Reforms Offer Good News for Trade

The European Commission's proposed pharmaceutical reform package has finally been unveiled—months later than scheduled. However, to the dismay of pharma companies, the section that would have effectively put an end to parallel trading in prescription medicines has been removed. The proposals are now being passed on to the European Parliament and Council of Ministers for further discussion and voting, but the earliest they could become law is 2010.

An earlier draft banning the repackaging of medicines would have made it extremely difficult for traders to buy up drugs in "cheap" countries and sell them for a profit where prices are higher. (Drugs could not be sold in Sweden, for instance, with a carton and insert labelled in Greek.) Following pressure from the traders, this part of the proposal was dropped—causing delay in publishing the document.

Instead of a blanket ban on repackaging, all drug products will require barcodes or serial numbers, as well as tamper seals that a limited number of certified manufacturers will be allowed to use. This will include parallel traders, who won't be able to alter the blister packs that contain the pills, but the rest of the package will be fair game as long as the pack meets all the new requirements. The aim of this part of the legislation is to make it more difficult for counterfeiters to create legitimate-looking drug packaging.

There has been disappointment, however, that no Europe-wide strategy to regulate Internet drug sales will be implemented. The proposal calls for member states to address that issue individually, despite the fact that counterfeits are a particular problem in Internet-based pharmacies.

Two other parts of the proposal will likely result in legislation. One allows pharma companies to give the public limited information about their products, and another will strengthen the pharmacovigilance system within Europe.