US embassy cable - 03ANKARA7761

UNCLAS SECTION 01 OF 02 ANKARA 007761 
 
SIPDIS 
 
 
DEPT FOR EB/TPP/MTA/IPC, EUR/SE AND E/CBA 
DEPT PASS USTR FOR MARK WU/LISA ERRION 
DEPT PASS USPTO FOR ELAINE WU 
USDOC FOR ITA/MAC/DDEFALCO 
 
 
SENSITIVE 
 
 
E.O. 12958: N/A 
TAGS: ETRD, KIPR, TU 
SUBJECT: GOT's Unclear Message on Data Exclusivity 
 
 
Ref: (A) State 322108 (B) Ankara 6847 
 
 
Summary 
------- 
 
 
1. (SBU) At the December Economic Partnership Commission 
meeting, the Turkish Health Ministry and Foreign Trade 
Undersecretariat took seemingly contradictory positions on 
data exclusivity protection for pharmaceuticals.  A followup 
meeting with the Health Undersecretary reinforced our 
impression that there is no GOT interagency consensus on 
this issue, and that any GOT move toward data exclusivity in 
early 2004 is like to be unsatisfactory.  The Ambassador is 
raising this issue at the political level (septel), but we 
also request Washington's assistance in following up in the 
near future, including by sending an expert-level delegation 
and, possibly, a Minister-level letter on this issue.  End 
Summary. 
 
 
2. (SBU) At the December Economic Partnership Commission 
(EPC) meeting, Health Ministry Pharmaceuticals Director 
General Hayriye Mihcak presented a paper stating that new 
legislation on data exclusivity protection for 
pharmaceuticals would be enacted in the first half of 2004, 
but did not specify whether and how long a transition period 
for implementation would be included in the law.  At the 
EPC's private sector session the following day, Tevfik 
Mengu, Foreign Trade's Director General for Agreements, 
appeared to contradict the Health Ministry in saying that 
Turkey believed it was already satisfying its TRIPS 
obligations in this area. 
 
 
3. (SBU) Following up on the EPC discussions, Econ Counselor 
requested clarification in a meeting with Health Ministry 
Undersecretary Necdet Unuvar and Pharmaceuticals Director 
General Hayriye Mihcak on December 12.  Mihcak stated that 
the Ministry intended to implement a regulation (not new 
legislation) on data exclusivity in the second quarter of 
2004, but added that the GOT was evaluating "international 
best practices" in this area in formulating its regulation. 
She also noted that the Ministry was not the only state body 
which would have to approve the regulation, and implied that 
there may not be an interagency consensus on data 
exclusivity as yet.  Mihcak disputed Foreign Trade's 
contention that Turkey was already in full compliance with 
TRIPS Article 39.3.  Unuvar and Mihcak raised concerns about 
the potential costs of implementation which range from 
several million dollars (according to the research-based 
companies) and several billion (according to their generic 
competition). 
 
 
4. (SBU) Econ Counselor responded that the generic producers 
had a strong incentive to frighten the GOT with inflated 
cost estimates and contended that their figures were far 
from accurate.  He emphasized that data exclusivity 
protection was long overdue under the TRIPS Agreement (not 
to mention Turkey's EU Customs Union Agreement), that the 
current Turkish pharmaceutical regime allowed local 
companies to "steal" from U.S. companies, and that the USG 
was losing patience on this issue.  Turkey would likely be 
elevated in our Special 301 Watch Lists in the absence of 
swift corrective action, which had to include moving to 
TRIPS-compliant data exclusivity quickly.  Econ Counselor 
noted that the EPC delegations committed to a followup 
meeting at the expert level on intellectual property and 
other issues.  Unuvar and Mihcak responded that they looked 
forward to these expert-level discussions. 
 
 
EU Balks at Joint Demarche 
-------------------------- 
 
 
5. (SBU) EU MISSION ECONOMIC COUNSELOR OSKAR BENEDIKT 
CONTACTED ECONOFF ON DECEMBER 16 TO REPORT THAT BRUSSELS HAD 
DECIDED NOT TO PURSUE A JOINT DEMARCHE WITH THE USG ON DATA 
EXCLUSIVITY (REF A) UNTIL IT HAS COMPLETED ITS TRADE 
BARRIERS REVIEW (TBR) OF TURKEY.  HOWEVER, HE LEFT OPEN THE 
POSSIBILITY THAT SOME JOINT ACTION COULD BE CONSIDERED AFTER 
THE TBR IS COMPLETED. 
 
 
RECOMMENDED ACTIONS 
------------------- 
 
 
6. (SBU) TO GET THE MOST MILEAGE OUT OF THE SPECIAL 301 
PROCESS, WE SHOULD USE ALL NEAR-TERM OPPORTUNITIES TO ENGAGE 
THE GOT ON IPR ISSUES.  FOR EXAMPLE, THE AMBASSADOR RAISED 
THE ISSUE FORCEFULLY WITH MINISTERS BABACAN AND UNAKITAN ON 
DECEMBER 17 (SEPTEL).  AT THE EPC, WE AGREED TO PRESENT THE 
TURKS WITH AN ANALYSIS OF AREAS IN WHICH WE BELIEVE TRIPS IS 
NOT BEING IMPLEMENTED.  BOTH SIDES AGREED TO MEET AT THE 
EXPERT LEVEL EARLY IN 2004 ON IPR AND OTHER TRADE/INVESTMENT 
ISSUES.  EMBASSY URGES WASHINGTON AGENCIES TO PROPOSE A 
DELEGATION AND DATES AS EARLY AS POSSIBLE.  WE ALSO 
REITERATE OUR SUGGESTION THAT WASHINGTON OUTLINE OUR 
CONCERNS IN WRITING, SUCH AS THROUGH A JOINT LETTER FROM 
USTR ZOELLICK AND COMMERCE SECRETARY EVANS TO STATE MINISTER 
TUZMEN (REF B).  WASHINGTON AGENCIES MIGHT ALSO THINK ABOUT 
ASKING EU AUTHORITIES TO RECONSIDER THEIR POSITION ON A 
JOINT DEMARCHE.  EDELMAN