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Cablegate: Ukraine: Ipr Enforcement Cooperation Group

VZCZCXRO4027
PP RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHKV #2865/01 3271300
ZNR UUUUU ZZH
P 231300Z NOV 07
FM AMEMBASSY KYIV
TO RUEHC/SECSTATE WASHDC PRIORITY 4392
INFO RUEAWJA/DEPT OF JUSTICE WASHDC
RUCPDOC/USDOC WASHDC
RUCNCIS/CIS COLLECTIVE

UNCLAS SECTION 01 OF 02 KYIV 002865

SIPDIS

SIPDIS

STATE FOR EUR/UMB AND EB/TPP/IPE
STATE PLEASE PASS TO USTR FOR BURKHEAD/GROVES
USDOC FOR 4201/DOC/ITA/MAC/BISNIS
USDOC FOR 4231/ITA/OEENIS/NISD/CLUCYCK

E.O. 12958: DECL: N/A
TAGS: ETRD KIPR ECON UP
SUBJECT: UKRAINE: IPR ENFORCEMENT COOPERATION GROUP
DISCUSSES PHARMACEUTICAL INDUSTRY ISSUES

REFS: A) KYIV 1450 and previous

B) 2006 KYIV 4304

1. Summary: GOU, Embassy and industry representatives
discussed IPR issues of importance to pharmaceutical
producers at a November 21 Enforcement Cooperation Group
(ECG) meeting. The Ambassador emphasized the importance of
IPR enforcement generally, and for the pharmaceutical
industry specifically. GOU officials argued that recent
legislative and regulatory changes made as part of WTO
accession marked major progress. Industry expressed
dissatisfaction that the GOU had not fully taken its
comments on previous draft regulations into account. The
GOU pledged to work to improve the transparency of the drug
approval process, and offered to expand its consultations
with industry reps. Econoff urged the GOU to properly
notify pharmaceutical companies of new market approval
applications; the GOU said it was working on the problem
and had only the day before resumed posting applications on
the internet. The meeting's tone was constructive, and it
helped lay the groundwork for improved cooperation between
the GOU and the pharmaceutical industry. End Summary.

2. On November 21 Ukraine's State Department of
Intellectual Property (SDIP) hosted the sixth meeting of
the IPR Enforcement Cooperation Group (ECG), with
participation of numerous industry representatives. (Note:
See Ref A for previous ECG meetings. End Note.) The
meeting focused exclusively on IPR issues of importance to
the pharmaceutical industry. The Ambassador represented
the Embassy and emphasized the importance of IPR
enforcement for Ukraine in meeting international and
European standards. The Ambassador noted the particular
importance of protecting IP rights for the pharmaceutical
industry, and encouraged the GOU to cooperate closely with
industry.

3. The following is a list of key participants:

GOU
---
Mykola Paladiy - Chairman, SDIP
Volodymyr Zharov - 1st Deputy Chairman, SDIP
Olga Baula - 1st Deputy Chairwoman, State
Pharmacological Center
Ludmila Plyuto - Ukrainian Institute of Industrial
Property (UkrPatent)
Oleg Gaschytskiy - State Customs Service
Vadim Vnukov - Security Service of Ukraine

Industry
--------
Igor Mozolevich - Delta Medical
Tatiana Avdeenko - Eli Lilly
Irina Kukovskaya-Rud - GlaxoSmithKline
Mikhail Aristov - Boehringer Ingelheim
Irina Kirichenko - Law Firm "Ilyashev and Partners"
Ludmila Lushpenko - Servier
Yuliya Kobuk - American Chamber of Commerce

(Note: Yuriy Savko, Director of the Association of
Pharmaceutical Research and Development (APRaD), industry's
lead lobbying group in Ukraine, was unable to attend.
Mozolevich represented APRaD on his behalf. End Note.)

WTO-Related Amendments Mark Major Progress...
---------------------------------------------

4. Paladiy and Zharov said that the November 2006
amendments to the Law "On Medical Drugs" providing
pharmaceutical producers with a five-year period of data
exclusivity (ref B) marked a major step forward for IPR
protection in Ukraine. Baula, whose State Pharmacological
Center handles market approvals for medical drugs, seconded
that the corresponding implementing regulations -- Cabinet
of Ministers Resolution No. 503 (dated 03/21/07) and
Ministry of Health Order No. 426 (dated 10/05/07) -- had
clarified regulatory procedures. Baula said that
regulations now required all market approval applications
to include copies of patent licenses, and that any
applications without the necessary documentation were
rejected. She said that the State Pharmacological Center's
Qualification Council met every Friday to review market
approval decisions, and that over 20 percent of
applications were in fact rejected.

KYIV 00002865 002 OF 002

... But Industry Concerns not Fully Taken into Account
--------------------------------------------- ---------

5. Econoff congratulated the GOU on the significant
progress, but cautioned that current procedures likely
needed additional improvement. Mozolevich asked why
industry's proposals on the draft regulatory amendments,
sent twice to the GOU by APRaD and the American Chamber of
Commerce, were not reflected in the final version of the
amendments. (Note: Econoff had participated in meetings of
the American Chamber of Commerce's Health Care Committee,
during which industry worked out detailed proposals on the
draft regulations. End Note.) Baula questioned whether
the Ministry had ever actually received their proposals,
incensing the industry reps.

6. Paladiy stepped in and encouraged industry to send a
copy of all such correspondence to SDIP, so that he could
ensure it received the attention of the proper GOU agency.
Baula subsequently pledged to work with industry to improve
the "transparency and openness" of the drug approval
process. She noted that the Ministry of Health was willing
to introduce additional amendments to regulatory acts, as
needed. Econoff noted that, despite a past failure to
communicate, the potential for cooperation now seemed ripe
-- the GOU was expressing an interest in improving its
regulatory procedures, and industry was ready with specific
suggestions. Paladiy proposed that Baula and industry reps
schedule a follow-on meeting to discuss industry's
proposals in detail.

7. Paladiy also encouraged industry to comment on a draft
Law "On Confidential Information" currently being developed
by SDIP. Baula added that the Ministry of Health was
drafting a law meant to eliminate any conflicts of interest
in the market approval process (i.e. domestic, generic
producers playing a role in application decisions), and
welcomed industry comment on the draft.

GOU Fixing Notification Problem
-------------------------------

8. Econoff emphasized the importance of informing major
pharmaceutical producers when another company tried to
register a drug similar to one already on the market.
(Note: In June, the State Pharmacological Center abruptly
stopped posting notifications of registration applications
on its website. End Note.) Zharov confirmed that the GOU
had promised to address this problem during bilateral
consultations held on the margins of October's WTO Working
Party Meeting.

9. Baula informed participants that the State
Pharmacological Center had resumed posting new market
approval applications on its website as of November 10
(i.e. the day before the ECG), blaming the temporary change
in practice on "technical issues." Mozolevich and
Lushpenko asked if industry would be able to access records
from the five-month period when the website posting was
halted. Baula said yes, but then asked that APRaD send a
formal request in order to aid the process.

Comment: First Step towards Better Cooperation?
--------------------------------------------- --

10. Except for frustration over past communication
difficulties, the tone of the meeting was overwhelmingly
constructive. Baula stayed after the meeting and spoke
privately with individual industry reps for over 30
minutes, at one point telling them, "We're all on the same
side." Following the meeting, Mozolevich confirmed that
APRaD and the American Chamber of Commerce will provide
fresh comments on Ministry of Health Order No. 426 to the
Ministry, and to Baula personally. Post believes there is
goodwill from the GOU and is optimistic that this meeting
will mark the beginning of improved cooperation between the
GOU and the pharmaceutical industry.

TAYLOR

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