VOICES: Help Ohio workers by rejecting IP giveaway

A proposal under consideration at the World Trade Organization could kill critical biotech manufacturing and construction jobs right here in Ohio. If President Biden truly wants to protect vital industry in the Midwest, he’ll reject this disastrous plan.

The proposal before the WTO would strip international intellectual property protections from cutting-edge, U.S.-developed Covid-19 tests and treatments. The WTO — with the support of the Biden administration — approved a similar IP waiver for Covid vaccines last summer.

The Biden administration has said it needs more time to consider extending the waiver to tests and treatments, but the WTO may come to a final agreement later this year.

The proposed IP waiver would force American firms to turn over their drug formulas and manufacturing secrets to competitors in other countries — for free. Under the plan, unauthorized manufacturers abroad could start making copycat versions of groundbreaking Covid-19 treatments, like Pfizer’s antiviral pill Paxlovid.

Waiving global patent protections for Covid tests and treatments would devastate America’s biotech industry, because it’d signal to firms that their hard-won innovations could simply be taken, free of charge, by competitors in the future.

Without reliable IP protections, firms would lose the incentive to invest the billions of dollars needed to make new medicines a reality. It now costs over $2 billion to develop just one new drug. America’s biopharmaceutical industry spent $24 billion on clinical trials for Covid-19 vaccine and treatment candidates alone. These mammoth financial risks simply can’t be justified without rock-solid IP guarantees.

A slowdown in biotech innovation would also threaten thousands of good-paying jobs, including in manufacturing and construction. As of 2020, the biotech industry employed more than 900,000 people in the United States, including 23,479 in Ohio. Buckeye State residents work for Merck and Pfizer, among other biotech firms large and small. Between 2015 and 2020, the life sciences industry invested close to $30 billion into capital development and construction.

It’s only natural that massive cutbacks in R&D will lead to fewer new facilities where crucial medical research happens. Similarly, with fewer newly invented medicines, firms will have less of a need to build, equip, and staff the factories where drugs are manufactured.

Knowing all this, it’s no surprise that many leading labor unions have voiced their opposition to the waiver proposal, including 203,000 members of the International Association of Sheet Metal, Air, Rail and Transportation and the president of the International Brotherhood of Electrical Workers.

Approving an extended IP waiver wouldn’t just destroy many good union jobs here at home, it would also allow America’s biggest rivals to profit off of decades of risky, expensive U.S. research.

Last year’s vaccine IP waiver was phrased in a way that makes it easy for China — the second-largest economy in the world and a notorious intellectual-property pirate — to help itself to American technology. The waiver “encourages” nations such as China to make a “binding commitment” not to exploit the decision.

That has all the force of hanging a “please don’t shoplift” sign in a store window.

Giving highly valuable life sciences IP to China would undoubtedly mean products that would’ve been produced domestically are instead churned out by factory workers overseas.

This inevitable outcome is at odds with President Biden’s stated desire to promote high-tech manufacturing in Ohio and the surrounding region. “The industrial Midwest is back,” the president proclaimed during a visit to New Albany, where Intel is constructing a $20 billion semiconductor plant. The industrial Midwest’s chief global rival? China, which is fighting hard to become the world’s number-one maker of semiconductors.

It makes no sense to compete with China in one vital industry — semiconductors — while aiding its efforts to become the world’s premier biotech powerhouse. We should be endeavoring to produce breakthrough technologies of all varieties here at home.

America beat Covid-19 thanks in large part to our biotech industry and the many manufacturing and construction workers it supports. It’d be the height of folly to go along with the World Trade Organization’s IP giveaway, which would threaten good-paying Ohio jobs while enriching our rivals.

Ross McGregor is a former Ohio state representative and current CEO of Springfield-based manufacturer Pentaflex, Inc.

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