New Belgian Act on medicinal product shortages
On 3 February 2020, the Belgian Act of 20 December 2019 amending various legal provisions concerning shortages of medicinal products (‘Act’) was published in the Belgian State Gazette. The Act’s provisions will enter into force on 13 February 2020, with the exception of Articles 2 and 4 which entered into force on 31 January 2020. In our view, the new legislation does not prevent pharmaceutical companies from applying quotas provided that they do not affect the ‘public service obligation’ of ‘wholesaler-distributors’ (also ‘full-line wholesalers’). Additionally, it is our opinion that the Act does not impose a general obligation on pharmaceutical companies to supply directly to retail pharmacies. Several provisions of the Act are to be implemented by royal decree(s), which is/are not yet available.
Overview of the Act
The Act follows a previous attempt by the Belgian legislator to address shortages of medicinal products, which was annulled by the Constitutional Court. Just like its predecessor, the Act aims to deal with shortages of medicinal products in Belgium. The Act amends the Belgian Medicines Act of 25 March 1964 and the Belgian Health Insurance Act of 14 July 1994.
Wholesalers should supply medicinal products within three working days to (i) a full-line wholesaler to the extent that this concerns a delivery within the framework of their public service obligation, and (ii) pharmacists (Article 4). A royal decree will implement this obligation and its control mechanism.
The interruption of the supply to a full-line wholesaler or pharmacist or the lack of a complete supply of the amounts requested within the framework of the full-line wholesaler’s so-called ‘public service obligation’ are now considered as a ‘temporary shortage’ (Article 2, §2). As discussed in our earlier posts, full-line wholesalers are indeed required “to guarantee permanently an adequate range of medicinal products to meet the requirements of a specific geographical area and to deliver the supplies requested within a very short time over the whole of the area in question”.
In the event of a (temporary) shortage, the marketing authorisation holder (MAH) is required to notify the Federal Agency for Medicines and Health Products (FAMHP) and to give the exact reason for the shortage. Not providing the exact reasons is considered to be a lack of notification (Article 2, §1).
Additionally, a temporary export ban can be applied to those medicinal products for which a shortage is notified or established (Article 3), and the MAH will be required to compensate any additional costs related to the unavailability of a medicinal product (Article 6). A royal decree will implement the procedure and conditions for both provisions.
If there is a shortage of a medicinal product, as reported to and published on the FAMHP’s website, then pharmacists are entitled to deliver a substitute medicinal product with the same active substance or combination of active ingredients, the same strength, the same method of administration and the same frequency of administration, provided that the FAMHP’s guidelines are complied with, and that the health care practitioner has made no therapeutic objection (Article 7). A royal decree will further supplement this Article.
Finally, if the medicinal product continues to be unavailable beyond the first day of the twelfth month following the start of the unavailability, then it will no longer be reimbursed (Article 5).
The Act’s impact on pharmaceutical companies active in Belgium
- Can pharmaceutical companies continue to use quotas?
The explanatory memorandum of the first draft of the Act referred to quotas of pharmaceutical companies per medicinal product per country as one of the causes of shortages. Trying to deal with shortages, several legal provisions of that draft Act directly or indirectly referred to such quotas.The eventually adopted legal provisions no longer contain such references, and it is our view that a quota system does not necessarily violate the Act. Rather, a pharmaceutical supplier should take into account whether or not the order of a full-line wholesaler is part of its public service obligation. The pharmaceutical supplier should avoid that it prevents the full-line wholesaler fulfilling such an obligation, but no more than that. It is not required to supply a full-line wholesaler with products that are intended for export, or to supply wholesalers that have no public service obligation.
- Should a pharmaceutical company directly supply pharmacists?
The Act stipulates that wholesalers have the obligation to deliver their medicinal products within three working days not only to full-line wholesalers, but also to pharmacists. The Belgian supply chain, however, is based on delivery to full-line wholesalers which in turn supply pharmacists. Does the new Act now oblige all wholesalers to deliver directly to all pharmacists? In our view, it does not.The same ‘obligation’ was already stated in the Medicines Royal Decree of 14 December 2006. The explanatory memorandum of the Act indeed states that the purpose of this provision is to enshrine in the Medicines Act the obligations that already exist under that royal decree, so not much appears to have been changed. A general obligation to deliver directly to pharmacists would furthermore impose a huge burden on pharmaceutical companies, disregard the specific cascade system and obviate the need and position of wholesaler-distributors. It would be irrelevant to deal with shortages, which is still the aim of the Act. The explanatory memorandum confirms the exceptional nature of such direct supply and states that it “goes without saying that, in cases of urgency, companies can supply directly to the pharmacist, without having to go through the wholesaler (distributors) channel. However, it is not the intention to supply publicly accessible pharmacies on a daily basis.”
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