4/85 MEDICAL EQUIPMENT AND PHARMACEUTICALS

The US has asked Japan to simplify its testing standards so that the US can increase it sales of American medical supplies in Japan. The US has asked Japan to drop a requirement that testing be accomplished on Japanese before a product can be sold in Japan, regardless of testing results abroad. The US has also asked that American experts be permitted to express their opinions at the meetings of Japan’s Pharmaceutical Affairs Council. Japan flatly rejected the latter request. The Ministry of Health and Welfare later decided to accept US clinical test data on medical equipment. In return for this Japan wants the US to exempt Japanese exporters to the US of similar requirements. In 1983 Japan exported some 85 billion yen in medical equipment to the US, while the US exported 62.5 billion yen in equipment to Japan. In terms of pharmaceuticals, Japan imported some 117 billion yen from the US in 1983 compared to 43 billion yen in imports from Japan by the Americans. Concerning the authorization of the imported pharmaceuticals, Japan has decided to accept clinical data from abroad if the drug is authorized in developed countries and it is confirmed to be effective regardless of race. However, concerning experimental data on patients, the ministry’s advisory body recommended that tests on Japanese still be required. The US has required that tests be made on whites, blacks and Orientals for drugs to be sold in the US.

On the other hand, the pharmaceuticals subcommittee of the American Chamber of Commerce in Japan said that the measures announced by Japan fell far short of American demands. Concerning the testing data, the Americans noted that Japan has since 1983 accepted clinical data from abroad if it is also conducted on Japanese subjects. Moreover, this acceptance of foreign data applied only to the first of 3 clinical testing stages. These new standards also only applied for drugs widely used in developed countries and that has been proven not to be affected by racial differences. In other words, these new standards would only apply if the drug had been on the market in other nations for one or two years in advance of Japanese application. Due to the competitiveness of the Japanese market, the lengthy approval process and the short time limit on pharmaceuticals patents, most drug makers want to submit their applications as soon as possible, not wait one or two years. The Americans had requested that the Japanese adopt a system similar to that of US FOOD and Drug Administration which will accept foreign data if comparative studies on native subjects have proven that racial differences do not affect test results.

As in case in telecommunications, in pharmaceuticals as well, the Americans want transparency in the drug approval process. In contrast to the US where new drugs are reviewed publicly and the maker is given a chance to defend his product, in Japan the approval is all done behind closed doors.

The Americans are also seeking the right to be able to transfer license to manufacture drugs from one company to another without having to start anew in the testing process. The ministry has agreed to discuss this but fears such transfers will result in the proliferation of sales of copied drugs. (which does not say too much about the confidence of the ministry in Japanese firms respecting licenses or foreign technology rights)

The Americans also seek simpler procedureS to change the country of manufacture of medical equipment imported, change the address in Japan of an importer and to market products with minor modifications.

The ministry did make some modifications in the nationalized medical health scheme to help use imported equipment. It had been founded that Japanese doctors had been using Japanese continuos ambulatory peritoneal dialysis equipment instead of a superior American product, simply because they received greater insurance payments to use the Japanese one. This has now in theory been changes.

Nevertheless, the conclusion of the president of the Japan subsidiary of Searle on these new market opening measures was:

"This is nonsense and is just no concession whatsoever. What it means is we have to carry out the things as before."

(JAPAN TIMES 4/4/85, p.8)

JAPAN LAWLETTER. April 1985. By Roderick Seeman