Japanese officials today gave a U.S. trade delegation an import plan that they said would meet many U.S. objectives for overseas drug and medical equipment sales.
The head of the American delegation welcomed the move.
"We are pleased with their attitude," said David Mulford, assistant secretary of the Treasury for international affairs. But he added, "You shouldn't overplay the positive element."
One U.S. official said the proposed steps in many cases were vague. Their significance would not become clear, he said, until final rules are published and enforced.
The proposals were contained in a working paper handed to the U.S. delegation this afternoon at the Ministry of Health and Welfare. It contained the formal response to eight U.S. questions in the medical field, which is one of four import sectors that the two governments are discussing.
The package represents a "steady improvement" in the discussions, Kumeo Shirota, a division director in the ministry, told reporters this evening. Asked if it meant Japan was "surrendering", Shirota responded that the United States "had some valid points."
Currently, Japan imports at least $750 million a year in U.S. pharmaceuticals and medical equipment. The total annual market here for pharmaceuticals alone is believed to be about $15 billion.
U.S. companies have contended that Japanese government requirements that drugs and equipment be tested extensively in Japan before being sold, as well as other import regulations, are unnecessary and constitute an unfair trade barrier.
Conducting tests here adds greatly to the expense and time of introducing a product, foreign companies say, without adding to safety in a meaningful way. Currently, companies can wait five years to get the go-ahead for sales.
Japan, however, has defended the rules as necessary to protect public health. The Japanese population's smaller body size and differing racial characteristics can render tests conducted in other societies invalid, it has argued.
Some Japanese also concede the web of regulations serves to protect Japan's growing pharmaceuticals industry, which is viewed as behind the U.S. industry in development of new products.
But in today's presentation, the government agreed in theory to alter some of those principles. Publication of the new rules is to come by July.
Some of the major features of the Japanese package are:
* Foreign clinical test data will be accepted for medical equipment and diagnostic agents used outside the body, such as those used in testing for hepatitis. However, there will be exceptions in both categories. Heart valves and other devices implanted inside the body may require local testing, for instance.
* Japan will continue to study the acceptance of foreign test data concerning drugs used in the body, with an eye to allowing it. However, the government gave no commitment to do so.
* Companies which shift production facilities from one country to another will not have to reapply for approval of the affected products. They will only have to notify the Japanese government.
* Companies making "minor" changes in a drug or device, such as color, will not have to reapply for approval. However, the definition of minor was not specified.
* A foreign company that has licensed a Japanese company to make a product will be able to obtain that license without reapplication if it wishes to begin its own production in Japan. However, this will be allowed only if the Japanese company agrees to it. This is a major point for foreign drug companies, because prior to 1975 they were not allowed to set up plants in Japan, forcing them to license local companies if they wanted to enter the market. Since then, investment rules have been changed to allow them to open here. Companies want to be sure they can get licenses transferred rather than having to apply again.