Price regulation of medical products in Russia

2020: The Government of the Russian Federation entered state price regulation on medical products

On April 6, 2020 Zdrav.Expert became known that the Government of the Russian Federation entered state regulation of the prices of medical products.

The resolution concerns distribution of respirators, masks, a gauze, medical gloves. The document sets a limit trade margin for sale of these products, etc. bans:

1. to Forbid for the organizations of any organizational legal forms, except for the operator-coordinator and (or) regional operators, wholesale of the goods made from the date of entry into force of this resolution to the organizations of any forms of business, except for the operator - the coordinator and (or) regional operators.
2. to Forbid retail purchase and sale of goods from the date of entry into force of this resolution for the organizations which do not have the license for implementation of pharmaceutical activity regarding retail by medicines for medical application and (or) a holiday of medicines for medical application.
3. Установить restriction of free alienation in the territory of the Russian Federation of goods, except for the actions provided by this resolution.
4. to Establish that for each stage of a commodity distribution chain of the wholesale supplies of goods the size of the wholesale allowance to the actual selling prices should not exceed 10 percent from the purchase price or cost value of goods including the price of the supplier, direct customs, transportation and logistic expenses.
5. to Establish that for each stage of a commodity distribution chain of the wholesale supplies of the goods made before entry into force of this resolution, the size of the wholesale allowance to the actual selling prices should not exceed 10 percent from the purchase price or cost value of goods including the price of the supplier, direct customs, transportation and logistic expenses.
6. to Establish that for the organizations of retail having the license for implementation of pharmaceutical activity regarding retail by medicines for medical application and (or) a holiday of medicines for medical application, the extreme size of the retail allowance to the actual selling prices of goods should not exceed 10 kopeks for a commodity unit (product).

It is detailed it is possible to study the text of order of the Government of the Russian Federation No. 431 "About establishment of features of the address of medical products and restrictions for implementation wholesale and retail by medical products and about the list of such products"here.

2018: The zero rate of the VAT can be cancelled on the imported medical products having the Russian analogs

The Ministry of Industry and Trade of the Russian Federation considers the possibility of canceling of a privilege on a value added tax (VAT) when importing finished medical products in the presence of two and medical products, more identical on technical characteristics, which manufacture in Russia, Vademecum with reference to department reported on September 4, 2018.

The Ministry of Industry and Trade can cancel a zero rate of the VAT for the finished medical products imported from abroad. Photo: tml.ru

The CEO of MTL company Ali Eylazov on commission session of Russian Union of Industrialists and Entrepreneurs (RUIE) on the pharmaceutical and medical industry suggested to cancel a zero rate of the VAT for the imported medical products still on July 26, 2018. According to him, existence of this privilege puts domestic manufacturers in unequal conditions with foreign as they are forced to put in the selling price of a product not only cost value and income, but also the VAT.

At the same time, the foreign companies return the VAT as the residents of the country of origin exporting the products, and when importing products to Russia use a zero tax rate. The imbalance of the prices and lack of incentives to localization of products is a consequence of such regulations, Eylazov considers. According to him, it is necessary to abolish a privilege on the VAT for the finished import medical products which are subject to the rule Third wheel (order of the Government of the Russian Federation No. 102). During discussion members of the commission of RUIE shared his opinion.

According to representatives of GE Healthcare implementing the project on localization of the heavy medical equipment together with MTL as of the beginning of September the document has a project format so far and to draw final conclusions prematurely. GE Healthcare expressed interest in adoption of economically motivated regulatory solutions as the company invests in localization of production of the medical equipment in Russia. At the same time representatives of GE Healthcare declared the concern about how this solution can affect availability of hi-tech medical care to the population, having added at the same time that the company conducts "constructive discussion with industry associations and regulating authorities".

As you know, in the draft of the Strategy of development of the medical industry of Russia till 2030 as one of measures of support of the industry canceling of a zero rate of the VAT for medical products is declared. According to the chief executive of IMEDA association Sergey Vanina, "alternative and much more effective measure including in terms of support of domestic manufacturers and stimulation of localization of production", there would be canceling of the VAT for all raw materials and the component parts used by production of medical products in Russia and also as option, introduction of a uniform VAT rate for all medical products, for example, in the amount of 5%, instead of the existing opaque system of taxation of different types of such products.^[1]

2017: The request of IMEDA to review criteria of pricing for medical implants

The association of the international producers of the medical products IMEDA in November, 2017 directed addressed to the Deputy Prime Minister of the Russian Federation Olga Golodets the letter with a request to review provisions of Order of the Government of the Russian Federation No. 1517 of December 30, 2015 "About state regulation of the prices of the medical products included in the list of the medical products implanted into a human body at delivery of health care within the program of the state guarantees of free rendering medical care to citizens".^[2] Software^[3] to belief of representatives of IMEDA, the state price regulation mechanism in the current type can become as a result the reason of decrease in availability of medical products of this category. Read more here.

2016: Delivery systems and fixings are excluded from under price regulation on implants

At the beginning of July, 2016 it became known that delivery systems and fixings will be excluded from under price regulation on the implanted medical products.

At the beginning of July, 2016 the president Russia Vladimir Putin signed changes in federal law No. 323 "About bases of protection of public health in the Russian Federation" according to which price regulation will extend not to all implanted medical products included in the corresponding list (it is approved Governments of the Russian Federation as order No. 2762-r of 12/29/2014).

Delivery systems and fixings are excluded from under price regulation on the implanted medical products

Since January 1, 2017, from under price regulation on the implanted medical products "the medical products used for preparation for implantation, prevention  of complications at surgical interventions, deliveries, fixings and extraction of the medical  products implanted into a human body, and included in the specified list" will be excluded.

 It is possible to study the text of federal law No. 286-FZ "About introduction of amendments to the federal law "About Compulsory Health Insurance in the Russian Federation" and separate legal acts of the Russian Federation" of 7/3/2016 according to direct ^[4]. The specified changes contain in point 4, Article 6.

In 2014 in Russia the list of the medical products implanted into  a human body was for the first time created. The program is financed for  the budget account on compulsory health insurance and  contains 205 types of products that by the beginning of July, 2016 makes about a quarter of  all registered in  the territory of the country, RIA Novosti with reference to the head of the Russian Ministry of Health Veronika Skvortsova reports.^[5]

See Also

• The market of medical products in Russia
• Import substitution of medical products

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