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EFFORTS TO FIGHT COUNTERFEITED MEDICINE HAVE MIXED RESULTS Russia, Moscow — A Status Report released today by the Association of International Pharmaceutical Manufacturers (AIPM) and the Coalition for Intellectual Property Rights (CIPR) finds that counterfeiting medicines are on the increase in Russia while the legislation to tackle the problem is still only on the drawing board. Robert Rosen, Executive Director of AIPM, the leading pharmaceutical industry group in Russia, said that the Russian authorities need to act faster and more decisively if they are going to control the growing problem of the manufacturing, retailing and use of counterfeit medicines. "Both government and industry research shows conclusively that counterfeit medicines are increasingly available to Russian consumers," said Rosen. "Counterfeit medicines are a menace to public health and a source of lost revenue to both the government and pharmaceutical producers. This is an unaffordable, unsustainable situation for Russia." The Status Report is part of the comprehensive strategy to combat counterfeit medicines developed last October at a conference of government, industry and consumer organizations organized by AIPM and CIPR. The strategy calls for a three-pronged approach to fight counterfeits, including 1) enacting changes to RF legislation in the areas of anti-counterfeiting and intellectual property protection; 2) improving enforcement of existing laws; and, 3) broadening coalitions and cooperation among relevant organizations. The Report analyzes the effectiveness of joint public/private sector efforts to fight the growth of counterfeit medicines in Russia. Joining AIPM and CIPR at the news conference were Tatiana Rodionova, Commercial Director, Aventis, Petr Shelisch, Deputy RF State Duma, Vadim Yakunin, Chairman of the Board of Directors of TsV Protek, and Sergei Zaitsev, Head of the Pharmaceutical Inspection Service. The cornerstone of the report is the findings of the recent AIPM/CIPR survey of pharmaceutical manufacturers that counterfeit medicines account for 12% of pharmaceutical products sold on the Russian market, at a cost annually of $250,000,000 to producers. Previous industry and government estimates put counterfeit medicines in the 2.7% to 7.0% range. Industry experts believe that the imposition of 10% VAT on medicines in January 2002 is forcing consumers to opt for cheaper counterfeit medicines. Although the RF Ministry of Health has prepared amendments to the Federal Law "On Medicines" and other laws to stem the tide of counterfeit medicines, they have not yet been submitted to the State Duma and are still awaiting approval by other government agencies. A package of more generic intellectual property legislation, with the principle aim of protecting well-known trademarks and eliminating "bad faith registration," has passed the first reading in the RF State Duma but still awaits approval in second and third readings before it is forwarded to the President for his approval. "Key progress may be achieved on enforcement with the establishment of the Ministry of Health's Pharmaceutical Inspection Service that will be responsible for certifying all medicines sold in Russia," said Rosen. "However, success will depend on efficient implementation of the Pharmaceutical Inspection Service and avoiding the creation of new bureaucratic barriers that is so common with new government regulations." The recent establishment of Union of Professional Pharmaceutical Organizations (UPROPHARM) and the Ministry of Health's All Region Pharmaceutical League together with the decision by the Confederation of Consumer Unions (KonfOP) to unite efforts in the fight against counterfeit medicines with AIPM and CIPR in Russia are tangible signs of the broader coalition encouraged by AIPM and CIPR. In the next phase of its activities, AIPM will work together with CIPR and other interest groups to support the Ministry of Health's proposed amendments to the Law "On Medicines" as well as continuing to advocate for the enactment of changes to Russia's intellectual property protection and enforcement laws. AIPM will also encourage the RF government to coordinate efforts with EU and WTO member countries to help develop an effective international approach to containing counterfeit medicines through effective laws and enforcement activities relating to intellectual property. Alexander Shelemekh, Vice President of CIPR, noted that international experience shows that legislation is the foundation of robust and effective efforts to fight counterfeiting. "The Russian government has taken some encouraging first steps towards adopting the sort of legislation that is needed. Now it's essential to speed up work and start on the challenging business of enforcing laws. It's important that everyone understands that it's the Russian population's health that is at stake." The report is being widely distributed among top government decision-makers and legislators, including RF President Vladimir Putin. To obtain a free copy of the full report and to learn more about CIPR and AIPM, please visit http://www.cipr.org and http://www.aipm.org.
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