Administrative and Penal Responsibility for Violations of Medical Device Marketing Regulations

M.A. MIGEEVA AND A.D. ZHIRNOV Administrative and Penal Responsibility for Violations of Medical Device Marketing Regulations Migeeva M.A., Zhirnov A.D. Administrative and criminal liability for offences in the field of medical devices The article tells about administrative and criminal liabilities in violating the current legislation in the field of medical devices. Articles from the Administrative Offences Code and the Criminal Code which apply to offences in the field of medical devices are provided. Keywords: circulation of medical devices, public regulation, administrative liability, criminal liability M.A. Migeeva A.D. Zhirnov The Federal Public Health Surveillance Service is a federal executive agency for control and surveillance of public healthcare. Under the powers vested therein, it carries out: the state registration of medical devices; safety monitoring of medical devices and keeping records of any adverse effects or reactions resulting from the use of medical devices, and any facts and circumstances of registered medical devices distributed in the market that pose a threat of harm to human life and health; and government control over the marketing of medical devices. M.A MIGEEVA, Deputy Head of Roszdravnadzor s Administration for State Control and Registration of Medical Devices, migeevama@roszdravnadzor.ru A.D. ZHIRNOV, Senior Specialist / Expert of Roszdravnadzor s Department for State Control over the Marketing of Medical Devices, zhirnovad@roszdravnadzor.ru This article is concerned with the government s control over the marketing of medical devices and the measures of administrative and criminal liability for violations of the medical device marketing regulations. Article 38 of Federal law No. 323-FZ On Foundations of Public Health Protection in the Russian Federation (hereinafter referred to as Law No. 323-FZ) defines medical devices as any tool, apparatus, instrument, equipment, material, and other device that is used for medical purposes, either alone or in a combination with other medical devices, as well as together with the other accessories which enable that device to be used in accordance with its intended use, including special software, and that is designed by the manufacturer for the purposes of prevention, diagnosis and treatment of disease, medical rehabilitation, human body monitoring, medical research, restoration, replacement or alteration of anatomical structure or physiological function, and prevention or interruption of pregnancy, and the functionality of such device is not implemented through pharmacological, immunological, genetic, or metabolic effects on the human body. The government control over the marketing of medical devices is one of the controls in public health protection and includes control over the technical testing, toxicological studies, clinical trials, efficacy, safety, production, manufacture, sales, storage, transportation, importation into and exportation from the Russian Federation, installation, setup, application, operation, including maintenance, repair, use, disposal, or destruction of medical devices. 10 VESTNIK ROSZDRAVNADZORA No. 3-2015

The government s controls applicable to medical devices are governed by the following laws and regulations: Federal law No. 323-FZ On Foundations of Public Health Protection in the Russian Federation (Articles 38, 85 and 95); Decision No. 970 of the Government of the Russian Federation, dated September 25, 2012, On Approval of the Regulations Concerning State Control over the Marketing of Medical Devices ; Decision No. 323 of the Government of the Russian Federation, dated June 30, 2004, On Approval of the Regulations Concerning the Federal Public Health Surveillance Service (paragraphs 5.1.2, 5.2.2 and 5.3); Order No. 196n of the Russian Ministry of Health, dated April 05, 2013 On Approval of the Administrative Regulations of the Federal Public Health Surveillance Service on the Exercise of Control over the Marketing of Medical Devices on Behalf of the State ; Order No. 175n of the Russian Ministry of Health, dated September 14, 2012, On Approval of the Procedure for Safety Monitoring of Medical Products ; Order No. 12n of the Russian Ministry of Health, dated June 20, 2012, On approval of reporting procedures for any occurrence of adverse effects not mentioned in medical device operating instructions or user s manual, adverse reactions associated with its use, interactions between medical devices, facts and circumstances presenting a threat to the health and lives of patients and medical heath professionals when using and operating medical devices ; Order No. 7n of the Russian Ministry of Health, dated June 15, 2012, On Approval of the Procedures for Importation of Medical Devices into the Russian Federation for State Registration Purposes ; Administrative Offences Code of the Russian Federation, No. 195-FZ, dated December 30, 2001 (6.28, 6.33, 14.43, 14.44, 14.46, 19.4, 19.5, 19.7.8, and 19.33); Criminal Code of the Russian Federation No. 63-FZ, dated June 13, 1996 63-FZ (Articles 235.1, 238.1 and 327.2). The government s controls apply to legal entities, officers in charge and other officers of legal entities, private entrepreneurs and authorized representatives thereof who are engaged in commercial distribution of medical devices. The existing system of government control identifies medical device non-conformities with the applicable quality, efficacy and safety regulations at each phase of commercialization, as well as identifies and withdraws any unregistered and adulterated medical devices. Information about such devices is then posted on Roszdravnadzor s official website at www.roszdravnadzor.ru in the Electronic Services Medical Device Disclosure Letters. Considering the importance of the application and use of high-quality, effective and safe medical devices, administrative and, subsequently, criminal liability for marketing falsified, counterfeit, adulterated, and unregistered medical devices was introduced for the first time in the Russian Federation. Therefore, from January 1, 2014, Roszdravnadzor is authorized to initiate and examine administrative proceedings pursuant to Article 6.28 of the Administrative Offenses Code of the Russian Federation (hereinafter referred to as the Administrative Code), i.e., any violations of the existing rules for the commercialization of medical devices. On January 23, 2015, amendments to the Administrative Code and the Criminal Code of the Russian Federation (hereinafter referred to as the Criminal Code) entered into force. The amendments provide liability for violation of the medical device laws. The s under the medical device laws and regulations can be divided into several groups as follows: 1. Violations of the medical device marketing regulations: Article 6.28 of the Administrative Code entitled Violation of the existing medical device rules, where the acts committed do not constitute criminal offense ; Article 6.33 of the Administrative Code Marketing falsified, counterfeit, adulterated, and unregistered medicinal products and medical devices, and trading in falsified biologically active additives. 2. Violation of technical regulations and product conformity requirements: Article 14.43 of the Administrative Code Noncompliance with Technical Regulations by a Manufacturer, Contractor (or a Person who Performs the Functions of a Foreign Manufacturer), or a Seller"; Article 14.44 of the Administrative Code False Declaration of Conformity ; Article 14.46 of the Administrative Code Violation of the Procedure for Labeling of Products Subject to Mandatory Conformity Assessment. VESTNIK ROSZDRAVNADZORA No. 3-2015 11

3. Misconduct during inspection: Article 19.4 of the Administrative Code Disobedience to Lawful Instructions of an Officer of a State Control (Surveillance) Authority or Municipal Control Authority ; Article 19.4.1. of the Administrative Code Obstructing the Lawful Activity of an Officer of a State Control (Surveillance) Authority or Municipal Control Authority"; Article 19.5. of the Administrative Code Failure to Fulfill a Lawful Order (Judgment, Communication or Decision) of a State/Municipal Control (Surveillance) Authority/Officer in Due Time ; Article 19.7.8 of the Administrative Code The Failure to Submit Information or the Submission of False Information to the Federal Executive Authority Responsible for Public Health Control And Surveillance"; Article 19.33 of the Administrative Code Failure to Comply with the Submission of Product Samples, Documents or Information Required for State Control (Surveillance) for Purposes of Compliance with Technical Regulations." Violations found when exercising the government s control over the marketing of medical devices will result in Roszdravnadzor s: issuance of a verification report and a binding order pursuant thereto, endorsed with a deadline to fix the violation. The deadline will depend on the gravity of the violation in question and whether or not it presents a threat to people s lives and health. The medical device marketing entity must remedy the violation within the prescribed time and report compliance to the supervisory authority. A situation where a medical device company misses the deadline or fails to remedy a violation pursuant to a binding order will provide the grounds for an unscheduled site visit; issuance of an report. Such report can be issued to a physical person, a company officer or a legal person. Roszdravnadzor then either reviews the offense report or refers it to court. For detailed descriptions of the types of administrative offense related to the marketing of medical devices, the applicable fines and the authority to issue and review violation reports, please refer to Table 1. The violation reports considered by Roszdravnadzor under respective articles are passed on to the officer authorized to review s. This officer orders an administrative penalty or terminates the administrative proceedings; referral of the case of non-compliance with a binding order to law enforcement and prosecution agencies who decide on launching criminal proceedings for offenses; filing claims and applications to court with respect to 12 VESTNIK ROSZDRAVNADZORA No. 3-2015 violations of the laws of the Russian Federation; participation in court hearings involving the application and (or) concerning a violation of the medical device laws of the Russian Federation; posting, on its official website, the decisions and orders, such as suspension of use or withdrawal of a medical device, issued in the process of the state control, (in Medical Device Disclosure Letters in the Electronic Services section of Roszdravnadzor s official website). As mentioned above, violations of the medical device laws (Table. 2) are criminalized since January 23, 2015. Such violations include: Article 235.1. of the Criminal Code of the Russian Federation provides liability for illicit production of medicinal products and medical devices; Article 238.1 of the Administrative Code provides liability for the marketing of falsified, adulterated and unregistered medicinal products and medical devices, and trading in falsified biologically active additives. Article 327.2. of the Criminal Code provides liability for the forgery of medicinal product or medical device documentation or the forgery of medicinal product or medical device packaging. Also, Federal Law No. 532-FZ of December 31, 2014 amends Article 38 of Law No. 323-FZ and provides the following definitions: Falsified Medical Device means a medical device accompanied by false information on its characteristics and (or) producer (manufacturer); Adulterated Medical Device means a medical device that does not conform to the producer s (manufacturer s) regulatory, technical and (or) accompanying documents or, if the above is not available, other applicable regulatory documents; Counterfeit Medical Product means a medical product that is distributed in the market in violation of the civil law.

It should be noted that Part 4 of Article 38 of Law No. 323-FZ provides that only medical devices that have been registered by a federal executive agency authorized by the Government of the Russian Federation, in the manner prescribed thereby, can enter the Russian Federation market or be marketed in the Russian Federation. Thus, a device that has not undergone the registration procedure is deemed unregistered. The introduction of stiffer compliance measures that increase the responsibility of medical device marketing entities minimizes life and health hazards associated with the use of medical devices and improves the quality and efficacy of medical services, including disease diagnostics. TABLE 1. Types of, administrative fines, the authority of Roszdravnadzor officers to issue violation reports and examine s Administrative Offense Administrative Fine Officer s Authority 1. Violations of the medical device marketing regulations Federal law No. 323-FZ, dated November 21, 2011, On Foundations of Public Health Protection in the Russian Federation, Article 38 Article 6.28. Violation of the existing rules for the marketing of medical devices Violation of the existing medical device rules, where the acts committed do not constitute criminal offense Article 6.33. Marketing falsified, counterfeit, adulterated, and unregistered medicinal products and medical devices, and trading in falsified biologically active additives 1. The manufacture, sale or importation into the Russian Federation of falsified medicinal products, or the production, sale or importation into the Russian Federation of counterfeit medical devices, or the sale or importation into the Russian Federation of counterfeit medicinal products, of the sale or importation into the Russian Federation of counterfeit medical devices, or trading in falsified biologically active additives, if such activities do not constitute criminal offense. natural persons between RUB 2,000 and 4,000; between RUB 5,000 and 10,000; RUB 30,000 and 50,000 natural persons between RUB 70,000 and 100,000; between RUB 100,000 and 600,000; 1 million and 5 million rubles or administrative suspension of activity for up to 90 days 2. The sale or importation into the Russian Federation of adulterated medicinal products, or the sale or importation into the Russian Federation of adulterated medical devices, or the illegal production, sale or importation into the Russian Federation of unregistered medicinal products, if such activities do not constitute criminal offense 2. Violation of technical regulations and product conformity declaration requirements: Federal Law No. 184-FZ, dated December 27, 2002, On Technical Regulation (as revised on June 23, 2014) VESTNIK ROSZDRAVNADZORA No. 3-2015 13

TABLE 1 (continued) Types of, administrative fines, the authority of Roszdravnadzor officers to issue violation reports and examine s Officer s Administrative Offense Administrative Fine Authority Article 14.43. Noncompliance with technical regulations by a manufacturer, contractor (or a person who performs the functions of a foreign manufacturer), or a seller 1. Noncompliance, by a manufacturer, contractor (or a person who performs the functions of a foreign manufacturer) or a seller, with technical regulations or, prior to the entry into force of the applicable technical regulations, with relevant technical regulations that contain binding requirements for products or binding requirements for products and the related processes of product design (including research), production, construction, installation, startup, operation, storage, transportation, sale, and disposal, or the release of products that not conform to these requirements, except as provided for in Articles 6.31, 9.4, 10.3, 10.6, 10.8, Part 2 of Article 11.21, Articles 14.37, 14.44, 14.46, and 20.4 of this Code 2. Acts falling under Part 1 of this Article, which resulted in causing harm to human life or health, property of natural or legal persons, state-own or municipal property, the environment, animal and plant life or health, or which constitute a threat of causing harm to human life or health, the environment, and animal and plant life or health 3. Repeated falling under Part 2 of this ArticleNote: In this article and in Article 14.47, binding requirements prior to the entry into force of the applicable technical regulations means the binding requirements for products or the binding requirements for products and the related processes of product design (including research), production, construction, installation, startup, operation, storage, transportation, sale, and disposal, which exist in the laws and regulations adopted by the Customs Union Commission in accordance with the Customs Union Agreement on Sanitary Measures, dated December 11, 2009, natural persons between RUB 1,000 and 2,000; between RUB 10,000 and 20,000; persons engaged in entrepreneurial activity without forming a legal entity, between RUB 20,000 and 30,000; RUB 10,000 and 300,000 natural persons between RUB 2,000 and 4,000, with or without confiscation of the items that were the instrument of committing the ; between RUB 20,000 and 30,000; persons engaged in entrepreneurial activity without forming a legal entity, between RUB 30,000 and 40,000, with or without confiscation of the items that were the instrument of committing the ; RUB 300,000 and 600,000, with or without confiscation of the items that were the instrument of committing the administrative offense natural persons between RUB 4,000 and 5,000, with the confiscation of the items that were the instrument of committing the ; between RUB 30,000 and 40,000; persons engaged in entrepreneurial activity without forming a legal entity, between RUB 40,000 and 50,000, with the confiscation of the items that were the instrument of committing the or administrative suspension of their activity for up to 90 days, with the confiscation of the items that were the instrument of committing the ; and administrative offense and administrative offense 14 VESTNIK ROSZDRAVNADZORA No. 3-2015

TABLE 1 (continued) Types of, administrative fines, the authority of Roszdravnadzor officers to issue violation reports and examine s Administrative Offense and any laws and regulations of the Russian Federation that do not contravene with the above, as well as those regulations of federal executive agencies that have binding force under paragraphs 1, 1.1 and 6.2 of Article 46 of Federal Law No. 184-FZ On Technical Regulation Article 14.44. False declaration of product conformity 1. False declaration of product conformity 2. The false declaration of conformity of a product that is being released for the first time and is a type of products which is subject to mandatory certification, or the false declaration of such products based on own evidence where the standardization documents to provide compliance with technical regulations are either absent or do not apply Administrative Fine RUB 700,000 and 1 million, with the confiscation of the items that were the instrument of committing the, or administrative suspension of activity for up to 90 days with the confiscation of the items that were the instrument of committing the between RUB 15,000 and 25,000; RUB 100,000 and 300,000 between RUB 25,000 and 35,000; RUB 300,000 and 500,000 Officer s Authority 3. Acts falling under Parts 1 and 2 of this Article, which resulted in causing harm to human life or health, property of natural or legal persons, state-own or municipal property, the environment, animal and plant life or health, or which constitute a threat of causing harm to human life or health, the environment, and animal and plant life or health between RUB 35,000 and 50,000; RUB 700,000 and 1,000,000 Article 14.46. Violation of the procedure for labeling of products subject to mandatory conformity assessment 1. Market access marking whose compliance with technical regulations has not been confirmed in the manner prescribed by the law on technical regulation, or conformity marking whose compliance with technical regulations has not been confirmed in the manner prescribed by the law on technical regulation between RUB 10,000 and 20,000; RUB 100,000 and 300,000 VESTNIK ROSZDRAVNADZORA No. 3-2015 15

TABLE 1 (continued) Types of, administrative fines, the authority of Roszdravnadzor officers to issue violation reports and examine s Officer s Administrative Offense Administrative Fine Authority 2. Acts falling under Part 1 of this Article, which resulted in causing harm to human life or health, property of natural or legal persons, state-own or municipal property, the environment, animal and plant life or health, or which constitute a threat of causing harm to human life or health, the environment, and animal and plant life or healthnote: For the purposes of this article and the other articles of this Code, market access marking (znak obrashcheniya) means a mark demonstrating that the product is certified for the market of the Russian Federation; Uniform market access marking means the marked product is certified for the market of the Member States of the Customs Union (EurAsEC countries). between RUB 30,000 and 50,000; RUB 700,000 and 1,000,000 3. Misconduct during inspection Federal law No. 294-FZ, dated December 26, 2008 On Protection of Rights of Legal Entities and Individual Entrepreneurs whilst Exercising Governmental Control (Surveillance) and Municipal Control" Article 19.4. Administrative Offenses Code of the Russian Federation. Disobedience to lawful instructions of an officer of a state control (surveillance) authority or municipal control authority 1. Disobedience to a lawful instruction or order of an officer of a state control (surveillance) authority or municipal control authority 5. Failure to comply, in due time, with a lawful requirement of an officer of the federal executive health control and surveillance authority or its regional body and/or obstructing such officer s official duties Article 19.5. Administrative Offenses Code of the Russian Federation. Failure to fulfill a lawful order (judgment, communication or decision) of a state/municipal control (surveillance) authority/officer in due time natural persons: a warning or the imposition of an administrative fine of RUB 5,00 to 1,000; between RUB 2,000 and 4,000; between RUB 5,000 and 10,000; RUB 20,000 and 30,000 between RUB 10,000 and 20,000; RUB 30,000 and 50,000 21. Failure to fulfill, in due time, a lawful order or decision of the federal executive health control and surveillance authority or its regional body Article 19.7.8. Administrative Offenses Code of the Russian Federation. The failure to submit information or the submission of false information to the federal executive authority responsible for public health control and surveillance between RUB 10,000 and 15,000; RUB 30,000 and 70,000 16 VESTNIK ROSZDRAVNADZORA No. 3-2015

TABLE 1 (end) Types of, administrative fines, the authority of Roszdravnadzor officers to issue violation reports and examine s Officer s Administrative Offense Administrative Fine Authority The failure to submit or untimely submittal of information to the federal executive health control and surveillance authority or its territorial body, if the submission of such information is required by health protection legislation, except as provided for in Parts 2 and 3 of Article 6.29 of this Code, or the submission of false information Article 19.33. Failure to comply with the submission of product samples, documents or information as required for the purposes of state control (surveillance) to ensure compliance with technical regulations between RUB 40,000 and 50,000; RUB 200,000 and 300,000 The failure to submit or evasion from submission, by a manufacturer, contractor (or a person who performs the functions of a foreign manufacturer) or a seller, of product samples, documents or information as required for the purposes of state control (surveillance) to ensure compliance with technical regulations, except for the cases specified in Article 8.23, Part 2 of Article 13.4, and Articles 13.8 and 14.37 of this Code TABLE 2. Punishable offenses related to the marketing of medical devices (in light of the adopted Federal Law No. 532-FZ, dated December 31, 2014, On Amendments to Certain Legislative Acts of the Russian Federation with Regard to Countering the Trafficking in Falsified, Counterfeit, Adulterated, and Unregistered Medicinal Products, Medical Devices and Falsified Biologically Active Additives ) Offense (Article of the Criminal Code of the Russian Criminal Responsibility Federation) Article 235.1. The illicit production of medicinal products and medical devices 1. The production of medicinal products or medical devices without an express clearance (license), if such clearance (license) is required (mandatory) 2. The same acts as above, if committed or perpetrated: a) by an organized group; b) on a large scale. Article 238.1. Marketing falsified, adulterated and unregistered medicinal products and medical devices A deprivation of liberty for the term ranging from 3 to 5 years, with or without a fine ranging from RUB 500,000 to RUB 2 million or the equivalent of the salary or other income made by the convicted person over a period from 6 months to 2 years A deprivation of liberty for the term ranging from 5 to 8 years, with or without a fine ranging from 1 million to 3 million rubles or the equivalent of the salary or other income made by the convicted person over a period from 1 year to 3 years Forced labor for three to five years, with or without deprivation of the right to occupy certain positions or be engaged in certain activities for a term of up to three years VESTNIK ROSZDRAVNADZORA No. 3-2015 17

TABLE 2 (continued) Punishable offenses related to the marketing of medical devices (in light of the adopted Federal Law No. 532-FZ, dated December 31, 2014, On Amendments to Certain Legislative Acts of the Russian Federation with Regard to Countering the Trafficking in Falsified, Counterfeit, Adulterated, and Unregistered Medicinal Products, Medical Devices and Falsified Biologically Active Additives ) Offense (Article of the Criminal Code of the Russian Criminal Responsibility Federation) and trading in falsified biologically active additives 1. Perpetration of the following offenses on a grand scale: the production, marketing or importation into the Russian Federation of falsified medicinal products or medical devices, or the sale or importation into the Russian Federation of adulterated medicinal products or medical devices, or the illicit production, sale or importation into the Russian Federation of unregistered medicinal products or medical devices to be sold, or the production, marketing or importation into the Russian Federation of adulterated biologically active additives containing pharmaceutical substances that were not disclosed during state registration 2. The same acts, if: a) they have been perpetrated by a group of persons by prior conspiracy or by an organized group; b) through negligence they have caused grievous harm to a person s health or caused a person s death. 3. Acts falling under Part 1 or 2 of this Article that through negligence have led to the death of two or more persons Article 327.2. The forgery of medicinal product or medical device documentation or the forgery of medicinal product or medical device packaging 1. The manufacturing, either for the purposes of use or sale, or the use of false medicinal product or medical device documents (marketing authorization (registration certificate), certificate or declaration of conformity, package leaflet of a medicinal product or producer s (manufacturer s) regulatory, technical and accompanying documents of a medical device) or a deprivation of liberty for the term ranging from 3 to 5 years, with or without a fine ranging from RUB 500,000 to RUB 2 million or the equivalent of the salary or other income made by the convicted person over a period from 6 months to 2 years, or with or without the revocation of the right to hold certain offices or pursue certain activities for up to 3 years A deprivation of liberty for the term ranging from 5 to 8 years, with or without a fine ranging from 1 to 3 million or the equivalent of the salary or other income made by the convicted person over a period from 1 year to 3 years, or with or without the revocation of the right to hold certain offices or pursue certain activities for up to 5 years A deprivation of liberty for the term ranging from 8 to 12 years, with or without a fine ranging from 2 to 5 million or the equivalent of the salary or other income made by the convicted person over a period from 2 to 5 years, or with or without the revocation of the right to hold certain offices or pursue certain activities for up to 10 years A fine ranging from RUB 500,000 to RUB 1 million or the equivalent of the salary or other income made by the convicted person over a period from 1 year to 2 years, or forced labor for up to 3 years, or a deprivation of liberty for the same term 18 VESTNIK ROSZDRAVNADZORA No. 3-2015

TABLE 2 (end) Punishable offenses related to the marketing of medical devices (in light of the adopted Federal Law No. 532-FZ, dated December 31, 2014, On Amendments to Certain Legislative Acts of the Russian Federation with Regard to Countering the Trafficking in Falsified, Counterfeit, Adulterated, and Unregistered Medicinal Products, Medical Devices and Falsified Biologically Active Additives ) Offense (Article of the Criminal Code of the Russian Criminal Responsibility Federation) 2. The manufacturing, either for the purposes of use or sale, or the use of false immediate packaging and (or) secondary packaging (container carrier) of a medicinal product A fine ranging from RUB 500,000 to RUB 1 million or the equivalent of the salary or other income made by the convicted person over a period from 1 year to 2 years, or forced labor for up to 3 years, or a deprivation of liberty for the same term Note: Paragraph b of Part 2 of Article 235.1 and Article 238.1 of the Criminal Code of the Russian Federation contemplates criminal responsibility for large-scale offenses. For the purposes of said articles, the scale is deemed large or grand if the value of such medicinal products or medical devices exceeds RUB 100,000. NEWS RUSSIAN-MADE PHARMACEUTICALS TO OCCUPY HALF OF THE DOMESTIC PHARMACEUTICALS MARKET BY 2020 The share of Russian pharmaceutical products in the domestic market is set to reach 50% by 2020. This strategic objective is being implemented with the government s support through the Pharmaceutical and Medical Industry Development State program, which has run in Russia since 2011. This was stated by Russian Minister of Industry and Trade Denis Manturov during his visit to Kaluga region on June 5, 2015, where he took part in an opening ceremony for Nearmedic Pharma s plant in Obninsk. The Pharma 2020 program, which is being implemented since 2011, incorporates the measures of State support developed by our ministry. Those developments that have been subsidized by the Ministry of Industry and Trade over the years are being persistently embedded in practice. We decided to adjust the program since 2015. For example, we have introduced another instrument to support the development of new preparations we reimburse for the cost of drug substance manufacturing in full cycle production, said Denis Manturov. The domestic pharmaceutical market is among the fastest growing drug markets in the world with an annual growth rate of more than 10% over the past few years. At the end of 2014, Russia ranked as the world s 7th largest drug market with a sales volume of 919 billion rubles. The measures of government support laid down in the Import Substitution Plan for the pharmaceutical industry will cut down on imports into the domestic market from 73 to 50% by 2020. The Minister of Industry and Trade also noted that special preferences have been designed today for Russianmade pharmaceutical products manufactured on a full-cycle basis. Such manufacturers will have preferential treatment at public tenders run by the Ministry of Industry and Trade. The State budget provides dedicated funding for pre-clinical and clinical trials, technology transfer projects and the development of technology platforms. Starting in 2015, subsidies are contemplated for drug substance manufacture and clinical research. Implementation of the government support measures has made it possible to maintain and increase the share of domestic production in the rising pharmaceutical market ahead, even ahead of forecast targets. In 2014, Russian pharmaceuticals accounted for 26% of the domestic market. The government s program helped bring 13 new products on the Vital and Essential Drugs (VED) List into the Russian market since 2011. In 2014, Russia was producing 67% of the drugs on the VED list. In 2018, this figure should be at least 90%. With the help of the Pharmaceutical and Medical Industry Development State program, full-cycle companies were able to launch production of proprietary pharmaceutical preparations in the Moscow, Vladimir and Kirov Regions and Saint Petersburg. The Ministry of Industry and Trade expects that the increase of Russian pharmaceutical production will boost the market over the last five years it has grown twice as much and reached 185 billion rubles in 2014. The government s support of the industry is also attracting a lot of nonbudgetary and private investments with more than 130 billion rubles over the past 3-4 years. minpromtorg.ru VESTNIK ROSZDRAVNADZORA No. 3-2015 19