US and Australia in TPP stand-off

Trade observers say the United States could have to back down from its stance on biological medicines in order to get the controversial Trans-Pacific Partnership signed in the next 24 hours.

Negotiations being held in Atlanta for the 12-nation pact were extended yet again as trade ministers struggle to agree on access to drugs and dairy - two major sticking points.

America wanted at least 8 years' patent protection for biological drugs, while Australia and Chile wanted to keep the status quo of five years.

Biological drugs are next generation medicines that are made by extracting cells from living organisms such as plants and animals.

Speaking from outside the talks, Global Access to Medicines' programme director Peter Maybarduk said the US is not in a strong position.

"At the moment we have the US in one corner and Australia in another...and I'm amazed to say it looks like the United States may just cave."

He said the US would have a hard time getting any deal in the next 24 hours if they insisted on a mandatory eight year minimum monopoly for all countries.

"The path to a deal for the United States probably involves some kind of exceptions, a shorter period for all, or some different kinds of flexibilities."

He said the big question was what New Zealand might do if Australia agreed to a compromise with the US.

University of Auckland professor Jane Kelsey said New Zealand had been very quiet on its stance over biologicals.

"It's a bit worrying - and I know the doctors have made statements to that effect - that New Zealand has not taken as assertive position as Australia in insisting that we won't move further. The Minister seems simply to be concerned about dairy," she said.

A deal on biologics was needed before dairy is tackled, with New Zealand wanting more access to America, Canadian and Japanese markets.

Even if American and Australia reached a deal, other countries would also have to agree to it. However, time was running out. Ministers from the US, Japan, Canada, Mexico and Australia due to leave for G-20 ministerial meetings that start in Istanbul on Monday so the pressure was on to find a solution.

Labour's health spokeswoman Annette King warned New Zealand would face much higher medicine prices and restricted access for life-saving cancer treatments if the Government folded on the deal.

"John Key and his ministers need to be standing up to this pressure and fighting for our health system," she said.

The Trade Minister Tim Groser, who is in Atlanta, was unavailable for comment.