EU/SWISS POSITIONS ON SAUDI PHRMA PRICING ISSUES

UNCLAS RIYADH 000666 SIPDIS SENSITIVE SIPDIS USTR FOR JASON BUNTIN USDOC FOR TYLER HOFFMAN E.O. 12958: N/A TAGS: ETRD EINV USTR SA EU SZ SUBJECT: EU/SWISS POSITIONS ON SAUDI PHRMA PRICING ISSUES REF: SECSTATE 38022 ¶1. (SBU) Summary. Econoffs delivered reftel points to Swiss and European Union (EU) officials on April 19. The Swiss Ambassador believes he needs further instructions from the Federal Department of Foreign Affairs in Bern to take additional measures to advocate for the pharmaceutical industry. The pharmaceutical industry has not contacted the Federal Department of Foreign Affairs in Bern to request intervention and must do so if they desire him to take action in Riyadh. The EU will forward USTR's non-paper to Brussels to receive instructions. End Summary. ¶2. (SBU) Econoffs met with the Swiss Ambassador and Deputy Chief of Mission on April 19. The Ambassador shared that he met with Saudi Ministry of Health (MOH) officials twice in 2007 to request that they consult with industry regarding its new pharmaceutical pricing mechanism. He expressed satisfaction that implementation of the pricing scheme was delayed four months. He believes this delay resulted from him (along with the Ambassadors of Belgium and the European Union) meeting with the Minister of Health last fall. Despite this success, he believes that the MOH, unfamiliar with the World Trade Organization (WTO),does not understand that concept of meaningful consultation with industry and that its actions do not comply with Saudi Arabia's WTO obligations. The Ambassador further explained that while local representatives of Swiss pharmaceutical companies (Roche and Janssen-Cilag) have solicited his assistance, the headquarters of Swiss pharmaceutical firms have failed to contact the Federal Department of Foreign Affairs in Bern. He conveyed his frank assessment that the Swiss firms' failure to contact the federal government seemed to indicate the pricing issue is not yet a high priority for them. Given this failure, he will remain passive until he is instructed to act by the Federal Department of Foreign Affairs. The Ambassador encouraged American pharmaceutical companies to work with Swiss pharmaceutical companies to request intervention of the Federal Department of Foreign Affairs in Bern. Further, the Ambassador agreed with Econoffs that the recent appointment of Minister of Commerce and Industry Alireza, one of Saudi Arabia's lead WTO accession negotiators, could offer a promising avenue to pursue our mutual concerns. However, he again felt obliged to wait for instructions from Bern before approaching the Minister of Commerce and Industry. ¶3. (SBU) Econoff met with the First Secretary working on economic issues for the EU on April 19. The EU will forward USTR's non-paper to Brussels to receive instructions. The official shared that the EU Ambassador felt that he had exhausted his means of engaging the MOH on these issues in Riyadh and suggested consideration of raising these issues in the WTO. She explained that the EU had quickly resolved a beef trade issue merely by placing the matter on a committee agenda at the WTO. FRAKER