Nadezhda Fedotova of Lidings law firm gives an update on recent amendments to the labeling legislation for medicines in Russia, their potential impact on the Russian pharmaceutical industry, and the numerous uncertainties still remaining.
"Despite the time moving up to January 1, 2020, it seems impossible to say whether the drugs labeling system will or will not be launched in time completely."
Under the Decree of the Government of the Russian Federation No. 1556 dated December 14, 2018 (hereinafter – Decree No. 1556), the monitoring system of the medical drugs circulation should become effective from the January 2020 with the exception of medical drugs for healing high-cost ICD diseases, which have already been monitored from October 1, 2019.
Starting from the effective date of the Decree No. 1556 the whole pharmaceutical community of Russia, including pharmaceutical companies, distributing and pharmacies organizations, professional communities of the developers of equipment and program software, began to prepare themselves for the launch of the monitoring system. During the preparatory process, participants faced various problems, which were reported to the governmental bodies and authorized organizations immediately. Thus, the government was able to include necessary amendments to the strategy before the system launched.
The most discussed issue was the length and the entering of the cryptographic code (coding information) created by the Russian cryptographic technologies, what is thought to provide the legal circulation and help to secure the pharmaceutical products from criminals. During the first quarter 2019 the pharmaceutical companies were testing and analyzing the cryptographic code with different symbol-length – 32, 44, 88, 92 – as well as making records on defects in code within each of the code lengths. After many testing results and professional discussions, the approved cryptographic code length was cut back on from 92 to 44 symbols, whereas the whole size of the labeling module is set with 85 symbols. As a result, the manufacturers will be able to use the 32х32 module. Also, the numerous changing in cryptographic code length expanded the time of the pilot project as well as the costs on regular updating and amending the equipment and program software.
At the same time, the liability on failure with the requirement to join the labeling system was provided within the legal framework. Among the offences, the following should be pointed out: the manufacturing of the medical drugs without labeling or with wrong labeling process; sale of the medical drugs without labeling or with wrong labeling process; underfilling or undue completion of the information in the labeling data base. The liability for commitment of each of the offences is set between 5 000 – 10 000 rubles for the officials and between 50 000 – 300 000 rubles for the legal entities.
Nevertheless, the provision of the cryptographic code created by the Russian cryptographic technologies is not free. According to the Decree of the Government of the Russian Federation No. 577 dated May 8, 2019 the price for creating of the 1 labeling code is 50 kopecks excluding VAT. Also, the Ministry of Industry and Trade of the Russian Federation has proposed the bill that will allow the drugs manufacturers to get the labeling codes under the pilot project for free. However, on the December 15, 2019 this bill has not been approved yet. There is only the one requirement that drugs manufacturers are free from – they do not need to register in the system in 2020 again.
Despite the fact that the drugs labeling system was not still launched completely and the results of the experiments were not evaluated, the Ministry of Health of the Russian Federation has the intention to include the labeling to the licensing requirements for all who do wholesale and retail of medical drugs, including pharmacies, the individual entrepreneurs and medical organizations. On December 15, 2019 the relevant decree project has passed the public hearings and anticorruption expertise, but has not been sent to the consideration to the RF Government yet.
Up to the end of 2019 the Russian Government agreed with the professional community on the time extension for the labeling system process implementation and on December 5, 2019 officially published the project of the decree of the Government of the Russian Federation, which deferrals of the deadline for labeling of the non-VEN and non-ICD drugs to the July 1, 2020. This project provides some details regarding the stages before the labeling of the medical drugs package itself and the declines for their implementation. These stages include: 1) registration in the monitoring system starting from January 1, 2020 up to February 29, 2020; 2) preparing the program software and filing an application for testing the information exchange within 21 calendar day starting from the day of registration in the system; 3) testing the information exchange between the program software and the monitoring system regarding the drugs labeling, introduction into the drugs circulation, circulation itself and withdrawal from circulation within 2 calendar months, starting from the date of completion of the program software to the information exchange; and 4) entering the data regarding the whole operations with the drugs from July 1, 2020 into the monitoring system.
The public hearing of the bill and its anticorruption expertise will continue up to December 25, 2019. After that the results of the abovementioned analysis and expertise will be evaluated. Based on this evaluation the necessary amendments will be included to the text, which will be finally sent to the consideration and approval to the Russian Government.
Despite the time moving up to January 1, 2020, it seems impossible to say whether the drugs labeling system will or will not be launched in time completely or if the government will approve the stage-plan implementation; what the results of the pilot project, which officially ended on December 31, 2019, will be; or which way and within what limits the punishments for offences in labeling system will be.