VZCZCXRO9566
PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #0411 0540905
ZNR UUUUU ZZH
P 230905Z FEB 09
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 0987
INFO RUEHFK/AMCONSUL FUKUOKA PRIORITY 2577
RUEHNAG/AMCONSUL NAGOYA PRIORITY 0399
RUEHNH/AMCONSUL NAHA PRIORITY 4922
RUEHOK/AMCONSUL OSAKA KOBE PRIORITY 6366
RUEHKSO/AMCONSUL SAPPORO PRIORITY 3128
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC PRIORITY
RUEAUSA/DEPT OF HHS WASHINGTON DC PRIORITY

UNCLAS TOKYO 000411 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR EAP/J AND EEB/TPP AND EEB/CIP 
DEPT PASS TO USTR FOR CUTLER AND BEEMAN 
 
E.O. 12958: N/A 
TAGS: ETRD EINV TBIO KSTH JA
SUBJECT: JAPANESE GOVERNMENT TO REVIEW PROPOSED BAN ON 
ONLINE OTC DRUG SALES 
 
Sensitive But Unclassified.  Please Handle Accordingly. 
 
¶1.  (SBU) Minister Yoichi Masuzoe has ordered a review of the 
Ministry of Health, Labor, and Welfare (MHLW)'s February 6 
ordinance that would ban Internet and mail order sales of 
most over-the-counter (OTC) drugs.  The review was ordered 
within hours of the provision's announcement following 
complaints it would seriously inconvenience consumers, 
particularly the elderly and those in rural areas.  Minister 
Masuzoe has convened a panel of 19 members, including 
stakeholders who support and oppose the measure, to discuss 
the merits of the ban.  The panel is due to meet by the end 
of February. 
 
¶2.  (SBU) The ordinance, as originally issued, would require 
nearly all OTC drugs to be sold at face-to-face retail 
locations, e.g., pharmacies, as a means of ensuring 
consumers' safety.  Certain medicines with low health risks 
could continue to be sold online and by mail order.  The 
measure would come into force in June 2009 when the revised 
Pharmaceutical Affairs Law is slated to take effect.  Under 
the revised law, nonprescription medicines will be classified 
into three groups based on the risk of side effects.  Mail 
order and online sales will be allowed only for those Class 
Three items deemed to have the lowest risk of side effects. 
 
¶3.  (SBU) Since a draft of the measure was released for 
public comment last fall, those for and against the ban have 
remained far apart.  The Japan Pharmacists' Association and 
organizations representing those who have suffered from drug 
side effects insist face-to-face sales are essential in 
ensuring consumer safety.  However, some observers note 
online competition has hurt pharmacy sales. 
 
¶4.  (SBU) Online retailers argue the ban creates difficulties 
for those who are not able to go to pharmacies.  Internet 
retailer Rakuten along with Yahoo have submitted 300,000 
signatures of those supporting mail order and online sales. 
Internet economy advocates also criticized the move to 
restrict this type of transactions, saying direct action 
would be better for addressing consumer safety concerns.  The 
GOJ's Council for the Promotion of Regulatory Reform also 
opposed the ban, asserting it would pose problems for 
consumers.  The association of pharmaceutical companies 
dealing in traditional herbal medicines submitted comments 
opposing the ordinance as well.  Chinese herbal medicines are 
traditionally sold via mail order, but will be labeled Class 
Two under the ordinance. 
 
¶5.  (U) Online sales of OTC drugs amounted to an estimated 
USD 68 billion in 2004, according to the Japan Online Drug 
Association.  Including catalog and mail order, sales were 
estimated to total USD 289 million. 
ZUMWALT