American companies operate face considerable trade barriers and theft of intellectual property in Jordan. Major concerns are as follows:

Intellectual Property

Until the present time, Jordan has represented the leading source of pirated pharmaceuticals in the Middle East region. As piracy of software, videos, publications and pharmaceuticals flourishes, Jordan has earned the dubious distinction of ranking among countries with the highest per capita rates of intellectual property infringement. PhRMA strongly supports the upcoming accession of Jordan to the WTO on the basis of the Government of Jordan's commitment to meet the requirements of the TRIPS Agreement. As part of its accession package, it is our understanding the Jordan has agreed to provide full pharmaceutical product patent protection, data exclusivity, and to stop production and export of pirate copies of pharmaceutical products no later than April 2, 2000.

The latter point is particularly important in view of a recent survey of 18 multinational, research-based companies that shows that during the period from January 1996 until June 1999, Jordanian companies have applied for or registered nearly 100 pirate copies of internationally patented pharmaceutical products. More than 50% of these products are American in origin. PhRMA estimates that American company losses exceed $25 million annually, primarily in the domestic and export markets in the Middle East and North Africa.

Indeed, as awareness of the WTO/TRIPS agreement spreads in the region, Jordanian companies appear to be accelerating registration of unauthorized (pirate) copies both domestically and abroad in a attempt to "grandfather" their marketing authorizations. In Qatar, a Jordanian generics company is aggressively registering nearly a dozen pirate copies of top selling American and European pharmaceutical products. Other Gulf countries and Lebanon remain particularly vulnerable in the lead up to effective patent protection in the region. Even more of a concern was the recent attempt by the Ministry of Health to register up to 60 copies of patented pharmaceutical products in the last week of November prior to the entry into force of the new patent law. PhRMA appreciates the strong support of Ambassador Burns as well as other senior USG officials that prevented this outcome. Throughout the same period during which the Government of Jordan was preparing its accession package, however, the Ministry of Health has provided rushed and incomplete reviews of dozens of copied pharmaceutical products, and we ask for a comprehensive review of these activities to invalidate these registrations, both to protect public health and to ensure that American companies receive the full benefits of Jordanian accession to the WTO.

Regulatory Discrimination

Multinationals may not import new products into Jordan without providing extensive documentation and proof of registration from "reference" countries, such as the FDA in the USA. These procedures are overly complicated and long, and local officials often repeat testing on these proven, high quality products, thereby exceeding international guidelines. The onerous regulatory review slows the commercialization of new products and delays availability to patients. In fact, Jordan lags up to 2-3 years behind other countries in the region in its capacity to evaluate and approve new medicines; bureaucratic delays pose a significant trade barrier. By contrast, local companies do not face such high regulatory and testing hurdles, and often register new products in a fraction of the time facing multinationals. Also, there have been documented cases of "queue-jumping," whereby local companies with connections to Government officials have been known to achieve regulatory review priority, thereby moving ahead of multinationals with pending dossiers in queue.

Overall, there is a lack of transparency and fairness in the regulatory system. One well-known example occurred when the ministry approved several pirate copy registrations simultaneously with original products that had been submitted many months earlier.

Pricing Discrimination

The Government has allowed inflation adjustments or price increases varying between 5-50% for locally produced goods. Multinationals have not been granted similar increases, despite the fact that multinationals face the similar inflationary pressures. By contrast, Jordanian health officials often compel foreign companies to accept lower prices than those requested by the company, irrespective of the product's superior quality or added value to the healthcare system and patients. In some cases, the negotiations drag on fruitlessly for many months, delaying market entry and availability to patients. Also, increasingly, companies have been compelled to accept prices that do not reflect an adequate return on investment. As a consequence, the introduction of new medicines is deterred. The unavailability of new medicines carry inevitable consequences for patients and the health care sector, which the Government is targeting for growth, especially in the area of "medical tourism," whereby Jordan aspires to be a regional health care center.

Public Sector Procurement Discrimination

Government officials often speak publicly of their support for the "Arab" pharmaceutical industry. As a policy matter, Jordan allows local companies to win public sector tenders at prices up to 20% of the bid price of imported products, a blatantly protectionist and discriminatory practice.

Infringement of Copyright and Proprietary Data

Enforcement of copyrights and trademarks is very weak, allowing local Jordanian companies to copy freely an innovator's product label, insert and promotional material, thereby misleading health care providers and patients. The misrepresentation and infringement of copyrighted, trademarked and original scientific materials are of serious concern. Local companies routinely copy American promotional materials and cite clinical data performed on the original product, implying that the clinical data refer to the performance of the copy product, which have little or no data to support claims.

Potential Exports/Foreign Sales

Widespread piracy, a lack of transparency, and discrimination in procurement and pricing have historically contributed to significant US pharmaceutical company losses in Jordan. Pirate domestic sales and exports by Jordanian copy-cat firms are responsible for tens of millions of dollars in lost US export sales. PhRMA believes that American exports to Jordan and the region will improve significantly, and at the same time, open new opportunities for investment, technology transfer and spending in Jordan, once Jordan completes WTO accession and comes into full compliance with the TRIPS Agreement.