AMBASSADOR MEETS WITH PHARMACEUTICAL REPS AND

UNCLAS SECTION 01 OF 02 ISTANBUL 000173 SIPDIS COMMERCE FOR GTAEVS FCS ISTANBUL E.O. 12958: N/A TAGS: ECON EFIN FCSC PHUM TU SUBJECT: AMBASSADOR MEETS WITH PHARMACEUTICAL REPS AND PROMISES TO PRESS GOT ON REGULATORY REFORM ¶1. (SBU) (Summary) Ambassador Jeffrey recently met with representatives of the U.S. pharmaceutical industry in Istanbul. The discussion centered upon familiar and long-standing industry problems in Turkey such as market access, patent protection and data exclusivity, as well as conformity with EU standards. The company officials asked the Ambassador for assistance in getting their "Road Map" report into the hands of key Turkish officials, including the Prime Minister. The Ambassador agreed do this, and offered to assist (perhaps combining efforts with the EU representative to Turkey) to push the GOT on passing the new Patent Law. He also promised to try to persuade Alpaslan Korkmaz of the Investment Support and Promotion Agency of Turkey (ISPAT) to reconsider his decision not to send officials to a May 18-21 biomedical convention in Atlanta. End Summary. ¶2. (U) On March 6 in Istanbul the Ambassador met with Jeff Kemprecos of Merck Sharp and Dohme, Chris L. J.J. Stijnen of Bristol-Myers Squibb, Muhittin Bilgutay of Schering-Plough and Serkan Yagcioglu of GlaxoSmithKline to discuss issues of concern to the pharmaceutical industry. ¶3. (SBU) Ambassador Jeffrey noted that, although the United States no longer produces as much steel or manufactured goods as it once did, it still produces and exports high quality products like pharmaceuticals. He added that in Turkey the drug industry is a politically sensitive sector because it is plugged in to a highly socialized medical system, and because poor people need access to affordable drugs. If intellectual property rights are not protected by the government there will be less incentive for the industry to invest and produce in Turkey. "Turkey must play by the rules," he emphasized. The Ambassador agreed to pursue diplomatic efforts to help move the GOT on regulatory reform, the industry Road Map and, hopefully, the Atlanta Biomed convention. THE ROAD MAP ¶4. (SBU) In October 2008 the industry completed an advocacy report known as Vision 2015, also known as "The Road Map", which followed up on earlier reports that called for critical regulatory reforms in Turkey, and which cited Ireland and Singapore as success stories in the realm of biomedicine. In late December of 2008 industry representatives presented the Road Map to Alpaslan Korkmaz, President of the Investment Support and Promotion Agency of Turkey (ISPAT) and his team. Jeff Kemprecos stated that the presentation was a "huge hit" and that Korkmaz promised to arrange a meeting where industry could present the report to the Prime Minister and the Ministers of Health, Labor and Industry. However, 2009 thus far has proved to be a disappointment, with local elections in Turkey dominating the government's focus in the first quarter of the year, and with recent cabinet changes creating an uncertain vetting process for complex regulatory reform issues in the near term. THE ATLANTA BIO 2009 CONFERENCE BLOW-OFF ¶5. (SBU) According to the pharmaceutical representatives, the Atlanta BIO 2009 Conference which begins on May 19 is hugely important to the industry. Kemprecos described it as "our Davos." In early 2009 GOT had confirmed that it would send a fact finding team to Atlanta consisting of seven officials and two ISPAT representatives. However, just a few weeks before the conference all the officials cancelled their trip, citing reasons ranging from the swine flu crisis to the recent cabinet shuffle. REGULATORY PROBLEMS IN TURKEY ¶6. (SBU) In Turkey it takes about two to three years for new medicines approved in the United States or Europe, including cancer drugs, to reach Turkish patients, a period that sector representatives view as far too long. Pricing and licensing approvals are determined by the Ministry of Health (MOH),and the process can take 12 to 24 months or more. Reimbursement for drugs purchased through the socialized health system involves 9 to 12 months or more of negotiations with the Social Security Institute (SGK). In Europe the final price discount on a new drug should be about 11% below the industry reference price, but in Turkey companies routinely are pressured to discount the price ISTANBUL 00000173 002 OF 002 16-17% below the lowest comparable level in the EU. In Europe the registration (licensing) phase is no more than 210 days and the reimbursement decision is given within 90 days. Industry representatives believe that the whole process should take about nine months: six months for licensing plus three months for reimbursement. ¶7. (SBU) In Turkey, data exclusivity (DE) for drugs is limited to six years, and the GOT counts the DE period from the first registration in Europe. Subtracting the two to three years of regulatory approval time required to get a product on the market, a company may only have three years of DE before the generic drug firms can use confidential test data in their own marketing applications. This is roughly one third of the European standard. Europe has an "8 2 1" system which allows a company to apply for up to 11 years of protection. Industry representatives believe the effective protection period in Turkey should be at least six years and that, as in Europe, a company should receive compensation if the effective DE protection period for one of its drugs is shortened due to regulatory delays. ¶8. (SBU) The pharmaceutical industry has pushed hard for Turkey to enact a new patent law which would replace the 1995 Decree. They would like the United States to help push this through, without any amendments. "We have a great opportunity to get a first-class patent law," enthused Kemprecos, but this will require a continued push. Kemprecos stated that the Turkish Patent Law Office (TPI) has been helpful in this regard ("objective and informative") but not the MOH. ¶9. (SBU) (Comment) The strategic relationship between the United States and Turkey is strong, but the bilateral commercial relationship has not always kept pace. Biomed is a sector where an improved regulatory regime could foster significant growth in U.S. investment into Turkey. Turkey is in the top 13 in the world as a health care market, but receives only a USD 140 million share of the annual USD 90 billion research and development (R&D) market in biomed. In contrast, as Kemprecos noted, biomed now accounts for 40% of Singapore's total exports, and Ireland has been so successful in this sector that the industry publicizes "The Irish Miracle." Sector representatives believe that the GOT lacks both the vision and the strategic plan to realize its potential in this field, but that a concerted push to create a better regulatory and legal climate could lead to a substantial payoff for both Turkey and the pharmaceutical sector. End Comment. Wiener