[CTC] Grassley says he doesn't support changing USMCA to address drug prices

Tue Feb 12 12:23:59 PST 2019

INSIDE US TRADE
Grassley says he doesn't support changing USMCA to address drug prices
February 12, 2019 at 2:36 PM

Senate Finance Chairman Chuck Grassley (R-IA) said Tuesday that while he supports efforts to lower the cost of prescription drugs, he does not back changes to pharmaceutical provisions in the U.S.-Mexico-Canada Agreement that Democrats have suggested.

“I’m with the Democrats on doing something about the cost of prescription drugs, and I could list you six or seven things that we could do that we would agree on, but I don’t want to do anything to mess around with USMCA,” he said on a conference call with reporters. “I want to get it passed.”

USMCA protects biologic drugs for 10 years from competition from generic versions, which Democrats argue will drive up domestic drug prices. They had concerns about a similar provision in the Trans-Pacific Partnership. Several Democrats noted the issue <https://insidetrade.com/node/165777> in post-State of the Union comments addressing President Trump’s call for Congress to pass the deal.

Rep. Earl Blumenauer (D-OR), who chairs the House Ways & Means trade subcommittee, said in a tweet <https://twitter.com/repblumenauer/status/1093238434586607616> last week that “a lot of work [is] needed on access and cost of Rx drugs in NAFTA 2.0.”

“I don’t think candidly that it passes out of my trade subcommittee” with the biologics protection provision intact, Blumenauer told theAssociated Press <https://www.apnews.com/52fd2fe15baf481eac7cfde5d9dbf85> on Tuesday. A Democratic pollster said in the same story that the argument that the deal could increase drug prices was particularly resonant with voters, likening it to “throwing a bomb into the focus group.”

Grassley said on Tuesday that he was willing to work with Democrats on the enforcement of USMCA labor and environment provisions via side letters, but maintained that the deal should not be opened for renegotiation. Sen. Sherrod Brown (D-OH) has said he believes talks must be reopened <https://insidetrade.com/node/165273> to address labor issues in particular.

“There are some areas where I would work with the Democrats on some side letters and some annexes that deal with environment, labor and enforcement” Grassley said. “I’m not saying I would agree with exactly with what they want to do in those areas, but I know that probably it’s pretty insignificant compared [to] what you’re asking me if I’d agree to that I think would make it go back to the negotiating table.”

Grassley referred to meetings he had last week with Mexican Ambassador to the U.S. Martha Bárcena Coqui and Canadian Foreign Affairs Minister Chrystia Freeland, saying that Mexico and Canada don’t want to re-open talks.

“And I can tell you visiting with the ambassador from Mexico last week and the foreign minister from Canada last week, there isn’t going to be any opening of renegotiations because if you got renegotiations opened for Democrats, you’d get Republicans wanting renegotiation on the arbitration provisions in regards to Mexico,” he said. “And Mexico’s had their belly full of these negotiations. They want to get something done.”

Democrats have repeatedly voiced their concerns about various provisions of the deal, particularly those related to enforcement. Sen. Brown said on Tuesday that he did not see a path forward for USMCA unless Democratic concerns were addressed.

“I don’t see evidence that it’s going to pass,” he told reporters <https://thehill.com/homenews/senate/429599-sherrod-brown-trumps-new-nafta-will-face-strong-dem-opposition> at a Christian Science Monitor-sponsored breakfast. “I don’t know what Republicans are going to do. I know that there are few Democrats in the Senate that support it.”

“It’s a big uphill fight in the House, too,” he added. “Labor’s overwhelmingly against it still.”

But not all Democrats will have to be won over. House Agriculture Committee Chairman Collin Peterson (D-MN) told Inside U.S. Trade last week that he was “supportive” of the deal, citing the deal’s benefits for U.S. agriculture.

Democrats on the committee, he said, were “still making up their mind, but I think they’re pretty much going to be supportive on ag.”

Peterson said he was not swayed by his caucus’ arguments on labor and environmental provisions, calling them “claptrap of the Democrats.”

The “biggest impediment” to getting the deal passed by all three countries, Grassley said, isn’t congressional concerns, but Section 232 tariffs on Canadian and Mexican steel and aluminum. Those must be lifted before Congress and Mexican and Canadian legislatures take up the agreement, according to Grassley.

“The Senate in Mexico is not going to take it up until the tariffs off. The House of Commons in Canada is not going to take it up if it’s not there before [or] soon after March the 1stt. And it’s not going to be there unless the tariffs are off,” he said. “And even Republicans and Democrats in the Congress of the United States say those tariffs have to go off. How much more definitive can I be?”

While Grassley did not give a date for USMCA implementing legislation to be introduced, he said he expected it “yet this spring.” -- Hannah Monicken (hmonicken at iwpnews.com <mailto:hmonicken at iwpnews.com>)

Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826

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