[Interpretation of Drug Administration Law (Draft Amendment)] Increase illegal costs to ensure drug safety-Zhejiang Jianfeng Pharmaceutical Co., Ltd.

[Interpretation of Drug Administration Law (Draft Amendment)] Increase illegal costs to ensure drug safety

Release time:

2018-11-27

In November 2018, the "the People's Republic of China and Drug Administration Law (Draft Amendment)" (hereinafter referred to as the "Draft") was released and solicited opinions from the whole society. The amendments involved in this draft mainly cover the whole process of drug supervision system, legal liability for illegal acts, drug marketing license holder system, drug approval system and other issues. Among them, the modification of the legal liability part exceeds the 1/3 of the modified part. The author in this to do a brief interpretation of the highlights.

Highlight a comprehensive increase in administrative penalties

In the draft, a large-scale adjustment has been made to the limits of punishment for illegal acts, and the law has comprehensively increased the intensity of administrative punishment for drug violations. The amount of fines and the number of years of revocation are several times or even dozens of times the original, for example, the amount of fines for the production and sale of counterfeit drugs has been increased from "two to five times the value of illegal production and sale of drugs" to "two to ten times the value of illegal production and sale of drugs; if the circumstances are serious, the illegal production and sale of drugs shall be imposed. A fine of more than ten times and less than thirty times the value of drugs" is unprecedented in the history of drug supervision in my country.

The purpose of this unprecedented approach is actually to use the reflective function of higher illegal costs to curb the occurrence of illegal acts, so as to further protect the quality and safety of people's medication. In fact, the low cost of illegality has always been one of the widely criticized problems of drug supervision in China. In the "chromium capsule" incident in 2012, two of the four companies involved in the production of problematic capsules had long been included in the "blacklist" of the local drug administration department, and all of them were punished by the local drug administration department for fines and confiscation of raw materials and products because of the problem of excessive chromium in raw materials and finished products. But it is clear that the disciplinary effect is vulnerable to huge interests. At present, the relevant punishment measures for drug violations in China are often not proportional to their extensive social harm, and the low cost of illegal activities makes the profit-seeking nature of the lawbreakers repeatedly challenge the social bottom line. In recent years, some illegal events may not be without the consideration of illegal risk cost, but in the lower illegal cost and huge practical benefits, the probability of lawbreakers taking risks is obviously much higher. In this revision of the law, the draft will greatly increase the upper and lower limits of illegal costs. It can be seen that my country's determination to strictly monitor drugs can not only sound a wake-up call for offenders, but also give people a "shot in the arm".

Highlight two will be illegal costs to people.

This draft fully implements the requirement of "punishment to people", and strives to achieve the purpose of reducing corporate violations by restricting decision makers. This practice of putting illegal costs on people is more direct than that of enterprises, and the types of penalties are no longer limited to property penalties. If criminal responsibility needs to be investigated, it may also involve people, and the intensity of punishment has also been greatly increased, such as Article 86.

Article 86 An enterprise or other unit engaged in the production and sale of counterfeit drugs or the production and sale of substandard drugs with serious circumstances shall confiscate its legal representative or principal responsible person, directly responsible person in charge and other directly responsible persons, the income earned from the unit during the period when the illegal act occurs shall be confiscated, and a fine of not less than 30% but not more than twice the income shall be imposed, and shall not engage in drug production or business activities for life.

It can be said that this "punishment to people" approach adds a piece of self-interest to the illegal cost of violating drug management regulations on top of the interests of the enterprise, and not only the relevant decision-makers need to make double measures when considering illegal acts. at the same time, the relevant management and executive personnel will also make prudent risk prediction out of their own interests when facing illegal decisions by decision-makers. This situation, to a certain extent, should be able to play a better role in curbing drug violations.

Highlight three supplement perfect legal responsibility link

The draft supplements the legal liability of drug marketing license holders and new obligations such as illegal reporting and recall, further improves the legal liability system of drug supervision, and implements the responsibility to the prevention and remedy links, such as Article 91 and Article 92.

Article 91 If a drug marketing license holder violates the provisions of this Law, fails to formulate a drug risk control plan or fails to submit an annual report, he shall be ordered to make corrections within a time limit; if he fails to make corrections within the time limit, he shall be fined not less than 100,000 yuan but not more than 200,000 yuan.

Article 92 If the drug marketing license holder refuses to recall after being ordered by the drug regulatory department of the people's government of the province, autonomous region or municipality directly under the central government, he shall be fined not less than five times but not more than ten times the value of the recalled drug; if the value of the drug is less than 10000 yuan, he shall be fined not less than 50000 yuan but not more than 100000 yuan; If the circumstances are serious, the drug approval document shall be revoked, the drug production license and the drug trading license shall be revoked. If a pharmaceutical manufacturing enterprise, pharmaceutical trading enterprise or medical institution refuses to cooperate with the recall, it shall be fined not less than 20,000 yuan but not more than 100,000 yuan.

The responsibility for the non-compliance of the drug marketing license holder with the obligation to formulate the drug risk control plan is actually to increase the risk control awareness of the drug marketing license holder and ensure the minimization of the harmful impact of the drug-related incident on the public by adding the responsibility cost of the prior risk investigation. The clarification of the consequences of the drug recall obligation of the drug marketing license holder is conducive to the timely recall of the problematic drugs and the further expansion of the damage consequences of the drug-related incidents, ensure the safety of public medication. These two, both add a prevention and control lock before the illegal damage, and give a security door after the illegal damage.

Highlight four clear penalty range discretion standard

The expansion of the range of punishment means the expansion of administrative discretion. In this case, how to clarify the scope of application of administrative power and prevent the abuse of administrative power is also reflected in this amendment, such as Article 100.

Article 100 Any of the following acts shall be given a heavier punishment within the range of punishment prescribed by this Law:

(I) passing off narcotic drugs, psychotropic drugs, toxic drugs for medical use or radioactive drugs as other drugs, or passing off other drugs as the above-mentioned drugs;

(II) the production and sale of fake and inferior medicines mainly targeted at pregnant women, infants and children;

The (III) production and sale of vaccines and other biological products belong to counterfeit drugs or inferior drugs;

(IV) production and sale of fake or inferior medicines, causing personal injury;

(V) the production and sale of fake or inferior medicines, and repeat the offence after handling;

(VI) refuses or evades supervision and inspection, or forges, destroys or conceals relevant evidentiary materials, or uses seized or impounded articles without authorization.

This amendment to the law in increasing the intensity of administrative punishment, mainly reflected in the increase in the range of the upper and lower limits, this expansion of the multiple range, in the actual implementation of the punishment decision, there may be a large discretionary difference. Therefore, it is further stipulated that from the perspective of the application of the law, it is more standardized and operational to ensure that law enforcers comply with the principle of equal punishment when making administrative penalty decisions.

Highlights Five Plus Regulator Responsibility

In addition to greatly increasing the penalties for drug producers and operators and related personnel who violate the Drug Administration Law, the draft also correspondingly increases the responsibility and consequences of drug regulators, such as Article 113 and Article 114.

Article 113 Where, in violation of the provisions of this Law, the local people's government at or above the county level commits any of the following acts, the person in charge directly in charge and other persons directly responsible shall be given a demerit or a major demerit; if the circumstances are serious, they shall be demoted, dismissed or expelled:

(I) fail to perform their duties, causing serious adverse effects or heavy losses;

(II) concealing, falsely reporting or postponing reporting of drug safety accidents;

(III) the occurrence of a particularly serious drug safety accident within the administrative area, or the continuous occurrence of serious drug safety accidents.

Article 114 If, in violation of the provisions of this Law, the pharmaceutical supervisory and administrative department commits any of the following acts, the person in charge and other persons directly responsible shall be given a demerit or major demerit; if the circumstances are more serious, they shall be demoted or dismissed; if the circumstances are serious, they shall be dismissed:

(I) concealing, falsely reporting or postponing reporting of drug safety accidents;

The (II) fails to investigate and deal with the drug safety violations found in time;

The (III) fails to perform its duties of drug supervision and administration, causing serious adverse effects or heavy losses.

Regulators play a vital role in ensuring the safety of drug use. Therefore, the increase in the cost of drug violations should be reflected not only in the managed, but also in the managers. After the amendment of the law, further clarify and improve the responsibility of regulators and increase the consequences of responsibility, which can not only urge law enforcers to strictly enforce the law, implement regulatory duties, and ensure drug quality and safety, but also a legal response to the serious lack of credibility of drug supervision caused by frequent drug-related incidents in China.

Looking forward to the new law as soon as possible

The amendment to the legal responsibility part of the Drug Administration Law has greatly increased the punishment for illegal acts, and the unprecedented punishment is rare in the field of drug supervision in China. it shows the public the determination of the state to ensure the safety of drug use and the right of life and health of the public. However, we must also see that compared with the fines of billions of dollars in foreign countries, the draft still cannot be said to have reached the limit of "severe punishment and chaos. Therefore, in terms of the strength and methods of deterrence and punishment of illegal acts, it can be further demonstrated and investigated in the light of China's national conditions, whether its punishment really matches the current situation of China's national conditions, and whether it can really achieve the purpose of relying on "heavy codes" to rectify the chaos in the pharmaceutical industry, it also needs more detailed research and analysis. In addition, in the study of punishment intensity, in addition to considering expanding the range of fines and confiscation and fully implementing the investigation procedures for the demonstration of punishment intensity, consideration can also be given to increasing the illegal cost by establishing a system of preliminary examination of drugs, a system of lifelong responsibility for drug evaluation or lifelong investigation, and other link penalties.

To sum up, although this amendment is open to question on some issues, it is of great significance to solve the problem of drug safety of the public and is worth looking forward.

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