Russia makes it easier to skirt imported drug sale norms

Print 28 May 2015
EJ Lane / FeircePharmaAsia

Moscow is opening a gray market to allow imports of drugs intended for sale in other countries to be sold in Russia without the consent of the maker with a trademark for the product. The government hopes the move will lower pharmaceutical costs.

The move is a reversal of reforms taken by the government in 2002, when it established a central distribution system and disallowed "parallel imports." Some estimates set Russia's potential savings as high as 50%.

The International Trademark Association has long opposed the practice of parallel imports, also known as a gray market, calling on governments to provide clear proof that a trademark owner consented to the imports.

Other critics cited by Russia Beyond the Headlines had already warned Russia that it would be opening itself to a flood of counterfeit goods that copy packaging and labels of legitimate drugs. The practice includes other goods, but the central focus of the change is on pharmaceuticals.

A business critic said the 2002 ban on parallel imports was a driving force in drawing companies into the country and setting up production plants over the past decade. He warned that the government may get lower prices, but it could suffer in the long run as potential investors shy away.

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