Medicinal product regulation and product liability in the Russian Federation: overview
A Q&A guide to Medicinal product regulation and product liability law in the Russian Federation.
The Q&A gives a high level overview of key issues including pricing and state funding, manufacturing, marketing, clinical trials, advertising, labelling, and product recall and liability.
For information on patents, trade marks, competition law, patent licensing, generic entry, abuse of dominance and parallel imports, visit Pharmaceutical IP and Competition Law in Russian Federation: overview.
To compare answers across multiple jurisdictions, visit the Medicinal product regulation and product liability Country Q&A tool.
This Q&A is part of the global guide to life sciences law. For a full list of jurisdictional Q&As visit www.practicallaw.com/lifesciences-guide.
The main legislation in this area is comprised of the following laws:
Federal Law No. 323-FZ on the Principles of Citizens' Healthcare in the Russian Federation of 21 November 2011 (Healthcare Law).
Federal Law No. 61-FZ on the Circulation of Medicines of 12 April 2010 (Law on Circulation of Medicines).
Code of Administrative Offences No. 195-FZ of 30 December 2001 (Administrative Code).
Criminal Code No. 63-FZ of 13 June 1996 (Criminal Code).
The Ministry of Healthcare (www.rosminzdrav.ru) is the key federal executive body responsible for drafting and implementing government policy and legal regulation in relation to healthcare.
The Ministry of Healthcare co-ordinates and oversees its subordinated services and agencies, including:
The Federal Supervision Service for Healthcare (Roszdravnadzor) (RZN), which is the enforcement arm of the Ministry of Healthcare.
The Federal Medical-Biological Agency.
Federal state institutions and unitary enterprises.
It also co-ordinates the activities of the Federal Mandatory Health Insurance Fund.
Generally, biological and combination products are regulated by the Law on Circulation of Medicines and Federal Law 29-FZ on the Quality and Safety of Nutrition Products of 2 January 2000. However, Russian legislation does not define biologicals or combination products.
The above law defines:
Food supplements as natural or synthetic substances and their compounds added to nutrition products during their production, to complement certain characteristics and/or preserve their quality.
Active biological supplements as natural (or identical to natural) biologically active substances designated for use, either together with food or through their incorporation into nutrition products.
Medical devices and diagnostics are generally regulated by the Healthcare Law and specific regulations (for example, elaborating on the procedure for registration of medical devices). A draft federal law on the specifics of circulation of medical devices in the Russian market is currently being considered by the State Duma (the Russian parliament).
There is no specific legal regulation of health IT issues and mobile medical applications in Russia (other than general Russian data privacy laws, which apply to any business processing personal data of individuals).
Pricing, state funding and reimbursement
The public healthcare sector is funded from the state budget and from the Federal Mandatory Health Insurance Fund. All employers must make monthly contributions for their employees to the Federal Mandatory Health Insurance Fund. Medical treatment in the public sector is free of charge for all Russian citizens. Emergency medical assistance is free for any individual in Russia, irrespective of his/her citizenship.
In parallel with the public sector, there is a large number of private health centres and polyclinics. These facilities are of a higher standard, but are relatively expensive. The services they provide are usually paid for by private insurance companies offering their clients (mainly corporate employers) voluntary medical insurance programmes. It is common for employers at least in large Russian cities to offer such additional medical insurance policies to their employees (and sometimes to employees' family members) at no charge to the employee. Some services offered by such private institutions are covered from public sources (for example, kidney dialysis services provided by specialised medical centres).
Each year the government approves the list of vitally important and necessary medicines, the Russian equivalent of an essential drug list (EDL). This list consists of medicines of the utmost social significance which are named in the EDL solely by their international non-proprietary name (INN).
Maximum sales prices for medicines containing INN on the EDL must be registered with the Ministry of Healthcare, and wholesale and retail margins for them are capped at certain levels. The Federal Supervision Service for Healthcare regularly monitors prices and margins for EDL medicines throughout Russia, both at the wholesale and retail levels. Any breach of the price restrictions can incur a fine of double the sales volume of products sold at a price exceeding the established maximum.
Medicines not on the EDL are not subject to any price restriction.
Certain categories of patients are allowed to receive EDL medicines for free. These include patients with diabetes, HIV/AIDS, hepatitis B, tuberculosis, oncological diseases, asthma, and psychological disabilities. Pensioners, unemployed disabled persons, and persons injured by the Chernobyl disaster are allowed to buy EDL medicines at a 50% discount.
The state purchases the EDL medicines through a tender and then transfers them to the pharmacy for dispensing, or the pharmacy purchases them from the distributor and obtains a refund from the state, including its statutory retail margin. The retail margin includes compensation of the pharmacist's dispensing services.
Legislation and regulatory authorities
The Law on Circulation of Medicines regulates the principles and procedure for clinical trials in Russia. The competent authority is the Ministry of Healthcare.
Conducting a clinical trial in Russia is a pre-requisite to obtaining a marketing authorisation for a medicine to be put on the Russian market. Results of clinical trials in other countries are not acceptable for obtaining a marketing authorisation in Russia.
A clinical trial can be conducted once a clinical trial permit is obtained from the Ministry of Healthcare. The permit is obtained by the sponsor of the clinical trial or a contract research organisation (CRO) acting under a power of attorney from the sponsor. To obtain a permit the applicant must file the following documents:
Clinical trial application.
Results of the pre-clinical trials.
Information on the experience of the investigators who will lead and participate in the trial.
A copy of the patient insurance agreement.
Information on the maximum number of patients in the clinical trial.
Information about the medical site conducting the clinical trial.
The clinical trial protocol.
Every patient participating in a clinical trial must receive a patient information sheet containing full information about the trial. The written informed consent of each patient must be obtained before he/she can participate in the trial. Consent is a prerequisite for the Ministry of Healthcare accepting the clinical trial results for issuing the marketing authorisation.
The following applies:
As a condition precedent for the issuance of a permit for clinical trials, a local ethics committee decides on whether a proposed clinical trial is justified and complies with ethical principles.
The sponsor of the clinical trial must obtain insurance cover for each patient participating in the trial. The statutory minimum amount of insurance cover per patient under Russian law is:
RUB2 million, in case of a patient's death;
RUB300,000 to RUB1.5 million, in case a patient's health deteriorates.
Information about the insurance cover must be included in the information sheet provided to each patient.
The sponsor (or CRO acting on behalf of the sponsor) must enter into a clinical trial agreement with the Russian medical institution (site) conducting the trial.
Whether the sponsor/CRO can enter into a separate agreement with the principal investigator in respect of the investigator's duties during the clinical trial remains open. A separate agreement is neither expressly permitted nor prohibited by Russian law, although the Law on Circulation of Medicines requires the clinical trial agreement with the site to indicate the remuneration paid to individual investigators. In the meantime, the 2008 Rules of Clinical Trials issued by the Ministry of Health prohibit the sponsor/CRO from entering into a separate agreement with an individual investigator. However, as these Rules do not have the effect of law, the fact that a separate agreement with an individual investigator contradicts them does not make such agreement null and void. Therefore, the currently prevailing market practice is for the sponsor/CRO to enter into the clinical trial agreement with the site and a separate agreement with the individual investigator for performing the investigator's duties during the trial, with the two contracts cross-referencing to each other.
Only the principal investigator can have access to patients' personal data. The principal investigator ensures that each patient has been provided with the information sheet and has signed an informed written consent to participate in the trial. The principal investigator assigns a unique personal code to each patient, which is then used in the report on the results of the clinical trial to be forwarded to the Ministry of Healthcare.
Manufacturing medicinal products can only be performed after the manufacturer obtains a licence from the Ministry of Industry and Trade.
An application for a licence to manufacture medicinal products must be accompanied by a number of documents confirming, among other things:
The legal status of the applicant.
Its title to the production premises and equipment.
The applicant having employees with the required qualifications.
An applicant for a licence to manufacture medicinal products must meet the following pre-conditions (as confirmed by the documents attached to the application):
Good and valid title to the premises and equipment required to manufacture the medicinal products for which the licence is being sought, in compliance with the specific sanitary, quality and other requirements.
The manufacturing process must comply with Russian GMP rules.
The applicant must have relevant internal regulations (approved by the applicant's chief executive officer) that include:
a list of pharmaceutical and ancillary substances used for manufacturing purposes, indicating the quantity of each;
information and data on the production equipment which will be used in the production process; and
a description of the technology and methods of quality control at all stages of the manufacturing process;
The applicant must have an employee authorised by the applicant to confirm compliance of the medicinal product stock manufactured at the facility with the requirements in their registration dossier, and to guarantee that the medicinal products are manufactured in compliance with Russian GMP rules.
This authorised employee must have a pharmaceutical, chemistry, medical or biology degree, at least five years' experience in the manufacturing and quality control of medicinal products, and a certificate issued by the Ministry of Healthcare confirming his/her qualifications.
The applicant's employees responsible for manufacturing and marking the medicinal products must possess a professional high or mid-level pharmaceutical, chemistry, chemical technology, medical, biology or biological technology degree.
The licence only covers specific products manufactured at the facility specified in the licence. Manufacturing the same products at a different facility, or manufacturing other products at the same facility, requires prior amendment of the licence.
Restrictions on foreign applicants
There are no specific restrictions on foreign applicants obtaining a licence to manufacture medicinal products. However, a foreign applicant must have registered its presence in Russia before applying for a licence. The only legal form in which a foreign company itself can carry out commercial (including manufacturing) activities in Russia is through a branch of the foreign legal entity. However, for practical purposes it is highly advisable for a foreign company to set up a Russian subsidiary company, which will then apply for and obtain the manufacturing licence. The Russian subsidiary, although owned by a foreign investor, will be considered as a Russian and not a foreign applicant for a medicinal pharmaceutical licence.
In general, there are no restrictions on foreign investment in a Russian company to enable it to obtain and hold a manufacturing licence. However, acquisition by a foreign investor of more than 50% of the shares in a Russian company intending to obtain a manufacturing licence for production of medicines using any infectious agents or for manufacturing medicines containing radiological elements requires preliminary approval of the government's Foreign Investment Committee. This is in charge of controlling foreign investment in industries that are deemed strategically important.
Key stages and timing
Following submission of an application for a manufacturing licence with the respective documents, the Ministry of Industry and Trade must examine the documents and information submitted and decide whether to issue a licence within 45 business days. Within three business days of the Ministry's decision and, if the licence is issued, registration of the licence in the register maintained by the Ministry, the licence (or an official notice of refusal to issue it) must be handed over to the applicant or sent to the applicant by registered mail.
The state duty for the issue of a manufacturing licence is RUB7,500.
Period of authorisation and renewals
The manufacturing licence is issued and valid for an indefinite period of time, subject to compliance with the licence conditions.
Monitoring compliance and imposing penalties
The Regulations for Licensing the Manufacturing of Pharmaceuticals (approved by Government Decree 686 6 July 2012) (clause 5) contain a list of requirements which a licence holder must meet.
The Ministry of Industry and Trade regularly audits companies manufacturing medicinal products and their manufacturing facilities for ongoing compliance with the licence. Similarly, the Federal Supervision Service for Healthcare regularly audits distributors and pharmacies for ongoing compliance with the licence.
A material breach of the licence can result in a fine on the manufacturer's officers of RUB20,000 to RUB30,000, and on the manufacturer of RUB100,000 to RUB150,000. The breaching company's activities can also be suspended for up to 90 days.
Unlawful manufacturing of medicinal products (that is, outside the scope of the manufacturing licence or without a licence) can lead to:
Criminal liability for an individual engaged in such activities (a fine up to RUB3 million and imprisonment for up to eight years). Criminal liability can only be imposed on an individual by a court decision which has come into legal force and effect.
Administrative liability of legal entities (a fine up to RUB5 million and suspension of business for up to 90 days).
Authorisation and abridged procedure
An application for a marketing authorisation for a pharmaceutical product (in Russian terminology, registration of a pharmaceutical as permitted for use in Russia) must be made to the Ministry of Healthcare.
To obtain a marketing authorisation, a medicinal product must undergo an expert examination.
The expert examination of the medicinal product includes:
Expert examination of the documents evidencing the possibility of the product's use as an orphan medicine (if applicable).
Expert examination of the suggested methods of quality control of the medicinal product, and of the quality of the submitted samples of the medicinal products with the use of these methods of quality control.
Expert examination of the expected benefit of the medicinal product compared with the possible risks of its use.
The expert examination is carried out in two stages:
Firstly, the experts analyse the documents submitted by the applicant and decide if the clinical trial of the medicinal product should be permitted in Russia. A clinical trial of the pharmaceutical must be carried out in Russia, irrespective of whether marketing authorisations are held for the pharmaceutical product in other countries. Russia does not recognise the results of clinical trials carried out in other countries.
Once the clinical trial has been completed, the experts examine the efficacy of the medicinal product and its benefit to risk ratio, based on the results of the clinical trial.
Key stages and timing
The key stages of obtaining a marketing authorisation for a pharmaceutical product are:
Filing an application with the Ministry of Healthcare.
Expert examination of the pharmaceutical.
Ethical examination of the pharmaceutical for the purposes of conducting a clinical trial.
Issue of a permit for the clinical trial.
Carrying out the clinical trial.
Submitting a report on the results of the clinical trial to the Ministry of Healthcare.
Obtaining the registration certificate (marketing authorisation).
The law requires the Ministry of Healthcare to complete the registration process within 210 business days following the filing date of the application. However, the law provides that this period is extended:
For the actual duration of the clinical trial.
If the Ministry of Healthcare requests additional documents/information, by the time required for the applicant to collect and submit the additional documents/information.
Article 333.32.1 of the Tax Code (part 2 of 5 August 2000 No. 117-FZ) provides the following fees for certain formalities related to registration of medicines:
Review of the application for registration of a pharmaceutical: RUB110,000.
Expert examination of the pharmaceutical: RUB325,000.
Confirmation of registration of a pharmaceutical (after expiry of the initial five-year validity period of the initial marketing authorisation): RUB145,000.
Period of authorisation and renewals
For any new pharmaceutical a marketing authorisation is issued for an initial period of five years. On expiration of this term, the holder must confirm the registration of the pharmaceutical (that is, the marketing authorisation) with the Ministry of Healthcare. If confirmed, it will continue to be valid for an indefinite period of time.
Confirmation of the marketing authorisation consists of an expert examination of the product's benefits as against possible risks, and/or its quality if the technology of its production has changed compared to that in the registration dossier.
The decision whether to confirm the marketing authorisation and issue a new one must be taken by the Ministry of Healthcare within 90 business days following receipt of the application.
Monitoring compliance and imposing penalties
The quality of medicinal products in Russia and their compliance with the relevant standards is constantly monitored by the Ministry of Healthcare and the Federal Supervision Service for Healthcare. A marketing authorisation can be revoked during the term of its validity in any of the following instances:
Pharmacovigilance studies reveal that the damage or potential damage caused by the use of the pharmaceutical exceeds its efficacy.
The holder does not inform the Ministry of Healthcare in time of any changes to be made to the product registration dossier maintained by the Ministry of Healthcare.
A Russian court issues a decision under which the holder is infringing intellectual property rights to the pharmaceutical, and the decision comes into legal force and effect.
In addition, any sales of unregistered, counterfeit or poor quality pharmaceuticals can lead to:
Administrative liability (for legal entities, a fine of up to RUB5 million and suspension of their business for up to 90 days).
Criminal liability for individuals only: a fine of up to RUB5 million and imprisonment for up to 12 years.
The regulator can only impose administrative liability, and the regulator's decision to impose such liability can only be challenged through court proceedings. Criminal liability can only be imposed on individuals by a court decision.
Each pharmaceutical company is obliged by law to monitor the quality and safety of its medicines, and to report to the Ministry of Healthcare any adverse effects that are not yet included in the medicine's registration dossier. However, the pharmaceutical company is not obliged to monitor how its drugs are distributed, other than being obliged to only sell its drugs to a duly licensed distributor or a pharmacy chain.
Only generic drugs can benefit from the abridged procedure for obtaining a marketing authorisation. However, the abridged procedure does not apply to immunobiological and insulin products or to generics being registered in Russia for the first time.
The abridged procedure for expert examination of the generic must be completed by the Ministry of Healthcare within 60 business days of submission of the marketing authorisation application and all relevant documents. In particular:
The ethical expert examination of the generic must be carried out and the Ministry of Healthcare must decide on the issue of a clinical trial permit within 15 business days.
The quality and benefit to risk expert examination of the generic must be carried out within 45 business days. The applicant must submit information on clinical trials published in specialist publications, and documents and materials containing the results of bioequivalency and/or therapeutic equivalency tests.
From a legal standpoint, parallel import into Russia is not currently allowed. Parallel import can be lawfully prevented by the Russian customs authorities, upon the claim of a Russian party holding an exclusive licence to IP rights to the product being imported into Russia.
The Federal Anti-trust Service has consistently taken the position that prohibition of parallel import contradicts the principles of free competition in the Russian market, so that parallel imports should be allowed as long as the product is genuine.
Based on current discussions in the government, it is highly likely that parallel imports of medicines will be allowed in Russia in the near future.
Restrictions on dealings with healthcare professionals
The following restrictions apply to collaboration of companies manufacturing or dealing with pharmaceuticals and medical devices with healthcare professionals:
Providing gifts or other benefits with a material value to healthcare professionals is prohibited (except for payments related to clinical trials, educational and scientific activity).
Arrangements obliging healthcare professionals to recommend or prescribe specific medicines to patients are prohibited.
Providing healthcare professionals with samples of products for subsequent distribution to patients is prohibited.
Meetings of representatives of pharmaceutical companies and/or their distributors with healthcare professionals (except for meetings with healthcare professionals related to clinical trials, pharmacovigilance, and education of healthcare professionals approved by hospital management) are prohibited.
Provision of false or incorrect information to patients by healthcare professionals is prohibited.
Prescription of medicines on paper containing a reference (name, logo, slogan, and so on) to a particular pharmaceutical company is prohibited.
Russian law has a similar set of restrictions on the interaction between these companies and pharmacists.
Sales and marketing
Medicinal products can only be sold in Russia (both wholesale and retail) by a company or an individual entrepreneur holding a licence for pharmaceutical activities, irrespective of the form of sale.
Medicinal products can only be sold by the licence holder in premises certified as suitable for selling pharmaceutical products. Accordingly, although there are no specific provisions governing the sale of pharmaceuticals through the internet, e-mail or mail order, the sale of pharmaceuticals in Russia by any of these means is not allowed.
Although there is a legal requirement that certain medicinal products can only be sold on presentation of a doctor's prescription, in practice this rule is not enforced, mainly due to the absence of statutory liability for non-compliance.
Legislation and regulatory authority
Federal Law 38-FZ on Advertising dated 13 March 2006, as amended, regulates general principles of advertising in Russia. It contains special provisions governing advertising of certain groups of products with particular social significance, including medicinal products.
The Federal Anti-trust Service monitors compliance of market players with advertising restrictions.
The advertising of medicinal products cannot:
Appeal to minors.
Refer to specific cases of recovery from a particular disease or improvement of a person's health resulting from use of the product.
Express an individual's gratitude for use of the product.
Create an impression about the advantages of the product by referring to its expert examination/trial which is mandatory for its registration (obtaining of marketing authorisation).
State or presuppose that the viewers/readers of the advertisement have the respective diseases or health disorders.
Encourage a healthy person to form the impression that use of the product is necessary (this requirement does not apply to medicinal products designed to prevent rather than treat a disease).
Create the impression that a doctor's advice is not needed.
Guarantee the positive effect of the product, as well as its safety, efficacy and absence of side effects.
Present the product as a nutrient or a food supplement, or as any other product which is not a medicinal product.
State that the safety and/or efficacy of the product are guaranteed by is natural origin.
Some requirements stated above equally apply to the advertising of medical devices.
The requirements in the second and third bullet points above do not apply to:
Advertisements distributed at special medical or pharmaceutical exhibitions, seminars, conferences and other similar events, and in specialist publications designed solely for medical and pharmaceutical professionals.
Advertising in any other form, if it is addressed solely to medical and pharmaceutical professionals.
The description of characteristics of a medicinal product in advertising, including the methods of its application and use, is only allowed as described in the patient leaflet for the product registered with the Ministry of Healthcare.
Advertising of prescription medicines and medical devices requiring special training for their use is only allowed:
At special medical or pharmaceutical exhibitions, seminars, conferences and other similar events.
In specialist publications designed solely for medical and pharmaceutical professionals.
Advertising of non-prescription medicinal products and medical devices aimed at a mass audience must contain a warning on the counter-indications for using the product, the need to read the patient's manual to use them, or to get a doctor's advice.
A radio warning should last at least three seconds, while a TV or cinema warning should last at least five seconds, and the text of the warning must take up at least 7% of the area of the shot. For a printed advertisement, the text of the warning must occupy at least 5% of the total area of the advertisement.
Advertising in any form for narcotics and medicinal products containing them is prohibited.
There is no specific regulation of advertising on the internet. All restrictions set out above apply equally to any advertising of medicinal products on the internet.
Any information relating to an individual is considered personal data in Russia. A person or legal entity receiving personal data from an individual in cases provided by law (for example, an employer entering into an employment agreement with an individual, or an investigator enrolling an individual patient into a clinical trial) is deemed an operator of the personal data. The operator can only transfer personal data to a third party with the individual's prior consent. In some cases (for example, information relating to the individual's health) the prior written consent of the individual is required.
These personal data protection rules apply to all cases where information about an individual is concerned, such as clinical trials, pharmacovigilance, adverse event reporting and data protection compliance. In clinical trials and pharmacovigilance the personal data is usually depersonalised by its operator in order to transmit the information to third parties, and to exclude the information from the data protection laws.
As of 1 September 2015, operators of personal data must store personal data in servers located in the Russian Federation.
Packaging and labelling
Legislation and regulatory authority
The packaging of a medicinal product must be identical to the specimen of the packaging approved by the Ministry of Healthcare during the product's registration (issue of marketing authorisation). The specimen packaging is part of the registration dossier for the product, maintained by the Ministry of Healthcare.
The Law on Circulation of Medicines (Article 67) regulates the labelling of medicinal products and sets out the information that must be provided on the label, with particular requirements for certain categories of pharmaceuticals.
The Federal Supervision Service for Healthcare monitors compliance with packaging and labelling requirements.
Pharmaceuticals can only be circulated if all the necessary information is provided on the package and in the information leaflet enclosed in the packaging, including:
International non-proprietary name or chemical or trade name.
Best before date.
Depending on the characteristics of the pharmaceutical (narcotic, homeopathic, and so on) additional information requirements may apply.
All information must be provided in Russian.
Medicinal product liability in Russia is governed by the Law on Circulation of Medicines, the Administrative Code and the Criminal Code.
The Federal Supervision Service for Healthcare can recall a product from the market if it determines that its quality is inadequate.
In addition, circulation of unregistered, counterfeit or poor quality pharmaceuticals can lead to:
Administrative liability (for legal entities: a fine of up to RUB5 million and suspension of business for up to 90 days).
Criminal liability (for individuals: a fine of up to RUB5 million and imprisonment for up to 12 years).
Pharmacovigilance related information must be reported to the Ministry of Healthcare.
In addition, information about any changes to be made to the registration dossier of the pharmaceutical must be filed with the Ministry of Healthcare within 30 days after the relevant event.
Circulation of pharmaceuticals of poor quality can lead to administrative and criminal liability (see Question 19).
Medicinal product liability can include:
Administrative liability under the Administrative Code (imposed if the inadequate quality of the product is discovered by the competent authorities, either on their own during their planned audit or on the claim of a market player or consumer).
Criminal liability (applicable only to individuals) under the Criminal Code (imposed if the inadequate quality of a pharmaceutical product resulted in death or severe damage to a person's health).
Civil liability under the Civil Code. This includes:
contractual liability of any seller of the defective medicinal product to the buyer; and
tort liability of the manufacturer, retailer, or Russian party authorised to receive and consider the consumer's claims for inadequate quality of the product to the consumer.
Disciplinary liability (in the form of dismissal of an employee guilty of causing defects in the quality of the medicinal product). This can only be applied by the employer to its employees).
If inadequate quality of a medicinal product is detected by any of the distributors or by a pharmacy before the product is sold to consumers, this is a ground for the contractual liability of the seller of the defective medicinal product to the party that discovered its inadequate quality. Therefore, a party in the distribution chain who discovers the inadequate quality of the product can file a claim for compensation of damages, but only against the seller counterparty which supplied the medicinal product to it on the basis of the contract (distribution, supply, purchase and sale, and so on) between them.
If inadequate quality of a medicinal product is detected by a consumer, under the Consumer Protection Law the consumer can claim damages from any of the following:
The retailer (the pharmacy).
The manufacturer of the defective medicinal product.
A Russian entity authorised by the manufacturer to receive and consider consumer claims about the inadequate quality of the products.
In respect of imported medicinal products, due to practical difficulties of filing a claim against a foreign manufacturer, Russian consumers usually file their claims with the pharmacy that sold the defective product, or with a Russian entity authorised by the manufacturer to consider consumer claims.
If a distributor or pharmacy makes a product liability claim, it can only file the claim against the supplier from whom it purchased the defective product.
Under general principles of Russian law, if the purchased product turns out to be of inadequate quality the buyer generally can, at its sole discretion, demand that the seller:
Reduces the purchase price pro rata to the defects discovered.
Fix the defects in the product for free.
Compensate the costs incurred by the buyer for fixing defects in the purchased product.
If the defects discovered by the buyer in the product cannot be fixed, or if the cost or time required for elimination of the defects is inadequate or the defects are multiple or revealed again after their removal, the buyer at its discretion can either:
Terminate the purchase and sale agreement and claim back the purchase price paid for the defective products plus statutory interest.
Demand replacement of defective products with products of adequate quality, at no cost to the buyer.
These are statutory remedies of the buyer which cannot be waived or altered in the purchase and sale/distribution contract if it is governed by Russian law.
However, the seller is not liable for defects in the quality of the sold medicinal products if the defects have arisen due to the buyer's failure to comply with the conditions of their transportation, storage and handling conveyed by the seller to the buyer.
The scope of the seller's liability upon such a claim can be limited if the parties have agreed to the limitation in the contract (for example, it can be limited to the amount of the direct damage suffered by the buyer, that is, the value of the defective products plus related expenses for their storage, transportation, and so on). Such a limitation of liability will be disregarded by a court if it determines that the product quality defects were caused by wilful misconduct of the defendant and/or its personnel.
If a consumer makes a product liability claim, as set out above, he/she can lodge it against the pharmacy from which he/she purchased the defective product, or directly against the manufacturer or Russian entity authorised by the manufacturer to receive and consider consumer claims. The likelihood of filing a claim against the manufacturer of an imported product is minimal. The defendant's liability for such a product liability claim by an individual consumer is unlimited. However, under Russian law a consumer can only claim direct damages (as lost profits would not apply in this case). Accordingly, the consumer will have to prove to the court the amount of direct damage incurred (including the price of the defective product, expenses for medical assistance needed to mitigate the results of the consumer taking the defective product, and so on), including moral damages. So far, Russian courts have been very reluctant to award any substantial amounts to cover specifically moral damage sought by consumers.
The general limitation period for seeking damages is three years from the date on which the person learned or should have reasonably learned about the breach of his/her rights caused by the defective product (but no more than ten years from such date).
Class actions do not exist as a legal concept under Russian law.
The remedies available to a claimant that is a commercial entity are determined by the contract on the basis of which the claimant purchased the product and the applicable law governing the contract.
The remedies available to an individual consumer claimant include the individual's right to file a claim for compensation of all direct damage incurred by the claimant due to consumption of the defective product, including:
The cost of the product itself.
Medical and other expenses incurred to fix the damage caused to the claimant's health due to consuming the defective product.
An individual consumer can also in theory file a claim for compensation of moral damage, but will have to prove to the court the degree of his/her mental and physical suffering directly caused by consuming the defective product.
Reform of the Russian pharmaceutical market has been ongoing since about 2010 when the Law on Circulation of Medicines came into effect.
The government is expected to continue to put pressure on foreign pharmaceutical companies to start local manufacturing of their products in Russia, instead of importing them from abroad. The criteria for a pharmaceutical product to qualify as locally produced in Russia may therefore be finally developed and approved.
Enforcement of the compliance provisions to increase the transparency of dealings between representatives of pharmaceutical and medical devices companies and healthcare professionals is likely to increase. In line with this, there may be amendments to the law to ultimately introduce administrative liability for pharma and medical device companies, and for healthcare professionals for breaching the existing restrictions.
Integration of Russian drug registration and circulation rules with those of other members of the EurAsian Community will continue. In line with this, it is highly likely that parallel import of medical products will be allowed in the near future.
Anna McDonald, Partner, Co-head of Russian Life Sciences practice
Professional qualifications. Moscow State University, 1989, Law Degree, with Honours.
Areas of practice. Life sciences and healthcare.
- Advising pharma clients on structuring relations between various players in clinical trials of pharma products in Russia, and preparing and negotiating contracts required to achieve this.
- Advising on licensing requirements (manufacturing, storage and wholesale) for pharma companies and their distributors.
- Advising pharma clients on licence, manufacturing, marketing and distribution agreements, including Russian regulatory issues in connection with marketing authorisations for products covered by such agreements.
- Negotiating lease contracts for storage of pharma products and medical equipment.
- Advising on pricing issues.
- Advising on various pharma regulatory issues.
Languages. Russian, English
Snezhana Sharova, Associate
Professional qualifications. Higher School of Economics, 2010; University Paris I Pantheon Sorbonne, Master of EU Public Trade Law, 2011.
Areas of practice. Life sciences and healthcare.
Languages. Russian, English, French