VZCZCXYZ0000
RR RUEHWEB

DE RUEHBU #0355/01 0791631
ZNR UUUUU ZZH
R 191631Z MAR 08
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC 0541
INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUCPDOC/USDOC WASHINGTON DC
RUCNMER/MERCOSUR COLLECTIVE

UNCLAS BUENOS AIRES 000355 
 
SIPDIS 
 
EB/TPP/IPE FOR RWATTS, RWALLACE AND CLACROSSE 
DEPT PLS PASS TO USTR JCGROVES, KDUCKWORTH 
SAO PAULO FOR USPTO DMAZURKEVICH 
USDOC FOR 4322/ITA/MAC/OLAC/PEACHER 
DOC/ITA/MAC/OIPR FOR CATHERINE PETERS AND JENNIFER BOGER 
PLEASE PASS TO USPTO JURBAN AND LOC STEPP 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ECON EINV KIPR AR
SUBJECT: Argentina: PhRMA Unexpectedly Upbeat on IP Environment 
 
Ref:  07 Buenos Aires 750 
 
------- 
Summary 
------- 
 
¶1. (SBU) Members of PhRMA's (Pharmaceutical Researchers and 
Manufacturers of America) Latin American task force, on a two-day 
visit to Argentina to meet with GoA officials, local affiliates, and 
pharmaceutical chambers, remain concerned about inadequate data 
protection for new pharmaceutical products and the lack of linkage 
between patents and market access.  However, they praised 
improvements in patent processing, and said that judicial 
injunctions in patent cases were not too difficult to obtain. 
Separately, the new GoA Science Minister expressed to Ambassador his 
interest in increasing pharmaceutical company research and 
development activity in Argentina, and acknowledged that an improved 
patent regime could facilitate that goal.  End Summary. 
 
--------------------------------------------- -------- 
Data Protection Concerns, Praise on Patent Processing 
--------------------------------------------- -------- 
 
¶2. (SBU) PhRMA task force members (Will Stephens, Johnson and 
Johnson VP of International Government Affairs; David Talbot, Eli 
Lilly Director of International Government Affairs; Nina DeLorenzo, 
Schering-Plough Senior Manager of International Public Affairs; and 
Andrew Rudman, PhRMA Assistant VP for Latin America) met March 4 
with Ambassador.  They had just completed a two-day country visit, 
during which they met with the Patent Commissioner of 
(USPTO-equivalent) INPI, local representatives of the International 
Judicial Academy, and the economic advisor to the EU Mission who 
covers intellectual property issues.  They were accompanied by 
Argentina country managers from Pfizer and Janssen-Cilag (Johnson 
and Johnson's local subsidiary). 
 
¶3. (SBU) DeLorenzo noted that non-existent data protection for new 
pharmaceutical products and the lack of linkage between patents and 
market access allow the GoA's FDA-equivalent to approve sales of 
patent-violating products.  This, she said, remains the most 
important issue for Schering-Plough in Argentina.  Rodrigo San 
Martin, Country Manager of Pfizer, echoed that concern.  However, 
Stephens praised INPI for its improvements in recent years on patent 
processing, and said judicial injunctions in patent cases were not 
too difficult to obtain, despite the process being "slower than we 
would like."  Overall, he said, the group was positively impressed 
by Argentina's IP progress.  When Ambassador asked for examples of 
countries in the region who could serve as IP exemplars, Rudman 
opined that Peru was one, especially in terms of efforts to 
encourage innovation.  He called Chile an example of what not to do, 
and stated that the GoC was making very little effort to adhere to 
TRIPS-plus IP standards negotiated in the USG/GoC bilateral FTA. 
Stephens called Mexico a "leading case" in the areas of pricing 
reforms, engagement on ways to increase innovation, and dialogue 
with the pharmaceutical industry, and an example that Argentina 
should seek to emulate. 
 
¶4. (SBU) Ambassador noted that he met with new Science, Technology, 
and Innovation Minister Lino Baranao, who told him that he wanted to 
see more primary research conducted in Argentina.  Ambassador told 
Baranao that better patent protection would probably facilitate that 
goal, and the Minister agreed.  (The Ministry was created last 
December by President Cristina Fernandez de Kirchner.)  Stephens 
said that the pharmaceutical industry's increasing production of 
complex, new-generation biological products requires that IP patent 
regimes worldwide modernize their legal and regulatory frameworks to 
reflect that greater complexity.  Ambassador noted Baranao had 
raised the same issue, and has said that he wanted to make an effort 
to ensure that Argentina's patent regime is appropriately updated. 
 
¶5. (SBU) Ambassador suggested that the local pharmaceutical chamber 
CAEMe present an "innovation package" of proposals to Minister 
Baranao on how the GoA can best spur new pharmaceutical company 
investment in R&D in Argentina.  President Cristina Fernandez de 
Kirchner has made attracting new investment a central theme of her 
tenure, Ambassador noted, and being able to tie specific changes in 
the IPR regime to increased investment might make a compelling 
argument, with Baranao and Economy Minister Lousteau as potential 
allies.  CAEMe Executive Director Ernesto Felicio noted that a 
number of local pharmaceutical firms who are not members of CAEMe 
are conducting research here and could be allies in addressing IP 
patent regime deficiencies. (On the other hand, all PhRMA members 
doing business in Argentina are members of CAEMe.) 
 
 
------- 
COMMENT 
------- 
 
¶6. (SBU) PhRMA's positive outlook on pharmaceutical IP protection in 
Argentina stood in stark contrast to the Embassy's previous meetings 
with industry reps, including an April 2007 round-table for local 
country managers (Reftel).  During that meeting, company reps listed 
flaws in Argentina's patent protection system including the slow 
issuance of patents, the lack of linkage between the GoA entity 
approving patents and Health Ministry approval to market generic 
copies, and a weak legal process to fight patent infringement. 
Interestingly, Talbot did not take issue with Stephens' optimism on 
preventing patent infringement via injunctions, even though Lilly's 
local country manager had highlighted exactly that issue as a major 
concern in a November 2007 meeting with the Ambassador. 
 
¶7. (SBU) The apparent disconnect is likely due to differing 
perspectives of the local branches and home offices of the 
companies.  The local branches face the difficulties of the 
Argentine IPR regime daily, whereas from the bottom line perspective 
of headquarters, Argentina is an increasingly profitable place to do 
business.  Product sales are growing here - pharmaceutical sales, of 
which approximately 50% are by research-based firms belonging to 
CAEMe, reached $2.6 billion in 2006, double that of 2002, and 
pharmaceutical consultant IMS Health predicts they will grow 29% to 
$3.4 billion by 2008 - and clinical trials run by pharmaceutical 
companies also continue to grow rapidly, with CAEMe estimating that 
its members, which include many PhRMA firms, spent USD 92 million on 
such research in Argentina in 2007, a 39.5% increase from 2006. 
 
WAYNE