VZCZCXRO3066
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHBK #0598 0302341
ZNR UUUUU ZZH
R 302341Z JAN 07
FM AMEMBASSY BANGKOK
TO RUEHC/SECSTATE WASHDC 4440
RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHGV/USMISSION GENEVA 1771
RUCPDOC/USDOC WASHDC
RUEAUSA/DEPT OF HHS WASHINGTON DC

UNCLAS BANGKOK 000598

SIPDIS

SENSITIVE

SIPDIS

STATE PASS USTR FOR B. WEISEL, C. WILSON
STATE PASS USPTO
HHS/OHGA FOR AMAR BHAT, ERIKA ELVANDER
USDOC FOR JKELLY

E.O. 12958:N/A
TAGS: ECON ETRD KIPR TH
SUBJECT: RTG OPEN TO DISCUSSIONS WITH PHARMA "AFTER CL'S ARE
ISSUED"


¶1. On January 29, Minister of Public Health Mongkol na Songhkla
issued a statement officially announcing compulsory licenses (CL) on
Abbott Labs' HIV medicine Kaletra, and the heart medication Plavix,
distributed by Sanofi-Aventis. The official notification for
Kaletra was signed on January 24, and for Plavix the following day.
According to the statement, the CL on Kaletra will be effective for
five years, but for Plavix will have no expiration date.

¶2. Mongkol's statement offered an opening of sorts to
pharmaceutical firms, saying that the government would ask for
voluntary price reductions from the firms before exercising
compulsory licenses. He added less than magnanimously that, "if we
can buy the original drug at a price not higher than that available
in other places, we are willing to buy it." In other words, any
pharmaceutical firm that markets a patented life-saving drug at a
higher price than available generics faces the prospect of a
compulsory license.

¶3. In a phone conversation with Econoff, Dr. Suwit Wibulpolprasert,
the Senior Advisor on Health Economics to the Minister of Public
Health and a driving force behind the CLs, claimed that the Ministry
was open to meeting with pharmaceutical firms to discuss pricing,
but only after the CL was issued. Suwit said that the Ministry had
opted against negotiating beforehand with patent holders, having had
no luck in previous discussions. He insisted that negotiations
would only have delayed the process and would not have resulted in
lower prices, and noted that WTO rules did not require prior
negotiations when used for public non-commercial use. Suwit said
despite pharmaceutical companies protests to the contrary there were
3-4 cases of prior discussions they could publicize, but chose not
to so that "the companies wouldn't lose face."

¶4. Pharmaceutical firms are up in arms over the newest declaration
and are mulling their options, including pursuing litigation.
Lawyers for the local pharmaceutical association (and attorneys of
record for many of the local firms) say they plan to file an appeal
to the Board of Patents on the CL on Merck's drug efavirenz. Thai
law offers the opportunity to appeal a CL decision within 60 days of
receiving notice of the decision. Although there was no official
government decree, Merck received notification on December 12, and
thus plan to file their appeal by February 9 to meet the deadline.
Any further litigation on this and other products may have to wait
until actual deliveries of generic versions of the drug are made in
Thailand.

¶5. The Swiss Ambassador brought up the CL issue on January 29 with
Minister of Commerce Krirk-krai Jirapaet, but the Minister simply
referred the matter to the Ministry of Public Health. Merck had
earlier reported that the Minister had pledged in a meeting with
them that no more compulsory licenses would be issued, but with the
Swiss he offered no more assurances other than that Thailand would
respect its international commitments.

Comment
-------

¶6. The Ministry of Public Health remains determined to forge ahead
with its CL plans, and feels that it is in a strong negotiating
position. To date, no RTG ministries seem to be either willing or
able to intervene in the CL process. Our impression is that, in
terms of group dynamics, the CL process is one "aye" (the MoPH) in a
room full of no-comments (the other ministries). Local media
coverage has been minimal and, aside from coverage of PReMA's press
release, uncritical.