VZCZCXRO6522
OO RUEHAST RUEHHM RUEHLN RUEHMA RUEHPB RUEHPOD RUEHTM
DE RUEHKO #3221/01 3261045
ZNR UUUUU ZZH
O 211045Z NOV 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 8991
INFO RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE PRIORITY
RUEHFK/AMCONSUL FUKUOKA PRIORITY 1108
RUEHNAG/AMCONSUL NAGOYA PRIORITY 9119
RUEHNH/AMCONSUL NAHA PRIORITY 3469
RUEHOK/AMCONSUL OSAKA KOBE PRIORITY 4898
RUEHKSO/AMCONSUL SAPPORO PRIORITY 1679
RUEHRC/DEPT OF AGRICULTURE WASHINGTON DC PRIORITY
RUEAUSA/DEPT OF HHS WASHINGTON DC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC PRIORITY
RUEHGV/USMISSION GENEVA PRIORITY 3439
RUEAIIA/CIA WASHDC PRIORITY

UNCLAS SECTION 01 OF 03 TOKYO 003221 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR AIAG AMBASSADOR LANGE 
DEPT FOR EAP/J AND OES/IHA 
USDA PASS TO APHIS 
HHS FOR DEPUTY SECRETARY TROY 
HHS FOR OGHA STEIGER AND ABDOO 
DEPT PASS TO AID/GH/HIDN 
 
E.O. 12958: N/A 
TAGS: SOCI TBIO KSTH ECON PREL KFLU JA
SUBJECT: HHS DEPUTY SECRETARY TROY'S VISIT TO JAPAN 
NOVEMBER 24-27 
 
TOKYO 00003221  001.2 OF 003 
 
 
¶1.  This message is Sensitive but Unclassified.  Please 
handle accordingly. 
 
Summary 
-------- 
 
¶2. (SBU)  As the world's second largest economy, Japan 
remains a strong ally and a key partner for the U.S. in 
global health efforts.  During its G8 presidency, Japan has 
shown leadership on important global issues and continues to 
be a top contributor to initiatives on infectious diseases 
and pandemic preparedness.  At the same, with a declining and 
rapidly aging population, plus a growing need to pay 
attention to current and future budgetary constraints, Japan 
faces increasing health care challenges and domestic public 
pressures.  The world's second largest pharmaceutical market, 
Japan nevertheless has lagged other countries in introducing 
innovative drugs and devices.  Limited reforms are underway 
to reverse the "drug lag" and similar delays in approvals of 
medical appliances, but progress has been slow.  Still, and a 
point not often understood by the Japanese public or Japanese 
officials, Japan is a world leader in life sciences and our 
long-standing cooperative science relationship continues to 
facilitate promising medical research in both countries.  End 
Summary. 
 
Japan's Healthcare System - Strong, Expensive, and Under Fire 
--------------------------------------------- ------------ 
 
¶3.  (SBU) Japan's national healthcare system receives high 
marks for delivering basic healthcare at a reasonable cost, 
but faces serious challenges.  Japan boasts the world's 
highest life expectancy, the lowest rate of infant mortality, 
and, although rising, the developed world's lowest prevalence 
of obesity.  While overall healthcare spending, at eight 
percent of GDP, and health spending per capita, are well 
below OECD averages, Japan is grappling with how to finance 
care for an aging population and ensure access to innovative 
drugs, devices, and specialized care.  The recent death of a 
pregnant woman who was refused treatment by eight Tokyo 
hospitals further raised awareness of critical gaps in 
Japan's system, including a shortage of hospital beds and of 
nurses and doctors, especially in rural areas.  Recent 
efforts, such as those to encourage medical school 
enrollment, may help over the long term, but current 
shortfalls raise questions about Japan's capacity to care for 
its growing ranks of older citizens and to respond 
effectively to health emergencies. 
 
Innovation 
---------- 
 
¶4.  (SBU) Japan is the world's second largest market for 
pharmaceuticals and medical devices, but the launch of 
innovative drugs and devices is often described -- by some 
Japanese as well as by many American experts -- as the 
slowest in the industrialized world.  Recognizing the 
economic and health implications of the "drug lag," the 
government has taken initial steps to accelerate the 
approvals process, bolster clinical trials infrastructure, 
and improve the competitiveness of the Japanese 
pharmaceutical industry.  The U.S.-Japan Economic Partnership 
for Growth and other bilateral economic dialogues have been 
useful for highlighting the benefits of health innovation to 
our bilateral economic relationship.  While progress has been 
made, critical issues remain.  For example, the 
Pharmaceutical and Medical Device Agency (PMDA) hired 
additional reviewers in 2008, paid for by increased user fees 
for device reviews.  However, PMDA still employed just 276 
reviewers as of May 2008.  Pricing and reimbursement policies 
that aim foremost to curb government healthcare spending 
continue to stifle innovation.  Imports account for about 20 
percent of Japan's pharmaceutical market.  Taking into 
 
TOKYO 00003221  002.2 OF 003 
 
 
account licensees and local production by foreign firms, the 
foreign share of the market approaches 40 percent. 
 
Stem Cell Research 
------------------ 
 
¶5.  (SBU) The recent breakthrough by Kyoto University 
researchers in cultivating induced pluripotent stem cells 
(iPS) from human skin gave a boost to Japan's ambitions to 
become a global leader in stem cell research.  Similar 
research advances in the U.S. have only heightened Japan's 
competitive focus.  The Council for Science and Technology 
Policy (CSTP), chaired by the Prime Minister, has pushed iPS 
research to the top of the government's life sciences 
research agenda.  For FY2008, the GOJ increased spending on 
iPS research more than tenfold to roughly USD 50 million. 
 
G8 and Global Health 
-------------------- 
 
¶6.  (SBU)  As G8 president, Japan supported our efforts to 
incorporate U.S. priorities on accountability and 
transparency into the Toyako Framework for Action on Global 
Health.  Despite serious and growing budgetary pressures, 
Japan remains a key partner in global efforts to fight 
infectious diseases and other health threats.  Japan is the 
third largest contributor to the Global Fund for AIDS, 
Tuberculosis, and Malaria, and has recently fulfilled a 
pledge to supply ten million long-lasting insecticide-treated 
bed nets to sub-Saharan Africa.  Japan's financial commitment 
to polio eradication is less certain, however, despite recent 
contributions through UNICEF.  We continue to urge Japan to 
join in helping eliminate polio in the four countries where 
it remains endemic. 
 
Pandemic Preparedness 
--------------------- 
 
¶7.  (SBU)  Japan has consistently supported the U.S. in 
calling for timely sharing of virus samples with the WHO. 
However, Japan's position has been tempered at times by a 
desire to avoid appearance of a standoff between developed 
and developing countries.  At October's Ministerial 
Conference in Egypt, Japan pledged an additional USD 24 
million for international efforts, the second largest pledge 
after the U.S.  At a November trilateral health ministerial, 
Japan pledged closer cooperation with China and Korea on 
information sharing and joint pandemic exercises. 
Domestically, Japan continues to develop its capabilities to 
respond to a pandemic by raising targets for anti-viral 
stockpiles and testing prepandemic vaccine on 6,000 
volunteers in front line occupations.  Bureaucrats and 
lawmakers have followed U.S. preparedness efforts closely, 
particularly on difficult issues such as vaccine allocation, 
anti-viral stockpiling, and guidance to citizens living 
abroad. 
 
Food Safety 
----------- 
 
¶8.  (SBU) Recent scandals involving tainted food imports, 
particularly from China, have prompted proposals to increase 
monitoring of food imports and more stringent labeling 
requirements.  While domestic food labeling scandals have 
also captured headlines, consumers are more concerned with 
the safety of imported food.  Imports account for 60 percent 
of Japan's food supply.  The recent melamine scandal in China 
has led to new requirements for testing Chinese dairy 
products and is fueling a more general suspicion of food 
imports from China, currently Japan's second largest supplier 
of food after the U.S.  While we support efforts for 
international coordination on food safety, we continue to 
urge Japan to adopt science-based regulations and avoid 
 
TOKYO 00003221  003.2 OF 003 
 
 
damage to U.S. agricultural trade. 
SCHIEFFER