92002E1143

WRITTEN QUESTION P-1143/02

by Jonas Sjöstedt (GUE/NGL) to the Commission

(15 April 2002)

Subject: Future cost of pharmaceuticals

In its answer to Question No P-0234/02(1), the Commission states that parallel imports of pharmaceuticals may have a detrimental effect on the research and development industry.

According to Ian Senior (NERA special adviser), the loss of revenue to the pharmaceuticals industry as a result of parallel imports is approximately equivalent to the cost of developing a new drug. In its decision to prohibit Glaxo Wellcome's dual pricing system, the Commission stated that the losses of revenue are too insignificant to affect these investments to a considerable extent and, indirectly, that they can be offset by reducing marketing costs. Parallel imports account for approximately 2 % of total pharmaceutical sales in the Union. On average, parallel importers buy pharmaceuticals at some 30 % less than the domestic sale price.

How is it possible that an approximate 0,6 % loss of revenue can have a detrimental effect on the research and development industry?

(1) OJ C 277 E, 14.11.2002.

Answer given by Mr Verheugen on behalf of the Commission

(31 May 2002)

The Commission confirms that, within the internal market, free movement of pharmaceutical products may be beneficial for the consumers and national social security schemes since they provide consumers with a broader choice of pharmaceutical products at a lower price through enhanced competition within the internal market. Such considerations have been taken on board in the case law to which the Honourable Member refers.

As regards the protection of industrial property rights for pharmaceutical products, the Union recalled in the context of enlargement negotiations- the importance it attaches to the existence of an equal level of protection of industrial property rights within the enlarged Union.

In its reply to written question P-0234/02 by the Honourable Member(1), the Commission indicated that the Union in the context of enlargement negotiations has proposed a specific mechanism in order to minimise potential problems resulting from the differences relating to the level of industrial property rights protection. Taking into account the date of introduction of patent protection in the candidate countries, all medicinal products which were marketed in the applicant countries before the change in the legislation took place, will remain unprotected there while they are still under patent in the Union. Therefore, this mechanism refers to the overall level of Intellectual Property Rights (IPR) protection and will only apply to products patented in a Member State at the time when a product patent could not be obtained in candidate countries for that product.

The Union considered that this solution constitutes an objective and balanced mechanism which takes into account the legitimate interest of the patent holders within the Union whilst it does not infringe or undermine any existing rights of operators in the candidate countries.

(1) OJ C 277 E, 14.11.2002.