1. Dr. P. V. Appaji, M.Pharm, Ph.D Director General, PHARMACEUTICALS EXPORT PROMOTION COUNCIL OF INDIA Hyderabad Email: dg@pharmexcil.com Presentation by

2. CONTENTS Which are EU Countries? Objectives of EU Directive 2001/83/EC Definition of Falsified Medicinal Product Potential targets of EU Directive 2001/83/EC Current Indian Pharmaceutical Industry Status Advantages with EU Directive to India Disadvantages with EU Directive to India Possible Negotiations

3. Which Are EU Countries?

4. Objectives Of EU Directive 2001/83/EC Introduction of a New Term Falsified Medicinal Product Aims to prevent suspected medicines reaching patients Safety features to be harmonised within the Union Aims safety measures All through the supply chain (manufacturer to end user) Contd…

5. Prevent distortions in the internal market Prevent falsified medicinal products entering the legal supply chain Aims at Ensuring Good Manufacturing Process of EU/EU Pharmacopoeia standards Aims at Pharmaceutical product quality for APIs, Generics formulations, Excipients at the manufacturing level Objectives Of EU Directive 2001/83/EC

6. EU Defines Falsified Medicine As Any medicinal product with a false representation of: a. Its identity, inclusive of package and labeling, its name or its composition as regards to any of the ingredients inclusive of excipients and the strength of those ingredients; b. Its source, its manufacture, its country of manufacturing, its country of origin or its marketing authorisation holder; c. Its history: The records and documents relating to the distribution channels used The definition Excludes unintentional quality defects and is without prejudice to infringements of intellectual property rights

7. Potential Targets Of EU Directive 2001/83/EC Confirming GMP with audits (for APIs, formulations, Excipients) Confirming distribution with audits Confirming GMP practices at least equivalent to those laid down by the Union Notification to the authority for any changes that may impact on the quality or safety of the active substances that are manufactured, imported or distributed Contd…

8. Implementation of anti-tampering devices Maintaining records in the form of purchase/sales at various levels of supply chain Persons brokering medicinal products are also subject to inspection by competent authorities Persons brokering must have permanent address, contact details in the Union Potential Targets Of EU Directive 2001/83/EC Contd…

9. Repeated inspections of Manufacturers (located in the Union or in third countries) and wholesale distributors of medicinal products Inspections of the premises of marketing authorisation holders and of brokers of medicinal products are possible Data submitted to comply with monographs of European Pharmacopoeia Potential Targets Of EU Directive 2001/83/EC

10. Current Indian Pharmaceutical Industry Status India is a leading exporter of quality pharmaceutical products globally Indian exporters comply with ISO, GMP/WHO GMP, ICH guidelines etc., Indian Drugs & Cosmetic Act terminology - Spurious drugs - Not of standard quality or substandard drugs - Adulterated drugs - Misbranded drugs may fall under the purview with international acts

11. EU rules for import of API’s. According to Articles 46b 2(b) i, ii & iii Written confirmation from the competent authority of the exporting third country of the following: The standards of good manufacturing practice applicable to the plant manufacturing the exported active substance are at least equivalent to those laid down by the Union. The manufacturing plant concerned is subject to regular, strict and transparent controls and to the effective enforcement of good manufacturing practice, including repeated and unannounced inspections, so as to ensure a protection of public health at least equivalent to that in the Union; In the event of findings relating to non-compliance, information on such findings is supplied by the exporting third country to the Union without any delay. Directive 2001/83/EC as amended by Directive 2011/62/EU

12. Implementation Of The New Directive Concept paper submitted for public consultation. “Implementing act on the requirements for the assessment of the regulatory framework applicable to the manufacturing of Active Substances of Medicinal products for Human Use”. Consultation closed on March 23, 2012. Implementation date : July 2013

13. Written confirmation waived for countries to be listed as per Article 111b. Third country to request for “Equivalence assessment” Assessment to be done by the commission If assessment confirms equivalence, third country will be included in the list. Regular verification thereafter. Written Confirmation & Equivalence Assessment (111b)

14. A review of relevant documentation An on-site review of the third country's regulatory system, unless a mutual recognition agreement ('MRA') is in place that covers the manufacturing of active substances; and If necessary, an observed inspection of one or more of the third country's manufacturing sites for active substances. Equivalence Assessment

15. Third countries rules for GMP implementation Pending the adoption of a delegated act on the principles and guidelines of good manufacturing practice for Active Substance EU rules to be taken into account are contained in Part II of the good manufacturing practice guideline of the EU (Eudralex Volume 4). Country's Rules For GMP (111b(1)(a))

16. Article 111b(3) The Commission shall verify regularly whether the conditions of the GMP equivalence are fulfilled The first verification shall take place no later than three years after the country has been included in the list. Regular Verification

17. The manufacture of active substances should be subject to good manufacturing practice regardless of whether those active substances are manufactured in the Union or imported. With regard to the manufacture of active substances in third countries, it should be ensured that the legislative provisions applicable to the manufacturing of active substances intended for export to the Union, as well as inspections of facilities and enforcement of the applicable provisions, provide for a level of protection of public health equivalent to that provided for by Union law. Minimum Expectations Of New Directive

18. A written confirmation that the manufacturer of the medicinal product has verified, compliance of the manufacturer of the active substance with principles and guidelines of good manufacturing practice by conducting audits, in accordance with point (f) of Article 46. The written confirmation shall contain a reference to the date of the audit and a declaration that the outcome of the audit confirms that the manufacturing complies with the principles and guidelines of good manufacturing practice. Responsibility of Formulators in the new directive

19. STATISTICS

20. Global Bulk Drugs Imports Region Wise (Values In US$ Mn) Sr. no Region200820092010YOY %share 1EU14794.0415649.5416673.386.5450.58 2North America7379.524494.003866.23-13.9711.73 3LAC2180.333338.823611.878.1810.96 4Asia (Excluding Middle East)2337.402445.332611.036.787.92 5Other European Countries1483.951045.191680.8460.825.10 6Asean1211.841250.181255.680.443.81 7South Asia1069.941079.491082.130.243.28 8Middle East761.60599.14995.2366.113.02 9Africa420.60423.74450.696.361.37 10Oceania392.32368.32378.672.811.15 11CIS261.88385.31355.17-7.821.08 12Other America4.375.436.1914.100.02 World32297.7931084.4932967.116.06 Source : UN COMTRADE

21. 21 Global Bulk Drugs Imports Qty : Region wise (In Kgs) Source : UN COMTRADE Sr. noRegions20082009% Share 1EU24596689221195966034.38 2North America10254852211583391618.79 3Asean607931426275429410.18 4LAC662732776223841010.1 5Africa21592271536346208.7 6Asia (Excluding Middle East)43341762410366576.66 7South Asia27439759326060465.29 8Middle East20308240106686311.73 9CIS977660097069861.57 10Other European Countries957424680822151.31 11Oceania653181960445610.98 12Other America61153619133430.31 Grand Total614758066616479339

22. 22 European Union`s Import of Bulk Drugs from India and China : (Value in US$ MN) Source : UN COMTRADE 20082009 Sum of Trade Value %share China1731.571607.0810.27 India198.46195.941.25 Grand Total14794.0415649.54

23. 23 Bulk Drugs Import of EU From Other than the Union (Country wise)(USD mn) Source : UN COMTRADE RankCountry200820092010%share YOY% 1Switzerland2970.633554.353630.5239.432.14 2USA2126.951420.701984.0721.5539.65 3China1731.571607.081918.6120.8419.38 4Singapore467.08501.82764.568.3052.36 5Japan383.30327.01297.183.23-9.12 6India198.46195.94206.642.245.46 7Argentina46.2755.4766.800.7320.41 8Rep. of Korea60.2162.1163.600.692.41 9Australia40.4944.3543.480.47-1.97 10Mexico55.6955.3241.810.45-24.43 11Croatia16.0913.0123.550.2680.94 12Israel15.9420.1223.150.2515.07 13Brazil25.7119.4221.880.2412.67 14Oman20.5415.0613.840.15-8.11 Total8266.578011.079208.09100

24. Bulk Drugs Import of EU From Other than the Union (Country wise)(In KGs) Source : UN COMTRADE RankCountry20082009%share 1China845782086740532969.92 2Switzerland104673651229646412.76 3India505148239553664.1 4USA611664345594624.73 5Singapore167283822371042.32 6Japan221584917911541.86 7Rep. of Korea8234797506710.78 8Israel455673964280.1 9Mexico3893223957200.41 10Brazil3191812223230.23 11Croatia74515499500.05 12Turkey1264712148490.22 13Canada105296701830.07 14Australia49519627740.07 15Argentina151922852350.09 16Colombia147207990710.1 EU Total11497560196399929100

25. Top Ten HS codes Imported by EU Inclusive of EU members (Values in US$ mn) Source : UN COMTRADE RankCommodity Code Commodity Description20082009% Share 1H3-294190Antibiotics & their derivatives (excl. of 2941.10-2941.50); salts thereof3884.543982.3525.45 2H3-293719 Polypeptide hormones, protein hormones & glycoprotein hormones, their derivatives & structural analogues (excl. of 2937.11 & 2937.12) 1501.242597.7116.60 3H3-293722Halogenated derivatives of corticosteroidal hormones980.07994.636.36 4H3-293711Somatotropin, its derivatives & structural analogues338.39734.404.69 5H3-293628Vitamin E & its derivatives881.83849.705.43 6H3-293750Prostaglandins, thromboxanes & leukotrienes, their derivatives & structural analogues386.50865.565.53 7H3-294110Penicillins & their derivatives with a penicillanic acid structure; salts thereof779.53774.884.95 8H3-293729Steroidal hormones, their derivatives & structural analogues (excl. of 2937.21-2937.23)1082.59649.064.15 9H3-293790 Hormones, prostaglandins, thromboxanes & leukotrienes, natural/reproduced by synthesis(excl. of 2937.11-2937.50); derivatives & structural analogues thereof, including chain modified polypeptides, used primarily as hormones 1021.44644.704.12 10H3-293627Vitamin C & its derivatives656.69548.243.50 Total of Top Ten11512.8212641.2180.78

26. Top Ten HS codes Imported by EU from China (Values in US$ mn) Source : UN COMTRADE RankCommodity Code Commodity Description20082009% share 1H3-294190Antibiotics & their derivatives (excl. of 2941.10-2941.50); salts thereof346.29381.4323.73 2H3-293628Vitamin E & its derivatives271.30245.6915.29 3H3-293627Vitamin C & its derivatives395.00327.2620.36 4H3-294130Tetracyclines & their derivatives; salts thereof96.13115.767.20 5H3-293629Vitamins & their derivatives, unmixed (excl. of 2936.10-2936.28)124.2079.354.94 6H3-294110Penicillins & their derivatives with a penicillanic acid structure; salts thereof59.9968.634.27 7H3-294140Chloramphenicol & its derivatives; salts thereof43.4447.972.98 8H3-293729Steroidal hormones, their derivatives & structural analogues (excl. of 2937.21-2937.23)25.2631.041.93 9H3-293721 Cortisone, hydrocortisone, prednisone (dehydrocortisone) & prednisolone (dehydrohydrocortisone) 26.0427.211.69 10H3-293621Vitamins A & their derivatives39.6631.831.98 Total China1731.571607.08100.00

27. EU's Top HS codes imported from India (Values in US$ mn) Source : UN COMTRADE RankCommodity Code Commodity Description20082009% share 1H3-294190Antibiotics & their derivatives (excl. of 2941.10-2941.50); salts thereof64.9670.6136.04 2H3-294150Erythromycin & its derivatives; salts thereof29.3832.7816.73 3H3-293629Vitamins & their derivatives, unmixed (excl. of 2936.10-2936.28)19.8216.648.49 4H3-293890 Glycosides, other than rutoside (rutin) & its derivatives, natural/reproduced by synthesis, & their salts, ethers, esters & other derivatives 10.3412.026.13 5H3-293999 Vegetable alkaloids, natural/reproduced by synthesis, & their salts, ethers, esters & other derivatives (excl. of 2939.11-2939.91) 9.6111.976.11 6H3-293930Caffeine & its salts10.218.694.43 7H3-293729Steroidal hormones, their derivatives & structural analogues (excl. of 2937.21-2937.23)8.308.014.09 8H3-293722Halogenated derivatives of corticosteroidal hormones5.596.013.07 9H3-293959 Theophylline & aminophylline (theophylline-ethylenedia-mine) & their derivatives (excl. of 2939.51); salts thereof, n.e.s. 6.125.642.88 10H3-294110Penicillins & their derivatives with a penicillanic acid structure; salts thereof7.043.361.71 India`s Total198.46195.94100.00 Top ten constitute 90 % Antibiotics & their derivatives constitute 37% Vitamins & their derivatives 8.49 % Erythromycin & its derivatives constitute(inclusive of penicillin) 18.4 %

28. India's exports to EU Country wise accounting for 90% (Values in US$ mn) Source : DGCIS RankCountry2008-092009-102010-11% shareCum shareYoY% 1Germany234.47201.87198.3720.36 -1.73 2Italy126.45110.86113.2711.6331.992.17 3Spain116.2197.52108.6311.1543.1411.39 4UK71.8576.17101.0010.3753.5132.60 5Netherlands66.0260.2955.055.6559.16-8.69 6France33.3533.4750.395.1764.3350.55 7Hungary50.3744.1745.104.6368.962.11 8Malta22.1636.6844.094.5373.4920.20 9Ireland73.1832.0441.274.2477.7328.81 10Poland35.3726.6032.563.3481.0722.41 11Slovenia41.7538.8132.293.3184.38-16.80 12Belgium49.1331.6026.272.7087.08-16.87 13Austria23.4138.6224.002.4689.54-37.86 14Czech Republic8.446.9318.011.8591.39159.88 Total of 14952.16835.63890.301.8591.396.54 EU Total1018.02902.18974.16

29. India's exports to EU country wise accounting to 90% (in Kilos) Source : DGCIS RankCountry2008-092009-102010-11% shareCum shareYoY% 1Germany761687011720506977063030.12 -16.64 2Netherlands36412753910589395746312.2042.331.20 3Spain33660703432590391281012.0654.3913.99 4UK414321693482514369488111.3965.786.10 5Italy2492780261464328697208.8574.639.76 6Ireland2925405319798621338186.5881.21-33.28 7Belgium2838243220502614568484.4985.70-33.93 8France1405119135738512912013.9889.68-4.88 9Poland4757314884056477472.0091.6832.62 10Austria3302315439284236051.3192.99-22.12 11Denmark3258452320763779801.1794.1562.87 Total of 116684973833185648305367031.1794.15-7.98 Grand Total685418253483614232433801100.00 -6.90

30. India's top ten Products by HS codes exported to EU (Values in US$ mn) Source : DGCIS RankCommodity CodeCommodity Name2008-092009-102010-11%shareCum shareyoy% 129420090Other diloxanide furoate, cimetidine, famotidine nes715.14559.18560.6957.56 0.27 229419090Other antibiotics38.1762.4974.427.6465.2019.09 329335990 Other cmpnds cntng a pyrimidine ring (w/n hydrgntd) or piperazine ring in structure 14.3321.0624.032.4767.6614.10 429332990 Other compnds cntng an unfused imidazole ring (w/n hydrgntd ) in structure 6.0417.1217.301.7869.441.05 528276010Potassium iodide6.366.4616.861.7371.17160.99 629415000Erthromycin & its drvtvs slts thereof7.4715.4216.361.6872.856.10 729362920Nctnc acid & nctnmd(niacinamide/niacine17.3415.4315.001.5474.39-2.79 829222933Para acetyl aminophenol(paracetamol)16.6718.3913.781.4175.80-25.07 929371900Other polypeptide hormones thr dtvtvs & strctl anlges1.051.5713.261.3677.16744.59 1029163190Other salts and esters of benzoic acid9.4010.8612.111.2478.4111.51 India's Total Exports to EU1018.02902.18974.16100.00 7.98

31. PIC/S Pharmaceutical Inspection Convention (PIC) & Pharmaceutical Inspection Co-operation Scheme (PICS)

32. PICS Established in 1995. Current members – 40 Participating Authorities Partners a) EDQM European Directorate for Quality of Medicines and Health Care, France b) EMA- European Medicines Agency c) UNICEF d) WHO Requirements : -Law on medicinal products. -A GMP guide equivalent to PIC/S or EU GMP Guide. -A GMP inspectorate fulfils PIC/S quality system requirements. -Experienced GMP inspectors Brief note on PIC/S

33. Objective of PIC/S An active and constructive co-operation in the field of GMP. To facilitate networking between participating authorities and to increase mutual trust, to exchange information and experience, in the field of GMP and related areas, and mutual training of GMP inspectors. Attain confidence of drug regulatory authority. Avoid duplication relating to → Inspections → Licensing procedures → Expenditure → One time procedure

34. Mutual recognition of Inspections. Harmonisation of GMP requirements. Uniform inspection systems. Training of inspectors. Exchange of information. Mutual confidence. Goals of PIC/S

35. PIC/S Constituted fee 8,100 CHF PIC/S Committee meetings – 2 per annum Seminars - 1 per year. Expert Circle meetings 3- per annum Events duration are 1 to 3 days in other PIC/S countries. Registration fee 8100 CHF & In assessment process, annual fee is 50% of Reg. fee for expert. Financial Costs

36. PIC/S is not a trade agreement. Membership in PIC/S may facilitate the export of pharmaceuticals. Non-PIC/S Countries (e.g. Colombia) may accept accreditation of PIC/S participating Authorities. Consequently, the Pharmaceutical industry located in these countries indirectly benefits PIC/S membership. Benefits

37. Thank You