Drug company protections the latest obstacle for NAFTA rewrite

WASHINGTON — President Donald Trump’s ability to get his revised North American Free Trade Agreement through Congress may hinge on a little-noticed provision governing intellectual property protections for new pharmaceutical products.

Congressional Democrats have seized on measures in the U.S.-Mexico-Canada Agreement that establish protections for drug companies, saying they are a boon to the pharmaceutical industry and could undermine efforts to make American health care more affordable.

The issue is the latest complication in Trump’s yearslong effort to rip up NAFTA and rewrite the rules of trade with Canada and Mexico. While Trump secured Canada’s and Mexico’s signoff on the new agreement last year, the trade pact must be ratified by legislators in all three countries.

Democrats, who now control the House, have already made it clear they will not approve the new trade deal without significant changes to labor and environmental provisions. Now, they are also looking for revisions to the trade deal’s pharmaceutical provisions, in particular a measure providing an advanced class of drugs called biologics 10 years of protection from cheaper alternatives.

Biologic drugs are made from living organisms rather than synthetic chemicals and have been used to treat diseases including diabetes, multiple sclerosis, rheumatoid arthritis and cancer. Obtaining approvals for these drugs requires clinical trials and other research and development, which are both costly and time consuming.

The new trade pact gives biologic drugmakers 10 years of protections against other products that would rely on the data they used to win approval. After a decade has elapsed, competing drug companies are allowed to rely on the original company’s data to get product approvals for their own drugs, without repeating clinical trials, as long as they can show they have produced a similar drug.