July 29,2015

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Aaron Fobes, Julia Lawless (202)224-4515

American Innovation Deserves Strong Protection in TPP

Twelve Year Standard for Biologics Should be Baseline for Trade Negotiations


Chief trade negotiators are currently meeting in Hawaii to hash out what could be the final details of the Trans-Pacific Partnership (TPP) – a twelve nation trade pact between the U.S. and Asia that promises to break down trade barriers for American exporters and unlock markets containing 478 million consumers.

When Congress passed bipartisan Trade Promotion Authority (TPA) legislation this summer, we set high objectives for trade priorities that the administration must meet in any trade deal. In turn, we equipped them with a powerful tool needed to bring home high-standard trade agreements to benefit our workers and job creators.

Armed with this tool, the administration must successfully negotiate, and potentially close, a set of high-standard rules for some of our most dynamic and innovative sectors while still achieving real market access for American exporters.

At the top of the docket should be securing protections for one of our nation’s most valuable assets – American ingenuity.

Specifically, a strong intellectual property (IP) chapter – including strong patent and regulatory data protections for biologics – is vital to securing congressional support for this trade deal.

Everyday millions of individuals around the world have access to innovative medical solutions that improve quality of life, maintain healthy well-being, and even change healthcare outcomes for patients.

This is, in large part, due to groundbreaking advancements in biotechnology by American innovators.

Biologics – a class of cutting-edge medicines derived from living cells – have shifted the healthcare landscape and changed the way medicine is practiced around the globe. They carry significant promise for patient cures and hold the potential for breakthrough treatments in some of the most intractable diseases, including cancer, heart disease, and Alzheimer’s Disease, among others.

The U.S. continues to lead the world in this industry, maintaining its role as the premier innovator of biologics. Today, roughly 5,600 medicines are in development in TPP countries with an astounding 3,372 coming from the U.S., including over 900 biologic medicines.

The biopharmaceutical industry has been a pillar to the American economy, supporting more than three million high-paying domestic jobs and contributing nearly $800 billion to the U.S. economy every year.

But despite the economic benefits and our ongoing efforts to discover new medicines to improve public health around the globe, there are real challenges in bringing biologics to market.

It takes about 10 to 15 years to develop a single medicine. And, for every one medicine that reaches a patient there are thousands of failures.  That comes at a substantial cost.

Because of their unique and complex nature, researchers must invest significant resources to ensure biologic medicines are safe and effective and to secure regulatory approval to bring them to market. On average, innovators spend more than $2 billion to produce one biologic.

Ultimately, the time and effort it takes to develop and market these life-saving products is well worth the investment.  With each new innovative medicine on market, we open the door for generic drug and biosimilar development which means more affordable medicines for more patients in need. However, a generic drug or follow-on biologic cannot be created without the initial time and effort to create the innovative medicine.

Clearly, research and development is the lifeblood of this vital industry. But without vigorous incentives for innovation, including strong global IP protections and a robust regulatory and legal framework that values innovation, the development of new life-saving medicines will be at serious risk of extinction.

That’s why Congress enacted bipartisan legislation to provide 12 years of data protection for biologics in our domestic market. Having strong data protections on the books promotes the development and launch of new drugs. It ensures competitors can’t capitalize on valuable clinical data developed over time and use it to unfairly compete in the marketplace. 

It preserves American ideas and the efficacy of our research and data. But most importantly, the 12 year standard is a cornerstone to helping build a dynamic economy here at home and sustaining medical innovation in our great nation.

Given the singularity of this American industry and its importance to our economy and global health, it’s critical the administration bring home a TPP agreement with this standard. 

After all, TPA requires the administration to negotiate trade agreements that meet the high standards of IP rights found in U.S. law.

Twelve years of regulatory data protection represents Congress’s goal of preserving the nation’s competitiveness as the leading innovator of biologics. It demonstrates a commitment to the continued creation of more high-value American jobs and will pave the way to increased access to safer and affordable medicine for patients around the world.

As the TPP trade talks move forward, Congress will be watching closely.  We expect our negotiators to close on what’s best for America and provide the strongest possible terms of protection for our most innovative industries.

Anything less risks congressional rejection of a once in a lifetime deal.

U.S. Senator Orrin Hatch (R-Utah) is the Chairman of the Senate Finance Committee and co-author of bipartisan legislation to renew Trade Promotion Authority, which was signed into law in June.