On Monday, December 10, 2019, the Trump administration announced that it had reached an agreement with the House of Representatives on the United States-Mexico-Canada Agreement (USMCA), which would replace the North American Free Trade Agreement (NAFTA.)

Citizens Against Government Waste (CAGW) is greatly disappointed that the administration caved to House Speaker Nancy Pelosi’s (D-Calif.) demands to reduce the treaty’s intellectual property (IP) protections for biologic drugs from 10 years to five years.  The 10 years would have compelled Canadian and Mexican drug companies to respect our IP, not simply copy our drugs, and at the same time help pay for our research.

Current law in the U.S. provides 12-year market exclusivity protection for biologic drugs, Canada provides eight years, and Mexico provides five.  The 10-year market exclusivity protection was a fair compromise and should have been retained.  Market exclusivity protects the innovator’s clinical trial data, which validates its safety and effectiveness, from being stolen.

Canada produces very little biopharmaceutical research, as does Mexico because they have a lower regard for IP and use price controls to keep their drug costs low.  They free-ride on the research and development paid for by American patients and taxpayers.

CAGW has long advocated for better trade deals to protect not only pharmaceutical IP, but every American invention, copyright, and patent.  The administration and Congress should support IP protection in trade deals that respect and adhere as closely as possible to U.S. laws.  The USMCA may otherwise be worthy of support, but it fails to achieve that objective.