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Parallel Trade Definition

Parallel trade or parallel import in pharmaceutical market simply refers to buy medicinal products in a country that sells them at a reasonable price and then to distribute such products outside the distribution channels set up by the drug manufacturer or its recognized distributor in one’s own country of origin. It is named ‘parallel’ as it takes place beside and usually in parallel to the producer’s distribution networks.

The EU Commission’s policy position is that parallel imports increased price competition, and that this in turn increases consumer welfare as the import of goods from a country with lower prices forces sellers in the country of destination to reduce prices. The commission’s overall approach is based on two principles (Competition Policy Newsletter 1, 2007):

  1. The single market in pharmaceuticals requires the unhindered free movement of products – private companies cannot erect barriers to undermine this without distorting intra-brand competition.
  2. The efficiency claims defence advanced by the research based pharmaceutical industry is unsubstantiated – i.e. there is no evidence that partitioning the common market would spur on global investment in inter-brand competition.

Parallel Trade in the Pharmaceutical Sector

The Reasons for Parallel Trade in the Pharmaceutical Sector The pharmaceutical industry is a special sector in two respects: Firstly, innovative pharmaceutical companies incur high research and development costs for novel medicines. Secondly, in many cases, the buyer of a pharmaceutical product does not directly pay for it but is reimbursed by a national health system. Prices and reimbursement schemes vary considerably between countries in Europe: Price differentiation allows companies to allocate contributions to research and development costs efficiently among different payers, which improves cost recovery.

1) This results in considerable price differences between Member States. A price comparison of pharmaceuticals in 16 EU Member States in 2013 shows differences between 25% and 100% for two thirds and between 100% and 251% for one third.

2) Such price differences are a strong incentive for parallel trade: An importer, usually a wholesaler, purchases pharmaceuticals in a low-price country and then sells them in a high-price country.

Parallel Trade of Pharmaceuticals and its Problems in the EU

Parallel trade, on the one hand, lowers expenditure on pharmaceuticals for high-price countries which is, of course, welcomed by them. The larger the share of parallel imported medicines, the greater this effect is. On the other hand, parallel trade adds to the non-transparency of price structures and may cause certain difficulties for pharmaceutical companies regarding cost calculations.

1) Shortages of Medicines

Parallel trade is exports of pharmaceuticals from low-price countries to high-price countries, may lead to shortages in the former unless the manufacturer is willing to make up for it and supply higher quantities of the product.

2) Risk to the safety of pharmaceuticals

Parallel trade can increase the potential risk of falsified pharmaceuticals because extra steps are added to the supply chain through parallel imports. Complex supply chains, routes of transport, changes of outer packaging and relabeling make it difficult for national authorities to trace the history of pharmaceuticals bought and sold by intermediaries in different EU Member States. The EU has taken measures against falsified medicines through the Falsified Medicines Directive. So far, however, this has not eliminated the problem completely.

3) Lack of transparency and calculation problems

Prices in the pharmaceutical sector are not transparent. The negotiated prices that health insurers pay are generally not published. Such lack of transparency protects the producers by blocking price signals to other insurers and other countries.

Result

Parallel trade is a form of arbitrage: A product, sold by the manufacturer in country A at a lower price than in country B, is bought by a dealer in country A and sold in country B. It is particularly relevant for pharmaceuticals in the internal market of the EU.

Parallel trade may lead to pharmaceutical shortages in low-price countries and increase the potential risk of falsified pharmaceuticals. It adds to the non-transparency of pricing of pharmaceuticals and can lead to calculation problems for manufacturers.

There are three basic options for addressing parallel trade: the exclusion of pharmaceuticals from the internal market rules, open redistribution among the national health systems by a subsidisation fund, and a unitary price that has to be paid everywhere in the EU.

Adverse drug effects are especially problematic in the elderly because they have slowed metabolism and excretion of medications. Often such adverse reactions are caused by the use of unnecessary medications, or the use of medications in excessive doses. Adverse drug effects are a widespread problem and can lead to significant injury and even death in the elderly. Physicians, nurses, and pharmacists are all responsible for the medication regimen in the nursing home setting.

The statistics regarding adverse drug effects are shocking. In the November 2006 issue of Clinical Geriatrics, a publication of the American Geriatric Society, the following was noted:

30% more money is spent in the United States on treating adverse drug effects than on all pharmaceuticals combined.

31% of older adults use more than one pharmacy, creating challenges for a comprehensive drug review.

50% of older adults receive prescriptions from more than one prescribing clinician.

One in 12 physician visits for the elderly result in a prescription of medication that is not recommended for them.

6,900,000 elderly persons are currently taking medications not recommended for the elderly.

10.3% of all prescriptions in the United States generate an electronic safety alert to the dispensing pharmacists. Of these alerts, 88% are overridden by the dispensing pharmacist. When interviewed, some pharmacists stated they did not believe the alert was important, was not real, or that they already knew about it.

The Centers for Medicare and Medicaid Services (CMS) have taken note of the high risk of injury related to adverse drug effects. In December 2006, CMS clarified federal mandates to state surveyors regarding the appropriate use of medications in the nursing home setting under F329 of the OBRA regulations. The rules are not new, but facilities are receiving clarification as to what medications should be reduced or eliminated from residents’ medication regimens. The clarification makes facilities responsible for the medication regimen, more so than the physician, nurse practitioner, or physician’s assistant who ordered the medication. State surveyors evaluate compliance with such rulings, and will, in essence, question the facility when rules are not followed. This clarification by CMS should be referred to when questioning whether therapy is recommended for the elderly population.

The following are questions you should ask the nursing home staff or medical provider of your loved one if you suspect medications are unnecessary or causing adverse effects:

Is this medication necessary?

Is the drug contraindicated in the elderly population?

Is the resident taking the lowest effective dose of the drug?

Are medications being used to treat the side effects of other medications? For example, medications for constipation are often given to treat the side effects of certain pain medications.

Can the drug regimen be simplified?

What are the potential drug interactions of the medications currently prescribed?

Resources

Merck

American Medical Director’s Association

Centers for Medicare and Medicaid Services

Types of Cancer Treatments

Cancer is a disease in which some of the body’s cells grow uncontrollably and spread to other parts of the body. Cancer can start almost anywhere in the human body, which is made up of trillions of cells


Some people with cancer will have only one treatment. But most people have a combination of treatments, such as surgery with chemotherapy and/or radiation therapy.

Common Cancer Treatment Options

Marrow Stem Cell Transplantation

A bone marrow transplant is a procedure that implants healthy blood-making stem cells into the body to replace damaged or diseased bone marrow. In cases where the bone marrow is not functioning or cannot produce enough healthy blood cells, a bone marrow transplant is required. Bone marrow transplants are of two types, autologous and allogeneic. Transplants in which cells from the human body are used are called autologous, and transplants from a donor or donor are called allogeneic transplants.

Chemotherapy

Chemotherapy is a drug-based therapies. Chemotherapy is a special form of drug therapy that aims to stop or destroy the growth and proliferation of cancer cells that cause uncontrolled growth in the human body and damage healthy tissues.

Immunotherapy

Immunotherapy is a new dimension of drug therapy in cancer. Millions of cancer cells are born in our bodies every day. There are cells in the human immune system to defeat cancer cells. When the immune (immune) system recognizes cancer cells, it immediately takes action and destroys the cell. T cells (T lymphocytes) in the immune system fight these cancer cells and try to destroy them.

Interventional Radiology

Interventional Radiology is a field of radiology that includes techniques applied for diagnosis and treatment in many areas of medicine. The patient is usually administered local anesthesia; Interventional radiology, which includes the diagnosis and treatment methods performed by entering the body with very small means (in the size of a pinhole), enables diseases to be treated with much simpler interventions than before, without the need for open operations and diagnostic surgical applications, and to obtain clearer information about the disease.

Radiation Therapy

Radiotherapy, that is, beam therapy, aims to destroy cancer cells to a large extent by emitting radiation beams on cancer cells and to treat cancer with this process. Radiotherapy procedures are in the field of specialization in the medical science called radiation oncology.

What is Diabetes?

Diabetes is a metabolic disease that develops when the secretory gland called the pancreas does not produce enough insulin hormone in your body or the insulin hormone it produces cannot be used effectively.


Our digestive system breaks down the eating into nutrients. Carbohydrates or various sugars are broken down into glucose for use by the body and absorbed. Glucose is an important fuel source for many organs in our body. However, in order to use glucose as a fuel, the glucose molecule must enter the cell. For this reason, we need a special hormone. Beta cells in the pancreas produce a hormone called insulin.


Insulin is the chemical messenger necessary for the entry of glucose into the cell to regulate blood sugar levels that rise after a meal. Insulin is released into the bloodstream to trigger blood glucose to enter cells. Insulin lowers your blood sugar level, allowing glucose to enter the cell.


Not only insulin but also glucagon which has an effect on blood sugar levels. If your blood sugar levels are too low or you haven’t eaten for too long, glucagon inform the liver to release stored sugar.


The other active hormone in diabetes is GLP-1 which helps the pancreas for production of the right amount of insulin to move sugar from the blood into the cells. When blood sugar gets too high, GLP-1 stimulates beta cells to increase insulin production and also helps lower the amount of sugar converted by the liver. When blood sugar gets too high, insulin production increases. Metabolic disorders in these systems lead to diabetes.

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