The Key Regulatory Developments of 2020 in Russia and EAEU

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The new video briefly looks at the key regulatory developments of 2020 in the sphere of IP protection, pricing and state procurement, EAEU common market and other issues.

IP protection issues

This year the topic of compulsory licensing remained under consideration. Two draft laws were submitted to the State Duma. In November 2019 the Russian Government submitted to the State Duma the draft Federal Law “On Amendments to Article 1360 of the Russian Civil Code” (the Draft Law No. 842633-7) regarding the use of an invention in the interests of national security. The Draft Law No. 842633-7 was adopted in the first reading on 15 December 2020. In March 2020 the Russian Government submitted to the State Duma the draft Federal Law “On Amendments to the Chapter 72 of the Russian Civil Code” (the Draft Law No. 912458-7) on introduction of article 1360.1 to the Russian Civil Code regarding the use of an invention for production of a medicine for its export in accordance with an international treaty. The Draft Law No. 912458-7 remains under consideration in the State Duma.

The parallel imports from outside the EAEU are prohibited by the EAEU Treaty due to the regional principle of exhaustion of trademark rights. In August 2020 however the Federal Antimonopoly Service recognized that by hindering the activities of parallel importers in car sector the right holders violated the antitrust law. It is not clear what impact this precedent may have on the pharmaceutical market. Therefore, further monitoring in needed.

The regulatory data protection (RDP) topic also remains under discussion. As part of its accession to the WTO, Russia agreed to provide six years of regulatory data protection, which today is applied as 4+2 and 3+3 formula. However, it is not entirely clear how the RDP regime will be technically applied after the transfer to common EAEU registration for new medicines.

Pricing and State Procurement

Another important area is the regulation of state procurement of medicines, which lately has been permanently under a stress. Although there are some positive changes such as temporal elimination of “third one out” rule for certain INNs of medicines; introduction of a direct provision on continuity of treatment; active discussions of the initiatives related to innovative contracts, there are still many barriers, that complicate the functioning of the drug supply system. Therefore, it is necessary to monitor further implications.

The global crises also showed the weaknesses existing in the pricing regulations in Russia. Thus, a number of measures were taken to improve the situation. In particular the Government adopted amendments on prevalence of price indexation over obligatory price re-registration. Moreover, the Government introduced specific mechanisms for increasing the prices for medicines that are in deficit on the market. These regulatory steps were welcomed by the market participants. However, it is still not clear, whether the ad-hoc pricing instruments will be effective and which consequences the obligatory prices re-registration for all essential medicines will have next year.

Other Measures

A number of other regulatory acts were adopted as a response to worldwide pandemic. From 1 January 2021 the registration of new medicines must be effected in accordance with the common EAEU rules. However, those medicines that are intended for use in emergency circumstances including for prevention and treatment of pandemic diseases, may be registered in accordance with national rules.

The Government also simplified the requirements towards Track&Trace system. Although many experts believe that the system requires further significant improvements.

As a result of lockdown, on-line sales of OTC medicines were allowed in 2020. However, these regulatory provisions are not perfect and may require further amendments.

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