The Office of the United States Trade Representative (USTR) issued its annual special 301 report on intellectual property (IP) protection and review of notorious markets for piracy and counterfeiting.
Within the report, the US identifies countries where the manufacture and distribution of counterfeit pharmaceuticals, biopharmaceuticals, and active pharmaceutical ingredients (APIs) are of significant risk to consumers.
The report highlights China, India, Indonesia, and Thailand as existing trade partners where there is cause for concern.
In terms of goods coming into the US, the report notes that China, Hong Kong, India, and Vietnam were the source of “the majority of the value of all counterfeit pharmaceuticals seized at the US border in fiscal year 2018.”
Additionally, the report notes that a potential 20% of all pharmaceutical goods sold in the Indian market are counterfeit.
The issue is one of rising concern due to the ‘rapid growth’ of illegitimate online sales of such products. In response to the trend, the USTR calls for e-commerce platforms to take “proactive steps and effective steps to reduce piracy and counterfeiting, for example, by establishing and adhering to strong quality control procedures in both direct-to-consumer and consumer-to-consumer sales.”
The USTR also used the report to signal the work it is doing to protect holders of IP in the US around the world.
It called attention to the US-Mexico-Canada (USMCA) agreement, which provided additional years of patent protection for pharmaceutical products, and secured an agreement with the South Korean government on non-discriminatory treatment for US pharma exports.
Brian Toohey, senior vice president for international advocacy at PhRMA, welcomed the details released in the report: “We are pleased the Administration is shining a light on damaging practices abroad that undermine American innovation and limit local patient access to new medicines.”
Concerns over major trading partners
The report outlines the countries and policies of concern to the US, highlighting trading partners, such as Japan and Canada, as implementing or proposing changes that it deems would undermine the marketplace for innovative pharmaceutical products.
The report refers to Canada’s proposed changes to alter how it reviews patented medicines and the price ceiling for such products as having “drawn significant concern.”
It continues to note that the USTR has ‘long urged’ Japan to “implement predictable and stable pricing and reimbursement policies,” but suggests that changes since 2017 represent a ‘retreat’ from previous progress.
For countries that fail to address US concerns, the USTR notes that it will take “appropriate actions, such as enforcement actions under Section 301 of the Trade Act.”
“Biopharmaceutical innovators rely on predictable, transparent and fair intellectual property and market access systems around the world to continue developing new medicines and get those treatments to patients,” Toohey said.