The Australian Labor Party has flagged the data exclusivity provisions of the Trans Pacific Partnership Agreement (TPP) as a major issue ahead of our now confirmed July date for an Australian election.

These provisions of the TPP have been controversial in Australia, with many commentators and politicians nervous that extending data exclusivity may delay market entry of biosimilar medicines, causing increased costs. It should be noted that this increased cost is primarily borne not by consumers but by the taxpayer, because of the Commonwealth Government’s extensive funding of pharmaceuticals through the Pharmaceutical Benefits Scheme.

The TPP includes a requirement that member countries provide data exclusivity in respect of biologics of either 8 years, or for 5 years with a requirement to deliver a “comparable outcome” through other measures. Australia currently offers 5 years of data exclusivity for all new pharmaceutical products, although this does not include new indications for existing products.  Australia’s then Trade Minister, Andrew Robb, stated when negotiating the TPP that Australia would not accept any changes to its current situation in the TPP.  Additionally, since agreeing to the TPP, Australian Government officials have indicated that they believe Australia is already compliant with its data exclusivity obligations.

Given the statements from some quarters that Australia is already compliant, we are left to speculate how this could be considered to be the case. It may be that it is more of matter of not being in breach of the obligation until a biologic appears, which in fact gets less than 8 years exclusivity (e.g. because of loss of patent protection).

What exactly constitutes “comparable market outcomes” is unclear, particularly in Australia which does not have, other than data exclusivity, any form of in-market exclusivity from a regulatory or approvals perspective, such as the United States’ model of market exclusivity. However, the clear position of both major parties in the Australian political sphere has been no changes to data exclusivity.  Recent comments from Liberal MP Steve Ciobo, the new Trade Minister, have been seized upon by the Labor Party as evincing an intention to at least negotiate on changes to the TPP, which have been flagged by American lawmakers.  According to reports, Mr Ciobo noted that “[w]hoever wins the forthcoming Australian election will need to play a key role in terms of what can be done around biologics which seems to be the main sticking point … with respect to the debate that is happening in the US,” at a recent conference.  A press release issued by Shadow Trade Minister Penny Wong and Shadow Health Minister Catherine King suggests that Australia may respond to pressure from Congress to provide certain guarantees regarding the comparable market outcomes.

Pricing of pharmaceutical products, particularly in the current context of arguments on both sides of politics regarding the size of the Budget deficit, has been a major issue. Emotive language regarding the costs to consumers have been commonplace.  Now, data exclusivity and pharmaceutical pricing are shaping as key issues in the upcoming Australian election.