As reported previously on this blog, several member states have imposed bans, requisitioned stock and applied various other control measures on medicines and protective equipment (e.g., Belgium, Bulgaria, the Czech Republic, France, the Netherlands, and Poland). On 8 April 2020, the European Commission (“Commission”) issued Guidelines on the optimal and rational supply of medicines to avoid shortages during the COVID-19 outbreak (“Guidelines”). The Guidelines, which are not formally binding,  request the Member States to lift any export ban for medicines within the EU internal market during the COVID-19 crisis. The Commission suggests a number of alternative measures, such as requesting joint industry efforts to meet demand.

  1. Promotion of solidarity within the EU

The Commission calls on the EU Member States to cease or avoid protectionist measures that may harm the internal market and negatively impact public health. In particular, the Commission requests that Member States (i) lift export bans for medicines within the EU; (ii) avoid national stockpiling by wholesalers or pharmacies (including hospital pharmacies); and (iii) avoid misinformation that leads to consumer stockpiling and improper use of medicines.

In the Guidelines, the Commission refers solely to export bans “within the internal market”, which “are detrimental to the availability of medicines for European patients even when they are legally justifiable” (emphasis added). Interestingly, the Guidelines are entirely silent on Member States’ export bans to third countries. In principle, such export bans ordinarily  cannot be adopted by the Member States, and national export bans driven by shortage concerns are subject to a specific consultation procedures under Regulation 2015/479 to seek to ensure that an export ban is only adopted at EU-wide level. As we reported in a recent client alert, in mid-March, the Commission adopted such measures for protective equipment.

  1. Measures to ensure national supply

As an alternative to export bans, the Guidelines offer a set of recommended actions that Member States may implement to guarantee adequate supply of medicines (including raw materials, intermediates, APIs, substances of human origin such as plasma, and related materials) during the outbreak, namely:

  • Increasing and reorganising production;
  • Ensuring manufacturing continues at full capacity;
  • Implementing regulatory flexibility;
  • Monitoring available stocks at national level;
  • Ensuring necessary support to the wholesale sector;
  • Fully enforcing border “green lanes”;
  • Facilitating air freight and other forms of transport; and
  • Ensuring fair distribution of supply.

These measures have a direct impact on the pharmaceutical industry. For instance, to guarantee manufacturing is not interrupted, the Guidelines recommend that pharmaceutical manufacturing be designated an “essential activity”, allowing its employees (including cross-border workers) to continue traveling to their place of work. Member States should also grant “regulatory flexibility” to the industry. This “flexibility” should take the form of accelerated administrative procedures, such as those for variations to marketing authorisations, procedures for changes in suppliers of APIs, designation of new manufacturing sites, or the extension of expiry dates.

Further, the Guidelines recommend that the Member States, “with the support of the Commission and the European Medicines Agency”, continue to (i) request that actors in the supply chain monitor their stocks and production capacity and share information with authorities (e.g., shortages or disruptions); (ii) request, facilitate and coordinate joint industry efforts to reduce shortages and meet demand; and (iii) implement demand support and procurement initiatives to encourage appropriate supply to patients (e.g., through the EU joint procurement agreement).

Importantly, to allow joint industry cooperation that may otherwise be problematic under EU competition law, the Commission has issued guidance on antitrust issues relating to forms of cooperation aimed at ensuring the supply and adequate distribution of essential scarce products and services during the COVID-19   outbreak.

The Guidelines also recommend that Member States share stock information, such as epidemiological forecasts, with pharmaceutical companies. This is aimed to help them better plan for increased demand and respond to that Member State’s needs. At this moment, some countries require that pharmaceutical companies provide them with stock and manufacturing information (e.g., Spain), but it is unclear whether they share their information with them.

  1. Optimisation of medicines use in hospitals

The Guidelines suggest a number of measures to ensure the optimal use of medicines, most of them relying on alternative routes of supply. For instance, the Guidelines recommend inviting marketing authorisation holders to request the extension of the expiry dates of essential medicines where possible.

The Guidelines also recommend that hospitals adapt their protocols to identify alternative medicines that may be relied on in case of shortages of first-line treatments. In such cases, marketing authorisation holders and wholesalers of alternative products should be informed. Further, Member States should consider using magistral preparations or equivalent veterinary medicines to replace first-line treatments.

In the case of off label use to treat COVID-19 under national early access programmes or in clinical trials, the Guidelines recommend assessing first the needs of patients using these medicines on-label, so as to avoid shortages for that population. The Guidelines state that large, European clinical trials should be given priority over national trials.

  1. Optimisation of sales in community pharmacies

The Guidelines also provide some recommendations for Member States to ensure that patients do not hoard medicines. These include introducing restrictions on sales in community pharmacies and online sales for medicines at risk of shortages or subject to increase demand. For instance, Member States may restrict dispensing to a one-month supply of prescription medicines, or a maximum of one package per customer of non-prescription medicines.

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Photo of David Lorello David Lorello

David Lorello is a partner in the firm’s London office and serves as a vice chair of the firm’s International Trade and Finance practice group.  Mr. Lorello advises clients concerning a range of international regulatory, white collar, and commercial matters under both European…

David Lorello is a partner in the firm’s London office and serves as a vice chair of the firm’s International Trade and Finance practice group.  Mr. Lorello advises clients concerning a range of international regulatory, white collar, and commercial matters under both European and U.S. laws.  Mr. Lorello is recognized in the leading peer review publications for his work on trade controls and anti-corruption compliance and investigations matters, with Chambers Global describing Mr. Lorello as a “compliance authority” in those areas.

Anti-Corruption Compliance and Investigations

Mr. Lorello regularly assists clients in investigating anti-corruption compliance issues arising under the U.S. Foreign Corrupt Practices Act (FCPA), the UK Bribery Act and other related U.S., UK, and European anti-bribery and anti-money laundering laws.Mr. Lorello has particular experience in managing corporate investigations and developing anti-corruption compliance programs for companies operating in Europe, including coordinating advice concerning parallel risks under U.S. and European anti-corruption laws, advising clients concerning European criminal enforcement and debarment risks, and ensuring compliance with European data protection and workplace laws in the course of investigations and compliance matters.

Mr. Lorello also regularly represents clients before the World Bank, and other international financial institutions, in debarment proceedings concerning allegations of corrupt practices in connection with contracts financed by those institutions. In addition, Mr. Lorello advises clients concerning the commercial liability risks arising from corrupt practices, including private rights of action that may arise for parties that suffer losses as a result of corrupt practices.

Export Controls and Economic Sanctions

Mr. Lorello regularly represents clients before the major agencies responsible for export controls and economic sanctions laws and regulations, both in the United States and European Union. He has assisted clients in export and sanctions licensing and compliance issues with regard to a variety of industries and products, including encryption and other computer technologies, satellites, oil and gas products, military items, and other goods and technology controlled for export due to national security reasons. Mr. Lorello has extensive experience assisting clients in developing effective export compliance strategies, including preparing export license requests, voluntary self-disclosures and intra-company agreements as well as policies necessary to ensure export controls and economic sanctions compliance.

Mr. Lorello has particular experience in assisting clients in economic sanctions matters relating to the financial services industry. He has represented financial services clients in various matters before U.S. and EU Member State regulators, and he has worked with financial services clients in developing tailored internal controls focused on economic sanctions compliance.

Photo of Bart Van Vooren Bart Van Vooren

Bart Van Vooren has a broad life sciences practice supporting innovative pharmaceutical, food, medtech and biotech companies on EU regulatory, commercial and strategic policy assignments. He is widely recognized for his expertise on general EU law and procedure, as well as his extensive…

Bart Van Vooren has a broad life sciences practice supporting innovative pharmaceutical, food, medtech and biotech companies on EU regulatory, commercial and strategic policy assignments. He is widely recognized for his expertise on general EU law and procedure, as well as his extensive litigation experience before the EU Court of Justice in dozens of cases.

Over the past seven years, Mr. Van Vooren has developed a niche practice on compliance with the Biodiversity Convention and the Nagoya Protocol, a set of rules to combat bio-piracy worldwide. He has accumulated unique, practical experience in dozens of jurisdictions around the world, and has handled everything from benefit-sharing negotiations, over compliance programs, to inspections by authorities.

Finally, Mr. Van Vooren has an active pro bono practice assisting NGOs defending the human rights of persons with a disability through strategic litigation.