Israel-U.S. Generics Battle Flaring Up

A group of American pharmaceutical companies is urging Washington to leave Israel on the blacklist of countries that flout copyright laws.

These firms, led by giants Johnson & Johnson and Pfizer, argue that Israel doesn't do enough to protect proprietary information and patents, and is lax toward the Israeli companies that develop generic versions of branded drugs. First and foremost among those is Teva Pharmaceutical Industries, the Jerusalem-based company that's become the world's biggest generic drugs player.

The U.S. International Trade Commission has asked the Israeli government for its view on the matter.

Jerusalem, for its part, hopes to end the dispute, which has been going on for three years. The Ministry of Industry and Trade, with the help of the health and justice ministries, is studying how the Israeli drug industry might be affected by amendments to local legislation - with a stress on jobs.

The ministries are also looking at how changes might affect the drug basket, the list of drugs subsidized by the state. Generic drugs are cheaper than branded ones, and it is in Israel's economic interest to increase the proportion of copycat drugs in its health basket.

On the other hand, it is also in Israel's interest not to be perceived as violating the law, so it is working on solutions based on the rules of the World Trade Organization and precedents in other countries, mainly the United States itself.