What is America’s greatest strength in fighting COVID-19? Our biopharmaceutical industry, including the many important companies located here in Washington State.
Since the virus arrived on our shores, the country has been looking to our thriving drug makers to develop faster tests, create new treatments, and explore every avenue to accelerate a vaccine. Fortunately, the biopharmaceutical sector was well positioned, with decades of advanced research under its belt and a pipeline of tens of thousands of therapeutic candidates.
This is the advantage of a robust, private market in a well-functioning capitalist system that rewards innovation and efficiency. As a successful business owner, I am grateful to live under this type of system, and I am on guard against any efforts to chip away at its strength.
A new threat is coming from an unexpected quarter. President Donald J. Trump in a recent executive order threatened to import government price controls from foreign countries with socialized medicine, aka the International Pricing Index (IPI). He called it the “most favored nations,” executive order but it is no such thing.
As a conservative and longtime Republican activist, I must admit I was disappointed by this announcement, but I have faith that the mistake can be rectified. We just need to share the details about the IPI included in the executive order and urge the administration toward a new course of action.
If you’ve never heard of it, the idea behind the IPI is to compile other countries’ prices for a given pharmaceutical product – let’s say an advanced chemotherapy drug. Take the average of those prices and then set that as the amount the U.S. government will pay for it.
I can see the appeal of this concept to a dealmaker like Trump, but the problem is it doesn’t work out the way it sounds. That’s because in the countries included in this international benchmark, the government directly controls the pharmaceutical market. It’s called socialism, and it’s the undoing of this executive order.
For example, Canadians suffering under their rationed health care system can access only 56 percent of cancer therapies released since 2011. The government simply won’t pay enough to obtain the others, and anyone whose life could depend on the latest treatment is out of luck.
Americans, on the other hand, can currently get nearly all of these innovative therapies—96 percent to be exact. Pricing isn’t a barrier to saving lives here, and it should stay that way.
The longer-range problems of IPI are far-reaching and could determine the fate of patients who need advanced treatments for serious conditions. However, the most dangerous aspect is the impact on innovation—the thriving biopharmaceutical market I was talking about. Three out of every four major drug makers say pharmaceutical IPI would negatively affect their research and development.
It’s difficult to know which research programs would be dropped and which potential cures might be abandoned, but reduction in biopharmaceutical development efforts leave the U.S. less ready. Just like military generals need to be preparing to fight the next war, our most innovative industries—particularly biopharmaceuticals, need to be pushing American leadership into the future.
Only with great, free market-supported research and development will the U.S. be ready for the next pandemic. Only with new drugs coming out of the pipeline will we save more lives from cancer, prevent great minds from slipping away due to Alzheimer’s, reduce maternal and infant mortality so more children grow up healthy and ready to contribute their talents to this country, and find better treatments for chronic ailments, including heart disease and diabetes, which can be a drag on family finances, the health care system, and even U.S. productivity.
Whatever the intention with this executive order, the deal isn’t worth it. But there is an upside in today’s political climate—the importance of ditching this executive order is something all sides: Republican, Democrat, and Independent—can probably agree on.
Nansen Malin is passionate about politics, technology, beach life, salmon, free enterprise and creating change. Former Alinsky student who does conservative politics.