Market Access in Ukraine

October 13, 2014
Lana Sinichkina

,
Leonid Cherniavskyi

Pharmaceutical Executive

On September 16, 2014, the Ukrainian and European parliaments ratified the EU–Ukraine Association Agreement (AA), providing for harmonization of many spheres of Ukrainian legislation with EU policy.

On September 16, 2014, the Ukrainian and European parliaments ratified the EU–Ukraine Association Agreement (AA), providing for harmonization of many spheres of Ukrainian legislation with EU policy.

In line with the signed AA, the government has adopted a detailed implementation plan, which endorses for preparation and approval by the end of 2015 the concept for a new healthcare system in Ukraine. The concept covers all fields of the healthcare sector, from education and self-government of healthcare professionals to financing public hospitals and reimbursement of the cost of medicinal products and medical devices to patients. Although the concept is still to be elaborated and approved, the reform legislation continues apace, with the long-term goal of establishing a developed and sustainable regulatory framework in Ukraine.

Marketing authorization simplified
On September 5, 2014, Ukraine’s Law on Medicines was amended, adding a category of products subject to simplified marketing authorization procedures. The new procedure applies to medicinal products

  • intended exclusively to treatment of tuberculosis, HIV/AIDS, cancer and rare (orphan) diseases; and

  • authorized for use by competent authorities of the United States, Swiss Confederation, Japan, Australia, Canada or European Union (countries with “high regulatory standards”).

The amendments to the Law on Medicines outline the reasons why medicinal products may be denied marketing authorization in Ukraine: 1) submission of incomplete set of documents; 2) incomplete or inaccurate information in the submitted documents; 3) if the manufacturer mentioned in application is different than the manufacturers approved in marketing authorizations for countries with high regulatory standards.

A current draft law (prepared by the Presidents’ Administration, with expert industry input) extends the list of countries considered to have high regulatory standards, adding Australia, New Zealand and Israel. If the draft law is approved (which may happen at the end of October 2014), all medicines authorized in countries with high regulatory standards will be have faster access to Ukraine’s US$3 billion pharmaceutical market.

Reference pricing  The government has however introduced stricter pricing limits for medicinal products. Wholesale price change declaration has been mandatory for medicinal products purchased with state funds or included in state pilot programs on reimbursement for several years. However, the previous declaration procedure did not provide any specific restrictions as to the level of wholesale price declared by the marketing authorization holder.

On August 1, 2014, the Procedure for Wholesale Price Calculation for Medicinal Products was approved by the Ministry of Healthcare. Under the new system the MH may not declare the wholesale price at a level higher than the reference price (calculated as simple average of the wholesale prices of respective medicinal products, where the country of origin is Bulgaria, Moldova, Poland, the Slovak Republic, the Czech Republic, Latvia, Hungary, Serbia and Ukraine).

Where there is no general reimbursement system functioning, the introduction of additional pricing restrictions (the government proposed at the drafting stage that reference pricing applied to pharmacy sales of Rx products) seems an unreasonable move on the part of the government. However, given the path toward harmonization with EU laws, stricter pricing in Ukraine can be seen as the first step to the implementation of a comprehensive reimbursement system.

Lana Sinichkina is Partner and Head of Life Sciences and Healthcare, and Leonid Cherniavskyi is Associate at Arzinger Law Office.

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