MANN: I ask about that because at one point you wrote that in fact some of these drugs are so badly pirated that they could make people sick who think that they are going to benefit.

FISHMAN: Yes, well there is that, too. You know, there are the renegade factories, probably not the ones run by the government, that copies drugs, but only copy them in form and color, and people who need lifesaving drugs die from them, hundreds of thousands of people have died in China because of this.

And it could also threaten an American company that makes the actual drug, because these false drugs are working their way into the supply chain. So you could have 28 good pills and two bad pills, but those two bad pills could kill somebody. We know what happens when legitimate drug companies have bad drugs. Well, they could get burned from bad drugs from counterfeiters making their way into the vials of drugs that have their own name on them.

MANN: China has been getting a lot of attention, and we've been devoting a lot of attention in this program, to intellectual property theft and copyright piracy. Does China deserve the blame it's getting?

YUEH: I think in a lot of ways the copyright issue has highlighted the main fragility in the Chinese economy, outside of the economic reforms, and that is the legal system. China actually has patent, copyright and trademark laws dating from the mid-1980s, which are essentially at the international standards, in accordance with the Trips (ph) Agreement.

However, implementation and enforcement are entirely different issues, and I think that's why China has been under a lot of criticism to speed up legal reform, so that the legal protections accorded to (INAUDIBLE) and foreign products can meet international standards.

And, of course, the difficulty here is that if there is political posturing, then it could derail attention from actually the most critical part of this issue -- is that it is in China's interest to improve intellectual property rights protection, to foster innovation, both domestic and to give assurance to foreign investors that they can transfer technology and invest in China and it will be a win-win situation for everybody involved.

And if China can't do that, then there is a real danger that it will not gain the productivity advances that it needs to continue its phenomenal rate of growth. So everybody is headed in the same direction. However, a lot of the disputes that we see, it's because there is a lot of both misapprehension and I think a degree of misunderstanding of where China's IPR laws actually stand. But it is true, they still have a long ways to go, and the Chinese are well aware of it.