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Parallel import is the instrument for overcoming shortage of medicines 

Kasper Ernst – Secterary General of Affordable Medicines Europe (AME)

Kasper Ernst has worked for the last 9 years in European affairs advocacy in Brussels. From 2009 -2018 he was with the Confederation of Danish Enterprise, since 2015 serving as Director of the EU & International Department. He has also served as the Board Member of several EU-level business organisations, as a Member of the Danish Government’s Implementation Council, and was co-founder of the European Business Services Alliance. In addition, he is an external lecturer at Copenhagen Business School. He holds a Master’s degree in International Business and Politics from Copenhagen Business School and Singapore Management University.  

How Europe managed the challenges related to COVID 19 in regards to medicinal products supply?

The response has been very different. In general, almost all Member States authorities have reacted with a short-sighted strategy of getting as much medicine as possible to stay in their territory. However, all countries are interdependent on each other. No country produces all of what they need. So when all Member States do this, some will have too much medicine A, B, C, but nothing of X, Y, Z. This makes no sense. The European Commission has reacted very swiftly and strongly to ensure that Europe kept medicines moving across borders, so that all Europeans, including the Bulgarian patient, would get all the medicines they need for COVID-19. The EU Commission has been quite successful, and I think proven that EU solidarity has ensured fewer COVID-19 shortages than we would have otherwise seen. It could have become a nightmare if we had not worked together. Also, the EU Commission is a much stronger player vis-à-vis e.g. India, which also made export bans. India produces up to 40% of all the API’s for EU medicines, and for medicines used to treat COVID-19 even more. Small Member States like Bulgaria or Sweden cannot easily negotiate with India – but when the EU stands together we can.

What was the input of parallel exports and imports in preventing shortages across Europe?

During these crises we have helped move products where they were most urgently needed. In Belgium, which has the highest death rate in Europe, we helped to bring in more paracetamol from outside the EU. We have also imported many mouth masks etc. We know how trade works, and therefore we could more easily adapt and get the best quality from outside the EU. Our parallel imports to Bulgaria have also helped during this crisis.

Where is Bulgaria on the EU map regarding parallel distribution?

Bulgaria is a very important country, because Bulgaria is proof that we can parallel import into all EU countries, even the newest EU members. Although prices are generally low in Bulgaria, there are always individual medicines with a lower price in other countries – these we bring to Bulgaria.

Bulgaria also has some of the best models for patients in terms of solving shortages in practice. In many Member States there is much talk and discussion about shortages, but in Bulgaria, stakeholders have actually taken action and done something concrete for the patients. This we always bring forward as the best practice for all of Europe. Bulgaria is really number 1 in this context.

Bulgaria also exports excess medicines to other EU countries, and this helps them to have more competition and keep their prices down as well. Therefore Bulgaria is a very important partner for many EU countries, and they respect the Bulgarian distribution sector very much for their fairness and quality.

What are AME analysis and estimations showing about access to therapy and shortages?

Shortages are unfortunately not easily solved, because they primarily relate to manufacturing problems (factories which must close for safety reasons, or production where the quality of the medicine is not high enough), or as in Bulgaria when manufacturers choose to withdraw from the market, because they claim prices are too low. The European Parliament and European Commission is currently working on proposals to solve the problems of manufacturing shortages. This is due to more requirements on manufacturers for better planning and higher quality, as well as moving production back to Europe. For commercial withdrawals we believe parallel imports may be an important part of the solution, but also a more flexible regime for pricing of generics seems to work well. For patent products there should be no commercial withdrawal – here the prices are always so high in all countries that the commercial argument is invalid if the manufacturer produces enough medicines for Europe in total. We need therefore a combined EU public service obligation on top of the national.

How can medicines supply chain be further secured and what are the market mechanism for avoiding any obstacles in the delivery to patients and health care facilities? 

We need manufacturers to plan their processes better, and then we need more medicines in the market – simply more packs. Today manufacturers restrict production to the very minimum of what they think is needed. Often their predictions are wrong, which lead to shortages. Or even very small disruption, like a truck whose cooling system fails and the medicines must be destroyed, causes a magnifying cascade of disruption throughout the supply chain leading to shortages. This is not acceptable. 

In many situations parallel imports could be used much better for solving also very short-term shortages, but unfortunately the legal framework is not up to date to handle this, so we propose a better legal framework to promote parallel imports in case of shortages.


   Parallel import is the instrument for overcoming shortage of medicines
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