This package demonstratesthe seriousness of purpose in Japan to press forward withstructural reform,'' Michael Gadbaw, a GE vice president andsenior legal counsel, said last week. Many of the deregulation proposals, such as a plan to lowerphone-connection rates, were made a year ago in Birmingham,England, during the Group of Seven industrialized nations summit. Japan promised to reduce by April 2000 the time it takes toapprove new drugs to about one year from more than three now. Andthe government dropped plans for a country-wide reference pricefor pharmaceutical products. U.S. officials had objected that the reference price, often set lower than market prices, would prevent drug companies fromrecouping research costs for new drugs.
Japan bases the price ofnew drugs on the cost of similar new drugs.
Japan agreed to change the way medical insurance companiesreimburse for medical devices, making it easier for companies tocharge more for newer, better technology. As for telecommunications, Nippon Telegraph and TelephoneCorp. is the only phone company in Japan that owns a networkreaching almost every home and business. Lowering those rates would benefit MCI WorldCom Inc. andWinStar Communications Inc., a wireless company that recentlystarted competing in Japan, Harris said. Harris said. ''Theinterconnection rates in Japan have been scandalously high.