Drug companies and durable medical equipment manufacturers would see reduced tariffs and improved international protection of patented products under the worldwide trade pact debated by Congress last week.
Medical device manufacturers believe that measures in the General Agreement on Tariffs and Trade, or GATT, would reduce their trading costs by phasing out duties on their products. Drugmakers, meanwhile, expect to cut overseas sales losses because of new worldwide patent protection measures.
The House last week approved the 124-nation GATT in a 288-146 vote. The Senate was scheduled to vote late last week, and surveys of senators indicated it would pass by a narrow margin.
The Health Industry Manufacturers Association said it expects GATT to save durable medical equipment manufacturers $1 billion a year in tariffs once they are phased out over five years. The savings would be passed on to customers, said Ed Rozynski, HIMA's vice president of global strategy and analysis.
U.S. drug manufacturers, which estimate they will have overseas sales of $28.8 billion for 1994, would benefit from a new international intellectual property protection system that would shield patented products from competition for 20 years. That standard is even more strict than that of the United States, which protects patented products for 17 years after a patent is granted.
Pharmaceutical manufacturers said the patent provisions under GATT are needed to protect their investments in developing drugs.
"If there was no adequate intellectual property protection, there would be no research and development," said David Barnes, chief executive officer of Zeneca Group, a British company that manufactures drugs to fight cancer and heart disease.
Steven Berchem, assistant vice president for communications at the Pharmaceutical Research and Manufacturers of America, said the group doesn't have any estimates of how much overseas sales would increase as a result of improved patent protection.
Mr. Berchem said, however, that member companies lose $1.5 billion a year in sales because of inadequate patent protection in just three countries-Argentina, Brazil and India.