Thailand

Intellectual Property Protection

While the Thai patent act changed in 1999 with the abolishment of the Price Review board, there are still many features of the Thai Patent Act which will not be changed in the pending legislation:

In addition, the draft Thai law introduces new inconsistencies:

Section 36(7) of the Patent Act allows importation of patented products if the patentee permits or gives consent to the manufacture or sale of the aforesaid product.

The current interpretation of the Thai Department of Intellectual Property of Section 39 of the 1992 law is directly opposite to the agreed intent of the law before the law was enacted. The focus is to prevent pending applications from having product claims inserted - as was intended. This calls into question the sincerity of the RTG in providing Intellectual Property Protection.

Draft Trade Secrets Law: Thailand is preparing a new trade secrets law to comply with TRIPS. Unfortunately, Section 11(4) attempts to exclude disclosure of trade secrets by a government agency to protect any "public interest" not having commercial objectives. This is intended to allow the use of registration data for generic regulatory filings.

Parallel Imports: The Thai pharmaceutical market suffers a relatively high level of parallel imports from other parts of Asia, yet neither the Thai FDA nor other authorities has moved to rectify this situation, despite the dangers that such imports pose to national health. There is recent evidence the Thai FDA is being slightly more diligent in enforcing restrictions on parallel imports.


Restrictive Drug Lists

The original list (NLED: National List of Essential Drugs) has been in place for several years and was an adaptation of the WHO 'essential drug list' (designed as a minimal list of drugs that should be available to satisfy basic health care needs in developing countries.) The WHO list maintains some 250 compounds. Thailand expanded its list to about 1,400 compounds, but applied a restrictive pricing scheme to limit reimbursement. Because of the severe price restrictions, companies avoided applying for listing on the National List and sought listing on individual hospital formularies since there were no restrictions on having their products prescribed and reimbursed within the hospital system.

The MOPH recently indicated that the NLED will now become a maximum list for government hospitals and that products with "provisional registration" subject to a "Safety Monitoring Protocol" (SMP) (i.e., Thailand's form of pipeline protection) would be excluded from the list.

The intention of the 1994 Thai FDA Rules on 'Transitory Provision to Conduct Safety Monitoring and Bioequivalence Study of New Drug', to provide pipeline protection for pharmaceutical products patented elsewhere in the world between 1 January 1986 and 30 September 1991 is clearly stated. The procedure required companies to report adverse reactions for a two year period. If requested by the company this could be rolled over for a further "two plus one" year reporting periods during which time the FDA would not accept a registration file for a generic copy. The rules provided up to five years market exclusivity; the only restriction being that sales were restricted to hospitals and clinics (i.e., no drugstore sales).

The treatment of the NLED as a maximum list and the exclusion of the opportunity to have SMP drugs included in the list effectively negates the original intent of the provisions to provide pipeline protection and market exclusivity for new products in Thailand. Innovative products qualifying for the SMP will not be listed or stocked in most hospitals.

PhRMA believes that the Thai Government's removal of the opportunity to market new products through government hospitals is tantamount to setting up a market access barrier to the introduction of new products in Thailand.


Import Policies

Drug and raw material imports are subject to duty which currently ranges from 10% to 30% (In the recent economic stimulation initiative, the duty for certain intermediate hormones was reduced to 1%). The duty rate for drugs where a generic equivalent is not manufactured in Thailand is normally 10%. The duty rate for imported finished goods that compete with locally manufactured product is 20% to 30%. While there are no specific policies which mandate "BUY THAI", the government hospitals are strongly encouraged to buy locally produced products where ever possible.


Standards, Testing and Labeling Requirements

A new chemical entity can be registered in Thailand, but the filing will not be accepted unless a Certificate of Free Sale (FSC) from the country of origin is supplied. Samples of the new drug must be submitted to the Thai Department of Medical Science for analysis prior to acceptance of registration filings. This analysis usually takes 6 months. Once the file is received, the FDA can take up to 18 months ensuring that it is complete, to its satisfaction, before submitting the clinical work to the Review Committee for consideration. The Committee may ask additional questions or require that a local study be carried out to ensure that the clinical data can be duplicated in Thailand by Thai national companies under local conditions.

The Thai FDA has implemented "user fees" to quicken the registration process and this policy has improved registration timing. However, these user fees are being politically challenged and may be eliminated in the near future. If this occurs, registration timing may fall back to the old two year filing term.

The Ministry of Public Health has eliminated the requirement for sample analysis before filing of registration dossiers. The Ministry still requires an FSC to allow filings for imported products. An FSC is not required for regulatory filings where the product is to be based upon local production. PhRMA believes this is in contravention of WTO principles of national treatment.


Government Pharmaceutical Organization

This organization is exempted from registration and Good Manufacturing Practice requirements and has rights to an exclusive position in supplying government hospitals with products on the National List of Essential Drugs. PhRMA believes this also is in contravention of WTO principles regarding national treatment.


Potential Exports/Foreign Sales

From Thai-based sales data and from estimates based on the size and buying power of the Thai population, PhRMA estimates that the potential market for its companies could be US$70 million, if the aforementioned barriers were removed.

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