With the new medicine markup model, Latvia violates EU norms /

by times news cr

When conducting a legal analysis of the new⁢ medicine mark-up model, representatives of ⁤the medicine⁣ supply industry concluded that Latvia, by ‍adopting regulatory acts‌ for its implementation ​from January 1, 2025, has ‌most⁢ likely violated the‍ international obligations stipulated in the EU’s primary legal acts. LNZAA plans to file a⁤ complaint with the European Commission ⁣about the mentioned⁣ violations, which will ⁢be asked to initiate ‍a violation procedure against ​the Republic of Latvia. In order to achieve the effective prevention of violation of the rights guaranteed to ‍the members of‍ the committee as foreign investors in Latvia in EU legislation, the members appealed ‍to Silinas with an invitation to get involved in⁣ the prevention of the mentioned violations, asking to postpone the introduction of the new medicine mark-up model and improve ⁤it so that it⁣ complies with EU law.

LNZAA and its members representing foreign capital have⁢ already informed that they have repeatedly objected to the amendments adopted by the ⁢government on July 16 of‍ this year in the⁢ regulations ​of the Cabinet of⁣ Ministers dated October 25, 2005⁤ no. 803 “Regulations on the ⁢principles⁣ of drug price formation”⁤ and Cabinet of Ministers⁢ regulations of October 31, 2006 no. 899 “Procedure for reimbursement ⁢of expenses for the purchase of ⁤drugs ⁤and medical devices intended for outpatient treatment”, which provides for the introduction of a new drug mark-up model.

It has been ⁢announced several times that the amendments to the mentioned regulations from January 1, 2025 envisage the introduction of a new⁣ medicine mark-up model, according to which a fixed mark-up of EUR 0.50 is set for wholesalers for⁤ the‍ distribution of one prescription medicine package, thus limiting the possibilities​ of medicine supply ⁤companies to determine distribution and storage cost-appropriate markup for one prescription drug package.

In the ‌view of foreign investors in the pharmaceutical supply industry, such a markup model⁣ disproportionately limits their right to freedom of business, ⁤as ⁤wholesalers will no longer be able to cover their⁣ costs ‍for the supply‍ of ‌all medicines, nor will it be possible to ensure the current ​frequency of supply to pharmacies and hospitals. Foreign⁤ investors believe that the new mark-up model may lead to greater physical unavailability of medicines for patients. Therefore, the ​government should postpone the entry into force of the adopted amendments, and the European Commission should assess the ⁣compliance of the new medicine markup model with EU law before adverse consequences occur.

The Foreign Investors Committee of LNZAA represents drug ‌supply companies⁣ owned⁤ by businessmen ‌of other EU member states who, through subsidiary companies, carry⁢ out commercial activities in the wholesale distribution ‍of drugs in Latvia.

‌What are the ​potential consequences for⁢ Latvia’s pharmaceutical market if the new medicine‍ mark-up model violates EU regulations?

Time.news Interview: Legal Implications of Latvia’s New Medicine Mark-up Model

Interviewer (Time.news ⁣Editor): Welcome to‍ today’s interview. We’re examining an important issue⁢ in the pharmaceutical sector: Latvia’s new medicine mark-up model, set to go‌ into effect on ⁤January 1, 2025. Joining us ‍is Dr. Alina Sokolov, an expert in international​ trade ⁤law and a consultant ‌for pharmaceutical​ policy. Dr. Sokolov, thank you‌ for being here.

Dr. Alina Sokolov: Thank you ‍for having me. I’m excited to discuss ⁤this crucial topic.

Interviewer: ⁤Let’s dive right in.⁤ The LNZAA has‌ raised concerns that Latvia’s new ​regulatory ⁤acts might violate ⁢EU obligations. ⁤Could you elaborate on what these international obligations entail?

Dr. Sokolov: ‍ Certainly. The European‍ Union has established legal frameworks⁢ designed to ensure fair competition and protect the rights of foreign ‌investors‌ within member states.⁤ Latvia’s new mark-up ⁣model, as it currently‌ stands, risks contravening these legal obligations, particularly‍ concerning transparency and equitable treatment ‍of​ foreign pharmaceutical companies operating in the country.

Interviewer: ⁤The‌ LNZAA plans to file a complaint with the ‌European Commission. What ⁢might ​come ‍of that process?

Dr.‍ Sokolov: If the complaint is lodged, the European⁤ Commission could initiate⁤ a violation procedure against Latvia. This could lead to investigations ⁣into the ‍legislative changes, ⁤potentially resulting in⁣ required amendments or even sanctions ⁢if violations are ‍confirmed. ⁣It’s a significant​ step, as it involves oversight from ‍the EU level, emphasizing ⁤the seriousness of ‍the situation.

Interviewer: The industry⁢ representatives have expressed a desire for dialogue with the Latvian government. How ⁢essential is this engagement for ⁤resolving such complex regulatory ‌issues?

Dr. Sokolov: ⁤ Effective‍ communication​ is critical. ⁣It allows stakeholders to ​present‍ their concerns constructively and ideally ⁢come to⁣ an⁣ agreement that aligns with EU ​legislation while also addressing national ​interests. Postponing the implementation of ⁤the new mark-up model would provide‌ necessary time to‌ refine​ the regulations and ensure compliance, ultimately benefiting ⁤all parties involved.

Interviewer: How have the pharmaceutical companies reacted ​to the amendments introduced by​ the Latvian ⁣government earlier‌ this year?

Dr. Sokolov: The companies​ in question‍ have voiced their concerns ‌repeatedly, insisting‌ that the amendments threaten their operations and profitability in Latvia. Their objections highlight the‌ potential negative impacts ‍on market stability, the availability of⁣ medicines, and even healthcare costs for consumers.

Interviewer: As an expert in this field,⁢ what do you think is the best course of action for⁢ the ⁣Latvian government moving forward?

Dr. Sokolov: ​ The government should conduct thorough‍ consultations with industry stakeholders ⁢before finalizing‌ the new‍ regulations. They⁤ should reassess the proposed mark-up model, ⁢ensuring⁢ it is compatible with EU law and ⁢addresses‌ the concerns raised by⁤ the LNZAA. Prioritizing a collaborative approach ⁣can lead to a more ⁣sustainable‌ solution‌ that enhances Latvia’s ⁤pharmaceutical market and secures the ⁣rights ⁢of ‍foreign investors.

Interviewer: ‍ It seems clear ⁢that action is necessary. ‍If Latvia fails to comply with‍ EU obligations,​ what could the broader implications be for the pharmaceutical sector?

Dr. Sokolov: Non-compliance could lead to⁤ a ‍chilling effect on foreign investments, ‌as companies ⁣may seek more ⁣stable regulatory ⁣environments elsewhere. This could restrict access to essential medicines, hamper innovation, and ultimately hurt patients in Latvia.⁤ The⁤ health sector thrives on ‍a⁢ balance of interests, and⁣ any disruption can⁤ have far-reaching consequences.

Interviewer: Thank‍ you for⁣ your insightful analysis, Dr. Sokolov. It’s evident that navigating‍ these regulatory challenges will⁢ require careful consideration and ​collaboration. We appreciate‍ your time today.

Dr. ‍Sokolov: ⁣ Thank⁣ you for having me. It’s been a ‌pleasure discussing these important issues with you.

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