5Recently, officials from the United States, Mexico, and Canada signed a new United States-Mexico-Canada trade agreement (USMCA). The agreement is likely to be ratified in Congress in the coming weeks, as it has support from both the Trump Administration and Democrats in the United States House of Representatives.
The agreement serves as a replacement to the North America Free Trade Agreement, adding additional components, largely added to garner the support of Democrats in Congress.
One part of the agreement that is turning heads, however, is that it no longer includes an exclusivity provision for biologic drugs. Currently, United States law allows twelve years of exclusivity for biologics. However, that exclusivity does not automatically translate to foreign countries, including Mexico and Canada. The USMCA had a provision that allowed for ten years of market protection to biologics, which would have allowed for exclusivity in Canada and Mexico, though it fell two years short of United States law.
The provision would have required Mexican and Canadian drug regulators to wait ten years after approving a biologic before allowing competitors to use the same trial data in a regulatory submission for approval of a biosimilar of the drug. However, the recent revision of the USMCA removed that provision, essentially eliminating the biologic exclusivity provision in Canada and Mexico.
Some are less than pleased about the removal of the provision. Pharmaceutical Research and Manufacturers of America (PhRMA) President and CEO Stephen J. Ubl issued a statement following the announcement, saying “The announcement made today puts politics over patients. Eliminating the biologics provision in the USMCA removes vital protections for innovators while doing nothing to help U.S. patients afford their medicines or access future treatments and cures. The only winners today are foreign governments who want to steal American intellectual property (IP) and free ride on America’s global leadership in biopharmaceutical research and development.”
Ubl went on to note that “The agreement signed with Canada and Mexico last year was a significant step toward leveling the playing field with our trading partners by delivering strong IP protections for American manufacturers. As USTR [Office of the United States Trade Representative] stated, nothing in the original agreement would have changed U.S. law related to biopharmaceuticals or increased medicine prices for American patients.”
Ubl concluded by calling for Congress and the Administration to “pursue international trade agreements that hold foreign governments accountable by ensuring that they protect and value the ongoing discovery of much-needed medicines to treat and potentially cure the world’s most devastating diseases.”
Speaker of the House Nancy Pelosi notes that she is hoping the House will hold a vote to ratify the agreement before the end of the year recess. Senate Majority Leader Mitch McConnell does not anticipate a vote taking place in the senate this year, but instead early next year.