Public Comment: Use tariff and market access tools to force OECD countries to pay their fair share for medical innovation

Advocacy

Feb 18

February 18, 2025 — No Patient Left Behind (NPLB) wrote to the Office of the United States Trade Representative regarding the 2025 Special 301 Review, urging the agency to use its tariff and market access tools to force OECD countries to pay their fair share for medical innovation and end the free-riding of American biomedical innovation.

Dear Mr. Lee:

Thank you for the opportunity to comment in response to the Office of the United States Trade Representative (USTR) request for information regarding “fair and equitable market access” for U.S. innovative products overseas.

I am writing on behalf of No Patient Left Behind (NPLB), a network of biotech investors, innovators, researchers, physicians, and patient advocates working together to support solutions that lower out-of- pocket costs for patients and preserve incentives for affordable biomedical innovation.

Please take a moment to watch this video and review the attached transcript posted on NPLB’s website. The statement urges USTR to use its tariff and market access tools to require high-income OECD countries (e.g., the UK, France, Canada, Australia, etc.) to pay more of their fair share for medicines to support the innovation they enjoy because of America’s market prices. These other wealthy countries do not have true markets for medicines. Their governments undervalue people's lives. Their cost effectiveness formulas ignore that medicines help people get back to work and free up caregivers, and that medicines, unlike hospitals, do eventually go generic and become inexpensive.

We believe that implementing a proactive market access approach with our nation’s trade competitors would align with the Trump Administration’s efforts to require European militaries to contribute their fair share to global security.

Please contact me if I can provide any additional information.

Sincerely,

Peter Rubin
Executive Director

America is the best in the world at biomedical innovation: Let’s stay the best.

When it comes to developing novel medicines, the US is already our most favored nation. Biotechnology is an American strategic asset. America is the global leader in biomedical innovation because it is a market that values new medicines and pays high enough prices to motivate investors. Those investors include millions of Americans with retirement accounts. They all fund the biotechnology industry to invent new medicines. That's why our scientists focus especially on diseases that afflict Americans. And that's what we mean when we say America is our most favored nation.

And all that innovation just costs us 8% of all our health care dollars. That's readily affordable, as long as we all pay for it out of premiums. It feels unaffordable when health plans burden patients with high out- of-pocket costs. We certainly aren't developing new medicines for people to be denied treatment. We applaud the policy makers working on insurance reform so that America's health insurance plans deliver on their promise to all Americans, letting the American health care market work for everyone.

But other wealthy countries free-ride on America's market. Their governments undervalue people's lives. Their cost effectiveness formulas ignore that medicines help people get back to work and free up caregivers, and that medicines, unlike hospitals, do eventually go generic and become inexpensive. These other wealthy countries don't have true markets for medicines. They don't have competing insurance plans making independent coverage decisions about medicines. Their citizens have no choice. Their governments have them trapped. They can credibly threaten to deny every patient in their country access to our medicines. And since some profit is better than no profit, companies often concede to the lower prices these wealthy countries insist on.

Make no mistake. If America were the only country in the world, there would still be innovation because the US market pays enough to stimulate investment in R&D. But without America, the little that all the other countries currently pay isn't enough. Without the draw of the American market, our companies would not be able to work on developing the medicines we're working on right now. And though the profits we expect to earn in other countries are not as high as in the US, they're still something. An America that is focused on getting what America needs can therefore see those foreign profits as chipping in for the cost of incentivizing biomedical innovation that produces new medicines for all Americans.

It's similar to military spending. Other countries don't spend as much as the US on defense, but they chip in for our collective security. In both cases, chipping in is better than nothing, but it feels unfair. It's free- riding. Other wealthy countries should pay their fair share. Now to make that happen. The US government should engage other governments in tough trade negotiations and get those countries to value novel medicines like the US does. It's worked before and can work again.

But Most Favored Nation drug pricing policy tasks drug companies to negotiate with governments by making them set the same price in all wealthy nations, without any pressure on those countries to pay more. We fear it would backfire on America. Here's how.

Investors would abandon biomedical R&D if companies told them they would charge Canadian, European, or Australian prices in the US. They know those are far too low to justify their investments. So Most Favored Nation wouldn't lower drug prices in the US. It will raise them abroad. But when other countries refuse to buy our medicines, at least until they go generic, that has consequences for Americans too. Even with the US market preserved, the total global market for medicines would shrink. Some investors would lose interest in our work, and we would develop fewer products. Americans would lose out. And when there are fewer products, there's less price competition, which means US prices may go up. And other wealthy countries would still get the benefit of whatever innovation the American market supported on its own. That's because our medicines will eventually go generic and be available at low cost and benefit anyone in the world who needs them. That's what we mean when we say most favored nation would backfire. Americans would end up paying more and getting fewer medicines. Patients, which is to say, all of us would lose. And that's not what we want. And that's not what Americans want either.

The only ones who might be happy with that outcome are other governments, which is why we hope that our government, the US government, will use trade negotiations to get other wealthy countries to pay their fair share. America's biotechnology industry can serve the whole world. We want to help all patients, but we need all wealthy countries to earn their share of biomedical progress. Free riding is not sustainable. And until other countries pay their fair share, we offer a special thanks to the American people for stepping up and driving biomedical innovation. You are our most favored nation.

Read the letter here

Marshall Bursis

Public Comment: Use tariff and market access tools to force OECD countries to pay their fair share for medical innovation

America is the best in the world at biomedical innovation: Let’s stay the best.

A note of thanks to the FDA

Protect American Innovation