The US government is urging economically-developed nations to work with it to “address concerns and encourage a common understanding on questions related to innovation in the pharmaceutical sector.”

US drugmakers have expressed concern at the policies of a number of the USA’s trading partners - including Canada, France, Germany, Italy, Japan, New Zealand and Taiwan – relating to innovation, says the US Trade Representative (USTR)’s latest annual Special 301 Report on global intellectual property protection (IPP).

The Report also points out that the USTR is “concerned” about a 2006 regulation in Poland which, it says, appears to reduce the official maximum wholesale and retail prices for imported drugs by 13% while generally leaving unchanged the prices for drugs of Polish origin. “The US pharmaceutical industry reports that this regulation has had a significant impact by reducing prices for numerous products manufactured outside Poland,” it says.

More dialogue is needed between nations along the lines of the US/Korea Free Trade Agreement (FTA), which will, once in place, “improve access to innovative products and ensure the transparent, predictable and non-discriminatory pricing and reimbursement of innovative and generic pharmaceutical products, medical devices and biologics,” according to the USTR Report.

“In this time of economic uncertainty, we need to redouble our efforts to work with all of our trading partners – even our closest allies and neighbours such as Canada – to enhance protection and enforcement of intellectual property rights in the context of a rules-based trading system,” said the USTR, Ambassador Ron Kirk.

His Priority Watch List for 2009, which names 12 countries requiring particular scrutiny, includes Canada for the first time, due to “increasing concern about the continuing need for copyright reform, as well as continuing concern about weak border enforcement.”

China appears, once again, on this year’s List, not least because of its role in the growing trade in counterfeit medicines. The manufacture of fake drugs is proliferating in Brazil, China, India, Indonesia and Russia, aided by the unauthorized use of bulk active pharmaceutical ingredients (APIs), and in China, domestic API makers are able to avoid regulatory oversight by not declaring that the bulk chemical is intended for use in pharmaceuticals, says the Report.

“While China has acknowledged that this loophole must be addressed and has committed to expanding its regulations to control bulk chemicals used as the underlying source of many counterfeit drugs, we continue to urge China to adopt policies that will in fact reduce the manufacture and distribution of unauthorized APIs,” the USTR stresses, and goes on, once again, to urge the government to add new drugs to its national formulary on a regular basis.

Other countries on this year's Priority Watch List include:

- Algeria, Argentina, Chile, India, Pakistan and Venezuela, which are still failing to provide adequate protection against unfair commercial use of undisclosed test and other data generated to obtain marketing approval for pharmaceuticals and must, says the USA, implement effective systems to prevent the issuance of marketing approvals for unauthorized copies of patented drugs. However, the USTR welcomes India’s Drugs and Cosmetics (Amendment) Act 2008 that increases penalties for counterfeit drugs;

- Indonesia, which joins the List for reasons including its counterfeit drugs trade, failure to protect against unfair commercial use of undisclosed test or other data generated to obtain marketing approval and for the introduction last year of a law on the operation of foreign pharmaceutical companies that raises “significant market access concerns;”

- Israel, which remains on the List because of its inadequate protection against unfair commercial use of undisclosed test and other data generated to obtain marketing approval and for measures that adversely affect the length of patent term extension granted to compensate for delays in obtaining regulatory approvals. “These policies result in an unfair disadvantage to innovative pharmaceutical companies who receive comparatively weak protection for innovative pharmaceutical products under Israel’s current laws,” says the USTR; and

- Thailand, whose new government is urged by the USTR to reduce the uncertainty created by the previous administration’s policies on compulsory licensing of patented pharmaceuticals and to ensure that the patent system “promotes the development and creation of new lifesaving drugs.”

“We urge Thailand to consider ways of addressing its public health challenges while maintaining a stable patent system that promotes investment, research and innovation,” says the Report.