Trump, House Democrats reach deal on USMCA trade agreement

House Speaker Nancy Pelosi today announced that the administration and House Democrats have reached an agreement in principle to modify President Trump’s revised North American trade pact.

The decision to proceed with the United States-Mexico-Canada-Agreement came after Democrats said they secured additional labor, pharmaceutical, environmental and enforcement provisions in a trade pact that governs commerce across North America. Those changes were critical to winning the support of labor unions, including the AFL-CIO, according to a New York Times report.

The changes to USMCA, which the three countries signed more than a year ago, must now be integrated into implementing legislation that the House and Senate will both vote on. The pact will also need to secure the president’s signature and the final approval of the Mexican senate and Canadian leadership, the report said.

House Democrats secured multiple policy changes related to prescription drug pricing, the environment, labor protections and dispute settlement, including removing a provision that Democrats criticized as a boon to the pharmaceutical industry.

Democrats had objected to provisions governing intellectual property protections for new pharmaceutical products, in particular an advanced class of drugs called biologics, which were given 10 years of protection from cheaper alternatives. Congressional Democrats said those measures could undermine efforts to make American health care more affordable and the revised deal strips out that 10 year protection.

The Association for Affordable Medicines issued a statement which said, “Today’s agreement reached by the Congressional Trade Working Group and the Trump administration represents a victory for patients. The revised text creates greater opportunities for patients in Mexico, Canada and the United States to access less expensive medicines and promotes a competitive pharmaceutical market across the three countries. The improved pharmaceutical provisions create the balance between access to medicines and support for innovation that was included in bipartisan 2015 Trade Promotion Authority legislation."

AAM went on to state that it is pleased that Congress and the Administration have made changes to USMCA that support open markets, greater competition and improved cost savings for patients and the three health care systems.

“The announcement made today puts politics over patients. Eliminating the biologics provision in the USMCA removes vital protections for innovators while doing nothing to help U.S. patients afford their medicines or access future treatments and cures. The only winners today are foreign governments who want to steal American intellectual property and free ride on America’s global leadership in biopharmaceutical research and development," Pharmaceutical Research and Manufacturers of America president and CEO Stephen Ubl said.

Ubl said that the agreement signed with Canada and Mexico last year was a significant step toward leveling the playing field with our trading partners by delivering strong IP protections for American manufacturers. "As USTR itself stated, nothing in the original agreement would have changed U.S. law related to biopharmaceuticals or increased medicine prices for American patients. Any statements to the contrary are purely political," he said.

Finally, Ubl said, “We cannot support abandoning provisions that protect American companies and raise standards abroad. We hope that Congress and the Administration will pursue international trade agreements that hold foreign governments accountable by ensuring that they protect and value the ongoing discovery of much-needed medicines to treat and potentially cure the world’s most devastating diseases.”