October 6, 2005

Government sources in Peru have insisted that a Free Trade Agreement (FTA) with the US, set to be signed on Nov. 20, will not lead to higher drug prices. At the same time, Peruvian officials maintain that the government will impose new "mechanisms" to offset any sudden drug price rises, with the country's finance ministry pledging new support for state treatment programmes.

However, talks appear to have hit a stumbling block on the issue of data protection, and it now appears that negotiations between the US and representatives of Colombia, Peru and Ecuador will continue at the highest level on the issue. Some sources -- including those joining recent mass street protests against the FTA -- fear that tough new patent rules could force the withdrawal of many locally made "generics" from the market.

Peruvian health officials are also taking action to preserve a minimum of government control over pharmaceutical prices. The recently expanded Essential Medicines List, which now covers 365 key molecules in 578 presentations, should guarantee a basic level of treatment. The list organises drugs by active ingredient, encouraging generic substitution. The ministry's new "good prescribing practices" guideline for doctors should also restrain spending.

Meanwhile, legitimate manufacturers hope that improvements to Peru's drug registration regime -- a continuing problem for research-based firms operating locally -- will lead to fewer regulatory submissions of copies and more genuine generics. At present, drug registrations in Peru are rushed through in as little as seven days.