PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PhRMA) SPECIAL ...

PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PhRMA)

SPECIAL 301 SUBMISSION 2021

PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PhRMA) SPECIAL 301 SUBMISSION 2021

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PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PhRMA) SPECIAL 301 SUBMISSION 2021

Table of Contents

PhRMA 2021 SPECIAL 301 OVERVIEW ......................................................................................................... 1 PRIORITY FOREIGN COUNTRY .................................................................................................................... 42

CANADA ...................................................................................................................................................... 43 JAPAN .......................................................................................................................................................... 57 KOREA ......................................................................................................................................................... 69 SECTION 306 MONITORING.......................................................................................................................... 75 THE PEOPLE'S REPUBLIC OF CHINA ....................................................................................................... 76 PRIORITY WATCH LIST................................................................................................................................. 99 ASIA ? PACIFIC............................................................................................................................................ 100 INDIA.......................................................................................................................................................... 101 MALAYSIA ................................................................................................................................................. 117 THAILAND.................................................................................................................................................. 124 EUROPE ....................................................................................................................................................... 130 RUSSIA ...................................................................................................................................................... 131 TURKEY ..................................................................................................................................................... 144 UKRAINE ................................................................................................................................................... 153 LATIN AMERICA .......................................................................................................................................... 156 ARGENTINA............................................................................................................................................... 157 BRAZIL....................................................................................................................................................... 163 CHILE......................................................................................................................................................... 169 COLOMBIA ................................................................................................................................................ 174 MEXICO ..................................................................................................................................................... 182 MIDDLE EAST / AFRICA .............................................................................................................................. 191 ALGERIA.................................................................................................................................................... 192 SAUDI ARABIA .......................................................................................................................................... 199 WATCH LIST ................................................................................................................................................ 206 ASIA ? PACIFIC............................................................................................................................................ 207 AUSTRALIA................................................................................................................................................ 208 INDONESIA................................................................................................................................................ 218 THE PHILIPPINES ..................................................................................................................................... 225 SINGAPORE .............................................................................................................................................. 231 TAIWAN ..................................................................................................................................................... 235

PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PhRMA) SPECIAL 301 SUBMISSION 2021

EUROPE ....................................................................................................................................................... 240 EUROPEAN UNION ................................................................................................................................... 241 UNITED KINGDOM .................................................................................................................................... 257

MIDDLE EAST / AFRICA .............................................................................................................................. 262 EGYPT ....................................................................................................................................................... 263

OUT-OF-CYCLE REVIEW ............................................................................................................................ 266 UNITED ARAB EMIRATES ........................................................................................................................ 267

PhRMA 2021 SPECIAL 301 OVERVIEW

PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PhRMA) SPECIAL 301 SUBMISSION 2021

PhRMA 2020 SPECIAL 301 OVERVIEW

The Pharmaceutical Research and Manufacturers of America (PhRMA) appreciates the opportunity to provide this submission for the 2021 Special 301 Report. America leads the world in the research and development of valuable new medicines and vaccines. Established by the Trade Act of 1974, the Special 301 review gives the Administration a critical opportunity to confirm its strong commitment to defend these and other American inventions in overseas markets and a critical tool to address damaging market access and intellectual property barriers abroad that harm America's innovative and creative industries and the more than 45 million jobs they support across the country.1

The COVID-19 pandemic has rattled health systems globally, but the biopharmaceutical industry is working around the clock to find ways to diagnose, treat and prevent infections from the virus and other conditions. In addition, the biopharmaceutical industry is providing financial support and in-kind donations to organizations and collaborating with U.S. and global health authorities to combat the pandemic.

Durable intellectual property and market access policies have made possible the tremendous R&D effort required to deliver COVID-19 diagnostics, treatments and vaccines to patients that need them. More than half of PhRMA members have R&D for potential treatments and vaccines under way or are providing donations of medicines and critical medical supplies as well as providing financial donations to support patients and first responders in addressing this evolving crisis. As a result of the unprecedented collaboration and partnerships between the private sector, researchers, academia, governments and other organizations, PhRMA members have and are working to deliver numerous COVID-19 treatments and vaccines in record time.

Urgent action is required to address serious market access and intellectual property barriers in the overseas markets named in this submission. As explained further below, biopharmaceutical innovators in the United States face a wide array of damaging government pricing policies abroad that undervalue American innovation, threaten billions of dollars in lost sales and put American competitiveness, jobs and exports at risk. Medicines discovered and manufactured by PhRMA member companies are the constant target of compulsory licensing and other harmful practices that deny the most basic intellectual property protections necessary to drive discovery and bring new treatments and cures to patients around the world.

The Office of the U.S. Trade Representative and other federal agencies should prioritize action to address compulsory licensing threats, including in Indonesia, Malaysia and Russia, and to end egregious and discriminatory pricing policies in several markets, including Canada, Japan and Korea. Government price controls imposed in

1 U.S. Department of Commerce, Intellectual Property and the U.S. Economy: 2016 Update, September 2016, available at (last visited Jan. 27, 2021).

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PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PhRMA) SPECIAL 301 SUBMISSION 2021

many markets are non-tariff barriers to trade that substantially eliminate incentives to invest in the development of new medicines for patients. They deny American inventors and workers the ability to compete on fair and equitable terms in foreign markets, undermine the expected benefit of intellectual property protections and exacerbate the U.S. trade imbalance by inappropriately raising barriers in their own markets, while their own inventors enjoy access to the U.S. market. Ending damaging pricing policies in these markets and others could add billions of dollars to research and development for new medicines and lower overall health care costs in the U.S. and around the world, while supporting U.S. competitiveness and jobs.2

I. The Innovative Biopharmaceutical Sector

The U.S. biopharmaceutical industry is the world leader in medical research ? producing more than half the world's new molecules in the last decade.3 Innovators in this critical sector depend on strong intellectual property protection and enforcement, and on fair and equitable access to overseas markets. With the right policies and incentives in place at home and abroad, they can continue to bring valuable new medicines to patients, contribute powerfully to the American economy and jobs and open markets to U.S. exports.

A. Biopharmaceutical innovation delivers value for patients and economies

PhRMA member companies and the more than 800,000 women and men they employ across the United States are devoted to inventing, manufacturing and distributing valuable medicines that enable people to live longer, healthier, and more productive lives.4 They work in partnership with universities, clinical researchers, patient organizations, health care providers and others to bring new treatments and cures to patients who need them at home and abroad ? introducing nearly 650 new therapies

2 See Council of Economic Advisers, "Reforming Biopharmaceutical Pricing at Home and Abroad," February 2018, available at (last visited Jan. 27, 2021); and U.S. Department of Commerce, International Trade Administration, Pharmaceutical Price Controls in OECD Countries: Implications for U.S. Consumers, Pricing, Research and Development, and Innovation, December 2004, available at (last visited Jan. 27, 2021). 3 Battelle Technology Partnership Practice, The Biopharmaceutical Research and Development Enterprise: Growth Platform for Economies around the World, Battelle Memorial Institute, May 2012, available at (last visited Jan. 27, 2021). 4 TEConomy Partners, The Economic Impact of the U.S. Biopharmaceutical Industry, Oct. 2017, available at (last visited Jan. 27, 2021).

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PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PhRMA) SPECIAL 301 SUBMISSION 2021

since 20005 and investing in many of the over 8,000 new drugs currently in development worldwide,6 with about three quarters having the potential to be first-in-class treatments.7

Pioneering work by biopharmaceutical innovators in the United States contributes significantly to economic growth and supports good-paying jobs in all 50 states. In 2017, biopharmaceutical research and development activity added more than $1.3 trillion to the U.S. economy and supported more than four million American jobs, including indirect and induced jobs.8 For all occupations involved in the biopharmaceutical industry, the average total compensation per direct employee is twice the average compensation in any other U.S. private sector industry.9 In 2019, U.S. biopharmaceutical goods exports totaled over $66 billion.10 The biopharmaceutical sector was the largest exporter of goods among the most R&D-intensive industries in 2019 ? which in addition to biopharmaceuticals included navigational/measuring/medical/control instruments, semiconductors and other electronic components, medical equipment and supplies, and communications equipment.11

Even more important than the biopharmaceutical sector's role in the U.S. economy is its contribution to global patient health. Biopharmaceutical innovation extends lives, improves worker productivity and cuts health care costs. Between 1950 and 2016, life expectancy for women and men in the United States increased by more than a decade12 ? adding trillions of dollars to the U.S. economy.13 New medicines are responsible for much of this increase. According to a National Bureau of Economic Research working

5 U.S. Food and Drug Administration, "New Drugs at FDA: CDER's new molecular entities and new therapeutic biological products," available at (last visited Jan. 27, 2021); and U.S. Food and Drug Administration, "Biological approvals by year," available at (last visited Jan. 27, 2021). 6 Adis R&D Insight database, last accessed Jan. 4, 2019. 7 Long G., The Biopharmaceutical Pipeline: Innovative Therapies in Clinical Development. Analysis Group; 2017. 8 TEConomy Partners; for PhRMA. The Economic Impact of the US Biopharmaceutical Industry 2017: National and State Estimates. 9 Id. 10 TradeStats ExpressTM: National Trade Data for NAICS Code 3254 Pharmaceuticals and Medicines, available at (last accessed Jan. 27, 2021). 11 U.S. Census. USA Trade: Foreign Trade Data, 2019; National Science Foundation Business Research and Development Survey (BRDIS), 2020; Siwek, Stephen E. Copyright Industries in the U.S. Economy, 2016 and 2014 reports. International Intellectual Property Alliance, available at and (last visited Jan. 27, 2021); ndp | analytics. 12 U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, National Center for Health Statistics, Health, United States, 2017, Table 15, May 2018, available at (last visited Jan. 27, 2021). 13 Between 1970 and 2000, increased longevity added about $3.2 trillion per year to national wealth in the United States. See Murphy, K.M. and R.H. Topel, "The Value of Health and Longevity," National Bureau of Economic Research, June 2005, available at (last visited Jan. 27, 2021).

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