by Brook K. Baker

President's State of the Union address call for trade promotion authority is a call to strengthen pharmaceutical monopolies

In his State of the Union Address on January 20, President Obama stated that he was asking both parties for trade promotion authority, otherwise known as "fast-track." This authority would limit Congressional review of trade agreements, such as those being negotiated with the Pacific Rim countries and Europe, instead allowing only limited Congressional debate and an up-or-down vote on their passage. President Obama said that the US was being squeezed by China, that new trade deals from Asia to Europe would protect American workers, and that the problem with past trade deals is that partners broke the rules at our expense. President Obama is wrong on all counts, but even more dangerously, trade promotion authority would allow fast-track approval of intellectual property (IP) and market access rules that would solidify, expand, and lengthen pharmaceutical monopolies hurting access to medicines domestically and abroad.

Economic evidence from past trade deals indicates that they have resulted in outsourcing of manufacturing jobs to cheap labor havens, where multinationals pay less to workers and pollute the environment more while reaping higher and higher profits that primarily benefit the world’s wealthiest. China was one of the beneficiaries of those policies. Country partners have not broken the rules. Rather, the corporations that benefit from global deregulation and expansion of IP monopolies have simply taken advantage of these agreements to ensure that workers—both in the U.S. and abroad—race to bottom while the richest of the rich clip coupons and rake in barely taxed capital gains. The legacy of past fast-tracked trade deals has been growing inequality with corporate elites multiplying their wealth, while workers lose ground.

These corporations aren't happy with any regulations that put the brake on their relentless search for trading profits. Similarly, IP-based industries, especially Big Pharma, are intent on expanding their patent rights and data monopolies. Pharma- inspired IP demands include patent term extensions, data monopolies, eased rules on getting patents, and elimination of price control measures and other regulatory barriers to high prices. Worse yet, when their expectations of bloated profits are thwarted by lawful regulations or decisions, corporations want the right to bypass the courts and to require biased and unreviewable arbitration directly against countries, like the $500 million NAFTA claim by Eli Lilly against Canada.

People in the US tend to think that IP-expanding trade rules mainly impact people in other countries, but increased IP monopolies will impact patients and payers here as well. Every time a rule in a US trade agreement ties the hands of a foreign government it simultaneously ties hands here as well, threatening efforts to bring drug prices under control in the US and efforts to reduce the proliferation of secondary patents on medicines that provide no real improvements for patients. Similarly, increased pharmaceutical monopolies will directly and adversely impact US global health initiatives, including those targeting HIV, TB, malaria, and even Ebola, which increasingly rely on affordable generic medicines.

Trade promotion authority is corporate profit-for-the-few promotion gussied up in the rhetoric of benefitting US exports. It's yet another massive corporate give-away, where the government, insurers, taxpayers, and individuals will pay more for medicines—or more likely, go without. Our demand should be no track for fast track.