This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 WARSAW 000308 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR EUR/NCE/MSESSUMS 
STATE PASS USTR FOR DONNELLY/ERRION/WEISEL 
COMMERCE FOR 4232/ITA/MAC/EUR/OECA/MROGERS 
 
REF: (A) Warsaw 0068 (B) Warsaw 0280 
 
E.O. 12958: N/A 
TAGS: ETRD KIPR PL
SUBJECT: POLAND: Comment on Pharma's Special 301 Input 
 
 
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Summary 
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¶1. (U) Sensitive but unclassified.  Not for distribution 
outside USG. 
 
¶2. (SBU) Pharma's call for Priority Foreign Country (PFC) 
status for Poland is understandable.  The industry has 
indeed faced many challenges in dealing with the Polish 
government prior to accession, and some of these issues have 
exacerbated dealing with the Ministry of Health in the post- 
accession environment as well.  However, the industry's main 
problem, which has consistently been at the foundation of 
most, if not all, its complaints, has been access to the 
reimbursement list.  And while issues relating to inadequate 
IPR protection played a role in hindering the 
competitiveness of the industry in the late 1990s, data 
exclusivity problems do not appear, given the evidence 
submitted, to be the main culprit in limiting industry's 
effectiveness.  Indeed, we have proposed a strategy (reftel 
A) for dealing with the new government that is already 
bearing fruit, thanks in great measure to the visit Commerce 
Secretary Gutierrez.  In sum, we believe that cooperative 
 
SIPDIS 
engagement is the best way to address industry's main 
complaint: access for innovative drugs to the reimbursement 
list.  End Summary. 
 
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Industry's Points: Data Exclusivity 
----------------------------------- 
 
¶3. (SBU) As we review industry's submission, we find a 
number of complaints, some with more substantive merit than 
others.  But most of the complaints are the same that we 
have read in previous years' submissions.  This does not 
mean the problems should be discounted.  However, it does 
beg the question for this year's review as to what specific 
301-related issues the industry has.  We have discussed this 
very issue with the primary AmCham pharmaceutical group 
(LAWG) as well as with specific companies.  We emphasized 
the need for current actionable examples regarding 
violations of data exclusivity. 
 
¶4. (SBU) We did get a number of complaints regarding "ghost 
list" drugs and the increasing number of molecules found on 
that list (reftel B), but by industry's admission, some of 
these drugs do not even exist as a marketable product.  Even 
the example of Fozomax, which industry uses in its 
submission as evidence of the data exclusivity problem, is 
not actionable on that basis.  We asked Merck (protect) 
directly if the company could claim the generics competing 
with Fozomax violated its patent (as reported in reftel A). 
The answer was no.  As to Lilly's Zyprexa, we understand 
this drug was subject to IP-related judicial proceedings in 
the United States as well.  Again, this does not diminish 
the threat to industry that Poland's lack of commitment to 
cooperation with the innovative drug industry demonstrates. 
But it does underscore why it is difficult for the Embassy 
to raise data exclusivity violations as a cudgel to gain 
access to the reimbursement list for innovative drugs, and 
why enhancing cooperation and dialogue is far more likely 
than threatening sanctions to get industry what it wants. 
 
¶5. (SBU) It is true that Poland has not implemented fully 
all data exclusivity directives (65/65 is still pending 
implementation).  But Poland has filed for an exception to 
implementation for full term data exclusivity in accordance 
with EU rules.  From our perspective, it is difficult to 
view this request as substantive IPR violation. 
 
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Industry's Points: Customs and Margins 
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¶6. (SBU) Industry has been rightly concerned about this 
issue, as the potential damage could be catastrophic, with 
literally hundreds of millions of dollars in financial 
penalties at stake.  However, the issue has been winding its 
way through the Polish courts, which have been consistently 
rendering decisions in industry's favour.  And while the 
case is still in court, the Minister of Health himself is 
pressing U.S. officials and industry to look for a 
settlement "out of court."  Previously, industry had been 
eager to pursue this approach as well.  Now, it smells 
blood, and an out of court settlement appears unlikely.  We 
support industry's position on the substance of the issue. 
As to the tactics related to resolving it, we of course 
defer to the LAWG.  However, given that the case is being 
handled without any undue political interference, we believe 
the issue does not rise to the level that would warrant an 
elevation of Poland's watch list status. 
 
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Give Dialogue a Chance 
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¶7. (SBU) Perhaps the most compelling reason to avert raising 
Poland's status is the fact that we now are dealing with a 
new government, which in meetings with Embassy officials and 
Washington visitors has impressed us with its desire to 
engage with us and industry to resolve problems on the IPR 
front.  In discussions with Secretary Gutierrez, Minister 
Religa gave reassuring answers to the Secretary's points 
about innovative drug access to the reimbursement list 
(again this is *the* major issue for industry).  Religa, a 
medical doctor and not a PiS party member, appeared genuine 
when he expressed both his desire to add innovative drugs to 
the reimbursement list and difficulties in dealing with the 
Finance Ministry to obtain the necessary budget to do it. 
While words and deeds, of course, need to be brought into 
synch, we nonetheless believe it is important to give 
substantive engagement a chance.  As reported, we are 
currently working to establish a regular dialogue between 
industry and the Health Ministry that we hope will resolve 
the thorniest outstanding issues.  It would send the wrong 
message to this Polish government if we were to use the 
stick as our opening gambit.