[Congressional Record Volume 150, Number 99 (Friday, July 16, 2004)]
[Extensions of Remarks]
[Pages E1397-E1398]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                  U.S.-AUSTRALIA FREE TRADE AGREEMENT

                                 ______
                                 

                               speech of

                          HON. HENRY A. WAXMAN

                             of california

                    in the house of representatives

                        Wednesday, July 14, 2004

  Mr. WAXMAN. Mr. Speaker, domestic healthcare policy should not be 
decided in trade agreements. That is why I rise in opposition to the 
U.S.-Australia Free Trade Agreement.
  I strongly support the opportunity for increased trade with 
Australia, our closest ally and strongest economic partner in the 
Pacific rim. I support the agreement's strong protections for digital 
copyright, the elimination of tariffs on entertainment and media 
products, and improved market access for U.S. films and television via 
cable, satellite, and the Internet. I am deeply concerned, however, 
that this agreement also involves a deliberate effort to drive up drug 
prices in Australia and set precedents that could be used to undermine 
efforts to lower drugs prices here in the United States.
  It is wrong for us to interfere with another country's domestic 
health policy, particularly when it comes to the affordability of 
medicine which is an equally sensitive issue here in the United States. 
I staunchly oppose provisions in this agreement that make it easier for 
pharmaceutical companies to challenge decisions made by the Australian 
Pharmaceutical Benefits Scheme, or PBS, a formulary system used by the 
Australian government to negotiate prices on behalf of its citizens and 
keep down drug costs. I am also concerned that the Bush Administration 
has set an irresponsible precedent that could bring scrutiny upon our 
own federally sponsored health programs like Medicare and the VA 
formulary system, which we rely upon to reduce drug prices for seniors, 
veterans, and the military.
  This is special interest policymaking at its worst. The Bush 
Administration is letting the pharmaceutical industry use trade 
agreements to manipulate the drug laws of the United

[[Page E1398]]

States and other countries in ways that the industry could not 
otherwise achieve.
  For example, the Australia agreement codifies provisions of U.S. law 
that prohibit reimportation of medicines that are produced in the 
United States and sold at a discount in other countries. I strongly 
oppose the inclusion of this controversial issue in a trade agreement 
when it is the subject of ongoing Congressional debate. Bills currently 
under consideration in the Senate and already passed by the House of 
Representatives will now be in technical violation of our trade 
obligations. Since the provision will have no actual impact because 
Australian law already prohibits wholesalers and pharmacists from 
exporting low-cost drugs procured through the PBS system, it appears 
that its sole purpose is to serve as a basis for the inclusion of 
similar provisions in future agreements.

  Unfortunately, it is not just the Australia free trade agreement 
where these back door assaults on domestic healthcare programs are 
taking place. The U.S. has also negotiated trade agreements with 
Central America, Morocco, and Thailand that would significantly impede 
and delay access to cheaper generic drugs in these developing countries 
where the availability of quality healthcare is already limited and few 
can afford medicine. All of these efforts fit into the pharmaceutical 
industry's agenda to raise drug prices and profits around the world, 
even at the expense of saving lives.
  Because of unique dynamics between the United States and Australia 
the net effects of this agreement on health programs may be negligible. 
But that doesn't mean they aren't bad policy and bad precedents. I am 
voting no on this agreement, which I would have liked to support, in 
order to register my strong protest against the Bush Administration's 
work with the pharmaceutical industry on provisions that sour an 
otherwise promising trade opportunity.
  International trade has the potential to raise the standard of living 
and quality of life for millions of people around the world. To uphold 
that vision, we must work for future trade negotiations that ensure 
that our citizens and our trading partners have the opportunity to 
experience the full benefits of free and fair trade.

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