[CTC] TPP Countries Willing To Clarify Biologics, Without Changing Basics

[Arthur Stamoulis]

Guajardo: TPP Countries Willing To Clarify Biologics, Without Changing Basics
April 01, 2016, Inside US Trade

Mexican Economy Secretary Ildefonso Guajardo said on April 1 that he believes Trans-Pacific Partnership countries would be willing to further explain or clarify the exact meaning of the agreement's obligation on monopoly protection for biologic medicines, potentially through their own implementing measures, but without changing the terms of the deal.

“So if there are explanations to be given about how it will work, probably other countries will be willing to cooperate,” he said at an event on the U.S.-Mexico economic relationship at the Woodrow Wilson Center for International Scholars. He added that this clarification could be done in the “implementing bills that will be required in every country.”

“But there is not space to change the [basics] of the negotiated package,” he said. “It wouldn't make much sense, because if something is going to change it's obvious that [another] country will ask for something else, and so we'll never [leave] the negotiating table,” Guajardo said.

He made it clear that biologics is not as “tough” an issue for Mexico as for other countries. He spoke in response to a question about whether Mexico would be open to further clarifying the biologics obligation in a side letter or implementation plan, as congressional Republicans have demanded of all TPP countries.

The Obama administration has made clear it is willing to discuss those demands as well as potential tools for addressing them, but has not yet come forward with specific solutions on the biologics issue, according to House Republicans.

Guajardo said the TPP obligation on biologics sets out a “basic eight-year process” that is a good balance between the 12 years of monopoly protection in U.S. law and the fact that some TPP countries like Peru and Vietnam started out with zero protection.

This interpretation is in line with how U.S. officials have described the TPP biologics obligation, although the text is not that clearcut. Congressional Republicans have criticized the duration of the marketing exclusivity as too short.

TPP Article 18.51 provides countries with two options for protecting biologics, the first of which is to provide eight years of market exclusivity. The second option is for countries to provide five years of market exclusivity for biologics plus unspecified "other measures," while recognizing "that market circumstances also contribute to effective market protection to deliver a comparable outcome in the market."

According to Guajardo, the compromise in the TPP text represents an “appropriate balance” that is long enough to promote research and development of brand-name biologic drugs and short enough to allow follow-on versions to enter the market in order to promote public health.

He noted that biologics was one of the last issues to be resolved in the negotiations because it was so sensitive for some countries. He emphasized that the signing of the agreement on Feb. 3 U.S. time in New Zealand means that the negotiations are over, and said the deal is in the “best interest of all parties involved.”

After the Wilson Center event, Guajardo told Inside U.S. Trade he was in Washington to meet with U.S. officials to check up on a range of trade issues, including TPP implementation and Chinese steel overcapacity.

On steel, Guajardo said during the event that the U.S., Mexico, Canada and the European Union need to coordinate their response to Chinese overcapacity ahead of an April 18 high-level meeting in Brussels of the Organization for Economic Cooperation and Development's steel committee on this topic.
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