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Cablegate: Egyptian Health, Trade Officials Engage Ustr's

VZCZCXYZ0003
PP RUEHWEB

DE RUEHEG #3297/01 3241425
ZNR UUUUU ZZH
P 201425Z NOV 07
FM AMEMBASSY CAIRO
TO RUEHC/SECSTATE WASHDC PRIORITY 7489
INFO RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY

UNCLAS CAIRO 003297

SIPDIS

SENSITIVE
SIPDIS

STATE FOR EB/TPP/IPE BOGER
USTR FOR GROVES
COMMERCE FOR USPTO KARIN FERRITER

E.O. 12958: N/A
TAGS: ECON ETRD KIPR EG
SUBJECT: EGYPTIAN HEALTH, TRADE OFFICIALS ENGAGE USTR'S
GROVES ON IPR

REF: A. STATE 107629

B. CAIRO 2735

Sensitive but unclassified, please protect accordingly.


1. (SBU) SUMMARY: The GOE is anxious to deepen engagement
with the USG on concerns about Intellectual Property Rights
protection, officials from the ministries of health, trade,
culture, and telecommunications told USTR's Jennifer Groves
during a visit to Cairo on Nov. 12 to discuss USTR's Special
301 Initiative Action Plan. However, GOE health officials
vigorously defended an interpretation of the Trade-Related
Aspects of Intellectual Property Rights (TRIPS) agreement
that fails to adequately protect pharmaceutical test data,
and information technology officials conceded that the
Ministry of Culture -- which has a poor record of IPR
enforcement -- has retained authority for policing optical
discs containing pirated movies, music, and non-functional
copyright-protected material. The GOE experts agreed to
participate in digital video conferences in coming months to
address these concerns in more detail. END SUMMARY.

2. (U) Jennifer Groves, USTR Director for Intellectual
Property and Innovation and Chair of the 301 Committee, and
Karin Ferriter, attorney advisor in the US Patent and
Trademark Office, visited Cairo on Nov. 12 to discuss items
in USTR's Special 301 Initiative Action Plan for Egypt (ref
A) with a team of Egyptian government IPR experts. The
discussions followed on discussions with the GOE by USTR and
Post regarding the release of the initiative action plan in
August (ref B). During her visit, Ferriter also conducted
training with Egyptian design examiners in the commercial
registry office and met with patent office officials
regarding Patent Cooperation Treaty (PCT) minimum
documentation issues.

---------------------------
PHARMACEUTICAL IPR CONCERNS
---------------------------

3. (U) Hesham Ragheb, senior legal advisor in the Ministry
of Trade and Industry, organized a group of GOE experts
including Mokhtar Warida, senior advisor to the Minister of
Health (MOH); two MOH advisory committee experts, Bahaa Fayz
and Fawzy el-Refai; Sherif Hashem, senior official in the
Information Technology Industry Development Agency (ITIDA);
and commercial registry, copyright office, foreign commercial
service, and other GOE agencies related to IPR.

4. (U) Warida stated that the World Trade Organization's
TRIPS Council had ruled that Egypt's 2002 law on intellectual
property rights is compliant with the GOE's TRIPS
obligations. Egypt will protect any confidential
pharmaceutical test data it requires companies to submit as
part of their applications for marketing approval of their
products, he said, adding that he believed no companies have
complained about unauthorized use of their data.

5. (U) Ferriter responded that even if the text of the GOE's
IPR law is considered TRIPS compliant, the GOE's
implementation falls short of its obligations. She cited the
GOE practice of requiring companies to assert they are not
submitting confidential test data as part of their
application, while at the same time admittedly relying on FDA
certificates for marketing approval. The GOE should uphold
the TRIPS principle that companies that invest in
pharmaceutical research should be compensated for their
investment in research for safety and efficacy
investigations, she said. She added that reliance only on
published summary safety and efficacy data and FDA approval
certificates violates this principle.

6. (SBU) Groves commented that this GOE practice was a
"clever way of getting around the obligation" to protect test
data. (NOTE: This is a potential problem because generic drug
companies could win GOE marketing approval for their products
by relying on the innovator's FDA approval during the data
protection period without the innovator's permission. END
NOTE.) Egypt's interpretation of its obligations is isolated
in the international community, she said. Warida responded
that there is no international consensus on how to interpret
these obligations. He also said the data protection
obligations in TRIPS may be interpreted different ways and
noted that the GOE considers the US data exclusivity system
to be "TRIPS Plus," or exceeding Egypt's TRIPS obligations.

------------------------------
COPYRIGHT ENFORCEMENT CONCERNS
------------------------------

7. (SBU) Regarding enforcement of IPR for software, Hashem
said that ITIDA is responsible for keeping pirated functional
computer software out of the Egyptian market, but that the
Ministry of Culture is responsible for IPR enforcement for
copyright-protected non-functional content of optical discs
such as pirated music and movies. Both agencies would have
IPR enforcement responsibility for software products that
include both functional content and non-functional content
such as music or movies, he said. (COMMENT: This was
disappointing and in contrast to our previous understanding
of a 2006 prime ministerial decree that gave ITIDA exclusive
authority over all "computer works (software and database)."
ITIDA officials had said that based on the decree, they
expected to exclusively enforce all optical disc piracy.
ITIDA has been much more assertive in promoting IPR
awareness, while the Ministry of Culture has a long record of
poor IPR enforcement. END COMMENT.)

8. (U) The GOE experts did not dispute Groves' assertion of
widespread pirating of university textbooks, such as an
estimate by the International Intellectual Property
Association that 90 percent of Egyptian medical textbooks are
pirated. In fact, several of the experts were professors and
noted that they write textbooks and personally appreciate
enforcement of IPR in this area. Groves called for more GOE
investigations, arrests, and prosecutions of people involved
in commercial-scale textbook piracy and for the GOE to order
all universities to use legal textbooks. They noted that the
Ministry of Culture carries this responsibility.

9. (U) Hashem responded that textbook companies could help
reduce pirating by offering discounts for legitimate
products. Microsoft successfully adopted a similar strategy
to reduce the use of pirated versions of its software in
government offices, he said.

----------------------
POSITIVE COLLABORATION
----------------------

10. (U) While expressing concern about software enforcement
issues, Groves noted the positive consultations USTR has had
with ITIDA in Washington, USAID support of judicial training,
and ITIDA's support for several cyber crime and IPR
enforcement conferences that include USG experts.

11. (U) During the meeting, both sides agreed to future DVCs
with their experts. The first of which would focus on
pharmaceutical concerns, followed by a DVC on copyright
enforcement concerns.

12 (SBU) COMMENT: While the meeting demonstrated a sincere
interest by the GOE in engaging on IPR issues, it also
demonstrated clearly that stark differences separate the USG
and GOE on adequate pharmaceutical data protection and that
other concerns remain in the Special 301 Initiative Action
Plan. We hope to narrow these differences during the DVCs
and Minister of Health Gabali's upcoming visit to Washington.
END COMMENT.
RICCIARDONE

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