Trade deal could drive up your prescription drug bills

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You may not be one of the many American workers concerned that your job may be shipped overseas because of international trade agreements, but if you are taking or think you might someday need prescription drugs, these agreements could have a major negative impact on your wallet and ultimately your health.


As you may have heard, the Trans-Pacific Partnership (TPP) and Trans-Atlantic Trade and Investment Partnership (TTIP) trade agreements are now being negotiated behind closed doors.

Many of us have long been concerned about the impact of trade agreements on global access to essential medicines, and many of us have worked long and hard to make sure that people in developing countries are not denied life-saving drugs.  The recent Ebola outbreak in west Africa demonstrates that improving global health is not just a moral issue, but one that has actual consequences for the United States.

What is getting more attention over the recent rounds of trade negotiations is that certain provisions could have profound impacts on drug prices for American consumers.

Groups like Consumers Union, AARP, and the American Public Health Association are ringing alarm bells about leaked provisions that could significantly increase the cost of medications – driving up costs for patients and for taxpayers.

Large pharmaceutical corporations looking for profits have zeroed in on trade negotiations as a way to block competition and challenge those seeking to reduce drug costs.

Some of the leaked provisions would weaken existing laws designed to make sure that the interests of big drug companies don’t completely trump the needs of consumers who want access to affordable – underscore “affordable” – drugs.

For example, brand-name drug companies could be given more opportunity to extend or obtain “secondary” patents, allowing them to benefit from additional periods of exclusivity by making only minor “tweaks” to their products once the original patents have expired. They could also block access to scientific and clinical data needed by generic competitors who want to enter the market with cheaper alternatives. Leaked provisions could threaten existing cost-saving mechanisms used in public programs, like Medicaid, Medicare and the Veterans’ Administration. A new investor-state dispute settlement system would give individual pharmaceutical companies the right to challenge those same rules as well as new cost containment approaches.

Other provisions would set requirements that would block new ways to lower drug prices – using secret trade negotiations as a backdoor way to eliminate state and congressional policy-making authorities.

For example, current U.S. law provides 12 years of patent exclusivity for innovative biologic therapies, but President Barack Obama and others have consistently supported lowering that number to 7 years. If a trade agreement locks in 12 years, Congress would be prevented from making a change that would reduce the deficit by $4 billion over 10 years.  In addition, changes to give Medicare drug price negotiating authority require discounts for low-income seniors and people with disabilities, or lower prices for drugs developed with taxpayer dollars could all be prohibited.

The result would be a double whammy for health care consumers. Not only would drug prices increase more rapidly, but Congress and state policy makers would have to look elsewhere to lower health care costs. The result would be even more pressure to raise premiums, deductibles and co-payments or to cut payments to doctors and hospitals.  Costs would go up, and consumers would bear a greater share of those higher costs.

That is one reason that respected senior organizations like the Medicare Rights Center and the Center for Medicare Advocacy have joined those expressing concern about trade agreements. Higher drug prices are not only harmful to individual and family budgets; they put financial strains on Medicare, Medicaid, the VA, and other public and private insurers.

International trade can be beneficial to workers and consumers here at home and around the world, and we should all support trade agreements that prevent countries from using currency manipulation and barriers to keep out U.S. products. However, it is wrong to use secret trade negotiations to make changes in U.S. health care policy that will have years of negative consequences for U.S. consumers.

Just as it is critical to understand the impact of trade negotiations on consumer financial protections, the environment and jobs, it is perhaps even more important for all of us to understand the consequences that trade agreements can have on our health care.

We must not replace public policymaking with closed-door trade agreements.  And, above all, we must not sacrifice the well-being of American consumers and workers for trade agreements that benefit the largest and already most-profitable corporations.

U.S. Rep. Jan Schakowsky, a Democrat, represents Illinois’ 9th Congressional District.


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