Intellectual property violations threaten WA innovation

Washington’s economy is breaking records left and right. The total market value of all of our state’s final goods produced and services rendered (GDP) is the highest it’s ever been. We have one of the nation’s most robust tech industries and some of its best-emerging life sciences companies. And the economy of the Seattle Metro area is the fastest growing in America, attracting nearly $3 billion in venture capital investment last year alone.

Having served as both Washington’s governor and as U.S. Secretary of Commerce, it’s no surprise to me that our state is so productive. We have creative and hardworking residents and a strong system of intellectual property rights that protects their inventions and innovations. Together, that’s a recipe for success. 

Unfortunately, a policy shift at a federal agency is putting one piece of this equation at risk — and it’s up to our representatives in Congress to hold it to account. 

Every year, the U.S. Trade Representative releases the “Special 301 Report,” surveying the intellectual property policies and enforcement practices of our trading partners. It’s meant to name and shame countries who undermine the rights of U.S. innovators — pressuring them to reform or better enforce their laws. 

However, in recent years during the tenure of former USTR Katherine Tai, the report has become increasingly permissive of serious violations of American inventors’ IP rights. In doing so, it is destabilizing the framework that underlies the success of Washington’s innovators — from tech behemoths to scrappy startups. 

IP rights like patents are critical drivers of innovation and investment. Granting inventors and innovators temporary exclusive rights to their new inventions enables individuals and businesses to recoup the sizable investments made during research, encouraging reinvestment and further research and development. IP rights also incentivize outside investors to fund promising startups, giving small companies a fair chance to compete.  

But a watered-down Special 301 Report threatens these crucial incentives. If foreign competitors are allowed to swoop in and copy a company’s innovative product without consequences, U.S. investors may limit or altogether avoid backing companies developing new technology.

A major policy shift in recent reports is a refusal to condemn “compulsory licenses” — when a foreign government allows their corporations to use and reproduce patented technology without the inventor’s approval. By failing to uphold IP rights, the USTR could keep billions of investment dollars from flowing into Washington — with serious ripple effects on our state’s economic well-being. 

Previously, the report consistently recognized the threat compulsory licenses posed to research incentives. But over the past two years, its stance has completely flipped. The USTR now claims to “respec[t] its trading partners’ rights to grant compulsory licenses,” often on biotech and pharmaceutical patents.

Trading partners like Colombia and the European Union have wasted no time using this to their advantage. Colombia issued its first compulsory license and is threatening more to extract price concessions, and the European Commission is seeking to facilitate compulsory licensing across Europe.  

In effect, the USTR is waving a white flag and telling foreign IP violators that Americans’ inventions are free for the taking. It’s a disaster in the making for Washington’s innovation economy. 

Nearly 40% of Washington’s private-sector jobs depend heavily on IP rights, according to the U.S. Patent and Trademark Office. Our life sciences industry alone supports more than 140,000 jobs, pays workers nearly 1.5 times higher —than the private-sector average, and contributes almost $40 billion to the economy every year. 

If we allow foreign trading partners to ignore our researchers’ and entrepreneurs’ patent rights, investment into Washington’s innovative industries could dry up — jeopardizing potentially thousands of jobs and businesses.

Washingtonians aren’t the only ones relying on the innovation happening here, either. Just this year, our Evergreen State’s medical researchers have developed new cancer treatments, pain management drugs, immunotherapy breakthroughs, and more, benefiting people all around the world. Greenlighting patent theft around the world will discourage and defund the next generation of life-saving breakthroughs. 

Fortunately, Washington’s senators and representatives in Congress are well aware of the important role innovation plays in our state’s economy. Many have worked as technology leaders or medical researchers themselves, giving them firsthand insight into the necessity of strong intellectual property protections.

They, along with the rest of Congress, must call on the USTR Jamieson Greer to return the Special 301 Report to its former standards. Protecting inventors’ rights is essential to sustaining the innovation that drives Washington’s economy and strengthens America’s global leadership.