Regulatory Focus™ > News Articles > US Trade Report Highlights Pharma's IP, Counterfeit Issues Abroad

US Trade Report Highlights Pharma's IP, Counterfeit Issues Abroad

Posted 01 May 2017 | By Zachary Brennan 

US Trade Report Highlights Pharma's IP, Counterfeit Issues Abroad

The Office of the United States Trade Representative's (USTR) 2017 report on the state of intellectual property (IP) protection and enforcement in US trading partners around the world offers a look into concerns regarding market access barriers, particularly for those in the pharmaceutical and medical device industries.

The report offers numerous examples of issues pharmaceutical and device companies deal with in some foreign countries, noting that these IP-intensive industries have expressed concerns on pharmaceutical market access policies of several trading partners, including Algeria, Austria, Belgium, China, Colombia, Czech Republic, Ecuador, Hungary, Italy, Lithuania, New Zealand, Portugal, Romania, South Korea, Taiwan and Turkey.

"Measures, including those that are discriminatory, nontransparent, or otherwise trade-restrictive, have the potential to hinder market access in the pharmaceutical and medical device sector, and potentially result in higher healthcare costs," the Special 301 report released last Friday says.

For example, Algeria has banned "a significant number of imported pharmaceutical products and medical devices in favor of local products," which the USTR says is "adversely affecting access to legitimate medicines."

In Indonesia, foreign companies' approvals to market pharmaceuticals are conditioned upon the transfer of technology to local entities or partial manufacture in Indonesia.
The report also estimates that federal and state taxes can add 38% to the cost of medicines in Brazil, while India maintains some of the highest tariffs on medicines, pharmaceutical inputs and medical devices among the WTO members

Proposals in Colombia and Ecuador may also "limit access by consumers to the latest generation of medicines," and in Turkey, the report notes a "lack of efficiency, transparency, and fairness in the pharmaceutical manufacturing inspection process," in addition to "initiatives to localize the production of pharmaceutical products through pricing and reimbursement listings."

The report also takes issue with a series of measures in several EU Member States, including Austria, Belgium, Czech Republic, Finland, Hungary, Italy, Lithuania, Portugal and Romania that raise concerns on transparency and the opportunity for meaningful stakeholder engagement in policies related to pricing and reimbursement. The report notes similar problems with New Zealand's Pharmaceutical Management Agency's pricing and reimbursement regime.


Counterfeit pharmaceuticals and active pharmaceutical ingredients "is a growing problem," the report notes, adding that they are of particular concern for those manufactured, sold and/or distributed in numerous trading partners, including China, Guatemala, India, Indonesia, Lebanon, Peru and Russia.

"While it is impossible to determine an exact figure, studies have suggested that up to 20 percent of drugs sold in the Indian market are counterfeit and could represent a serious threat to patient health and safety," the report says.

In addition, 90% of all counterfeit pharmaceuticals seized at the US border in Fiscal Year 2016 were shipped from or trans-shipped through four economies: China, Hong Kong, India and Singapore.

In China, the report questions how the country is implementing commitments outlined in November 2016 on not linking drug registration review and approval with pricing commitments.
The report also notes "China's problematic definition for new drugs," which it says is "inconsistent with harmonized practice, reflected in the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use, and represents a failure to implement China's related commitment of the 2012 Joint Commission on Commerce and Trade (JCCT)."

2017 USTR Special 301 Report

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