Freedom Line Blog

For a man who constantly claims to support “Buy American,” Joe Biden demonstrates an inexplicable and almost fetish-like tendency to undercut American industries.

Since day one, the Biden Administration has ceaselessly besieged a domestic energy sector that finally achieved U.S. energy independence after decades of effort.  And now, it is following through on its inexcusably foolish assault against the U.S. pharmaceutical sector.

Each year, American pharmaceutical innovators account for an astounding two-thirds of all new lifesaving drugs introduced worldwide.  That’s the direct result of our system of intellectual property (IP) protections, including patents, which consistently leads the world.

Instead of protecting that legacy of American Exceptionalism, however, the Biden Administration remains bizarrely determined to eviscerate it.  Today, the World Trade Organization (WTO) announced agreement to forcibly waive patent protections for Covid vaccines, a dangerous effort that the Biden Administration for some reason supports.

This is nothing short of a license to steal U.S. patents.

The WTO effort serves no valid purpose, because Covid treatments are already being provided to poor nations across the world and the underlying pharmaceutical patents it targets are already being licensed at reduced prices or even for free.  Moreover, the  nations that the WTO claims to help recognize that lack of immunizations stems not from vaccine shortages, but rather from local logistical distribution problems and vaccination hesitancy among unvaccinated people in those nations.  Indeed, biopharmaceutical manufacturers remain capable of producing 20 billion vaccine doses this calendar year, so the problem isn’t lack of vaccine availability.

Additionally, a  supermajority of American voters spanning the political spectrum oppose this forcible waiver of Covid vaccine patents, favoring instead the licensing of patents to boost the global supply of vaccines.  Specifically, over 70% of voters believe that waiving Covid vaccine IP could have significant negative implications on the safety and efficacy of supply.

American patent protections explain our unmatched record of innovation, and also why we produce the overwhelming share of new drugs worldwide.  As the pandemic demonstrated once again, that includes Covid vaccines.  The WTO proposal egregiously sacrifices U.S. property rights and undermines the rule of law, which in turn will mean fewer lifesaving vaccines and treatments in the future.  If the Biden Administration won’t correct course, Congress must intervene to do so.

CFIF has continuously sounded the alarm on dangerous drug price control efforts, which will only do what artificial price controls always do – cause shortages of the very products they attempt to regulate.  The numbers speak for themselves.

Today, The Wall Street Journal editorial board cogently addresses the looming bankruptcy of Medicare and Social Security, and along the way nicely makes that point that we and others have been making, while also pointing out that drug prices have actually remained flat while prices for other products and services have skyrocketed:

Democrats blame Big Pharma for bankrupting Medicare, but annual Part D prescription drug costs have grown on average 1% over the last five years.  That’s far less than inflation, GDP and other Medicare spending. Even expensive drugs that grow spending in the short run can reduce long-term health spending.

Consider Hepatitis C treatments, which public-health scolds lambasted as too pricey when they launched nearly a decade ago.  Prices have since plummeted 75% from about $100,000 per course thanks to market competition.  A Department of Health and Human Services analysis estimates the treatments reduce patient health costs by about $16,000 annually and will save Medicaid $12 billion after this year.

Once the hospital trust fund runs dry, spending will have to be slashed by 10%.  The Democratic solution is to let Medicare “negotiate” drug prices — their euphemism for price controls.  But this will reduce the incentive to develop innovative treatments for hard-to-treat conditions like Alzheimer’s.  The result may be higher Medicare spending over the long term.“

Artificial government efforts to impose price controls never work, whatever the product, whatever the time and whatever the flimsy rationalization.  America leads the world in producing lifesaving pharmaceuticals – 2/3 of all new drugs introduced worldwide, in fact – so we mustn’t tolerate Biden Administration or Congressional efforts to try this failed proposal yet again.  The stakes for us all are too high to re-learn that lesson the hard way.