Proposed HCP’s liability for using medicine brand names in prescriptions

Pursuant to art. 14.2(16) of Federal Law No. 323-FZ on the Principles of Citizens' Healthcare in the Russian Federation of November 21, 2011, on December 20, 2012, the RF Ministry of Health (“MOH”) issued Decree No. 1175n on Approval of the Procedure for Assigning and Prescribing Medicinal Preparations, and Prescription Forms for Medicinal Preparations, Procedure for Completing the said Forms, Recording and Storage Thereof ("Decree"), which prohibits HCP to indicate the brand name of a medicine in a prescription. The Decree requires HCPs to state the INN of the medicinal preparationin the prescription, or, if the prescribed medicine has no INN, the relevant group name, and only if there is neither an INN nor a group name for the medicine, its brand name can be stated in the prescription.  Failure to comply with these requirements renders  the prescription invalid, however, no liability is currently provided for the HCP who fails to follow these rules.

In July 2014, MOH drafted amendments to the RF Administrative Code introducing liability for HCPs that fail to comply with the above requirements in the form of a warning or a fine in the amount of from 2,000 to 3,000 rubles. At the time of writing, these draft amendments to the RF Administrative Code are under review by the competent federal authorities and have yet to be submitted to the State Duma by the RF Government.

Intended prohibition on state procurement of foreign medical equipment dropped

In spring, 2014, the RF Ministry of Industry and Trade ("MIT") drafted a resolution providing a total ban on the access of foreign medical products to procurements for state and municipal needs.  The prohibition was expected to affect complex medical equipment, such as tomographic and x-ray apparatus, and other items.

However, the MIT has now changed its position in an effort to preserve competition while encouraging domestic producers with preferences.  Information on the MIT website states that instead of a ban there will be restrictions giving foreign companies access to state procurement tenders only in cases where only one company from a Customs Union country has submitted a bid.  At the same time, this restriction will not apply to goods for which Russian companies are not competitive or do not have sufficient production capacity.  That is, the restrictions will not apply, for example, to perinatal or certain complex x-ray equipment.

Proposed liability for unlawful production of medicines

“Just Russia” deputies have introduced a draft law in the State Duma amending the Criminal Code to provide criminal liability for producing pharmaceuticals without complying with statutory requirements (licensing, organization of production, quality control, manufacturing and release rules) and for counterfeiting pharmaceuticals. Liability is also provided for the sale of such pharmaceuticals. Absent aggravating circumstances, the draft law provides for criminal liability (which under Russian law may be imposed only on an individual) in the form of a fine of 40,000 – 60,000 rubles, correctional labor, or imprisonment for a term of up to three years.  If a person dies as a result of taking the counterfeit pharmaceuticals, if the income from the sale of such pharmaceuticals is too large, or if medicines for children under six years are counterfeited, the court may sentence the criminals to imprisonment for a term of up to eight years. If two or more deaths are caused by the counterfeits, the term of imprisonment increases up to 12 years.

Notably, in November 2013, another group of deputies also introduced a draft law (ref. No. 392886-6) amending the RF Criminal Code, RF Administrative Code and other RF legislative acts to provide criminal and administrative liability for producing pharmaceuticals and medical products without a license, circulation of counterfeit, poor quality and unregistered medicines and medical products, and counterfeit supplements containing prohibited components, and for the production and use of false documentation for medicines and medical products and their packaging. The said draft law passed its first reading in the State Duma on July 1, 2014, and provides for criminal and administrative liability for certain unlawful actions. In particular, it provides for imprisonment for a term of up to eight years with a fine of up to 2,000,000 rubles for the production of pharmaceuticals and medical products without a license; imprisonment for up to 12 years with a fine of up to 5,000,000 rubles (in the event of aggravating circumstances, such as the death of a person or committing the crime by an organized group) for the production, sale, and import into Russia of counterfeit, poor quality, and unregistered pharmaceuticals and supplements; and a fine of up to 1,000,000 rubles or imprisonment for up to three years for the preparation of false documentation for pharmaceuticals or medical products.

These draft laws compete with respect to liability for failure to comply with licensing and quality of medical products requirements, as well as falsification of documents. At the same time, draft law No. 392886-6, adopted recently at the first reading, provides for more systematic and fundamental amendments to legislation.  It would appear that draft law No. 392886-6 has better chances of obtaining State Duma approval.