Lead Letter to USTR Greer, Secretary Lutnick Urging Section 301 Investigation to Support American Patients and Taxpayers
WASHINGTON — Today, Congressman Vern Buchanan, Vice Chairman of the House Ways and Means Committee and Chair of the Health Subcommittee, Congressman Jodey Arrington (R-Texas) and Congresswoman Nicole Malliotakis (R-N.Y.) led a letter signed by 48 members of Congress to U.S. Trade Representative Jamieson Greer and Secretary of Commerce Howard Lutnick encouraging the Trump Administration to move forward with a Section 301 investigation into unfair foreign pharmaceutical pricing policies, as first reported by Politico Morning Trade.
In their letter, the lawmakers express support for President Trump’s efforts to ensure that foreign nations pay their fair share for American pharmaceutical innovation. They highlight concerns that many countries benefit from U.S. developed medicines while using policies that allow them to avoid contributing fairly to the costs of research and development.
“We write to express our strong support for President Trump’s efforts to ensure that foreign nations pay their fair share for American pharmaceutical innovations,” write the lawmakers in the letter. “To build on the success of your recent landmark agreement with the United Kingdom, we urge you to use trade enforcement tools, including a Section 301 investigation, to dismantle foreign government policies that force American patients to pay a disproportionate share of global research and development costs for medicines.”
The lawmakers urge Ambassador Greer to move forward with a Section 301 investigation and to use available government tools to prevent further burden of global pharmaceutical innovation onto American patients and taxpayers. Despite warnings from the Administration, some countries, such as Germany and Switzerland, have recently announced plans to further reduce their pharmaceutical spending, reinforcing concerns about foreign free riding. The letter calls for strong enforcement measures to address these unfair practices and ensure that U.S. trading partners contribute more equitably to the costs of pharmaceutical research and development.
Last year, Buchanan and Arrington led a letter cosigned by 33 of their colleague to Ambassador Greer urging him to take further action to address foreign policies that force the American health care system to bear the burden of subsidizing pharmaceutical research and development that is used across the world.
Earlier this Congress, Buchanan and Arrington introduced the USTRx Act (H.R. 4780), legislation aimed at lowering prescription drug costs in the United States by addressing foreign price controls that shift the burden of innovation onto American patients. The USTRx Act would create a Chief Pharmaceutical Trade Negotiator within the Office of the U.S. Trade Representative (USTR). This official will be tasked with identifying and reporting annually on foreign price-setting practices that disproportionately burden American patients and recommending trade remedies.
Read the full letter here or below:
Dear Ambassador Greer and Secretary Lutnick,
We write to express our strong support for President Trump’s efforts to ensure that foreign nations pay their fair share for American pharmaceutical innovations. To build on the success of your recent landmark agreement with the United Kingdom, we urge you to use trade enforcement tools, including a Section 301 investigation, to dismantle foreign government policies that force American patients to pay a disproportionate share of global research and development costs for medicines.
For too long, wealthy foreign nations have reaped the benefits of American pharmaceutical innovation while using price controls and other unfair policies to avoid paying their fair share for these technologies. As a result, more than 70 percent of patented pharmaceutical profits in OECD countries come from U.S. sales even though the United States represents only one third of the OECD’s GDP. Whereas past Presidents stood by and allowed foreign nations to take advantage of the United States, President Trump has rightly called for bold trade action to confront this problem.
We applaud the Administration for concluding the landmark U.S.-UK Arrangement on Pharmaceutical Pricing. Thanks to President Trump’s leadership, this unprecedented agreement requires the UK to double its spending on innovative medicines, reducing the burden on the United States to finance these innovations for the world. This historic agreement shows that targeted trade negotiations on pharmaceutical pricing can deliver real benefits for American patients and taxpayers.
Unfortunately, other foreign governments are not taking President Trump’s concerns on pharmaceutical pricing seriously. Nearly a year after President Trump’s Executive Order called for an end to foreign freeloading, countries such as Germany, Japan, France and Canada have taken no steps to correct their market-distorting policies, many of which were documented by USTR in its recent National Trade Estimate and Special 301 Reports. Even worse, and despite the Administration’s warnings, Germany and Switzerland recently announced plans to further suppress pharmaceutical spending and prices below market value, doubling down on their strategy to free-ride off the United States.
We welcomed Ambassador Greer’s February 20 announcement that USTR would initiate a Section 301 investigation on pharmaceutical pricing practices “on an accelerated timeframe.” We believe this investigation is urgently needed to prevent further policy deterioration abroad, bring foreign governments to the negotiating table, and secure additional agreements modeled on the successful arrangement with the UK. We urge you to initiate this investigation as soon as possible to ensure that American patients are no longer forced to subsidize foreign healthcare systems and price controls.
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