11 Preventing the counterfeiting of medicinal
products
| (30293)
17504/08
COM(08) 668
+ ADDs 1-2
| Draft Directive to amend Directive 2001/83/EC as regards the prevention of the entry into the legal supply chain of medicinal products which are falsified in relation to their identity, history or source.
Commission staff working documents: impact assessment and summary of assessment.
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| Legal base | Article 95 EC; QMV; co-decision
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| Document originated | 10 December 2008
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| Deposited in Parliament | 22 December 2008
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| Department | Health |
| Basis of consideration | Minister's letter of 1 October 2010
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| Previous Committee Report | HC 19-v (2008-09), chapter 5 (28 January 2009)
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| To be discussed in Council | Possibly October
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Background
11.1 A Council Directive of 2001 established rules for Member
States to authorise and supervise the manufacture, importation,
marketing and wholesale distribution of medicinal products for
human use.[43] Since
then, the Commission has reported a significant increase in the
number of counterfeit medicines in circulation in the EU which
pose a serious threat not only to public health but also to trust
in the pharmaceutical industry. Counterfeit medicines may, for
example, contain sub-standard or falsified ingredients, and they
may either omit active pharmaceutical ingredients or include them
in the wrong dosage. The Commission therefore proposed, in 2008,
amending the 2001 Directive to strengthen provisions on the detection
of counterfeit medicines and to prevent their entry into the legal
supply chain.
11.2 The main changes proposed were to:
- require all the parties involved
in the distribution of medicines (including importers and middle-men)
to comply with the wholesale distribution requirements of the
2001 Directive;
- authorise the Commission, through the comitology
procedure, to introduce a requirement for manufacturers to place
a safety feature on the outer packaging of prescription-only medicines
to enable the authenticity and identity of the product to be confirmed,
to ensure its traceability, and to prohibit tampering with the
safety features of the packaging;
- require wholesalers who buy medicines from other
wholesalers to verify that the supplying dealer complies with
the EU's good distribution practices;
- require wholesalers who buy medicinal products
from manufactures or importers to verify that they hold marketing
authorisations;
- strengthen the requirements for the verification
of active pharmaceutical ingredients imported from third countries
("APIs"); and
- strengthen the rules for inspections to check
compliance with the EU's standards of practice for good manufacturing
and distribution.
The previous Government's view
11.3 The previous Government agreed with the Commission's
assessment that there was an increased risk of counterfeit medicines
entering and remaining undetected in the supply chain and that
the legislative framework for regulating medicines needed to be
strengthened. The Government broadly supported the Commission's
proposals while seeking to ensure that any new EU measures were
"proportionate to the public health risk".[44]
11.4 Subsequent progress reports from the Government
indicated that there was widespread support from stakeholders
for firm action to tackle the threat posed by counterfeit medicines,
but that negotiations on the proposed changes to the 2001 Directive
were proceeding slowly. However, in March the Minister reported
that significant headway was being made under the Spanish Presidency.
The previous Committee's view
11.5 The previous Committee welcomed the proposals
to prevent counterfeit medicines entering the legal supply chain
and thought that the internal market legal base proposed by the
Commission was appropriate. The Committee kept the document under
scrutiny so that it could continue to consider any changes to
the Commission's proposal before a revised draft of the Directive
was presented to the Council for agreement.
The Minister's letter of 1 October 2010
11.6 The Parliamentary Under Secretary of State for
Quality at the Department of Health (Earl Howe) says that negotiations
have progressed well and that the Belgian Presidency of the Council
of Ministers is keen to secure a first reading agreement with
the European Parliament, based on a compromise text agreed by
Member States, later this month. The Minister outlines the main
changes which the compromise text would make to the Commission's
original proposal:
- Ensuring all parties
involved in the distribution of medicines comply with the wholesale
distribution requirements in the 2001 Directive
— the compromise text includes "brokers" who deal
in medicines but do not take possession of them. The Government
supports this change as it says that currently unregulated brokers
are often implicated in counterfeit cases;
- Applying a risk-based approach to the application
of compulsory safety features to medicines
— safety features are intended to make it possible to identify,
authenticate and trace medicines through the supply chain, and
include the use of tamper-proof seals. The compromise text would
establish a new procedure for determining which medicines are
at risk of counterfeiting, based on a number of criteria including
price and the potential risk to public health, and so should be
subject to the compulsory safety features. The Government supports
a risk-based approach as it will allow safety features to be affixed
to non-prescription as well as prescription medicines where there
is a risk of counterfeiting;
- Ensuring that wholesalers who purchase
medicines from other wholesale dealers are required to verify
that the supplying dealer complies with good distribution practices
— the Government supports the
inclusion in the compromise text of a requirement for wholesale
dealers to record the batch numbers of medicines which are subject
to the compulsory safety features in order to improve their traceability;
- Strengthening requirements for importers
of APIs from countries outside the EU if that country has not
demonstrated that it operates regulatory systems equivalent to
the regime in force in the EU —
the compromise text includes provision for the supervision and
inspection of the premises of manufacturers, importers or distributors
of active substances used as starting materials for medicines
(APIs), wherever they are located, to ensure that they comply
with good manufacturing and distribution practices. The UK supported
Commission proposals to establish an EU-wide system of accreditation
for third party auditors to verify the quality of APIs manufactured
outside the EU, but all other Member States opposed. However,
the Minister considers that the compromise text allows sufficient
flexibility for the UK to establish its own system of accreditation;
- Strengthening rules for inspections through
publication of the results in an EU database
— the Government supports greater transparency as a means
of exposing non-compliance as well as encouraging good manufacturing
and distribution practice;
- Clarifying rules applicable to medicines
held in customs areas for re-export to third countries
— the Minister says that the compromise text makes clear
that medicines regulatory authorities are entitled to enter customs
areas to check medicinal products intended for re-export to non-EU
countries, but that detailed rules setting out the nature of the
checks will require separate legislation.
11.7 The Minister draws attention to two additional
areas of concern during the negotiations. The first concerns the
proposed use of delegated powers, under Article 290 of the Treaty
on the Functioning of the European Union (TFEU). This Article
enables the Commission to adopt further legislation to supplement
or amend "non-essential elements" of the parent legislation
(in this case, the amended 2001 Directive). The Government accepts
the use of delegated powers to establish detailed rules on the
use of safety features, but contests their use for determining
the nature of the checks to be carried out by medicines regulators
in customs areas. For the latter, the Government considers that
Article 291 TFEU, which empowers the Commission to adopt "implementing
acts", would be more appropriate as Member States would play
a more active role in overseeing the rules and guidance proposed
by the Commission. The Minister explains that the UK is in a minority
of Member States in opposing the use of delegated powers for customs
checks and that he therefore proposes registering UK opposition
by means of a "minutes statement" when the draft Directive
is adopted.
11.8 Member States have also expressed concern at
the absence of regulatory controls on the use of excipients —
products with no pharmaceutical effects which are added to medicines,
for example, to ensure their stability or provide colour. The
Minister says that the compromise text requires manufacturers
to conduct a risk-based review of excipients included in medicinal
products and to apply good manufacturing processes.
11.9 The Minister sets out the main amendments proposed
by the European Parliament and which will form part of the first
reading negotiation with the Council. These concern the regulation
of internet sales, the supervision of brokers of medicine, and
the scope of application of safety features to medicinal products.
The Minister says that most Member States favour national regulation
of internet sales of medicines, but foresee the possibility of
some degree of oversight at EU level provided that it adds value
without increasing bureaucracy and costs. The Minister accepts
that there is scope for a further tightening of the rules on the
supervision of brokers but that these should be proportionate.
He says he will seek to encourage the EP to support the risk-based
approach to the use of safety features set out in the Council's
compromise text.
Conclusion
11.10 We thank the Minister for providing a detailed
explanation of the progress made towards agreeing a compromise
text which is likely to form the basis for the Council's negotiations
with the European Parliament with a view to securing an agreement
at first reading. The changes proposed in the compromise text
seek to establish an appropriate balance between strengthening
controls in the supply chain to help prevent and detect counterfeiting
of medicinal products, and to protect public health, while avoiding
the imposition of excessive regulatory burdens on the pharmaceutical
industry.
11.11 We note that the legal base proposed in
the compromise text has been amended to reflect the entry into
force of the Lisbon Treaty last December. The text retains an
internal market legal base — now Article 114 TFEU —
but adds Article 168(4)(c) TFEU which provides for the adoption
of measures "setting high standards of quality and safety
for medicinal products and devices for medical use". We consider
the legal base proposed to be appropriate.
11.12 We also note that the Minister expresses
reservations about the proposed use by the Commission of delegated
powers to determine the nature of checks that medicines regulators
may undertake in customs areas. Article 290 TFEU states that "the
objectives, content, scope and duration of the delegated power
shall be explicitly defined" in the parent legislation and
that "the essential elements of an area shall be reserved
for the legislative act and accordingly shall not be the subject
of a delegation of power". While we are not in a position
to determine whether the use of delegated powers for the particular
purpose indicated in this case is justified, we consider that
the Government is right to scrutinise carefully any proposed delegation
of power in order to ensure that the requirements of Article 290
are satisfied.
11.13 We conclude, on the basis of the information
provided by the Minister, that the compromise text represents
a reasonable outcome for the UK. As the compromise text largely
supersedes the Commission's original proposal, we are content
to clear the draft Directive from scrutiny.
43 Directive 2001/83/EC: OJ No. L 311, 28.11.01, p.67. Back
44
Minister's Explanatory Memorandum of 14 January 2009, see HC 19-v
(2008-09), chapter 5 (28 January 2009). Back
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