The Drug Policy Debate
By David Dreier

The Battle of Gettysburg and a U.S.-Australia Free Trade Agreement. Other than each being a potential Jeopardy category, it is hard to see at first glance what the connection between these two events could be. But a student of history might recall that Gettysburg was notable in part because the most cataclysmic battle of the Civil War happened rather unexpectedly, in a time and at a place that nobody really anticipated.

The discussions between the United States and Australia over a possible bilateral free trade agreement is actually shaping up into a Gettysburg-type confrontation revolving around the modern, largely American-based pharmaceutical industry. The clash could be massive, important, unexpected and in an out-of-the-way locale.

We are in the midst of a pharmacological revolution. The pace of progress has been staggering. Remember what it was like 30 years ago to hear that a family member or friend had "cancer"? Voices hushed at the word. Most people considered it a death sentence. Today, it is a disease that in most cases, if detected in time, is eminently treatable. And, most experts believe that the biotechnology revolution is really just beginning, offering hope for advances even more profound in the next thirty years.

Nobody should be surprised that the real world, life-and-death changes created by the march of modern pharmaceuticals have created massive social and political issues. This is true here in America. It is true globally. In fact, it's becoming increasingly clear that you can't separate our national pharmaceutical industry and experience from the global situation. At the same time, we need to set our national policy on the critical issues first, before trying to engage in setting international standards.

Access and cost are two key issues, here and around the world. The costs imposed on U.S. seniors for access to the latest and best drug therapies might be our most sensitive domestic policy issue. The swirl of debate surrounding current Medicare prescription drug proposals centers on concerns about the cost that would be imposed on American taxpayers. Specifically, what is the best proposal to reduce drug prices and control costs: market-based or government-based; or a hybrid of both approaches?

Countries around the globe face a parallel set of issues. Whether in Canada, Europe, Japan or Australia, taxpayers struggle with paying for their universal health care plans. The cost of access to modern drugs in low-income countries, such as those in AIDS-ridden sub-Saharan Africa, is an ongoing international issue. It is worth noting that only here in the United States, where the vast majority of new drug therapies go from invention to completion, is the cost of developing the next generation of breakthrough drugs taken seriously.

The Bush administration and Congress are working hard to tackle our domestic issues. The long debate over Medicare prescription drug coverage is at a crucial stage, with negotiators at work. They are discussing serious issues, such as the cost of the program, "means-testing" the new benefit, providing competition to the traditional Medicare program and the wisdom of empowering the Medicare bureaucracy to effectively set prices for new drugs. There is legislation modifying the rules governing new drug patents and cheap generic copies in play, and an intense debate over the complex issue of importing drugs from countries that employ government drug price controls.

The prospect of free trade negotiations with Australia comes at a particularly sensitive time in relation to these domestic pharmaceutical issues. The Australian Prescription Benefits Service (PBS) is in many ways a hallmark of the typical government-run universal coverage system, replete with non-market decision-making and cost controls, that are employed by nearly every wealthy industrial country besides the United States. Players on both sides of our domestic health care debates have already contacted the Bush administration to push trade negotiation positions that would promote their domestic policy preferences.

The domestic political stakes could not be larger, and the real-world impact may prove even more significant - the pace of future cures to terrible maladies is a life-or-death matter to millions. In that case, the leaders of the U.S. body politic should take the lead in developing our answers to these massive issues. Then, our trade negotiators should reflect those positions. If the opposite takes place, and our trade negotiators with Australia are moving the drug policy debate in one direction or the other, the tail will be wagging the dog on some of the most important policy decisions we face.

This column by Rep. David Dreier, California Republican, who is chairman of the House Rules Committee, was published in the Washington Times November 5 and is in the public domain. No republication restrictions.