VZCZCXRO3980
PP RUEHCD RUEHGD RUEHHO RUEHMC RUEHNG RUEHNL RUEHRD RUEHRS RUEHTM
DE RUEHME #3724/01 1972031
ZNR UUUUU ZZH
P 162031Z JUL 07
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC PRIORITY 7991
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY

UNCLAS SECTION 01 OF 02 MEXICO 003724 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: KIPR ETRD MX
SUBJECT: UPDATE ON PHARMACEUTICAL IPR ISSUES IN MEXICO 
 
Summary 
------- 
 
¶1. (SBU) Embassy officials met with the head of Mexico's 
Federal Commission of Health Risk Protection (COFEPRIS - 
rough equivalent of the U.S. Food and Drug Administration) to 
discuss issues of concern to U.S. drugmakers, including data 
protection, patent linkage, and Mexico's proposed elimination 
of the requirement that would-be pharmaceutical vendors must 
have production facilities in Mexico.  The following day 
emboffs met with representatives of the U.S. pharmaceutical 
industry to compare notes and strategize on how best to push 
Mexico on data protection, the IPR issue of greatest 
importance to the industry.  End summary. 
 
COFEPRIS Commissioner 
--------------------- 
 
¶2. (SBU) Juan Antonio Garcia Villa, COFEPRIS Commissioner, 
and three of his top staff met with Embassy FCS, EST, and 
ECONoffs on July 10 to discuss issues of concern.  Regarding 
Mexico's lack of regulations to implement its NAFTA 
commitment (Article 1711) to provide at least five years of 
protection against disclosure of data that companies must 
submit to health authorities in order to receive health 
approval, Garcia Villa agreed that there was a gap in Mexican 
law.  He then pointed out that international agreements 
themselves have the force of law in Mexico, thus suggesting 
that the NAFTA text itself was sufficient basis for data 
protection.  Emboffs replied that companies would be 
understandably reluctant to pursue legal claims in Mexico 
with nothing other than a copy of the NAFTA in hand.  Garcia 
Villa pointed out that, despite the lack of legal or 
regulatory guidance, COFEPRIS was very careful in handling 
data from companies seeking health approval.  His staff 
complained that this task is made more difficult when 
companies label everything included in their application 
packets as confidential, putting a strain on the ability of 
COFEPRIS to secure such large quantities documents.  They 
also pointed out that, in many cases, companies insist on 
protecting data that is already accessible in the public 
domain. 
 
¶3. (SBU) Emboffs raised the issue of the pharmaceutical 
patent linkage instituted via presidential decree in 2003, 
praising COFEPRIS for its 2007 record of not issuing a single 
health approval for a drug protected by a valid Mexican 
patent, but inquiring about the legal status of the dozen 
health approvals issued the year before for patent-protected 
drugs.  Garcia Villa replied that the twelve cases in 
question involved patents that had already expired and for 
which the original patent holders were seeking extensions. 
The view of COFEPRIS was that, with the patents expired, 
there was no reason for COFEPRIS to deny health approval to 
generic drug-maker applicants.  That said, the original 
patent-holders had initiated legal proceedings by arguing 
that approvals should not have been issued while their patent 
extension applications were still pending.  Garcia Villa said 
these cases will be resolved by the courts and thus are no 
longer in the hands of COFEPRIS or any other executive branch 
agency. 
 
¶4. (SBU) Garcia Villa commented that the GOM's decision to 
eliminate its plant requirement for pharmaceutical vendors 
was at least in part motivated by complaints made by El 
Salvador that this rule violated national treatment under the 
terms of the two countries' free trade agreement.  As a 
result of this change, COFEPRIS will soon have to meet the 
challenge of certifying the safety and efficacy of 
pharmaceutical products imported from other countries.  To 
meet the new demand, Garcia Villa said COFEPRIS planned to 
increase its personnel, would seek to contract certified 
private companies to perform health checks on less sensitive 
products, and would consider reciprocal agreements to 
recognize the health approvals of select trading partner 
governments. 
 
Industry Representatives 
------------------------ 
 
¶5. (U) On July 11, Emboffs met with representatives of the 
Pharmaceutical Research and Manufacturers of America (PhRMA) 
to discuss the same set of issues from the U.S. industry 
perspective.  The PhRMA reps, who had met separately with 
COFEPRIS earlier in the same week, said they were not opposed 
to the elimination of the plant requirement, though specific 
member companies might be affected.  They also remarked on 
COFEPRIS' recent good record in respecting the patent linkage 
when considering health approval applications for drugs. 
 
¶6. (SBU) They asserted that the industry's main IPR concern 
 
MEXICO 00003724  002 OF 002 
 
 
in Mexico is getting the GOM to formulate clear rules on data 
protection.  They were convinced that legislating such rules 
would be hard if not impossible to achieve in the near term 
future given the current state of politics in the Mexican 
congress.  Thus, even though legislation was the desired 
long-term end point, for now they planned to concentrate on 
seeking executive branch regulations on data protection. 
Such regulations are vulnerable to being discarded by 
subsequent administrations, unlike rules enshrined in law, 
but they pointed out that the pharmaceutical patent linkage 
decree issued by the previous administration of President Fox 
was proving to be effective, at least at present.  The 
industry has submitted a proposal to the Mexican Secretariat 
of Economy (the bureaucratic parent of the Mexican Institute 
of Industrial Property, or IMPI, the rough equivalent of the 
U.S. Patent and Trademark Office) on establishing clear and 
NAFTA-consistent data protection rules and believes that 
Economy Secretary Sojo might be willing to act on this 
proposal.  The PhRMA reps requested that the Embassy urge him 
to do so.  They noted one tactical concern -- apparently some 
European embassies are planning to make a push for a 
legislative amendment, an initiative that PhRMA believes 
would expose the whole initiative to unwelcome political 
manipulation.  At the urging of Emboffs, the PhRMA reps 
agreed to discuss the relative merits of the legislative 
versus the regulatory approach with their European industry 
counterparts and lobby their respective embassies to go for 
the more sure bet of a relatively low-key regulatory solution 
to this problem.  Depending on the response, this Embassy 
stands ready to coordinate with other embassies in lobbying 
for clear and NAFTA-consistent data protection rules. 
 
 
Visit Mexico City's Classified Web Site at 
http://www.state.sgov.gov/p/wha/mexicocity and the North American 
 Partnership Blog at http://www.intelink.gov/communities/state/nap / 
GARZA