Egypt: Counterfeit Drugs Threaten Public Health, IPR

UNCLAS CAIRO 001677 SENSITIVE, SIPDIS C O R R E C T E D COPY - ADDING SUBJ LINE USTR FOR FRANCESKI COMMERCE FOR 4520/ITA/ANESA AND USPTO E.O. 12958: N/A TAGS: ECON KIPR ETRD EG SUBJECT: Egypt: Counterfeit Drugs Threaten Public Health, IPR Sensitive but Unclassified, Not for Internet Distribution ¶1. (U) Summary: GOE health and security officials are seeking assistance from US pharmaceutical companies to combat counterfeit drugs, which threaten public health, cost an estimated 1 billion Egyptian pounds ($190 million) a year, and violate the intellectual property rights of the innovative drug companies. Pfizer hopes to launch a pilot project in Egypt for combating counterfeits. End Summary. -------------- Dangerous Fakes -------------- ¶2. (U) According to estimates by Egyptian pharmaceutical representatives, Egyptians spend 1 billion Egyptian pounds ($190 million) a year for counterfeit medicine out of 10 billion pounds spent overall on pharmaceuticals. A study by the pharmaceutical company Aventis indicated that 18% of drugs sold in Egypt are counterfeit. ¶3. (U) Most of the counterfeit products found locally are unsophisticated copies with either no active ingredient or potentially dangerous ingredients such as ink jet dye, ecstasy, amphetamines, and boric acid, Pfizer representatives said in a meeting in the Embassy. Counterfeits of Viagra - the world's most pirated drug - generally contain none of the actual drug. ¶4. (U) Pfizer representatives told us that it is difficult for them to estimate the magnitude of counterfeiting here because most drugs are sold over-the-counter. Therefore, tracking doctors' prescriptions to determine the total market size is not possible, although it might be possible to track actual sales. Regardless, there are many possible shipping routes into Egypt, and parallel importation - importing a drug that had been manufactured for sale in another country - is not illegal. According to Pfizer, while most counterfeits here are imported from China, India, and Pakistan, investigators discovered two counterfeit drug manufacturing plants in Cairo in recent years. -------------- GOE Investigations -------------- ¶5. (SBU) The Ministry of Interior's Anti-counterfeiting and Trade police conduct about 250 drug raids and seizures a year, according to the head of the unit, General Mohamed Ibrahim Abou Shady. The maximum penalty for counterfeiting drugs is 3-7 years, but the offender is most often only fined and released. Fines for a first offence range from 5,000 to 20,000 Egyptian pounds ($900-$3,600). ¶6. (SBU) Investigations begin with inspections initiated based on tips from informants, or complaints by rights- holders. Police also maintain a watch-list of past offenders and common locations for counterfeit drugs. Suspect drugs must be removed from pharmacy shelves until cleared by the MOH. Abou Shady indicated that police generally coordinate with health inspectors, although pharmaceutical companies report that such coordination breaks down at times, resulting in cases being dismissed from court. ¶7. (SBU) Abou Shady has coordinated with Pfizer as well as companies in other sectors such as HP, Cannon, and GM to help investigators distinguish between legitimate and illegitimate products. Even so, he said investigators often have trouble identifying pirated products because of inadequate packaging security features and difficulties in getting information on legitimate products from rightholders. He hopes to increase training and coordination with the private sector to identify original products. -------------- Future plans -------------- ¶8. (U) Coordinating closely with the GOE, Pfizer intends to sponsor training and conferences for Egyptian officials to raise awareness on IPR crimes, give officials global perspective on IPR issues, and help them identify counterfeit products. A Pfizer official told us that Egypt will be a pilot product for their anti-counterfeiting initiatives, which could include training for Ministry of Interior investigators as well as about 45 inspectors under the Ministry of Health's Drug Policy and Planning Committee. ¶9. (SBU) Comment: Private-sector engagement with the GOE has proven effective to combat other IPR violations, such as Microsoft's efforts against computer software piracy in Egypt. In this case, Pfizer could help the GOE save lives as well as protect intellectual property. We will continue to work with the GOE and private sector support these efforts. Scobey