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Second, the agreement may limit competition horizontally. In several OECD countries, associations of pharmacists or pharmacists have been identified that have coordinated prices or restricted entry into professional life. In some cases, associations have limited the ability of individual pharmacists to treat third-party payers individually, which has helped to determine control of potential defectors and stabilize agreements. In some countries, competition authorities have implemented a dual strategy. On the one hand, they have carried out sectoral studies and published reports, for example on the interaction between patents and competition, in order to better understand competition problems in the pharmaceutical sector and to identify relevant market structures. On the other hand, they then used the lessons learned to provide policy direction and to enforce competition law more effectively. It is clear that several developing countries, including China and India, have made considerable progress in increasing their share in the global pharmaceutical and medical market without joining the multilateral agreement. It is significant that restrictions on the export of pharmaceuticals and necessary medical products have been imposed by industrialized countries such as the United States and some European Union countries, said the Trade Representative. For example, Figure 2 shows that India has reduced its average tariffs by 24% since 2001. However, it increased the categories of drugs subject to customs requirement from 9 to 141 over the same period. This extension of the pharmaceutical tariff regime likely offsets the revenue lost as a result of these tariff reductions. Thailand, South Africa, the Philippines and Indonesia are other important countries that have significantly increased pharmaceutical coverage (Figure 6). Given that most of these new tariff lines fall into existing HS categories, it is likely that these tariff hedging increases are deliberate measures to maximize customs revenues.

Follow-up studies carried out by the European Commission on the pharmaceutical sector survey (see Box 4.23) have shown that the number of patent comparisons that are problematic under EU cartel and abuse rules has decreased considerably in the years following the publication of the report. The third European Commission report on the control of patent applications in the pharmaceutical sector, published in July 2012, confirmed that, although the total number of comparisons concluded has increased considerably, the share of problematic comparisons for competition has stabilised, compared with 21% in the results of the sector survey. This shows that the Commission`s action has not prevented companies from making comparisons, contrary to the concerns expressed by some stakeholders in this regard. At the same time, with fewer problematic comparisons, monitoring measures have been able to increase stakeholder awareness of competition issues in general.11 Box 4.23. The European Commission`s investigation into the pharmaceutical sector and related enforcement measures In addition to the growing importance of BMI in the global drug trade, it should be noted that, since 2010, the categories of products covered by the WTO drug agreement have not been updated. This encouraging trend towards the liberalization of drug tariffs over the past two decades reflects a general global shift towards lower tariffs, in addition to the implementation of the 1995 WTO Pharmaceutical Agreement, a WTO multilateral sectoral agreement whereby signatories approve a reciprocal removal of tariffs , which will be extended to all WTO members (see below in this research crisis).