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Monday, July 21, 2008

Rice wants "serious answer" from Iran

U.S. Secretary of State Condoleezza Rice warned Iran on Monday that it faced more sanctions if it defied a two-week deadline to agree to curb its nuclear program.

Rice said Iran was stalling and must give a "serious answer" within the deadline set by six world powers which offered trade and technical incentives if Tehran halts its uranium enrichment. The West fears Iran wants to build a nuclear bomb.

"We are in the strongest possible position to demonstrate that if Iran does not act then it is time to go back to that (sanctions) track," Rice said,

It was her first comment on the subject since Washington broke from usual policy and joined nuclear talks with Iran in Geneva on Saturday.

Rice, speaking to reporters on her way to Abu Dhabi en route to Asia, said the United States would impose more bilateral sanctions on Iran and the Europeans would look at what they could do if Iran failed to meet the world powers' demand.

"The main thing is we will have to start considering what we do in New York," she said, referring to the Security Council which has imposed three rounds of sanctions on Iran.

Envoys from the United States, Russia, China, France, Germany and Britain -- the so-called sextet of world powers -- attended the Geneva meeting.

Iran's top nuclear negotiator, Saeed Jalili, said at the next meeting Iran would not discuss the demand to freeze its sensitive atomic work which the West fears is aimed at making bombs. Iran says its aims are peaceful.

But Iranian President Mahmoud Ahmadinejad gave an upbeat assessment on Sunday. "Any negotiation that takes place is a step forward," he told reporters, according to IRNA news agency.

A senior Iranian official said Iran was ready to respond to any positive U.S. overture but it was unclear whether Washington had decided between diplomacy and force.

The U.S. government was "indecisive about whether to lean on diplomacy or the military option", said Deputy Foreign Minister Alireza Sheikh-Attar, according to the student news agency ISNA on Monday.

Turkish Foreign Minister Ali Babacan, briefed by Jalili in Istanbul on Sunday, said: "There is no reason to be hopeless. The process continues but it would not be right to raise expectations too high."

NO MORE "SMALL TALK"

Rice said Iran's envoy to Saturday's talks, attended by senior U.S. diplomat William Burns, engaged in small talk rather than address the central issue of the sextet offer.

"I understand that it was at times meandering," Rice said.

She said EU foreign policy chief Javier Solana "clarified" Iran's choices at the talks.

"It was also a very strong message to the Iranians that they can't go and stall and make small talk and talk about culture and that they have to make a decision," said Rice.



U.S. attendance at the Geneva talks was an about-face and comes as Washington is considering whether to open an interest section in Tehran, which would allow for diplomatic contact while falling short of diplomatic ties.

The United States broke ties with Iran nearly 30 years ago.

"We are always looking for ways to relate to the Iranian people and to make it easier for them to relate to us," said Rice. She said such a move should not be seen as a thawing of relations.

Rice said there were no plans to join further nuclear talks unless Iran met conditions to give up the enrichment work. She said the decision to join the Geneva talks was to show U.S. commitment to the incentives offer to Iran.

"I think we have done enough to demonstrate that the United States is serious and to assure our partners that we are serious and to show the Iranians that we are serious. I think we have done enough," Rice said.

Ranbaxy probe highlights medical issues

When US regulators raised concerns during their visit to a factory operated by Ranbaxy, the Indian generic drugs group, no one involved imagined that their inquiry would last so long, become so public or raise the stakes so high.

Since an inspection by the Food & Drug Administration (FDA) at the Paonta Sahib plant in February 2006, there has been a drawn-out battle for extra information, triggering raids and subpoenas last year from the Department of Justice.

But it was only in the past few days, after the US attorney's office for Maryland filed a court motion to force disclosure of more internal documents from Ranbaxy, that unusually detailed claims have emerged.

The filing alleges "a pattern of systemic fraudulent conduct, including submissions by Ranbaxy to the FDA that contain false and fabricated information . . . failure to timely report the distribution of drugs that were out of specification and attempts to conceal violations of good manufacturing practices".

The accusations could have great impact. In the US alone, Ranbaxy last year reported sales of generic drugs of $390m. It has been an important supplier of antiretroviral medicines to treat HIV patients in the developing world via Pepfar, the US government's Aids programme. It has ambitious plans elsewhere.

Ranbaxy, which stresses it is fully co-operating with the authorities, calls the claims "baseless". It adds that samples of its products have been independently tested and found to be compliant. No charges have been filed against the company.

The spat comes at a time of heightened public concern over drug quality following the discovery in the US at the start of this year of life-threatening substandard Heparin, a blood thinner, in which contamination in raw materials supplied from China was found.

The saga highlighted the difficulties for US regulators to accelerate their capacity to conduct foreign inspections to keep pace with the jump in the purchase of raw materials and manufactured drugs coming from Asia.

For Ranbaxy, the timing is sensitive; last month,Daiichi-Sankyo of Japan announced its intention to buy control of Ranbaxy for up to $4.6bn as part of a process diversifying from its traditional innovative medicines base into the generic drug sector.

News of the US probe has depressed both companies' share price on fears the deal could be called off - a suggestion firmly denied by both groups.

The allegations are not the first concerns involving the company. In 2004, it and Cipla, another Indian generics producer, withdrew antiretroviral medicines for HIV after inspections by the World Health Organisation identified "serious discrepancies" in clinical tests conducted by a common third-party contractor.

But the storm may prove overblown. Inspections constantly raise concerns in western innovative companies as well as generic companies, but details are rarely made public.

Stripped of the aggressive language in the Department of Justice's motion, the FDA's inspection report highlighted sloppy procedures at Ranbaxy and inadequate records to audit its processes, but did not prove that substandard drugs liable to harm patients were being produced.

Whatever the outcome, the case highlights two broader issues concerning quality of medicines. The first is that even good manufacturing practice" inspections such as the FDA's only examine procedures in place at the time of a spot check. There is a case for more frequent follow-ups, and regular testing of batches of medicines delivered to ensure they meet quality standards.

Second, in countries such as India, with a large and vibrant generic drugs sector, there are often different standards for drugs manufactured for domestic use, and those destined for export which are subject to far tougher regulatory scrutiny. Convergence of the two will be an area of increasing attention.

Top U.S. admiral says strike on Iran means turmoil

White House military adviser Adm. Mike Mullen said on Sunday he was concerned that any U.S. or Israeli strike on Iran carried a notable risk of more turmoil in the Middle East.

"I think it would be significant. I worry about it a lot," Mullen, chairman of the Joint Chiefs of Staff, told the "Fox News Sunday" television program.

U.S. officials have played down fears of a military strike against Iran over its nuclear program, which Tehran says is for peaceful purposes. But Israel fears Iran is seeking to build atomic weapons, and speculation it would bomb Iranian nuclear installations has grown since a big Israeli air drill last month.

"I worry about the instability in that part of the world and ... the possible unintended consequences of a strike like that," Mullen said.

He said it would be difficult to predict the impact throughout the region or what actions the United States would have to take to contain it.

"Right now I'm fighting two wars, and I don't need a third one," Mullen said, speaking of U.S. military engagements in Iraq and Afghanistan. But he quickly added the U.S. military would be capable of handling another front.

Alternately, he added, the risk of doing nothing is also big.

"It's a very, very tough problem," Mullen said. "But that's where I think this international community -- and the pressure has got to continue to be brought specifically on Iran to not proceed in this regard."

Iran faces tougher sanctions after talks on reining in its nuclear program ended in a stalemate on Saturday despite unprecedented U.S. participation.

Mullen said he believed the Iranians are intent on building nuclear weapons. "We need to figure out a way to ensure that that doesn't happen," he said.