Legal advice on state registration and re-registration of drug prices
BRACE Law Firm, within the framework of the Healthcare and Pharmaceuticals practice, provides legal services to manufacturers and distributors of medicines, medical devices, dietary supplements and other healthcare organizations on issues of Russian and international law. We provide legal assistance in the areas of business support, dispute resolution and litigation, public and corporate procurement, antitrust, compliance and international trade law.
One of the important areas of legal services in the framework of the “Healthcare and Pharmaceuticals” practice is advising on state registration and re-registration of drug prices.
State registration and re-registration of drug prices
Wholesale organizations and (or) pharmacy organizations, individual entrepreneurs licensed for pharmaceutical activities, sell drugs included in the List of Vital and Essential Drugs at prices that do not exceed the amount of the actual selling price established by the manufacturer of drugs and not exceeding the registered maximum selling price, and the size of the wholesale allowance and (or) the size of the retail allowance, not exceeding respectively the size of the maximum wholesale allowance and (or) the size of retail markups, set in the region of the Russian Federation.
Wholesale and retail allowances are formed in accordance with the Rules for establishing the maximum sizes of wholesale and maximum sizes of retail allowances to the actual selling prices established by manufacturers of medicines included in the List of Vital and Essential Drugs in the constituent entities of the Russian Federation approved by Decree of the Government of the Russian Federation N 865 dated October 29, 2010. Moreover, the indicated allowances are used, starting from the maximum selling price in accordance with the current legislation.
In accordance with Art. 2 of the Federal Law of June 06, 2019 N 134-FZ “On Amendments to the Federal Law“ On the Circulation of Medicines ”with regard to state regulation of the prices of medicines included in the List of Vital and Essential Drugs” registered before the effective date of this Federal law, the maximum selling prices of manufacturers of drugs included in the List of Vital and Essential Drugs are subject to mandatory re-registration and in 2019 - 2020 in the manner established by the Government of the Russian Federation.
The specified law establishes the need to reduce the maximum selling price for medicines included in the List of Vital and Essential Drugs.
Mandatory price reduction will be in cases:
- reduction of the price in foreign currency for a drug in the country of manufacture and / or in countries in which the drug is registered and / or supplied by the manufacturer;
- lower prices for reference medicines (for the corresponding reproduced, bio-analogue (biosimilar) medicines);
- excess of the maximum selling price for the first reproduced, bio-analogue (biosimilar) drug of foreign manufacture over the maximum selling price of the manufacturer for the second reproduced bio-analogue (biosimilar) drug;
- excess of the maximum selling price of the first reproduced, bio-analog (biosimilar) medicinal product of the manufacturer of a member state of the Eurasian Economic Union over the maximum selling price of the manufacturer for the second reproduced, bio-analog (biosimilar) medicinal product of the manufacturer of the EAEU Member State.
The current legislation establishes the Methodology for calculating the maximum selling prices for drugs included in the List of Vital and Essential Drugs during their state registration and re-registration, approved by the Government of the Russian Federation dated September 15, 2015 N 979 “On Amending the Government of the Russian Federation from October 29, 2010 N 865 and on the approval of the methodology for calculating the maximum release limits set by drug manufacturers “prices for drugs included in the List of Vital and Essential Drugs, at their state registration and re-registration”.
Also, at present, the Government of the Russian Federation has developed the Draft Rules for the mandatory re-registration in 2019 - 2020 of the registered maximum selling prices for manufacturers of medicines included in the list of vital and essential medicines. The specified project clarifies the main provisions of the re-registration of maximum selling prices in the transition period.
Thus, taking into account the obligation to re-register the maximum selling prices for Vital and Essential Drugs before the end of 2020, it is recommended that many pharmaceutical companies start collecting the necessary documents for the planned re-registration, as well as start preparing the appropriate economic feasibility studies. Moreover, an additional analysis is needed as to whether the currently registered maximum selling prices are subject to the conditions for their mandatory reduction. Such an analysis is recommended to be carried out before the official appeal of the Federal Antimonopoly Service of Russia on the need for reduction to be able to prepare for the changing conditions for determining the maximum selling prices.
- Analysis of registered maximum selling prices for the need to reduce / the possibility of re-registration with increasing prices.
- Advising on the possibility of re-registering the maximum selling price on terms that will help to comply with the interests of the owner (holder) of the registration dossier.
- Legal support in the formation and submission of an application for re-registration of the maximum selling price and the set of documents required for such re-registration.