A free trade agreement between Malaysia and the United States will not push drug prices up but instead will generate jobs and woo clinical research to Malaysia, a US business lobby group said.

In past trade talks, Washington has taken a hard line on medical patents, and HIV/AIDS activists here say they are concerned about the deal's impact on access to cheap, generic drugs.

Trade activists and political groups have also voiced concern during a street protest that a Free Trade Agreement (FTA) with Malaysia's top trading partner, the United States, could cost Malaysian jobs.

Vince Lensner, president of the American Malaysian Chamber of Commerce in a letter to the New Straits Times today downplayed the concerns.

"We believe that this will not be the case based upon an historic review of previous FTAs negotiated with the US," he said.

Experiencing a boom

Citing an example of the FTA signed with Australia in 2004, Lensner said that "the generics industry is experiencing a boom."

The net profit for one of Australia's newest generics companies Arrow Pharmaceuticals, grew at 54 percent in 2004 compared with 39 percent in 2003, he said.

Lensner said in neighbouring Singapore, after the signing of the US FTA in 2004, the number of generics in the market increased from 784 in 2003 to 847 in 2004 and to 941 in 2005.

"In conclusion, all available facts suggest that there is no basis to allegations that the generics industry will decline after an FTA with the US," he said.

Washington is racing to conclude the FTA by the end of March to give the US Congress the requisite time of three months to consider the deal.