May is World Trade Month, when we celebrate the many American companies exporting products around the world, and growing opportunities here in the U.S.
Every day, thousands of biopharmaceutical researchers in the United States work to develop innovative treatments and cures that have the potential to transform the way we treat some of the most complex diseases facing patients worldwide. Our companies lead the world in medical research, creating over half of the new molecules produced over the last decade.
This leadership in global medical innovation has long been recognized, but industry’s impact goes even further. The U.S. biopharmaceutical sector is not only responsible for bringing groundbreaking new medicines to people around the world, but also plays a powerful role in driving and supporting the American economy. In fact, in 2017 alone, U.S. biopharmaceutical exports totaled $51.2 billion – only behind the software industry as a leading exporter among R&D intensive industries.
The vitally important scientific and economic contributions made by America’s biopharmaceutical industry haven’t just happened by chance. American innovation and economic output has long depended on strong regulatory systems, robust intellectual property protections and enforcement, and fair and transparent access to overseas markets.
Trade agreements with other nations extend this mutually beneficial arrangement into new frontiers, helping the industry reach patients and consumers with the latest medicines, while also protecting the American economy, the nearly 4.8 million jobs that the sector creates and the innovators who work tirelessly on tomorrow’s treatments and cures. Unfortunately, not all trade agreements are strong or well-enforced, undercutting one of America’s most crucial engines of economic growth.
Take South Korea, for example. Despite the clear commitments it made in the 2012 trade agreement known as KORUS, South Korea has refused to appropriately recognize the value of innovative U.S. pharmaceutical products, and instead implemented price controls that impede access to medicines and take advantage of billions of dollars in U.S. investments. Americans should not subsidize the medicine costs in other wealthy countries. Fortunately, in March the Trump Administration secured a long-needed commitment under KORUS that South Korea will rein in some of its unfair pricing policies.
But the United States government can’t stop at South Korea. To ensure U.S. innovation and economic growth are protected, and U.S. exports increase, it’s critical that the United States government continue to take action through trade negotiations that put America first, and through policies that encourage and support our innovation ecosystem.
The U.S. Trade Representative signaled through its 2018 Special 301 Report that it is concerned about the IP protection and enforcement and market access issues facing biopharmaceutical manufacturers, writing in a fact sheet, “In order to promote affordable healthcare for Americans and the innovation to preserve access to the cutting-edge cures and therapies, USTR has been engaging with trading partners to ensure that U.S. owners of IP have a full and fair opportunity to use and profit from their IP.”
As the administration negotiates a modernized North American Free Trade Agreement (NAFTA), it’s imperative it works to reduce trade barriers and hold our international partners accountable. The health of the American economy and global patient access hang in the balance.
Jay Taylor Jay Taylor is Vice President of International Advocacy at PhRMA. Prior to Joining PhRMA, Jay was a partner at the international law firm, McDermott, Will & Emery, where he specialized in international trade policy, export controls and Foreign Corrupt Practices Act (FCPA) matters. Previously, Jay served as Associate General Counsel at the Office of the United States Trade Representative (USTR), where he managed and litigated numerous international trade disputes, and drafted and negotiated several free trade agreements. Mr. Taylor received his undergraduate degree from Princeton University, and a law degree from Tulane University.