[Ip-health] Glaxo on US-Australia FTA

[Mike Palmedo]

http://www.thisislondon.co.uk/news/business/articles/timid79348?source=3D

Glaxo dismisses free trade concerns

Bill Condie, Evening Standard
14 June 2004

DRUGS giant GlaxoSmithKline has dismissed as 'fear-mongering' Australian
concerns that a proposed free trade agreement with the US - due to be
debated in the Australian parliament this week - could erode the
country's subsidised pharmaceuticals scheme.

But a study commissioned by an Australian Senate committee inquiry into
the free trade deal warns that prices of drugs in Australia could rise
steeply.

The managing director of the Australian arm of Glaxo, Daniel Tasse,
dismissed the findings, saying subsidised medicines will be protected
under the agreement.

'If you look at the FTA, it will very clearly not amount to an increase
in drug prices as some fear-mongering here has suggested,' he said.

With Glaxo and other big drugs companies locked in legal battles across
the US in an attempt to limit Americans' access to similarly subsidised
drugs in Canada, the Australian agreement - which gives the companies
unprecedented access to the government's pharmaceutical procurement
process - has become a test case.

The Senate report finds the patent provisions in the deal could delay
the introduction of generic drugs to the Australian market and would
increase drug prices in Australia as multinational pharmaceuticals
companies continue to sell higher-priced proprietary products.

It is a big setback for the drug companies and is likely to increase
hostility to the free trade deal among it many sceptics in the
opposition Labour Party.

'Labour has consistently said it will vote against the free trade
agreement if it undermines the Pharmaceutical Benefit Scheme or
increases the prices of medicines to consumers,' Stephen Conroy, the
party's trade spokesman, warned.

Trade Minister Mark Vaile acknowledged that he is not expecting a smooth
passage of the Bills needed to ratify the agreement and says it is in
the hands of the Senate, the upper house controlled-by a handful of
independents.

The National Prescribing Service, a pharmaceutical information body, has
labelled the deal a 'costly mistake' while an Australian National
University research team says it will force up the costs of the PBS from
=A32.3bn a year to =A33bn. Glaxo denies this and says the new provisions
will lead to more transparency.

The Australian government has already given in to demands that big
pharmaceuticals companies sit in on decisions over what drugs will be
listed under the PBS with a right of appeal. Australian negotiators have
also given assurances that re-importation of drugs to the US would be
banned.