International Pricing Index Model, that suggest referencing prices and flawed policies of other countries are so dangerous.

The Special 301 submission also notes the role that some multilateral organizations play in legitimizing and facilitating countries’ adoption of policies that undermine IP rights and harm innovation. When the World Health Organization (WHO), UN Development Program (UNDP) or Unitaid advance these policies, often over the objection of the countries that fund them, they jeopardize patient health.

Biopharmaceutical companies depend on IP rights and protection to deliver treatments and cures to patients who need them. For instance, the enforcement of IP rights in the United States helps American patients get quicker and more access to treatments than anywhere else in the world, including developed countries like Japan, the United Kingdom, Canada, France and Australia.

PhRMA urges overseas government leaders to recognize the importance of IP protection to research and development that can improve health outcomes worldwide. PhRMA is encouraged by USTR’s historically firm position on protecting and enforcing IP, and PhRMA member companies look forward to working with both the USTR and foreign governments to resolve challenges and strengthen the global ecosystem of biopharmaceutical innovation.

Topics: Patents, Intellectual Property, Trade, IP Explained, International Reference Pricing