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Ukraine modifies medicines law

Data exclusivity protection for innovative medicines to be limited in line with international standards

Ukraine has announced new legislation governing medicinal products that effectively limits the data exclusivity protection provided to innovative medicines.

The adoption of Law No. 3998-VI is set to bring data exclusivity provisions into line with international standards, and "modifies a previous one that is seen as being excessively favourable to innovative producers," according to Brendan Melck, European analyst at IHS Global Insight.

Ukraine remains a small pharmaceutical market at the moment, but its 46 million-strong population and increase in consumer spending capacity in recent years make it a long-term target for many overseas drugmakers.

Under the new rules, registration of generics in Ukraine is permitted five years after the originator product was registered in in the country.

Six years of data exclusivity can be however be given to the innovator company if - during the first three years of marketing - new indications are awarded which are "advantageous" compared to the original indication, although the criteria for this have yet to be elaborated by the Ukrainian authorities, according to a note from law firm CMS Cameron McKenna.

More significantly for pharmaceutical companies, however, are provisions that state data exclusivity can only be awarded to originator products that are registered in Ukraine within two years of initial registration in any other country.

"Although the original amendment to the law is seen as giving too much away to innovative producers, the new amendment provides the 'stick' as well as the 'carrot'," said Melck.

"Companies will be forced to consider entering the Ukrainian market earlier than they might have planned, if they had planned to enter it at all."

Meanwhile, the new amendment confirms the legal status of compulsory licensing of medicines, a measure introduced by Ukraine's government to allow import substitution in order to stimulate the growth in domestic pharmaceutical manufacturers.

A recent report from Business Monitor International downplays the impact of this development however - at least in the near term - as it believes the local industry lacks the capacity and capital to exploit this opportunity.

"For innovative pharmaceutical companies, these are negative, if not entirely surprising, developments," commented Melck.

"Ukraine remains an important market, due to its sheer size and potential, although it is set to remain a challenging one for the foreseeable future."

7th December 2011

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