Sen. Elizabeth Warren Wants the Government to Steal IP and Stifle Future Pharmaceutical Innovation | Citizens Against Government Waste

Sen. Elizabeth Warren Wants the Government to Steal IP and Stifle Future Pharmaceutical Innovation

The WasteWatcher

Sen. Elizabeth Warren (D-Mass.) has long been seeking to use the federal government’s power to lower prescription drug prices. To that end, she has introduced the Affordable Drug Manufacturing Act, which would give the Department of Health and Human Services (HHS) the power to manufacture its own drugs, and cosponsored the Medicare Prescription Drug Negotiation Act, which would give HHS new powers to negotiate drug prices, even though Medicare Part D has been less costly than anticipated and remains extremely popular among seniors.

She has also twice called in 2022 for HHS Secretary Xavier Becerra to use the Bayh-Dole Act’s march-in rights as a mechanism to lower prescription drug prices, first on February 18, 2022, for the prostate cancer drug Xtandi, and then on April 22, 2022, for a much broader use of those rights for all prescription drugs, along with the act’s royalty-free license authority. The irony of her April 22 letter is that World Intellectual Property Day occurred on April 26, 2022. This day celebrates intellectual property (IP) and the discoveries that bring innovation and new technology across the globe each year. Her push for this broad use of executive power is also galling after the strong protection of IP rights led to the record-breaking manufacturing and distribution of safe and effective COVID-19 vaccines.

The Bayh-Dole Act was signed into law in 1980 to solve a specific problem, when only 5 percent of government-funded technology was being successfully commercialized. The concept worked, as new products started to reach the marketplace. The Bayh-Dole Act allows the government march-in rights, under which it serves the public good by ordering a private company to grant a compulsory license to a third party, including competitors, if the inventor is not taking sufficient steps to make the invention useful in a reasonable period of time, or not satisfying national health and safety needs. To date, march-in rights under Bayh-Dole have never been used.  But Sen. Warren believes HHS should use this power as broadly as possible to lower drug prices.

Sen. Warren has also urged the use and abuse of executive orders to distort the medical marketplace artificially, and with the swipe of a pen, lower drug prices, but she fails to understand how that this would be a significant abuse of executive authority. Not only is the government overreach Sen. Warren suggests in her letter a primary concern, but also the use of Bayh-Dole march-in rights that will have unforeseen negative consequences. Every action has an equal and opposite reaction, and instituting march-in rights in this manner would devastate future research and development not only for the next pandemic, but also new cures and treatments for every other disease. The goal should be to encourage innovation, not stifle it and distort the medical marketplace further. Investors are looking for a return and enacting march-in rights whenever the Executive Branch sees fit would discourage future investment. The solution to lowering drug prices is not to let the government pick winners and losers but allow for a free marketplace that provides an ecosystem suitable for innovation.

Biopharmaceutical research and development has led to record-breaking medical discovery and development. The COVID-19 vaccines developed from mRNA technology prove that intellectual property saves lives. Sen. Warren’s attempt to manipulate the marketplace through executive powers is deplorable and will result in negative consequences around the world, not just for the American people.