Transfer of Marketing Authorization for Medicinal Products in Russia & EAEU

Anna Ivanova, Associate at BRACE Law Firm

June 1, 2022

The registration of medicinal products is always accompanied by the issuance of a Marketing Authorization. According to Article 28 of Federal Law No. 61-FZ dated April 12, 2010, On the Circulation of Medicinal Products (the "Law No. 61-FZ", the "Law on Circulation of Medicinal Products"), a medicinal product Marketing Authorization specifying dosage forms and strengths is issued for an indefinite term, except for a Marketing Authorization issued for a term of 5 (five) years for medicinal products registered in the Russian Federation for the first time.

However, in practice, with the distribution of medicinal products in the global market or within a single state, cases may arise where it is necessary to transfer (change the owner or holder of) the Marketing Authorization to another person.

Under Paragraph 168 of the Rules for Registration and Examination of Medicinal Products for Medical Use approved by Decision of the Council of the Eurasian Economic Commission No. 78 dated November 3, 2016, when changing the Marketing Authorization Holder in the reference state or a concerned state, the new Marketing Authorization Holder must submit documentary justification for such a change (transfer) and confirmation of the ability to interact with Marketing Authorization Holders in other Member States, ensuring proper performance by the new Holder of all duties of a Marketing Authorization Holder.

Furthermore, according to Annex No. 19 to the said Rules, a change of the Marketing Authorization Holder, as well as the transfer of the Marketing Authorization from one Marketing Authorization Holder to another legal entity, is classified as a minor variation [1].

Thus, the EAEU rules establish requirements for the mandatory documentary formalization of the transfer of a Marketing Authorization.

According to Article 30 of the Law on Circulation of Medicinal Products, to amend documents contained in the registration dossier for a registered medicinal product for medical use, the Marketing Authorization Holder (or owner) or another legal entity authorized by it submits to the authorized federal executive body an application for such amendments in the form established by the authorized federal executive body, along with the attached amendments to said documents and documents confirming the necessity of such amendments. The specified form was approved by Order of the Ministry of Health of Russia No. 727n dated September 21, 2016. In this form, the list of amendments introduced into the registration dossier includes the name and address of the organization authorized by the Marketing Authorization Holder (or owner) to accept claims from consumers, as well as the addresses of manufacturing sites. However, the list of amendments does not explicitly refer to the holder of the registration dossier.

Order of the Ministry of Health of Russia No. 959n dated December 13, 2016, approved the classification of amendments introduced into documents contained in the registration dossier for a registered medicinal product for medical use, according to which major amendments to the registration dossier may include:

• Change of the name, organizational and legal form, and (or) address, or contact information of the Marketing Authorization Holder or owner;
• Change of the name, organizational and legal form, or contact information of the manufacturer of the medicinal product, not related to a change in the manufacturing site;
• Exclusion of one or several participants in the manufacturing process, or the replacement or addition of one or several participants in the manufacturing process of the medicinal product.

The Roszdravnadzor Methodological Recommendations on working with labeled medicinal products establish the procedure for a medicinal product circulation entity to change the Marketing Authorization Holder for a medicinal product for medical use in the MDLP System. This procedure includes: registration of products by the new holder with the GS1 association, direct registration in the MDLP, execution of a contract for the payment of marking codes, and the actual application of labeling. It is important to note that the emission of codes for the product for the old Marketing Authorization Holder closes no later than 6 months after the approval of the new holder in the ESKLP (Unified Directory of Classifiers of Medicinal Products). The acceptance of documents closes from the moment the first report on application enters the MDLP System from the new Marketing Authorization Holder. In this regard, it is recommended that the old Marketing Authorization Holder, in the event of ordering codes under the "prepayment scheme", request codes based on the actual demand for the product that will be transferred to the new owner. This rule is significant when regulating the issue of the transition period during the transfer of a Marketing Authorization.

For instance, foreign countries establish a grace period, i.e., a term during which the original Marketing Authorization Holder may receive profit from the medicinal product manufactured by it before its Marketing Authorization is fully transferred to the new holder. However, there are countries that do not have such a grace period; as soon as the transfer of the Marketing Authorization is confirmed by the authorized body, all rights pass to the new Marketing Authorization Holder. Some companies manufacture more medicinal products in advance, before the confirmation of the transfer of rights, to obtain benefits, while others agree with national authorities on granting a grace period. For example, the United Kingdom has a special system for granting a grace period. The date of transfer of all rights to the medicinal product is established by the original holder but cannot exceed 6 months from the date of approval of the change of the Marketing Authorization. During this time, two Marketing Authorization Holders operate in the market, and the original holder receives profit from sales.

Currently, the procedure for profit distribution and establishing such a transition period is not defined in Russian legislation. We believe that the establishment of a 6-month period for the emission of marking codes for the old Marketing Authorization Holder may indirectly indicate that such a term could be enshrined at the legislative level as a transition period regarding profit distribution during the transfer of a Marketing Authorization.

Thus, the transfer of a Marketing Authorization is a complex procedure regulated under both private and public law. When transferring, it is necessary to consider that liability for the quality, efficacy, and safety of the medicinal product (pharmacovigilance) is transferred along with it. At the same time, the Marketing Authorization Holder may transfer rights to conduct pharmacovigilance activities for the product to another organization without transferring the Marketing Authorization itself. The person appointed by the Marketing Authorization Holder (owner) must possess appropriate theoretical and practical knowledge to carry out pharmacovigilance activities and must reside and work in one of the EAEU Member States [2].

In addition to liability for the manufacture and quality of the medicinal product when structuring contractual relations for such a transfer, it is important to pay special attention to the issues of transferring intellectual rights and procedural succession. For instance, in one dispute regarding the use of a patent for a medicinal product, the court denied procedural succession based on the lack of proof of grounds for establishing procedural succession, noting that the fact of changing the Marketing Authorization Holder does not attest to the transfer of procedural rights and duties to the new owner, as this is not evident from the terms of the agreement on the alienation of the exclusive right concluded between the parties, which does not belong to the category of agreements entailing a change of persons in an obligation [3].

Until recently, the procedure for transferring a Marketing Authorization for a medicinal product was not established by Russian legislation, which, however, did not allow for the conclusion that the transfer itself was prohibited. Currently, the adoption of a number of legal acts regulating the transfer of a Marketing Authorization can be noted.

Transfer of Marketing Authorization During Technology Transfer

It is also important to note that, in effect, the transfer of a Marketing Authorization is not merely a formal process requiring the implementation of appropriate administrative procedures. Such a transfer in certain cases may affect the further production and distribution of medicinal products, as well as technology transfer. In general, the term "technology transfer" is enshrined within the EAEU framework with the adoption of Recommendation of the Board of the Eurasian Economic Commission No. 11 dated June 8, 2021, On the Guide on the Transfer of Technologies and (or) Analytical Procedures for the Manufacture of Medicinal Products. The document entered into force on December 10, 2021. Transfer involves the transfer of any process along with the corresponding documentation and professional expert knowledge from the transferring party to the receiving party. Technology transfer is a systematic procedure performed for the purpose of transferring to the receiving party documented information and experience obtained during pharmaceutical development and (or) the release of medicinal products, including the transfer of documentation, information on manufacturing processes, skills, and knowledge from the transferring party and practical confirmation of the receiving party's ability to effectively perform critical operations according to the transferred technology in order to ensure the traceability of this process for all interested parties and authorized bodies (expert organizations) [4]. In other words, the goal of technology transfer is the transfer of information about the medicinal product, its manufacturing process, and quality control of the medicinal product within a single manufacturing site or between manufacturing sites, including during the transfer of pharmaceutical development to production, as well as the transfer of analytical procedures from a manufacturing site to an accredited testing laboratory [5].

Thus, technology transfer is a very broad concept, and it can be concluded that the transfer of a Marketing Authorization is an important part of technology transfer.

According to the specified Guide on Technology Transfer, it is important to regulate the interaction and liability of both parties at various stages of the transfer. It is necessary to provide for the possibility of providing comprehensive support from the transferring party after the completion of the transfer (including during the preparation of documents included in the registration dossier (if necessary)).

The transfer of analytical procedures must cover the full scope of analytical testing necessary to confirm the compliance of the transferred medicinal product with the specifications included in the medicinal product registration dossier.

Disputes Regarding Marketing Authorization Transfer

Disputes regarding the Ministry of Health of Russia introducing amendments to the registration dossier concerning the Marketing Authorization Holder in cases where participants in the manufacturing and distribution process of the medicinal product have not reached the necessary agreements are also of great importance. In these cases, the court, as a rule, sides with the Ministry of Health if it has observed all requirements for verifying the authority of the person who filed the corresponding application for amendments to the registration dossier.

For example, in one court case, an organization that was the developer and manufacturer of a medicinal product, possessing rights to the production technology and clinical trials, applied to the Ministry of Health. The application of the medicinal product developer to amend the documents contained in the registration dossier regarding the change of the legal entity in whose name the Marketing Authorization was issued was submitted to the Ministry of Health of the Russian Federation, and the corresponding amendments were made based on it. However, the Marketing Authorization Holder disagreed with such a decision. The court did not accept arguments that the claimant is the developer of the medicine in separate documents of the registration dossier, as this contradicted the literal content of these documents, which is confirmed by the case materials [6]. Thus, in the joint development of a medicinal product, the indication of the developer's name plays a key role, as the Marketing Authorization Holder may be changed at the initiative of the developer.

This article examined the main nuances of transferring a Marketing Authorization for a medicinal product. It should be noted that despite the development of legislative regulation of the Marketing Authorization transfer process, a rather large number of issues remain unregulated. In effect, the key role in their settlement is assigned to contractual relations between the transfer parties, which, on the one hand, gives the parties a certain freedom of action, but on the other hand, may give rise to additional disputes.

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References

[1] Decision of the Council of the Eurasian Economic Commission No. 78 dated November 3, 2016, On the Rules for Registration and Examination of Medicinal Products for Medical Use (as amended on March 17, 2022).

[2] Methodological Recommendations. Pharmacovigilance System Master File (PSMF), approved by Roszdravnadzor on January 15, 2018.

[3] Ruling of the Supreme Court of the Russian Federation No. 305-ES21-15800 dated August 27, 2021.

[4] Recommendation of the Board of the Eurasian Economic Commission No. 11 dated June 8, 2021, On the Guide on the Transfer of Technologies and (or) Analytical Procedures for the Manufacture of Medicinal Products.

[5] The Guide on Technology Transfer in the Manufacture of Medicines in the EAEU was adopted. June 11, 2021.

[6] Decision of the Arbitration Court of the City of Moscow dated May 31, 2017, in case No. A40-51831/2016.