US embassy cable - 04AMMAN725

C O N F I D E N T I A L SECTION 01 OF 02 AMMAN 000725 
 
SIPDIS 
 
STATE FOR NEA/ARN 
STATE ALSO FOR EB/TPP/MTA/IPC - P. QUIGLEY 
PASS TO USTR FOR E. SAUMS 
USDOC 4110/ITA/MAC/OAC/TCC/JSTRADTMAN 
USDOC 4520/ITA/MAC/OME/NWIEGLER 
 
E.O. 12958: DECL: 01/25/2014 
TAGS: ETRD, KIPR, PREL, JO 
SUBJECT: JORDAN FDA DECISION ON OSTEOPOROSIS DRUG GENERIC 
RAISES IPR CONCERNS 
 
REF: AMMAN 460 
 
Classified By: DAVID M. HALE, CDA. REASONS: 1.5 (B,D) 
 
1.  (C)  SUMMARY:  Jordan appears on a collision course with 
Merck Sharp and Dohme over MSD's osteoporosis drug, FOSAMAX 
OW, which a Jordanian drug firm called JOSWE is marketing as 
a generic after receiving permission last September from the 
Jordan Food and Drug Administration (JFDA).  After informal 
discussions with the JFDA failed last fall, and an MSD court 
case was dismissed on a technicality in January, MSD plans to 
go back to court. According to PhRMA's regional rep, the 
association could file a recommendation to return Jordan to 
the Special 301 Watch List.  END SUMMARY. 
 
Court Rules Against MSD 
----------------------- 
 
2. (C)  The gist of MSD's complaint revolves around clinical 
data protection and the difference between the FOSAMAX 
(aldenomax) daily and weekly formulations.  Smaller, daily 
doses of FOSAMAX are already being sold as generics in 
Jordan, the five-year registration period having expired. 
When MSD registered the once-weekly (OW) dose in June, 2001, 
it expected a five-year protection of the registration, which 
includes protection of the proprietary clinical data on which 
the application was based.  However, the JFDA and its 
internal committees appeared to have allowed the 
OW-formulation clinical data to be used prematurely by 
generic manufacturer Jordan Sweden Medical and Sterilization 
(JOSWE).  As MSD said in a letter to the Ambassador, the JFDA 
was misinterpreting the application of data protection 
(afforded by both Jordanian law and WTO obligations) by 
maintaining that Jordan's FDA law only covered new chemical 
entities with novel active ingredients, a decision MSD 
labeled as having "severe negative implications" for the 
innovative pharmaceutical industry.  (NOTE:  The bilateral 
Free Trade Agreement (FTA), Article 4, para 22 not only 
states Jordan's affirmative obligation to protect such 
clinical data from unfair commercial use, but also the 
simple, direct responsibility to "protect such information 
against disclosure." END NOTE.) 
 
3. (C)  MSD initially tried to address this informally with 
the JFDA and senior Jordanian trade officials.  They also 
approached JOSWE to see if a mutually agreeable solution is 
possible.  When these steps failed, MSD filed a complaint in 
Jordan courts in late 2003.  According to Ramsey Morad, MSD 
Jordan Country Director, the court ruled January 14 that the 
MSD complaint did not specify the offending party or the 
substance of the case (a JFDA Technical Committee had 
approved JOSWE's "LF-1" form request to register the generic, 
but these key details were missing) and therefore threw the 
case out.  MSD plans to go back to court using its 
London-based regional office (MSD/UK) as a new plaintiff and 
correcting the technical deficiencies.  Morad said that JOSWE 
does not know that MSD is "going after them again" and that 
MSD will not quit in defending its right to five years of 
exclusive marketing for the OW formulation. MSD is asking 
that the JOSWE product be de-registered.  Morad states that 
MSD does not know what the JFDA's exact ruling on the JOSWE 
application was.  The court case, if it had been allowed to 
proceed, would have helped ascertain the facts through 
discovery. 
 
4. (U)  NOTE: Most pharmaceuticals patented outside Jordan 
are placed for registration with the JFDA, which affords five 
years of exclusive marketing protection.  Although a patent 
offers 20 years of protection in Jordan and/or the patent 
protection of the country of origin, representatives for 
major pharmaceutical companies say that the economics of the 
2-3 year application process in this market justify the 
five-year protection, which would generally match the 
remaining exclusivity of the same drug in the U.S. END NOTE. 
 
Embassy Advocates for MSD 
------------------------- 
 
5. (C)  In a letter and subsequent conversations with Deputy 
PM and Minister of Industry and Trade Halaiqa, the Ambassador 
has advocated that the case should have been resolved through 
regulatory relief.  Instead, the GOJ unnecessarily allowed it 
to escalate into a costly court case that will lead potential 
investors to look twice at Jordan.  We have repeatedly 
expressed the opinion that the matter can still be resolved 
by GOJ action.  PhRMA's regional rep, Samir Mansour, said 
January 20 that PhRMA may pursue Special 301 action against 
Jordan if this case is not resolved in MSD's favor.  He also 
said that this is part of what he sees as a pattern of weak 
enforcement of IPR laws. 
 
Royal Interest 
-------------- 
 
6. (C)  Morad told Econoff that King Abdullah used the 
occasion of a WEF business luncheon in Davos last week to 
speak directly to an MSD rep.  The King reportedly told Jeff 
Keprecos, MSD External Affairs Director for Europe, the 
Middle East and Africa, that he had heard about the Merck 
case.  Morad said that Keprecos interpreted the King's 
questions about the case as being generally supportive.  The 
King reportedly said that he wanted to create a good 
regulatory environment in Jordan.  At the King's request, MSD 
is sending a file on the case to the royal court this week. 
 
Comment 
------- 
 
7. (C)  This case illustrates the level of complexity of IPR 
cases in Jordan and the need to get the government to rise to 
a new level of commitment in dealing with them.  DPM Halaiqa 
told the Ambassador (septel) that he thought the JFDA was 
given too wide a mandate under Jordan's FDA law.  It would 
appear the JFDA is using that mandate to continue a trend of 
leaning toward support of Jordan's generics manufacturers 
where possible, and even where the facts would not appear to 
support their position. 
 
8. (C) At the same time, at a business luncheon at WEF on 
January 24, Mazen Darwazeh, chairman of industry leader Hikma 
Pharmaceuticals, boasted of Jordan's position in the region 
with a mature group of companies accessing a market of 300 
million, capable of conducting clinical trials.  He also 
reportedly boasted of Jordan's adherence to international IPR 
agreements.  Jordan's adherence to the highest IPR standards 
is critical to the aspirations of the industry, which has 
prospered since Jordan joined the WTO.  Several PhRMA firms 
have entered into joint agreements with local companies. 
This and other progress will be jeopardized if Jordan doesn't 
get its legal and regulatory house in order.  END COMMENT. 
HALE