Under the Swedish medicinal products benefits scheme, the pharmacist shall substitute any prescribed product for a cheaper generic or parallel imported product, provided such product has first been declared substitutable by the Swedish Medicinal Products Agency (MPA).

Having approved a medicinal product for distribution with regard to quality, safety and efficacy, the MPA ex officio shall assess whether the product is substitutable with another product. Provided the first mentioned product is deemed equivalent with the other product, the MPA shall declare the products substitutable. According to the MPA, equivalence is normally at hand when the products contain the same active substance in the same amount and form of preparation and are distributed in the same size of package. According to case law, the aspects of bioequivalence, safety and efficacy may also be taken into account in such assessment (Kammarrätten in Stockholm, case no. 8075-05 judgment dated 16 February 2007).

Since 2005, major pharmaceutical companies have frequently appealed such decisions, e.g. in 2005 Merck appealed the decisions to declare its Fosamax osteoporosis product substitutable with several generic or parallel imported products.

In several cases the appeal initially was successful, not on the merits, but in the sense that the MPA’s decision to declare a product substitutable with another did not take effect until the appeal eventually had been tried. In the Fosamax case mentioned above, the generic products were excluded from the medicinal products benefits system for almost two years due to the appeal.

When eventually trying the cases, the first and second administrative courts of appeal did uphold the appealed decisions of the MPA to declare products substitutable. Last year, the supreme administrative court decided not to grant leave. Taken together with the fact that in 2007, the Medicinal Products Act was amended so as to normally give immediate effect to the MPA’s decisions to declare a product substitutable, we may see a trend to facilitate the introduction on the market of cheaper generic products, a trend which is also represented by the preliminary report on the pharmaceutical sector inquiry recently published by the EU Directorate-General for Competition http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/preliminary_report.pdf.