Last fall, President Biden announced that the United States would explore development of an Indo-Pacific Economic Framework (IPEF) to deepen economic relations in the region and collaborate to address global economic challenges. In February, the administration published additional information regarding its plans. As officials from the U.S. Trade Representative (USTR), the U.S. Department of Commerce (DOC) and other agencies advance this initiative, PhRMA encourages the administration to pursue an IPEF agreement that is as comprehensive and ambitious as possible. Such an agreement should include strong intellectual property (IP) protections and predictable and transparent market access, regulatory and other provisions that incentivize innovation, dismantle unfair trade barriers and facilitate the manufacturing and distribution of lifesaving medicines.
U.S. biopharmaceutical manufacturers and their employees rely on such policies to produce valuable new medicines for patients throughout the U.S., the Indo-Pacific region and the rest of the world. By promoting a more innovative global environment and encouraging its Indo-Pacific trading partners to adopt stronger standards, the U.S. will expand access to new treatments and cures, create high-paying American jobs and increase economic growth in both the U.S. and countries in the Indo-Pacific region.
As detailed in recently submitted comments to the USTR and the DOC, PhRMA first and foremost encourages the administration to pursue a comprehensive and ambitious IPEF agreement that prioritizes these pro-innovation policies. In addition, PhRMA recommends that the U.S. and its IPEF partners incorporate into the agreement the following measures and practices:
- Open digital trade practices | Digital trade, data, data usage and international data flows are essential components of biopharmaceutical research and development (R&D), manufacturing, delivery and pharmacovigilance. PhRMA encourages the U.S. and its IPEF partners to prohibit forced technology transfers, digital tariffs and unnecessary data localization requirements. Sound public policies that encourage open digital trade practices will advance patient care and economic growth.
- Supply chain resilience | Diverse global supply chains are key to ensuring continuity, safety and resilience in the supply of medicines to patients in the U.S. and worldwide. The U.S. and its IPEF partners should bolster biopharmaceutical supply chain policies to prepare for future global health challenges and strengthen trade and investment. Specific proposals include leveraging regional manufacturing infrastructure to expand R&D and production capacity; facilitating free movement of pharmaceuticals, inputs, and personnel; and strengthening cybersecurity capabilities and infrastructure to address threats.
- Transparency in policymaking and good regulatory practices | Foreign governments, including several in the Indo-Pacific region, often impose burdensome and nontransparent regulations on the biopharmaceutical sector and employ price controls and reimbursement policies that discriminate against American products. IPEF negotiations are an important opportunity for the U.S. to ensure fair and equitable market access for innovative American medicines in countries throughout the Indo-Pacific region, including by committing Indo-Pacific governments to adopt and implement pricing, reimbursement and other regulatory policies that are fair, reasonable and non-discriminatory, and that appropriately value patented biopharmaceuticals.
- Improved customs and trade facilitation policies | The U.S. and its IPEF partners should take actions to ensure that trade in pharmaceuticals can occur without unnecessary obstacles. Specific recommendations include eliminating tariffs, prohibiting export restrictions and improving customs practices and related trade facilitation policies.
- Creation of a medicines working group | Given the complexity of issues and the variety of trade barriers in multiple Indo-Pacific countries that significantly impede the invention, manufacturing and distribution of innovative medicines, PhRMA encourages the establishment of a Medicines Working Group that commits IPEF governments to regular, frequent and sustained engagement on issues of importance to biopharmaceutical research, innovation and distribution.
The IPEF has the potential to deepen the United States’ economic relationships with countries throughout the region and address meaningful global economic challenges. By adopting stronger pro-innovation policies and eliminating trade barriers, leaders can drive more global collaboration on biopharmaceutical R&D to deliver new medicines for patients throughout the world. PhRMA welcomes the opportunity to be an active stakeholder as the IPEF advances.