Chester “Chip” Davis, Jr, the President and CEO of the Association for Accessible Medicines (AAM) in the United States, discusses the contradictory nature of Trump’s efforts to lower drug prices.
The President has forcefully pledged to provide relief to these patients and their families, but his own trade policy threatens to undermine this commitment.
Free trade never means unleashing market forces to unfold in a purely natural pattern. The manner in which a trade agreement is framed, the incentives in place, the regulations enforced or relaxed—all these factors determine who has the upper hand.
In our industry, the determination of winners and losers goes beyond economics—it affects people’s health. The unintended consequences of trade policy can be disastrous for the individuals affected and on a public health level.
The matter of tariffs illustrates this point. Imposing tariffs on China might seem like a good way to address a trade imbalance and to protect U.S. manufacturers. However, tariffs on generic or biosimilar medicines threaten to increase prescription drug prices and increase the risk of drug shortages for affected medical products, thereby hurting patients here in the U.S. Similarly, a recent story in STAT revealed how the issue of drug pricing sank the Trans-Pacific Partnership—which Doctors Without called “worst trade deal ever for access to affordable medicines”—even though only a handful of the agreement’s 5,000 pages even mentioned the issue.
The U.S.-Mexico-Canada Agreement (USMCA; informally known as NAFTA 2.0) contains provisions that could similarly jeopardize patient health. It is especially troubling for the way it hampers the nascent biosimilars industry, which is already running far behind Europe. According to a recent white paper from the Biosimilars Council, there are only 12 approved biosimilar medicines in the U.S., compared to more than 40 in Europe. And only five of the FDA-approved biosimilars are currently available to patients in the United States.
Axios calls USMCA a big win for Big Pharma, explaining, “By shielding the drugs from generic competition in Canada and Mexico, the measure will also help pharmaceutical companies reap more profits abroad.” If the brand-name pharmaceutical companies are the winners, who are the losers? That would be the members of my organization–the manufacturers and distributors of finished generic pharmaceuticals, biosimilars, and bulk pharmaceutical chemicals and suppliers of other goods and services to the generic drug industry. And if this group is put at a disadvantage, the consequences for patients could be grave.
The Association for Accessible Medicines is not alone in our concerns about USMCA. In June, AARP wrote to United States Trade Representative Robert E. Lighthizer, “AARP strongly opposes efforts to add harmful provisions to the renegotiated text of NAFTA that would extend or enhance monopoly protections for already-expensive biologic drugs.” Furthermore, survey data clearly shows that Americans oppose longer monopolies for big brand-name pharmaceutical companies in USMCA.
Finally, USMCA undermines the Trump administration’s own blueprint to lower drug prices. US patients have been forced to forego lifesaving medicines or to stretch a month’s prescription to two by chopping pills in half. The President has forcefully pledged to provide relief to these patients and their families, but his own trade policy threatens to undermine this commitment.
Globalism has brought unmistakable economic and social gains, but those benefits are not distributed evenly. Some populations benefit more than others from accelerated international trade. Let’s not make the patients pay the price. Access to safe, effective and affordable generic and biosimilar medicines can make people healthier and provide relief to personal budgets. Moreover, federal and state budgets stand to gain with the widespread availability of generics and biosimilars.
