The US pharma industry is handcuffed by sanctions, the group argues.
America’s powerful lobby group, the Pharmaceutical Research and Manufacturers of America (PhRMA), has identified a host of factors that threaten the innovation potential of the pharmaceutical sector, not only in the US but also in Europe and beyond. It is concerned by the perceived weakness of intellectual property protections and the perennial challenge of pricing controls, both concerns intensified by an impending legislative review in Europe, which the US industry sees as more of a threat than an opportunity.
“PhRMA and its member companies are concerned by the European Commission’s Pharmaceutical Strategy Directive for Europe and pending options for IP for all medicines and other incentives, which could undermine IP rights in the world’s largest market,” the group said. The first paragraph condemned European conditions when submitted to the US Trade Representative. “Unfortunately,” it continues, these proposals may limit regulatory data protection, research exemption mechanisms and incentives, and IP incentives to product launches in all EU member states.
This comes on top of the EU’s recently introduced exemption that allows copying of products that are still covered by a supplementary protection certificate that “could encourage other countries to maintain or weaken their already-low patent protection standards.” There are also new fears, that the EU is on the verge of moving away from the long-standing position that “compulsory licenses should be a measure of last resort”.
The risk PhRMA sees is the creation of “an uneven playing field for transatlantic pharmaceutical trade and investment.” The bottom line for PhRMA is the risk to the U.S. economy — that “failure to effectively protect these incentives in the world’s largest market for innovative drugs will harm U.S. exports and jobs.”
In addition, the group continues, its member companies face “national government restrictions across Europe that jeopardize incentives for biopharmaceutical innovation.” European countries “continue to seek additional cost savings at the expense of the innovative biopharmaceutical sector, thereby not bearing a fair share of the costs to research and develop new drugs, as well as undermining US biopharmaceutical competitiveness.”
Many countries in the region “price patent-protected innovative medicines based on policies that restrict availability, limit patient access, and fail to recognize the value of innovative medicines to patients and society,” states PhRMA. It believes those rules are enhanced by “rigorous health technology assessment evaluation interpretations.” Worse, where prices are a given, there are long delays for medicines launched in Europe – an average of 511 days, it says, with the result that only 46% of new medicines launched globally since 2012 are available in EU member states, by comparison. 85% in the US. Criticisms are not just common. PhRMA goes down on cases nationally.
According to the group, Hungary’s mandatory licensing of COVID-19 treatments “raises significant legal concerns” and harms the environment for investment and ease of doing business in the EU member state. And PhRMA is “concerned about the growing interest in the Netherlands regarding the use of compulsory licensing as a way to reduce spending on pharmaceuticals” — with potentially “devastating effects on the innovation and R&D environment in general.”
The PhRMA document (see here: https://onphr.ma/3lkreoI) is a real alphabet of Austria, which is one of the richest countries in Europe, but sets relatively low prices on new drugs and imposes controls on use; ” in Sweden, its “frequent re-evaluations of reimbursed drugs that usually result in price reductions;” Belgian transaction taxes and claw-backs; the Czech Republic’s “strict cost-control regulations;” Denmark’s price caps; and Finland’s “restrictive” pricing and reimbursement. Environment. France is “characterized by a notoriously slow market access process,” and Germany sees no additional benefit for 71% of potential patients, while “many of these treatments are widely recognized as important and breakthrough treatments in the US.” PhRMA Greece , also touches on the climate in Italy, Poland, Romania and Spain.
“PhRMA member companies and their innovative products disproportionately bear the brunt of these measures because they undermine financial incentives for privately sponsored R&D,” it argues. “Not only does this threaten the development of new treatments and cures, it also directly threatens the competitiveness of the US biopharmaceutical industry and its workers.”