QUITO -(Dow Jones)- Ecuador's President Rafael Correa has signed a decree to grant mandatory licenses for local laboratories to produce local medicines currently protected with patents, aiming to lower prices for medicines.
The decree, signed on Friday, gives exceptions for cosmetic products.
It also says that royalties will have to be paid for use of the licenses.
There are about 2,214 pharmaceutical patents in Ecuador, where 243 pharmaceutical firms operate. Of those, 177 are foreign, and cover 87% of the annual sales of $720 million.
Local units of Pfizer Inc. (PFE), Grunenthal and Bayer (BAYN.XE) are among the foreign pharmaceutical firms operating in the country.
Renato Carlo, President of the Association of Ecuadorian Pharmaceutical Laboratories, said the process to change the patents into production licenses could take six months to a year.
The Ecuadorian Institute of Intellectual Property estimates that about 200 products will be among the medicines that will require the licenses.
Correa has said that his government doesn't believe in patent rights, saying they are only "to protect the pockets of the multinational companies."
Correa has also said his government will require mandatory licenses to produce agrochemicals and software programs.
-By Mercedes Alvaro, Dow Jones Newswires; 5939-9728-653; mercedes.alvaro@dowjones.com