Court asked to suspend Roche drug distribution

Court asked to suspend Roche drug distribution

JAKARTA (JP): Drug distributor company PT Perusahaan Dagang
Tempo has requested that the South Jakarta District Court order a
temporary stop to the distribution of some products of drug
company PT Roche Indonesia while a hearing of a dispute between
both parties was in progress.

Roche's lawyer Todung Mulya Lubis said the request, if
approved by the court, would result in the suspension of Roche's
generic and over-the-counter drug production in Cimanggis, Bogor,
West Java.

"This is a different way of demanding the company's shutdown,"
Lubis told reporters at a news conference.

Tempo further demanded that Roche be fined Rp 500 million
(US$65,000) a day if it failed to comply with the provisional
ruling.

Lubis said the court would hold the next hearing of the case
next Thursday but he did not explain if the court would decide on
Tempo's request that day.

Tempo filed a lawsuit against Roche at the South Jakarta
District Court last October for annulling a contract appointing
the former as a distributor of Roche's generic and over-the-
counter drug products on the domestic market.

Generic and over-the-counter products are drugs that can be
purchased without a doctor's prescription.

While the examination of the lawsuit was in progress, Tempo
filed another lawsuit at the same court in March charging Roche
with wrongfully transferring Tempo's distribution rights to its
competitor.

Lubis described Tempo's second lawsuit as redundant, saying it
dealt with the same issues as the first lawsuit.

Lubis said Roche's contract with Tempo allowed the former to
annul the contract without reason in return for Tempo's
distribution rights for an unlimited period.

Lubis further said the distribution was mostly conducted by
Roche rather than Tempo.

"Roche had some 80 people working with Tempo for the
distribution," he said.

Lubis further asserted that the court should have turned down
the lawsuit right from the outset because Roche and Tempo clearly
stipulated in their distribution agreement that any dispute
arising between them which could not be settled amicably should
be settled by arbitration in the English language and held in
Jakarta under the Rules of Arbitration of the Indonesian National
Board of Arbitration (BANI).

However, Roche's demand was rejected with the issuance of a
provisional ruling, which stated that the district court was
entitled to handle the case.

The court also sequestered Roche's assets, including its land
and factory in Cimanggis, Bogor; its machines and all
manufacturing equipment on the land and in the factory; as well
as spare parts and half-finished goods there.

Lubis said the case set a bad precedent for foreign investors,
as it showed how weak Indonesia's legal system was.

"Our President traveled around the world to lure investors,
while our courts here throw existing foreign investors out," he
said.

Meanwhile, Tempo's lawyer Amir Syamsudin said his client was
only demanding that Roche honor the present court process and not
transfer the disputed distribution rights to another party.

"Roche must maintain a status quo position on over-the-counter
drug distribution while the case is still in process," he said.

He further questioned the sudden cancellation of Tempo's
distribution agreement, after the company had distributed Roche's
products for over 25 years. (bkm)