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What International Trade Agreements Have to Do with Innovation

June 26, 2014
Innovation is not just the life-blood of the biotech industry, it is the very premise of the BIO International Convention. So what is a panel on international trade doing here?

Answering this question is the task panel moderator, Richard Bergstrom, Director General, EFPIA gave to participants in the session TTIP: Can US and the EU Lead the Way in Setting New Global Benchmarks for IP, Regulatory and Market Access Issues; and each provided a piece of the answer. Panelist Ruxandra Draghia-Akli, Director, Health Research at the European Commission described Europe’s ongoing commitment to fund the basic research that helps found innovative drug and biological development. For example, through the Horizon 2020 framework program, the European Commission will make 79 billion euro available from 2014 to 2020 for multinational, multidisciplinary research grants. These grants will not just benefit the researchers funded, but, because of common intellectual property and dissemination rules, the research findings will be made available to inform the work of a broader global research and development community. Additionally, the Innovative Medicines Initiative 2 makes 3.3 billion euro available in funding of public-private partnerships. However, Dr. Draghia-Akli made it clear that the European Commission is not making this kind of investment in scientific research just “for the beauty of the science.” At the end of the day, these projects need to benefit public health.

Funding research is not the only way the European Commission can impact innovation. Dr. Draghia-Akli laid out three mechanisms by which policymakers intend to link research to regulatory activities to impact citizens’ lives: providing a platform for dialogue on needed system improvements, advising and assisting in the implementation of regulations, and introducing policy incentives that drive change. International trade agreements, and the Transatlantic Trade and Investment Partnership (TTIP) agreement specifically, offer the opportunity to reflect, impact, and ingrain national priorities in these day-to-day activities moving forward.

Panelist Ian Hudson, Chief Executive, U.K. Medicines and Healthcare Products Regulatory Agency, spoke to the audience about the importance of regulatory convergence. Usually a tall order for trade agreements because of the significant differences between the standards to which national regulatory authorities adhere, the high degree of sophistication of these bodies in the U.S. and E.U. may make the TTIP an exception. It is as simple as this, Dr. Hudson said: regulatory convergence helps manufacturers, especially small and medium size enterprises, use their investment dollars as wisely as possible instead of being required to duplicate these resource-intensive processes.  Not only can these newly available dollars fund future research, but the efficiencies of regulatory convergence can lower the overall costs of bringing an innovative therapy to market. In turn, asserted Dr. Hudson, increasing the speed of getting safe, effective, and innovative therapies to market can help fiscally-conscious governments since these therapies can help patients recover more quickly and reduce the need for expensive hospitalizations, surgical interventions, and physician office visits.

Jon Santamauro, Senior Director, International Affairs at Abbvie, also got straight to the point: the TTIP has the potential to codify, at the highest level of political support, an innovation ecosystem in the markets where much of the research and development funding is invested. Moreover, especially in the area of intellectual property, codifying robust regimes and infrastructure that support innovation can serve as a global best practice.

Thus, panelists answered the question “what does trade have to do with innovation?” with a resounding “everything.” Though the TTIP is still in the initial stages of negotiations, the process is steadily marching forward and has the potential to dramatically impact the ecosystem of innovation. As negotiations progress, it is crucial that the cause of promoting and protecting innovation and of bringing safe, effective, and innovative therapies to patients in a timely manner be front and center.