Biden’s Big Pharma Coup Is a Blank Check for More Government Takeovers

Targeting unpopular pharmaceutical firms is step one in a larger project to expand federal power over all U.S. companies

The Biden administration is implementing an election-year ploy that it says is about fairness in drug pricing. But even a quick glance at the facts makes it clear that the goal is to steal Big Pharma’s innovations—theft that won’t stop there and will likely instead shaft true innovators like inventors and small business owners. 

According to reports, the administration is building a framework to take patent protections away from some of the largest pharmaceutical companies and license their drug formulas to manufacturers of generic medicine. The justification for this move is that drug prices are too high and taxpayers’ participation in drug research and development gives them the right to a lower price.

The administration’s strategy is based on a concept known as “march in rights” that allows the government to essentially “march in” to a business in certain circumstances. For this scheme, the White House plans to exploit a seldom used provision of the Bayh-Dole Act of 1980 that allows federal agencies to distribute third-party licenses for patents earned with R&D funded by the government when inventors don’t commercialize the product, or in the interest of public health. Since its passage, the government has only invoked this provision a handful of times and not once has it been fully exercised.

Biden is banking on people saying, “Big Pharma had it coming.” It’s a smart play—liberals think drug companies make too much profit, conservatives point to the companies’ huge COVID-19 vaccine mess, and senior citizens may appreciate their personal savings going up. 

But former federal judges Paul Michel and Kathleen O’Malley have called the scheme “legally unsupportable”—the Bayh-Dole Act was written to stimulate innovation and product development, not punish it. And the Center for Strategic and International Studies says, “the harm that this policy will inflict on a pillar of the nation’s innovation system will be substantial.”

It won’t even have much of an impact on lowering drug prices. Research released last November found 92 percent of all FDA-approved medications had no federal research funding so the march in rights scheme wouldn’t apply. 

Okay, so the policy is clearly legally insane and it won’t actually achieve its stated goal. That’s bad—but it gets even worse when you dig down a level or two:

• The administration is essentially saying that anyone’s patent can be stolen if government money was involved in the transaction. This means every major industry and company is at risk. What stops Biden from going after subsidy-laden Tesla because he doesn’t like Elon Musk, or a future President Trump from going after Amazon’s government contracts because he doesn’t like Jeff Bezos?

• It’s not just big firms at risk. Why should a serial inventor, or a small business built on licensing its technology, assume that its patent will be held sacrosanct? They shouldn’t, which means patent innovation is going to be chilled.

Then again, we shouldn’t be surprised at this abuse of power. Biden was vice president when the so-called Affordable Care Act (Obamacare) demanded everyone who wants the right to breathe buy insurance, and it was the Obama administration which accelerated pressure favoring so-called “non-discrimination” laws and policies because businesses’ use of public permits allegedly made them vulnerable to government policies requiring customer service.

And Biden isn’t the only Obama alum pushing this policy. Biden’s National Economic Advisor Lael Brainerd said, “If American taxpayers paid to help invent a prescription drug, the drug companies should sell it to the American public for a reasonable price.” She was Obama’s Undersecretary of the Treasury.

And Neera Tanden, who leads Biden’s Domestic Policy Council, was a “key architect” of Obamacare. She’s also pushing the trope saying, “American taxpayers pay more for research than any country in the world: hundreds of billions of dollars on research relevant to developing new drugs through the [National Institutes of Health] and other agencies.”

So there you have it, the same clown show responsible for skyrocketing healthcare costs is telling you they know how to reduce prescription drug costs. And they’re hoping that Americans will be distracted by the bauble of attacking Big Pharma that we’ll ignore how the administration is blowing up the patent system, destroying innovation, and stealing private property.

Paul Revere is the pseudonym of a conservative writer