19.11.2014

Seminar: The Main Trends in the State Regulation of Prices for Medicinal Products in Ukraine

On November 19 the Arcane Art Gallery hosted a workshop organized by Arzinger Law Office. Speakers at the event were lawyers of the Life Sciences & Healthcare practice Lana SinichkinaSvitlana Malynovska and Leonid CherniavskyiThey discussed issues related to state price regulation for medicinal products in Ukraine, their regulatory and antitrust aspects as well as reimbursement issues with the representatives of the pharmaceutical market invited to the event. Lawyers of Arzinger keep monitoring the changes in legislation that affect the activity of the pharmaceutical market players in Ukraine

The workshop was opened by Lana Sinichkina, Partner and Head of Life Sciences & Healthcare at Arzinger. She presented a an overview of recent changes in the legislation of Ukraine and made a particular focus on reference pricing, having touched upon the chronology of its implementation as well as the new declaration procedure for changes in wholesale and selling prices. She cited the first officials of the state in relation to prices for medicines and stated the traditional populism of Ukrainian authorities in this area. While promising cheap treatment to the population, the State does not allocate additional funds to finance the healthcare sector or offer innovative approaches to improving the quality and availability of medicines, but puts pressure on manufacturers by administrative methods to reduce prices. “A total lack of understanding of economic processes or their intentional neglect is the major problem of the Government's decisions in this area,” Lana said.

The next to take the floor was Senior Associate Svitlana Malynovska, who is an expert in in Life Sciences & Healthcare as well as in Antitrust & Competition. Svitlana told about the possible implications of the recent changes for market participants and emphasized the problems arising in the declaration of changes in wholesale and selling prices. Moreover, the expert detailed the risks of antimonopoly violations in the light of close attention of the Antimonopoly Committee of Ukraine to the pharmaceutical market of Ukraine during the last several years and the practice of antitrust investigations against global pharmaceutical companies operating on the Ukrainian market in relation to the price overstatement alleged by the Committee.  In this regard, Svitlana drew the participants’ attention to the high risks of competition violations arising inter alia from unreasonable reductions in prices for medicinal products due to the introduction of reference pricing. In her report she referred to the practice of the Antimonopoly Committee of Ukraine as well as to pharmaceutical companies’ practice. Svitlana Malynovska spoke about the liability of market participants for pricing and competition violations and provided hands-on advice on how to mitigate the said risks.

The final part of the workshop was the assessment of the prospects and possible ways of implementing reimbursement in Ukraine presented by Associate Leonid Cherniavskyi. He told about the provisions of the Association Agreement with the EU and the relevant Implementation Plan of the Cabinet of Ministers of Ukraine, which involve the development of the reimbursement system implementation and functioning concept for Ukraine. In addition, Leonid presented an overview of the reimbursement and price regulation tools for medicines used in the EU and spoke about the nature of the healthcare technology assessment mechanism by citing some examples from the USA, Germany, and the UK. Based on the EU experience, the lawyer suggested a possible reimbursement structure which would function in Ukraine.

Arzinger’s lawyers always promptly respond to legislative changes and thus are able to provide timely advice to clients in all areas of business.

The workshop was organized as a discussion, where everyone could ask a question or speak about the most interesting points of the peers’ reports. The described risks of competition violations were of great interest for the participants. Most of them were actively involved in the discussion seeking for practical solutions to the situation with pricing in their companies. The choice of location has largely contributed to the special format of the event, as Arcane Art Gallery creates a unique chamber atmosphere conducive to a fruitful dialogue. "This format provides for an effective discussion of business issues and makes it possible to brighten up the event with a special creative mood," Lana Sinichkina noted.

Arcane Art Gallery is the first Gallery of Objective Art and the only one in Ukraine to feature a single artist - Galina Moskvitina. The Gallery has been established as a presentation and communication platform for all those interested in Objective Art.