1. Swissmedic Swiss Agency for Therapeutic Products Hallerstrasse 7 CH-3000 Bern www.swissmedic.ch The Fight Against Counterfeit Medical Products: The Medicrime Convention and the Swiss Experience Andreas Balsiger Betts Swissmedic, Swiss Agency for Therapeutic Products, Head Legal Sector 35th EMACOLEX Meeting Budapest, 14/15 May 2011

2. 2 Overview Counterfeiting medical products – a global menace Council of Europe’s fight against pharmaceutical crime CoE’s Medicrime Convention Switzerland‘s means of action today What will the Convention change for Switzerland? State of play in Switzerland

3. 3 Counterfeiting of Medical Products – A New Scourge of Humanity? Illegal drugs and counterfeit medical products Common ground: huge markets high profitability high body count

4. 4 Counterfeiting of Medical Products – A New Scourge of Humanity? Illegal drugs and counterfeit medical products Differences: market potential awareness of consumers awareness of politicians, judges, adminstrators potential risk for criminals

5. 5 Council of Europe (CoE) What it is: International political organisation working towards European integration Aims (inter alia): protection of human rights, pluralist democracy and the rule of law Organisation: Committee of Ministers (decision-making) Parliamentary Assembly (deliberative); decides on/ launches instruments such as binding international treaties, and programs of activities assisting MS

6. 6 Council of Europe 47 member states

7. 7 CoE activities in the legal field Number of CoE’s international treaties today: 209 Best know: Convention for the Protection of Human Rights and Fundamental Freedoms CoE’s treaties criminal matters: (inter alia) money laundering (economic and organized crime) corruption cyber crime terrorism trafficking in human beings

8. 8 EDQM: European Directorate for the Quality of Medicines and HealthCare 37 contracting parties incl the EU observers: China, RUS, USA, AUS, Canada, WHO Aim: safe and adequate use of medicines in society leading organisation as regards standard setting for human and veterinary medicinal products, blood transfusion and organ transplantation technical Secretariat of the Commission of the European Pharmacopoeia Recent issues - (> 2003): fight against counterfeit / medical crime - (> 2007): Elaboration of Medicrime Convention

9. 9 CoE’s path to the Medicrime Convention (1) 2003: Creation of the Committee of Experts on Minimising the Public Health Risks Posed by Counterfeiting of Medical Products and Related Crimes 2004-2007, three recommendations of the Parliamentary Assembly (PACoE): The rapidly rising incidence of counterfeit goods in Europe - a phenomenon which places customers health and well-being at risk, erodes the markets for legitimate producers, damages the reputation of brand names, distorts competition, undermines employment and reduces tax income.“ 2007: PACoE adopts the call for a convention on the matter

10. 10 CoE‘s path to the Medicrime Convention (2) Committee of Ministers mandate in October 2007: Preparation of a report focusing on the key elements which could be included in a binding international legal instrument to fight against crime concerning counterfeit pharmaceutical products

11. 11 Report to Committee of Ministers Convention should focus on protecting the public health by combating “pharmaceutical crime” should not try to protect intellectual property rights should cover medical products, including medicinal products and medical devices, for human and veterinary use should not include cosmetic products, food and food supplements and biocide products could have a worldwide impact by enabling non-MS of the Council of Europe to become parties

12. 12 The Medicrime Convention A comprehensive instrument against crime Opportunity to put in place a complete system of: administrative proceedings preventive measures security, quality and efficiency standards criminal sanctions against counterfeiting and similar crimes

13. 13 Manufacturing of counterfeits (art. 5) Supplying, offering to supply and trafficking in counterfeits (art. 6) Falsification of documents (art. 7) Similar crimes involving threats to public health (art.8) Aiding or abetting and attempt (art. 9) Jurisdiction (art. 10) Corporate liability (art. 11) The Medicrime Convention An Overview

14. 14 effective, proportionate and dissuasive sanctions, including criminal and non-criminal monetary sanctions Administrative measures: -temporary or permanent disqualification from exercising a commercial activity, -Seizure, confiscation and destruction (goods, documents, proceeds, property) -any other appropriate measures Sanctions and measures (art. 12 MC)

15. 15 Aggravating circumstances (art. 13 MC) death or damage to the physical or mental health of the victim perpetrator abuses the confidence of the patient/client (e. g. in their capacity as medical professionals) large scale distribution criminal organisation conviction of perpetrator due to similar offences

16. 16 Criminal investigations (art. 16 MC) specialised units or services possibility of carrying out -financial investigations -covert operations -other special investigative techniques (e. g. controlled delivery)

17. 17 National cooperation and exchange of information (Art. 17 MC) ensure that representatives of health authorities, customs, police and other competent authorities exchange information and cooperate ensure cooperation between competent authorities and industry as regards risk management of counterfeit medical products and similar crimes mechanisms for receiving information / data and making them available to authorities

18. 18 Prevention (art. 18 MC) measures to establish the quality and safety requirements of medical products measures to ensure the safe distribution of medical products other preventive measures: -training -awareness-raising campaigns -prevention of illegal supply

19. 19 International cooperation (art. 21 and 22 MC) in criminal matters: in pursuance of relevant applicable instruments/treaties, legal assistance on prevention and administrative measures: national contact point; assistance programs for the benefit of third states

20. 20 Monitoring mechanism (Art. 23-25 MC) Committee of the Parties < representatives of the Parties to the Convention and of CoE bodies monitor implementation facilitate collection, analysis and exchange of information, experience and good practice (expertise of relevant CoE committees) facilitate effective use, identify problems, questions concerning application

21. 21 Formal provisions (Art. 26-34 MC) relationship with other instruments amendments signature and entry into force accession to the convention territorial application etc

22. 22 The Medicrime Convention In a nutshell The Medicrime Convention is the first international instrument to criminalise: the manufacturing of counterfeit medical products; supplying, offering to supply and trafficking in counterfeit medical products; the falsification of documents concerning medical products; the unauthorised manufacturing or supplying of medicinal products and the marketing of medical devices that do not comply with conformity requirements.

23. 23 The Medicrime Convention What it is not Absolute necessity to distinguish health issues intellectual property issues  The Medicrime Convention deals with health issues only

24. 24 Enforcement by Swissmedic “Enforcement pyramid” Purpose : to sanction infringements Operative support, information Training, advice, recommendations Targeted controls, surveillance Intervention Administrative proceedings Penal proceedings Evaluation Purpose: to restore a state of legal compliance Purpose: to prevent health risks

25. 25 Enforcement by Swissmedic Counterfeit and illegal products in Switzerland General remarks The controls of the authorised distribution channels are effective Low risk of counterfeit or otherwise illegal products being sold in authorised pharmacies Need to keep the high standards in place in the long term

26. 26 Internet orders Increasing number of seizures of imported products at the border -2008: 687 -2009: 1154 -2010: 1861 Illegal domestic resale (retail trade) at an unknown scale Illegal activities by Swiss residents within international networks Enforcement by Swissmedic Current challenges

27. 27 Enforcement by Swissmedic Swiss Legislation (1) Act on Therapeutic Products (ATP) -term “counterfeit” is unknown -mention of examples of illicit acts (Illegal manufacturing, illegal trade, etc.) Swiss penal code (PC) -infringements of property (fraud; counterfeiting of goods) -infringements of “life and limb” (homicide; serious assault) Infringements of intellectual property law Infringements of customs and tax law

28. 28 Louis Vuitton Viagra Cancérostuff Cholestérostuff Cialis Lacoste Rolex Levitra Xenical Rhumatop Counterfeiting, falsification Infringements to the Act on Therapeutic Products + Custom and tax infringements (potentially) Penal Code + Enforcement by Swissmedic Swiss Legislation (2)

29. 29 Act on Therapeutic Products Penal provisions – applicable sentences Crimes and misdemeanours (Art. 86 ATP, danger to health): -Up to 3 years imprisonment or adequate cash penalty (plus possible fine) -Up to 5 years imprisonment or adequate cash penalty (plus possible fine) for aggravated infringements Contraventions (Art. 87 ATP, no danger to health): -Fine up to CHF 50,000.- -Cash penalty equivalent to 180 sentence days (plus possible fine) for aggravated infringements Bodily harm or homicide  application of the Swiss penal code (maximum penalty: life sentence)

30. 30 General Criminal Law (Penal Code) Applicable measures Prevention from exercising a profession (Art. 67 PC) Note in criminal record (Art. 365 et. seq. PC) Publication of judgement (Art. 68 PC) Confiscation of dangerous objects used for or resulting from infringement  destruction (e.g.: dangerous medicines. Art. 69 PC) Confiscation of assets resulting from infringements or intended to reward the perpetrator (or compensatory claim on the part of the State, if assets are no longer accessible) (Art. 70/71 PC)

31. 31 Benefits of Medicrime Convention for Switzerland The Medicrime Convention highlights that the infringements in question are serious: -they are lucrative -they are dangerous to people’s health -they cheat the consumer international collaboration has to be intensified national collaboration has to be optimized. helps to increase awareness at the political level (authorities/population) acquire procedural methods increase the penalties get more resources deployed

32. 32 The Medicrime Convention State of Play in Switzerland Signatory Procedure Decision by Federal Council of the Swiss Confederation (executive) in May 2011 Ratification Procedure Proposal for adherence in Parliament by 1.Q/2012 Adherence by ??

33. 33 Thank you for your attention !