VZCZCXRO5056
PP RUEHHM RUEHLN RUEHMA RUEHPB RUEHPOD
DE RUEHKO #3456/01 2100046
ZNR UUUUU ZZH
P 290046Z JUL 07
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 5929
INFO RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 8093
RUEHRL/AMEMBASSY BERLIN 1295
RUEHFK/AMCONSUL FUKUOKA 2283
RUEHNAG/AMCONSUL NAGOYA 1335
RUEHNH/AMCONSUL NAHA 4708
RUEHOK/AMCONSUL OSAKA KOBE 5881
RUEHKSO/AMCONSUL SAPPORO 3057
RUEHRC/USDA FAS WASHDC 8508
RUEAUSA/DEPT OF HHS WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEAIIA/CIA WASHDC

UNCLAS SECTION 01 OF 02 TOKYO 003456 
 
SIPDIS 
 
DEPT FOR OES/IHA 
DEPT FOR EAP/J WEBSTER 
USDA PASS TO APHIS CLIFFORD; FSIS FOR U/S RAYMOND 
HHS PASS TO CDC, FDA, APSE, CMS 
HHS FOR OGHA STEIGER, HICKEY AND WADWHA 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: TBIO KSTH ECON PREL SOCI EAGR JA
SUBJECT: HHS ACTING DEPUTY SECRETARY HARGAN'S MEETING WITH JAPANESE 
HEALTH MINISTER YANAGISAWA 
 
TOKYO 00003456  001.2 OF 002 
 
 
¶1.  (SBU) Summary: On July 10, Department of Health and Human 
Services (HHS) Acting Deputy Secretary Eric Hargan met in Tokyo with 
the Japanese Minister of Health, Labor, and Welfare, Hakuo 
Yanagisawa.  After a brief discussion of beef imports and food 
safety issues, they exchanged views on fostering innovation in 
Japan's pharmaceutical and medical device sectors.  In a candid 
conversation, Acting D/S Hargan and Minister Yanagisawa agreed that 
Japan must deal with structural obstacles in its health system to 
reap greater benefits from innovation, and Acting D/S Hargan offered 
to assist Yanagisawa in these efforts in any way that would be 
useful. End summary. 
 
Beef Imports and Food Safety 
------------------------------ 
¶2. (SBU) On July 10, HHS Acting Deputy Secretary Eric Hargan met 
with Japanese Minister of Health, Labor, and Welfare (MHLW) Hakuo 
Yanagisawa.  Acting D/S Hargan began by thanking Yanagisawa for the 
relaxation of import inspection requirements for U.S. beef, and said 
he looked forward to further relaxation so the Japanese public could 
enjoy more American beef.  Acting D/S Hargan asked Yanagisawa to 
share Japanese perspectives on dealing with food safety issues with 
China.  Yanagisawa responded that Japan has been dealing with the 
issue of chemical residues in Chinese food imports for many years, 
and has developed a framework to respond to the situation.  He 
mentioned that media reports of food safety difficulties in the 
United States were helpful reminders to step up the Japanese system. 
 
 
Innovation in Japan's Drug and Medical Sector 
--------------------------------------------- 
¶3.  (SBU) Acting D/S Hargan turned to Japan's initiative to foster 
greater innovation, and noted that one would expect more innovative 
drugs and medical devices from a country with many of the world's 
leading scientists and technology companies.  With unexpected 
candor, Yanagisawa responded that Prime Minister Abe's "Innovation 
25" initiative includes a plan to develop Japan's growth potential 
in drugs and medical devices, to help Japan to recover "lost ground" 
in these markets.  He noted that Japan's global share of these 
markets is only 16 percent and that much of the problem can be 
attributed to the slow drug-approval process, the inability of 
innovators to recoup the costs of research and development, and 
administrative burdens that hinder foreign direct investment in the 
pharmaceutical and medical device industries.  Acting D/S Hargan 
agreed that government controls play a key role in getting or 
preventing innovation from getting to market and that the U.S. 
Administration is striving to shorten the time it takes for 
innovative products to reach the market without compromising safety. 
 
 
¶4.  (SBU) Pointing to the example of Australia, Acting D/S Hargan 
noted that many of these structural obstacles can be overcome, but 
that countries such as Germany have also lost ground because of 
onerous requirements that hinder innovation.  Yanagisawa agreed that 
Germany's reference-price system has discouraged innovation, and 
added that Japan's pricing system has also been a disincentive to 
innovation in Japan, though not to the extent as in Germany. Acting 
D/S Hargan concluded his comments by noting that public-private 
sector dialogue was important, 
and that transparent dialogue with industry allows discussion of key 
issues earlier in the process.  He added that a discussion on 
generic drugs could also be central to reducing costs in the 
Japanese system, and offered any assistance Yanagisawa would deem 
useful.  Yanagisawa assured Acting D/S Hargan that Japan is making 
efforts to reward innovation and increase the share of generic drugs 
on the market, but that the introduction of such changes needs to be 
gradual, so as not to "shock" Japan's domestic pharmaceutical 
industry.  Yanagisawa thanked Acting D/S Hargan for his time, and 
indicated he very much valued these types of discussions with the 
U.S. Government and would welcome advice on these issues. 
 
¶5. (SBU) Meeting participants: 
 
 U.S.: 
 
TOKYO 00003456  002.2 OF 002 
 
 
 Ambassador J. Thomas Schieffer 
 HHS Acting Deputy Secretary Eric Hargan 
Brian Harrison, Confidential Assistant to the HHS Deputy Secretary 
 Nina Wadhwa, HHS Office of Global Health Affairs 
Toby Wolf, EST Officer (notetaker) 
Mikako Sano, Scientific Affairs Assistant 
 
 Japan: 
 Minister of Health, Labor, and Welfare Hakuo Yanagisawa 
 
Toshiyasu Ikenaga, Director, International Planning Office, 
Minister's Secretariat, MHLW 
 
Dr. Tokuaki Shobayashi, Infection Control Planning Director, 
Tuberculosis and Infectious Diseases Control Division, Health 
Service Bureau, MHLW 
 
Dr. Eiichi Seki, Director, Blood and Blood Products Division, 
Pharmaceutical and Food Safety Bureau, MHLW 
 
Toshiyohi Tominaga, Planning Director, Evaluation and Licensing 
Division, Pharmaceutical and Food Safety Bureau, MHLW 
 
Dr. Hideshi Michino, Director, Office of Import Food Safety, 
Inspection and Safety Division, Department of Food Safety, MHLW 
 
¶6.  (U) The HHS delegation has cleared this message. 
 
SCHIEFFER