Parallel Trade Series 4: Quality and Legality of Parallel Trade in Pharmaceuticals
In this last article of our Parallel Trade Series, we tried to uncover legal basis for parallel distribution of pharmaceutical products in the EU. And, we also explored different set of public and non-profit organizations responsible for assuring safety and quality of such products in the Single Market.
As stated in our previous articles, parallel trade in pharmaceutical products in the EU was recognized as a lawful form of trade by the European Commission. Such recognition of legality based on the provisions (Articles 28-30) on the free movement of goods of the EC Treaty (renamed as the Treaty on the Functioning of the European Union- TFEU and articles concerned were renumbered as Articles 34-36) . The principle of free movement of goods within the European Economic Area (EEA) has enabled parallel trade in medicines to be recognized as a legal form of trade. Based on this principle, the parallel import of industry has been contributing to preclude compartmentalization of individual national markets through bringing a healthy competition into the Single Market.
Though its legality was recognized by number of treaties, acts and public institution in the EU, how has quality in the industry been assured? The European Medicines Agency (EMA) acts as a decentralized regulatory agency responsible for the scientific evaluation, supervision and safety monitoring of medicines in the EU. Thus, it endeavors to assure that all medicinal products on the market are safe, effective and of high quality. In this regard, regulation and quality assurance of parallel-imported medicinal products also fall under the remit of the EMA, it was tasked to check parallel-distributed products’ compliance with the related EU legislation and marketing authorizations of such products. 
In addition to wholesale authorization, parallel distributors are also required to comply with Good Distribution Practices (GDP) guidelines developed by the European Commission. Moreover, founded as a not-for-profit organization and representing 80% of the volume of the parallel import industry in the Single Market, the European Association of Euro-Pharmaceutical Companies (EAEPC) developed its own code of operational conduct to assure quality and safety of parallel distributed products by its members. Representing more than 90 firms from 23 European countries, the EAEPC requires its members to follow its Good Parallel Distribution Practices (GPDP) guidelines for further elevating levels of safety and quality in the industry. In short, acknowledged as a lawful form of trade by number of public institution in the EU, safety and quality of parallel distributed medicinal products have been assured by a mix of public and non-profit institutions detailed above.
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The European Association of Euro-Pharmaceutical Companies (EAEPC), Parallel Distribution: Making modern medicines more affordable for European citizens:8. Available at: http://www.eaepc.org/images/pdf/factbook-draft.pdf (accessed July 25,2018)
For more information on the principle of free movement of goods please see, The European Commission, Free movement of goods: Guide to the application of Treaty provisions governing the free movement of goods, Luxembourg: Publications Office of the European Union, 2010. Available at: https://publications.europa.eu/en/publication-detail/-/publication/a5396a42-cbc8-4cd9-8b12-b769140091cd/language-en (accessed July 25,2018)
The European Medicines Agency (EMA), “Parallel distribution,” ema.europa.eu. http://www.ema.europa.eu/ema/index.jsp?curl=pages/regulation/general/general_content_000067.jsp&mid=WC0b01ac0580024594 (accessed July 25,2018)
The EAEPC, “Code of Operational Conduct,” eaepc.org. http://www.eaepc.org/about-parallel-distribution/code-of-operational-conduct (accessed July 25,2018)