Healthcare Singapore Newsletter February 2016 In This Issue: Chapter 2 Of The HealthTech Report Launched Trans-Pacific Partnership Agreement Signed South Korea's NHIS Authorised To Collect Insurance Damages From Pharmaceutical & Medical Device Companies Without Litigation AVA Introduces Amendments To Singapore's Food Regulations HSA Warns Public Of Undeclared Western Medicinal Ingredients In Health Products Recent Developments In Indian Food Laws Chapter 2 of the HealthTech Report Launched Following the first chapter on "The Creative Destruction of Healthcare", Chapter 2 of The HealthTech Report on Data-driven Healthcare was launched in February 2016. The HealthTech Report has been developed by Baker & McKenzie in partnership with The Propell Group, a boutique venture investor and advisory firm focused on healthtech early-stage companies. This chapter addresses the legal point of view on genomics, telemedicine, mobile health applications and highlights regulatory concerns for new technology, amongst others. The next issue will feature Funding. The HealthTech Report is available for download on the App Store and as a PDF version here. For more information about The HealthTech Report, please contact Local Principal Lim Ren Jun at +65 6434 2721 / [email protected] Trans-Pacific Partnership Agreement Signed On 3 February 2016, the 12 countries comprising the Trans-Pacific Partnership ("TPP") signed the TPP Agreement in Auckland, New Zealand. The member nations now have 2 years to ratify the trade pact domestically. If full agreement amongst the 12 nations is not reached within this time period, the TPP will require approval by at least 6 countries, accounting for 85% of the combined gross domestic production of the 12 nations, to come into force. Both the United States and Japan will have to ratify the deal, given the size of these countries' economies. For an overview of the TPP, please refer to our October 2015 newsletter here. South Korea's NHIS Authorised to Collect Insurance Damages from Pharmaceutical & Medical Device Companies Without Litigation On 3 February 2016, the Korean National Assembly passed an amendment to the National Health Insurance Act, granting the National Health Insurance Service (“NHIS”) administrative authority to collect losses incurred by the NHIS, an insured or an insured’s dependents from certain unjust conduct by pharmaceutical and medical device companies. This means that the NHIS will no longer need to bring civil claims for unjust enrichment against such companies. Instead, it can collect damages based on violations. Such violations include: (a) unjustly influencing the NHIS to provide unnecessary healthcare benefits or causing an insured to make 2 | Healthcare Newsletter unnecessary healthcare co-payments; or (b) unjustly influencing the Ministry of Health and Welfare's reimbursement decisions. The NHIS will have administrative authority to collect and to reimburse the insured or the insured’s dependent for losses resulting from any violations occurring after 4 August 2016, when the amendment comes into force. AVA Introduces Amendments to Singapore's Food Regulations Following a public consultation by the Singapore Agri-Food and Veterinary Authority ("AVA") which concluded in December 2015, new amendments to the Food Regulations have come into force on 2 February 2016. The amended regulations introduce the following key changes: Food products labelled as "organic" must be certified as organic under an inspection and certification system that complies with the Codex Guidelines for the Production, Processing, Labelling and Marketing of Organically Produced Foods, GL 32-1999, or equivalent (Regulation 9B(5)); Advantame has been added to the list of permissible sweetening agents (Regulation 18); Bovine lactoferrin is now allowed in infant formulas, in an amount not exceeding 100 mg per 100 ml (Regulation 252); “Incidental constituents” under Regulation 29 now include veterinary drugs (previously it was "antibiotic, oestrogen" only). In conjunction with this amendment, a definition for “veterinary drugs” (based on Codex definition) has been included; The term "modified starches" may be used on labels as a general term for the various starches listed in the First Schedule; and Regulation 93 now prohibits the import, sale and advertisement of raw milk intended for direct human consumption. HSA Warns Public of Undeclared Western Medicinal Ingredients in Health Products The Singapore Health Sciences Authority ("HSA") is alerting members of the public not to purchase or consume three complementary health products that were tested to contain undeclared Western medicinal ingredients which could cause serious adverse reactions. The adulterated complementary health products were found to contain dexamethasone, chlorpheniramine and diclofenac, all of which are listed poisons under the Poisons Act. Whilst complementary health products (including traditional medicines, Chinese proprietary medicines and health supplements) are currently not subject to pre-marketing approvals, the labels 3 Healthcare Newsletter should minimally have a list of ingredients featured, which these product labels did not have. Under the Poisons Act, anyone who imports, sells or supplies without a licence, any products containing ingredients which are regulated under the Poisons Act, may be fined up to S$10,000 (about US$7,000) and/or jailed up to 2 years. For more information, please refer to the HSA's media release here. Recent Developments in Indian Food Laws (This article was contributed by Pawan Chopra and Mohan Rajasekharan of Dua Associates, India) In the November edition of this newsletter (link), it had been reported that there was an impasse in the Indian food industry following the decision of the Supreme Court of India upholding the Bombay High Court’s decision striking down all advisories on Product Approval (a pre-market approval process). On account of the uncertainty surrounding the status of foods such as Proprietary Foods, Novel Foods, Health Supplements, Nutraceuticals, etc., introduction of foreign products as well as new products was put on hold by several companies. Broadening The Regulations On 4 August 2015, the Food Safety and Standards Authority of India (“FSSAI”) notified (for public comments) the draft regulations on food additives (“Draft Regulations 2015”), which sought to broaden the standards for various food additives and formally introduce the food category system for assigning food additive uses. It would be relevant to understand that prior to the notification of the Draft Regulations 2015, Regulation 3.1 of the Food Safety and Standards (Food Products Standards and Food Additives) Regulations, 2011 (“Food Additive Regulations”) laid down the standards for approximately 370 food products. However, the Draft Regulations 2015 proposed food standards for over 1000 products. On 23 December 2015, the FSSAI published on its website the notice on operationalisation of standards of food additives for use in various food categories (“December 23 Notice”), further to which the FSSAI brought into force with immediate effect, most of the standards of food additives that were provided in the Draft Regulations 2015. Accordingly, all food products, which met the specific standards prescribed in the December 23 Notice, were permitted to be introduced in the Indian market. However, the uncertainty on Proprietary Food (broadly defined to mean an article of food for which no standards were specified but is not unsafe) still continues. What Constitutes Proprietary Food? The 2016 New Year has brought in a ray of hope for food business operators as, in a move welcomed by all, the FSSAI introduced a revised definition of Proprietary Food. On 15 January 2016, the FSSAI notified the Food Safety and Standards (Food Products Standards and Food Additives) Amendment Regulations, 2016 (“2016 Amendment Regulations”) which introduced the following amended definition of Proprietary Food: 4 | Healthcare Newsletter “(1) Proprietary food means an article of food that has not been standardised under these regulations, but does not include any novel food, food for special dietary use, functional food, nutraceutical, health supplement and such other articles of food which the Central Government may notify on this behalf. (2) Proprietary food shall contain only those ingredients other than additives which are either standardised in these Regulations or permitted for use in the preparation of other standardised food under these Regulations. (3) Proprietary food shall use only such additives as specified for the category to which the food belongs and such category shall be clearly mentioned on the label along with its name, nature and composition. (4) Proprietary food product shall comply with the food additives provisions as prescribed in Appendix A and the microbiological specifications as prescribed in Appendix B of these Regulations and all other Regulations made under this Act. (5) The food business operator shall be fully responsible for the safety of the proprietary food. Accordingly, a Proprietary Food may be an article of food not standardised (under the Food Additive Regulations) but may still contain either standardised ingredients or ingredients permitted in other standardised products or additives specific to the category to which the food belongs (subject to compliance with the microbiological specifications). To the extent the food product contains ingredients which are not standardised or additives which are not specific to the category to which the food belongs, it is assumed that the food product in question cannot be introduced in the Indian markets. Since the advisories on the Product Approval were struck down by the courts, further clarity is being awaited from the FSSAI on the treatment of such products. Comments An initial review of the developments introduced by the FSSAI appears to indicate that India is moving towards a more liberal regulatory regime where the onus of compliance and food safety is on the food business operator. The December 23 Notice and the 2016 Amendment Regulations should go a long way in enabling several existing foreign products and foreign brands to access the Indian markets. As regards novel foods, health supplements, nutraceuticals, etc., it would be advisable to wait till a clarification is issued by the FSSAI. Some concerns have been raised on the relevant provisions of the Food Safety and Standards Act, 2006 under which the December 23 Notice and the 2016 Amendment Regulations have been issued. However, we understand that the FSSAI is working with various industry associations in ensuring that this, along with other steps, would help in reviving innovation in the food industry as well as promote foreign direct investment in this sector. For further information please contact: Andy Leck +65 6434 2525 [email protected] Lim Ren Jun +65 6434 2721 [email protected] Baker & McKenzie.Wong & Leow 8 Marina Boulevard #05-01 Marina Bay Financial Centre Tower 1 Singapore 018981 www.bakermckenzie.com ©2016. All rights reserved. Baker & McKenzie.Wong & Leow is a member of Baker & McKenzie International, a Swiss Verein with member law firms around the world. In accordance with the common terminology used in professional service organizations, reference to a “partner” means a person who is a partner, or equivalent, in such a law firm. Similarly, reference to an “office” means an office of any such law firm. This may qualify as “Attorney Advertising” requiring notice in some jurisdictions. Prior results do not guarantee a similar outcome. This newsletter is provided as general information and does not constitute legal advice. Baker & McKenzie does not practice Indian law and the summaries of Indian regulations contained herein are contributed by Dua Associates in India.