Last week, Americans for Tax Reform and the Property Rights Alliance submitted respective comments to the United States International Trade Commission (USITC) urging the agency to take a strong stance against expanding the TRIPS waiver.
Last year, the Biden administration, with the World Trade Organization (WTO), made the mistake of agreeing to waive IP protections under the TRIPS Agreement for COVID-19 vaccines. Now, the WTO is considering the expansion of the waiver to include COVID-19 diagnostics and therapeutics. It is the USITC’s job to examine the short- and long-term consequences of this policy. According to the USTR, the resulting report will help inform whether the United States will support an expansion of the TRIPS waiver.
As ATR’s comments argue, further undermining IP protections will weaken manufacturers’ incentives to innovate new cures and treatments, will reduce investment in medical innovation, and will threaten the strength of the U.S. biopharmaceutical sector.
Developing new medicines is a costly, risky, and time-consuming process. Without IP protections, there is no guarantee that manufacturers will recoup the time and money they invested in the project. After all, during an average drug development process, a manufacturer must invest an average of $2.6 billion and spend 11.5 to 15 years in research and development. And still, a vast majority of those drugs will fail.
In healthcare, the consequences of a lack of medical innovation are a matter of life and death. Reduced investments mean less research into cures and/or treatments for cancer, Alzheimer’s, heart disease, brain disorders, HIV/AIDS, and more.
As Philip Thompson of the Property Rights Alliance argued, an expanded TRIPS waiver would jeopardize IP-intensive jobs while giving foreign firms, including state-owned firms from adversarial countries like China and Russia, the opportunity to unfairly benefit from American inventions.