Category: Issue 11.7

Overseeing diverse sectors across multiple countries, Petrol Group Director of Legal Affairs Mojca Logar discusses the challenges and strategies in managing the group’s legal affairs and navigating complex regulatory landscapes, while emphasizing internal legal expertise and collaborating with external firms for specialized projects and new legislation.

CEELM: Tell us a bit about yourself and your career path leading up to your current role.

Logar: I graduated from the University of Ljubljana’s Faculty of Law in 2004. Even while studying, I began my professional journey in the corporate sector. Initially, I worked in the insurance industry, then moved to banking, and later transitioned to retail. Throughout my career, I continued to enhance my skills through further education. I completed my master’s degree in law from the University of Ljubljana in 2009 and passed the bar in 2011. In 2016, I also qualified as a bankruptcy administrator.

Before joining Petrol Group, I worked for Lidl Slovenia, where I was Head of Legal & Compliance. To support my role, I obtained the ICA Advanced Certificate in Business Compliance. With 20 years of experience in the corporate world, I briefly worked in the public sector but found that I thrive more in corporate environments.

When I joined Petrol, it marked a significant step forward for me. Petrol is Slovenia’s largest company, with diverse operations spanning retail, energy, and more. Beyond Slovenia, Petrol operates in multiple countries, including Croatia, Bosnia and Herzegovina, Serbia, and Montenegro. Leading the legal department across these regions was a major leap, reinforcing my decision to pursue corporate law. The dynamic nature of the work ensures there’s never a dull moment.

CEELM: What has been the most challenging aspect of your work for Petrol so far?

Logar: When I joined Petrol, I was immediately struck by the complexity of the business. Petrol operates as a parent company with a presence in numerous other companies, either as a shareholder or a participant. Understanding the company’s organization and its multifaceted nature was a significant shift from my previous roles. Petrol’s operations span various sectors – fuels and petroleum products, retail, energy, renewable energy production, mobility, and more. This diversity was markedly different from my earlier experiences in retail. Petrol’s breadth of activities was a significant change for me, incorporating elements from many sectors. I firmly believe that to be an effective lawyer, especially in a corporate setting, one must have a comprehensive understanding of the business. It’s not enough to just focus on specific clauses in a contract, a broader perspective is essential.

One of the most important things I emphasize to my colleagues in the legal department is the importance of truly understanding the business they support. I’m committed to breaking the stereotype of lawyers as obstacles. To be an effective corporate lawyer, it’s crucial to find ways to manage and mitigate risks while delivering the best legal advice. This means identifying potential risks and communicating them clearly to the relevant business teams.

CEELM: How large is your in-house team currently and how is it structured?

Logar: Currently, my team consists of 25 members, with 22 of them being lawyers. We navigate the complexities of different legislations across various countries, which adds to the excitement and challenge of the role. At the parent company, Petrol Ljubliana, I manage a team of 15, divided into smaller, specialized groups. For instance, some focus on the energy sector, others on M&A transactions, insolvency proceedings, or lawsuits. These specialized groups work closely with both Slovenian and foreign companies. Additionally, I have a team of two in each country with whom I collaborate closely. We hold regular meetings and I make it a point to visit and have in-person conversations, which fosters better cooperation, especially when significant issues arise. I stay involved in major legal matters and lawsuits, often working directly with my team or occasionally with external counsel.

CEELM: How do you decide if you are outsourcing a project or using internal/in-house resources?

Logar: We primarily handle our legal work internally because our team is highly specialized in the areas of law they cover. However, when facing new legislation or significant lawsuits, we do collaborate with external lawyers.

We partner with many external firms, predominantly in Slovenia but also internationally. The main criteria for selecting these firms include their industry-specific knowledge – they must understand our operations and business model. Additionally, they need to have strong legislative expertise and problem-solving skills. It’s crucial for them to grasp our business if they are to propose effective solutions and innovative ideas. Their responsiveness is also vital, meeting deadlines is essential for us.

After 2.5 years at Petrol, working with various law firms, we’ve developed a keen sense of which firms excel in different types of legal challenges. While some large law firms can address all topics comprehensively, I find value in collaborating with a diverse range of firms to gain varied perspectives – this diversity in legal opinions can offer fresh insights that might otherwise be overlooked.

CEELM: What has been keeping you and your in-house team busy over the last 12 months? What about the upcoming 12 months? What are you keeping on your radar that you think will impact your workload the most?

Logar: The major issue we are encountering in Slovenia is state-imposed regulations. Specifically, these regulations are related to fuel price controls. Petrol Group, which has around 600 fuel stations internationally, is the largest operator in Slovenia, where we have more than 300 petrol stations. The regulated margins are insufficient to cover operational costs, creating a significant financial burden. While other countries also have regulations, the margins in Slovenia are notably lower than the EU average or any other country in the region. This issue has persisted, and it remains a critical challenge for us. Our priority is that Petrol and other fuel distributors in Slovenia can operate sustainably while making the necessary investments for the energy transition.

This began in 2022, and we believe that these regulations have inflicted significant financial damages and continue to do so. In addition, the measures obstruct the energy transition and distort the market. As a result, we are currently engaged in a substantial lawsuit against the state. Unfortunately, in June 2024, a new regulation was enacted for the coming year, which prompts us to consider our next steps. There are also wider implications at play, in particular when it comes to adherence to the rule of law. These are very concerning. Not only was the regulation adopted without consulting the Slovenian Price Council, but we believe that the conditions for the new regulation have not been met and that the measure is not proportionate. I am working very closely with the management board on this matter. We strongly advocate for the elimination of such regulations and believe that margin setting should be left to the market.

Over the next 12 months, addressing these new regulations will be a key priority for me. We will be working in close partnership with international experts, including economic, regulatory, and legal advisors- to tackle this challenge.

CEELM: What do you foresee to be the main challenges for GCs across all sectors in Slovenia in the near/mid future?

Logar: As I mentioned earlier, the primary regulatory concern revolves around the complexity of new businesses and operations, a challenge experienced globally. Additionally, one of the critical issues is the recruitment and retention of talent, particularly in sectors like energy where specific knowledge is crucial. We are actively addressing this by focusing on not only attracting but also retaining employees through motivation and providing growth opportunities.

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Greece’s vibrant life sciences sector is supported by a robust regulatory framework and expanding investment opportunities. In the following paragraphs, we will examine key aspects of product liability, intellectual property (IP), artificial intelligence (AI), and investment potential within the Greek life sciences landscape, highlighting the laws and regulations that shape the industry.

Product Liability

In Greece, product liability for pharmaceuticals and medical devices is regulated by Law no. 2251/1994 on ‘Consumer protection’ and aligns with the directives issued by the European Union. More certainly, Law no. 2251/1994, which aligns with EU Directive 85/374/EEC, as amended and in force, provides the prerequisites for a product to be held as defective and establishes a strict liability regime for producers, i.e., non-fault-based. This includes pharmaceuticals and medical devices, allowing patients to seek compensation without proving negligence, thus increasing consumer protection. The Greek Medicines Agency (EOF) monitors the market and ensures that medical products meet safety and efficacy standards before they reach consumers. However, the lack of specific compensation schemes for medical injuries necessitates reliance on general legal provisions, indicating a need for greater alignment with broader European practices to streamline claims processes.

Intellectual Property

Intellectual property rights, with a primary focus on patent protection, play a critical role in the Greek life sciences sector, protecting innovation and fostering an environment conducive to research and development. Greek Law no. 1733/1987 on ‘Patents’ implements the European Patent Convention (EPC) and provides robust protection for biotechnological inventions, which is essential to ensure innovation in pharmaceuticals and medical devices. In addition, Greece complies with EU Supplementary Protection Certificates (SPCs), which extend patent terms for pharmaceuticals and crop protection products by up to five years to compensate for regulatory approval delays. This extension helps companies recoup their R&D investments. The Hellenic Organization of Industrial Property (OBI) manages patent registrations but faces challenges in the efficiency of the judicial system in handling IP disputes.

Artificial Intelligence

Artificial intelligence is revolutionizing the global life sciences sector, and Greece is embracing this change. AI technologies are being integrated into healthcare for applications ranging from drug discovery to personalized medicine and diagnostics. Greece is supporting AI development through initiatives such as the National Digital Strategy, which outlines its vision for digital transformation and AI adoption in healthcare.

Compliance with the General Data Protection Regulation (GDPR) is critical for AI applications that rely on extensive personal health data, ensuring secure data handling, and fostering patient trust.

Investment Opportunities

Greece’s life sciences sector offers substantial investment prospects, driven by a skilled workforce, advantageous geographic location, and supportive government policies. The Greek government offers incentives such as tax breaks, grants, and streamlined regulatory processes to attract foreign investment. The pharmaceutical industry is a major contributor to the Greek economy, with investments in R&D and manufacturing facilities supported by the government’s emphasis on innovation.

Collaborative clusters between academia, research institutions, and industry players foster an environment that enhances Greece’s global competitiveness. Medical tourism is a burgeoning sector, leveraging Greece’s high-quality healthcare services and scenic locations to attract international patients. Investments in advanced medical facilities and treatments are positioning Greece as a leading destination for medical tourism.

The digital health sector is also on the rise, with startups and established companies developing innovative solutions, supported by the government’s focus on digital transformation and the availability of EU funding. Greece boasts a robust R&D infrastructure and highly skilled workforce, with its universities and research institutes renowned for their contributions to life sciences. The country’s pharmaceutical sector is increasingly focused on generic production, in line with global trends, and offers significant growth potential while meeting local healthcare needs.

The convergence of Greece’s robust healthcare system with its thriving tourism industry presents unique opportunities, particularly in medical tourism for specialized treatments such as fertility and geriatric care. The government’s commitment to the life sciences sector is evident through various incentives to encourage innovation and support start-ups, thereby improving the investment climate.

Conclusion

Greece’s life sciences sector is poised for significant growth, supported by a robust regulatory framework, strategic investments, and the integration of cutting-edge technologies such as AI. Although challenges remain in the areas of IP enforcement and AI ethics, ongoing efforts to address these issues are expected to strengthen Greece’s attractiveness as a hub for life sciences innovation and investment. This combination of regulation, innovation, and investment promises to improve healthcare outcomes and drive economic growth, solidifying Greece’s global position in the life sciences.

By Marios Bahas, Managing Partner, Bahas Gramatidis & Partners

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Following extensive discussions between industry stakeholders and state institutions, several crucial solutions have been identified to address the problems of drug availability and monitoring control. The primary aim is to ensure wider and faster access to medicinal products for patients in Latvia.

As a result of these collaborative efforts, a proposal for amendments to the existing regulatory framework, under the Cabinet of Ministers Regulations No. 416 “Procedures for the Distribution and Quality Control of Medicinal Products” (Regulation No. 416), has been drafted and is currently undergoing the legislative approval process. Three of the proposed solutions warrant particular attention.

Options for Expanding the Export Ban

The current regulatory framework includes a procedure for prohibiting the export of medicinal products to ensure their availability and to protect the health of Latvian patients (known as the export ban mechanism). This mechanism aims to regulate the volume of exported medicines, thereby improving the availability of essential medicinal products within Latvia. Presently, the regulation permits the export ban only for medicines covered by agreements between the National Health Service and the relevant market authorization holders or wholesalers. However, the State Agency of Medicines has extensively reported that the issue of medicinal product shortages due to excessive exports affects many other categories of reimbursable medicines.

The proposed changes to Regulation No. 416 aim to extend the export ban mechanism to almost all categories of reimbursable medicines. Furthermore, the State Agency of Medicines could identify additional medicines whose absence (actual or planned) or insufficiency in wholesale stock poses a risk to public health, which could prompt a ban on deliveries to EU countries or an export ban as necessary.

Parallel Distribution of Medicinal Products Registered through the Centralized Registration Procedure

The current regulatory framework outlines the responsibilities of wholesalers involved in the parallel distribution of medicines registered through the centralized registration procedure. This applies when the wholesaler is a parallel distributor rather than the manufacturer, registration holder, or authorized representative, and the medicines are sourced from a European Economic Area country. While the regulation provides a detailed explanation and definition of parallel distribution, it does not address situations where manufacturers of centrally registered medicines have not made these products available on the Latvian market, nor are they distributed by parallel distributors, despite patients’ needs. This creates a risk of patients not receiving the medicine prescribed by their doctor in a timely manner.

The proposed changes to Regulation No. 416 aim to implement a mechanism that allows wholesalers to execute a bona fide order for medicines registered through the centralized registration procedure, provided two conditions are met. First, the marketing authorization holder of the centrally registered medicinal products has not commenced distribution in Latvia and they are not available. Second, no available analogs are present in the Latvian market, or the available analogs included in the Latvian Register of Medicines cannot be used for treating a specific patient due to inadequate therapeutic effects or medical indications, including cases where the National Health Service has decided to compensate medicine purchase expenses for individual persons.

Facilitated Accessibility of Compassionate Use Programs

Compassionate Use Programs have been well-known in the industry for years, focusing on groups of patients with chronic or severely debilitating diseases, or those whose disease is considered life-threatening and cannot be satisfactorily treated with registered medicines. It is evident that any delay in the approval of Compassionate Use Programs and the delivery of medicines is critical for the lives of patients.

According to Association of International Research-based Pharmaceuticals Manufacturers, the availability of innovative medicines in Latvia within the framework of Compassionate Use Programs is cumbersome and lengthy, especially compared to Lithuania and Estonia, where the regulatory framework is significantly more relaxed. This is primarily due to Regulation No. 416 defining “compassionate medicines” as gifts, which, in addition to requiring permission from the State Agency of Medicines, necessitates the importation of unregistered medicines to be approved by the Ministry of Health for donation purposes, alongside separate contracts with each hospital. This significantly complicates patients’ access to these programs.

The proposed changes to Regulation No. 416 aim to eliminate the dual monitoring system and the requirement for a Ministry of Health permit as a gift of medicine. Medicinal products for Compassionate Use Programs will no longer be considered gifts, thereby removing a significant barrier to the approval of Compassionate Use Programs.

By Indrikis Liepa, Partner, and Janis Sarans-Reneslacis, Senior Associate, Cobalt

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Digitization is affecting many sectors and healthcare is no exception. It is a key tool for speeding up and streamlining processes that can significantly improve the quality and availability of medical care. In the Czech Republic, the overall level of digitization in healthcare is still low.

A significant step toward improvement is draft legislation that introduces the first definition of telemedicine into the Czech legal system and aims to promote the maintenance of medical records in electronic form.

Telemedicine

Currently, from all forms of telemedicine, only consultation services provided remotely outside of medical facilities are recognized by Czech law. Regulation of other forms of telemedicine, such as remote monitoring of patients or the assessment of certain health-related data that can be self-measured by patients, is missing. This leads to various legal uncertainties for healthcare providers, such as issues around coverage of telemedicine services by medical liability insurance. The draft amendment to the Healthcare Services Act (Act no. 372/2011 Coll.) has the potential to change this.

The amendment defines telemedicine as healthcare services provided remotely (without the physical presence of the patient) while using information and telecommunication technologies or a certified medical device. This clarifies that telemedicine is a way of providing healthcare services, not a separate form or type of healthcare service requiring a separate license or training. It also means healthcare providers who would like to limit their services to remote consultations only will still be required to set up a duly equipped and approved medical facility where on-site patient visits can take place.

The amendment stipulates that a provider of telemedicine healthcare services must meet various technical requirements. These include: (i) technical requirements for the quality and security of the communications and their encryption, (ii) requirements on verification of the identity of the communicating parties, and (iii) requirements for obtaining and recording the patient’s consent with the recording of remote communication. Details of these requirements will be laid down in implementing legislation that has yet to be drafted.

Medical Records

The amendment changes the approach to defining medical records. Instead of listing individual items that belong in records, it broadly states that it should include all information processed by the provider for the purpose of delivering healthcare services to a specific patient. It explicitly mentions this can include data obtained from the patient or the provider’s own activities, as well as information received from another provider or even other individuals or entities. The amendment clarifies that rules on medical records do not apply to anonymized medical data processed for the purposes of scientific research.

The amendment introduces new rules for the maintenance of medical records. Currently, regulations primarily address medical records in paper form. The new rules will allow providers to keep documentation solely in electronic form. The amendment introduces rules for creating and maintaining electronic medical records, including the conditions for the authorization of entries, etc. Nevertheless, maintenance of medical records in paper form or a combination of paper and electronic forms will be still possible.

The provider will be required to draft written internal rules for processing medical records. The rules must set out appropriate technical and organizational measures to ensure and demonstrate that the processing of medical documentation complies with the law, including personal data protection regulations.

Conclusion

The proposed amendment to the Healthcare Services Act was approved in May 2024 by the Chamber of Deputies. Approval by the Senate and signature by the President are likely to occur in the summer.

For both healthcare professionals and patients, the amendment eliminates current legal uncertainties around telemedicine. This could result in the expansion of telemedicine services in the country.

Furthermore, the amendment supports and motivates healthcare providers to maintain medical records in electronic form. With this step, the Czech Republic is joining the modern trends in healthcare, which are already common practice in many countries and have great potential for the better use of healthcare data for the benefit of patients.

We believe these changes will bring positive effects and will be an impetus for further innovations in the Czech healthcare system.

By Monika Maskova, Partner, and Kristyna Kupcova, Associate, PRK Partners

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

It is not new that originator pharmaceutical companies try to block generic competitors from entering the market. Considering the recent developments in the Court of Justice of the European Union (CJEU), originators should tread carefully when defending their patents. Having a strong patent is crucial, and the consequences of failing to vet the strength of a patent could end up costly.

In this article, we explore the effect of the CJEU’s judgment in case C-473/22 on January 11, 2024 (Mylan), on Estonian disputes.

Resisting Interim Injunctions is Challenging

Originators are important to the pharmaceutical market, as are their generic competitors. Both play vital roles in pharmaceutical innovation and in ensuring the affordability of medicines. There is no lack of disputes between originators and generics in Estonia. It is not uncommon for originators to use offensive patent strategies and ask for an interim injunction to try to block a generic medicine from entering the Estonian market.

An injunction is quite easy to obtain when the originator company owns a registered patent. The plaintiff does not have to prove actual infringement of intellectual property rights with its application for interim measures. The court does not consider any evidence when first deciding the application and only relies on the plaintiff’s explanations while presuming that all the plaintiff’s statements are true. The court also does not have to hear the defendant before granting the injunction, further complicating the defendant’s position. To the additional advantage of the plaintiff, even in cases where the patent could be considered weak and there is good reason to believe it will be declared invalid, it is challenging to convince the court to dismiss the application for interim measures, especially once imposed. A patent is presumed valid, and the likelihood of the plaintiff’s claim succeeding is not a prerequisite.

For these reasons, it is an uphill battle to resist an interim injunction when measures are sought for the protection of a patent by an originator.

Uncertainty Pre-Mylan Regarding Generic Defendant’s Right to Appropriate Compensation

Compared to many European countries, Estonia’s legal system is relatively young. The law is still developing in more complex legal issues, one of which is the defendant’s right to appropriate compensation when unjustifiably blocked from entering the market. Under Estonian law, an applicant who has obtained an interim injunction in a dispute where the action is denied or dismissed must compensate the other party for any harm caused by such unjustified application of interim measures. This is known as no-fault or strict liability. While the provision itself is clear, European Union law must also be considered.

Directive 2004/48/EC of the European Parliament on the enforcement of intellectual property rights (Enforcement Directive) was interpreted by the CJEU in its judgment on September 12, 2019 (Bayer Pharma). The CJEU named several circumstances that should be considered when deciding the applicant’s liability for damages (abuse of interim measures, risk of irreparable harm, etc.). Shortly after, the first case by a generic competitor against an originator was brought before the Estonian Supreme Court. The generic claimed damages for being blocked from entering the market when the originator’s patent was later declared invalid. While the Supreme Court referenced the findings of the CJEU judgment, the impact of the judgment in Bayer Pharma caused confusion as its effect on the strict liability regime remained unclear and thus became the central point of contention.

The CJEU Allows Strict Liability

A Finnish court referred a case to the CJEU to determine whether strict liability is compatible with the Enforcement Directive. The resulting Mylan judgment aligns with the interpretation that Estonian law is proportional: the applicant need not prove infringement when obtaining the interim measure and the defendant need not demonstrate the applicant’s fault when claiming damages.

When an intellectual property right is declared invalid retroactively, it is deemed never to have existed. The Mylan judgment indicates that in such a situation, blocking a generic from the market to protect such rights hinders legitimate trade. Under Estonian law, this is relevant when determining compensation awarded to the defendant.

Summary

The Mylan ruling should make originator companies cautious when blocking generics from the market to protect their patents. Estonian courts have yet to interpret the Mylan judgment, but it is likely that they will confirm strict liability for appropriate compensation where interim measures were unjustified in intellectual property cases. Originators should ensure their patents are strong before seeking interim measures. Blocking a generic exposes the originator to the risk of strict liability for the generic competitor’s damages, and contesting such claims can be problematic.

By Kadri Michelson, Co-Head of Private Wealth Practice, and Anna-Riin Brett, Associate, Cobalt

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Healthcare is a fundamental component of any society, reflecting its core values and priorities. In Lithuania, the healthcare system is marked by a pronounced division between private and public hospitals. Lithuania’s healthcare services are divided into outpatient (ambulatory) and inpatient (stationary) services.

State-owned hospitals are financed through public funds from the National Health Insurance Fund (NHIF). Almost all of the services that they provide are reimbursed by the NHIF. They also have a monopoly on access to NHIF funds for inpatient services. Conversely, securing a reimbursement contract for inpatient services is nearly impossible for private hospitals. The latter predominantly depend on out-of-pocket and private insurance payments. Reimbursement agreements between the NHIF and private institutions are confined to outpatient services and involve much less funds compared to what is available for public entities. Despite that, public institutions are often slow in their operations, resulting in long waiting times for consultations and treatment. In contrast, private hospitals can offer more personalized and timely care for the patients, albeit at a higher cost.

Due to the unequal distribution of state funds, private hospitals are charging patients premium fees in addition to the reimbursed amount covered by the NHIF. Basically, it means that they are paid twice for the same service. According to the Law on the Healthcare System of the Republic of Lithuania, charging premiums is permitted only in exceptional cases where specific conditions are met. However, in practice, this has become more of a norm than an exception. Recent NHIF data shows that 79% of day surgery procedures performed in private hospitals which were covered by the NHIF were also supplemented by patients’ out-of-pocket payments. These payments come in the form of “comfort fees,” which are borderline legal and very difficult to regulate. Public hospitals, on the other hand, are not allowed to charge premium fees.

Such a situation made private hospitals grow revenue at a faster rate than their public counterparts, which then allowed them to lure doctors away from the public sector, offering larger salaries. Despite the NHIF being responsible for administering these payments, as an institution, it lacked the legal authority to prevent malpractice. For example, even in cases where the NHIF would terminate the reimbursement contract due to breach, no limitation existed on how soon a hospital could re-enter into a new contract with the NHIF. A hospital could apply for a new contract immediately after the termination of the previous one.

Another shortcoming was the fact that the NHIF could not mandate a clinic to compensate for budgetary breaches. Even if the NHIF requested to rectify the breach, the NHIF’s decision was not binding on the hospital, and the NHIF had to seek judicial recourse to recover the funds through court, allowing the hospital to continue providing healthcare services without adhering to the legal requirements of the reimbursement contract. Put simply, the NHIF lacked effective leverage to ensure the efficient use of its budget and to prevent patients from paying premiums. This situation prompted the Parliament to adopt amendments to the Laws on the Healthcare System of the Republic of Lithuania and the Healthcare Insurance. The amendments will come into effect on July 1, 2025.

The goal of the amendments was to give power to the NHIF to impose stricter sanctions on medical institutions that violate reimbursement contracts. For example, after the amendments come into effect, the NHIF will have a comprehensive list of criteria for terminating the reimbursement contract and suspending a hospital from accessing NHIF funds. In addition, private hospitals will find it more difficult to apply premium surcharges to payments because they will be at risk of breaching the reimbursement contract and having it terminated. On top of that, the NHIF will have more authority on recovering the misused funds much faster, by simply deducting payments from the hospital and performing write-offs without even going to court.

Although the amendments were adopted with the goal of protecting patients from paying twice for their healthcare, these changes will undoubtedly restrict the expansion of private medical institutions. However, it is unclear whether they will have any positive effects on making public hospitals more effective and fixing their short-staffing problem. Addressing this issue and leveling the playing field between public and private hospitals necessitates a multifaceted approach, including increased funding for both sectors, robust regulatory measures, and incentives for providing high-quality services.

By Darius Paulikas, Head of Life Sciences, Widen Legal Lithuania

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

For the pharmaceutical industry in the Hungarian market, the first half of 2024 involved several legislative changes with significant practical implications. Some of these changes have yet to unfold their full impact, due to the lack of implementing regulations and prerequisite authority actions.

Below is our review of the most important legal developments, including an indication of where further actions are expected by legislators and regulators.

1. Uniform Hospital Pharmacy Service

In February, the government adopted the implementing decree for the uniform institutional (hospital) pharmacy service. Under this service, medicinal product procurement (as well as related logistic and coordination services) for hospital pharmacies would be centralized through a project company. Participation in the scheme will be compulsory for state-owned hospitals and voluntary for other hospitals. According to the legislators, the centralization will ensure the same level of service and security of supply in all participating hospitals, and also increase efficiency. Although the implementing decree already entered into force, the centralization will only commence once the project company has been selected through a public procurement procedure, yet to be initiated. The uniform hospital pharmacy service is expected to start from January 1, 2025.

2. Stockpiling Obligation Introduced

In March, the minister responsible for healthcare issued a decree imposing a new stockpiling obligation on medicinal product wholesale license holders. The decree entered into effect on May 10, 2024, listing 313 active substances. Wholesale license holders must maintain a continuous stock of products containing active substances, equal to one-twelfth of the volume distributed during the preceding 12 months. The new stockpiling obligation raises several practical questions. For example, it is unclear if the obligation applies to each wholesale license holder through the supply chain (resulting in multiplication of the stock held), or if wholesale license holders of the same supply chain may jointly comply with the obligation. Lastly, the ministerial decree tasked the Hungarian regulatory authority (NNGYK) with publishing by June 1, 2024, a list of medicinal products marketed in Hungary that contain the concerned active substances. The NNGYK has yet to publish this list on its website, adding to the legal uncertainty for the industry.

3. Revised Named-Patient Reimbursement

In June, the Parliament passed a new law amending several acts and spanning multiple industries. For the pharma industry, this new law will introduce changes to named-patient reimbursement with effect from January 1, 2025. Based on the changes, a new public benefit foundation will be established, which will decide on the named-patient applications in addition to the Hungarian Health Insurance Fund. The statement of reasons clarifies that the legislator does not intend to set the criteria for the decisions but rather leaves it to the foundation to decide in the context of social and economic responsibility. According to Deputy State Secretary for the Professional Management of Healthcare Judit Bidlo, the budget allocations made available to the foundation will still be part of the health insurance fund’s budget. Therefore, the new scheme is not primarily about saving money but about using the money more efficiently.

4. Access to eHealth Data for the Purposes of AI Development

The same new law regulates future access to health-related data stored in Hungary’s National eHealth Infrastructure (EESZT). Access to the data stored in the EESZT may be requested as of January 1, 2026, on a case-by-case basis, for the purposes of training, testing, and developing AI algorithms, as well as evaluating and developing medical devices and digital health applications. Access will be subject to ethics committee research authorization and compliance with the GDPR, including conducting a data protection impact assessment.

5. Implementation of Cybersecurity Requirements in the Pharma Sector

Lastly, on June 24, 2024, a ministerial decree was adopted on cybersecurity classification and specific security measures in connection with the Hungarian implementation of the EU’s NIS2 Directive. Pharma manufacturers and wholesalers must comply with the ministerial decree by October 18, 2024.

By Helga Biro, Partner, and Mate Laczko, Attorney, Baker McKenzie Budapest

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

Despite the ongoing full-scale invasion by the Russian Federation, the life sciences and healthcare sector in Ukraine is actively evolving to support the well-being of its population.

Under martial law, certain regulatory measures have been simplified to maintain the steady supply of essential goods within the Ukrainian market. These regulatory changes can sometimes affect the business interests of market players, as in the case of the extension of patents until the end of martial law (i.e., without a specific time limit), potentially putting competitors at a disadvantage. Nonetheless, Ukraine remains on a promising path toward advancing its healthcare system, demonstrating resilience and commitment to public health in the face of challenging circumstances.

Healthcare reform in Ukraine is underway, with the objective of establishing an effective and universally accessible healthcare system. Efforts are being directed toward creating a robust network of medical institutions, with substantial investments being made in their modernization and re-profiling. Over the past few years, the state program of medical guarantees (PMG) and the reimbursement system were introduced, and these initiatives are expanding, enabling the population to save significantly on healthcare costs. Areas that were not previously in the spotlight, such as rehabilitation, transplantation, mental health, infertility treatment, blood donation and transfusion, are now receiving significant attention and development. Relevant legislative acts are being adopted to improve the regulation and access to respective treatment and services. Reforming the blood system has become a priority, and efforts are underway to align it with European standards by replacing outdated equipment and strengthening control over blood quality, ensuring that these services meet the highest levels of safety and efficacy.

Looking ahead, there are plans to implement a system of compulsory health insurance. However, given the ongoing full-scale war, determining the exact timeline for this implementation remains challenging.

Another emerging trend is driven by the fact that during Russia’s full-scale invasion of Ukraine, more than 1,500 medical facilities were damaged, and about 200 more were destroyed and cannot be restored. In response, there has been a significant increase in public-private partnership projects aimed at rebuilding Ukraine’s infrastructure and restoring the capacity of the hospital network.

To ensure the population has access to medicines, new supply mechanisms have been introduced. In 2022, Ukraine introduced compassionate use and expanded access mechanisms, significantly expanding patients’ access to unregistered medicines. These mechanisms, widely used in developed countries, are acknowledged as effective tools for expanding treatment options for patients with life-threatening, long-lasting, or seriously debilitating illnesses. Additionally, a procedure for procuring innovative medicines through managed entry agreements was introduced. This allows the Ministry of Health of Ukraine to directly negotiate with manufacturers and obtain them at significantly reduced prices under the condition of price confidentiality. As a result, seriously ill patients gain access to expensive treatments free of charge.

Moreover, to facilitate the treatment of thousands of patients, Ukraine has become the 57th country in the world to legalize medical cannabis.

It is also worth noting that even the clinical trials sector, which is quite vulnerable to military operations, is gradually recovering in Ukraine, and new clinical trials are being launched.

Furthermore, Ukraine is undergoing significant changes in its public procurement system, with one of the notable achievements being the introduction of electronic catalogs for the procurement of medicines and medical devices. According to recent data, this tool has proven to be highly effective, enabling hospitals to achieve savings of more than 20% on procurement costs.

Another development involves licensed entities being allowed to sell medicines online, except for certain categories such as those containing narcotic or potent substances.

As part of Ukraine’s digitalization efforts, the comprehensive electronic healthcare system e-Health was introduced to automate the management of medical information in an electronic format. To this end, Ukraine is gradually transitioning to electronic prescriptions for all prescription medicines (although paper prescriptions remain an option during martial law).

Telemedicine is also rapidly advancing in Ukraine: 328 healthcare facilities have already been connected to telemedicine services, virtual operating rooms have already been installed in two hospitals, and 31 out of 41 healthcare packages within the PMG include telemedicine services.

The area of medical devices is also advancing, with ongoing efforts to develop and adopt the draft law On Medical Devices and updated versions of relevant technical regulations aligned with EU standards.

In summary, despite the challenges of martial law, Ukraine is vigorously striving to restore and enhance its healthcare system, as the well-being of the population is definitely the driving force behind all transformations.

By Lana Sinichkina, Partner, Arzinger

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

In recent years, public concern about the roles of organizations in environmental issues has significantly increased. Governments, public institutions, and non-profits now demand that companies adopt environmentally friendly practices. Consumers are seeking “green” products and investors prefer companies that prioritize environmental care. This trend has led companies to adopt greenwashing strategies in marketing to attract eco-conscious consumers.

The term “greenwashing” refers to practices aimed at portraying an organization, its products, goals, and principles as environmentally friendly through the use of specific statements, terminology, and images. Greenwashing is most often associated with the food or cosmetics industry, but it is a common phenomenon, and many companies are taking advantage of the green fad to gain a competitive advantage. This trend has not escaped the attention of legislators and competition authorities.

Directive (EU) 2024/825

Directive (EU) 2024/825 of the European Parliament and of the Council of February 28, 2024, amending Directives 2005/29/EC and 2011/83/EU as regards empowering consumers for the green transition through better protection against unfair practices and through better information (Directive) entered into force on March 26, 2024. Member States must implement it by March 27, 2026. The Directive aims to protect consumer rights and ensure informed purchasing decisions by introducing rules to counteract unfair commercial practices. These practices include misleading environmental claims (greenwashing), misleading social characteristics of products, and non-transparent sustainability labels. The rules empower national bodies, such as the Polish competition authority, to address these practices effectively, ensuring that environmental claims are fair and clear. This allows consumers to choose genuinely eco-friendly products, encouraging competition, and leading to more sustainable products with reduced environmental impact.

We expect that the Directive will significantly impact cosmetics brands, which often use unverified environmental terms like “pure,” “clean,” “natural,” and “green.” These claims should be verified by independent experts with environmental monitoring experience to ensure their accuracy.

Amendment to the Act on Pursuing Claims in Group Proceedings

Recently, the Council of Ministers adopted a draft law amending the Law on Investigation of Claims in Group Proceedings and Certain Other Laws, submitted by the Polish consumer authority. The draft aligns Polish law with Directive (EU) 2020/1828 on representative actions for the protection of collective consumer interests, enabling more effective use of class actions.

This amendment may significantly impact greenwashing proceedings as outlined in Directive (EU) 2024/825. It allows non-governmental organizations and other authorized entities to file class-action lawsuits against businesses violating consumer interests. In the context of greenwashing, this enables groups of consumers to jointly pursue their rights against companies using misleading marketing practices. This increases the likelihood of effectively pursuing claims, especially for individual consumers who might struggle against large corporations.

Directive (EU) 2024/825 mandates that businesses provide clear and reliable information about the environmental characteristics of products. Group proceedings can help enforce these regulations, enabling consumers to better pursue accurate information and raising awareness about greenwashing.

Polish Competition Authority’s Action against Greenwashing

Poland is not as active in counteracting greenwashing as Western European countries like the UK, the Netherlands, or France. However, it is worth pointing out that the President of the Office of Competition and Consumer Protection is aware of the problem and is currently conducting eight investigations into whether ESG-related marketing practices used by businesses constituted greenwashing. The proceedings conducted by the Polish Consumer Authority concern the retail platform Allegro, the cosmetics brands Bielenda Kosmetyki Naturalne, Dr Irena Eris, and L’Oreal Polska, and the apparel brands H&M Hennes & Mauritz, KappAhl Polska, LPP, and Zara Polska. As of the date of publication of this article, the cited proceedings are still pending, and no decisions have been issued.

Conclusions

Recent EU and Polish legislative changes mark significant progress in the fight against greenwashing, especially in the cosmetics industry. Directive (EU) 2024/825 mandates clear, verified environmental claims, compelling cosmetics brands to substantiate terms like “natural” and “green.” Amendments to Polish law enhance consumer class actions, increasing accountability for deceptive practices. The Polish competition authority’s ongoing investigations into major cosmetics brands highlight a growing commitment to combating greenwashing. These combined efforts will likely improve market transparency, foster consumer trust, and encourage more truthful, sustainable practices within the cosmetics sector, contributing to overall environmental protection.

By Pawel Halwa, Partner, and Paulina Klimek-Wozniak, Attorney at Law, Schoenherr

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.

North Macedonia, as a European Union country candidate, progresses toward integrating with the European Union’s regulatory and economic systems. As these frameworks grow more complicated, the country is tasked with continuously aligning its local industry with European and global standards.

This alignment is vital for promoting innovation, safeguarding public health, and drawing foreign investment. The life sciences sector’s development specifically is impacted by numerous factors, including funding, pricing, regulatory adherence, product liability issues, and sustainable public procurement mechanisms. Its growth and improvement in our country should not be underestimated, and the legal system must follow the trends.

Legislation Framework

The pharmaceutical industry in North Macedonia is governed by several key legal instruments, focusing primarily on the Law on Medicinal Products and Medical Devices (Official Gazette of Republic of Macedonia Nos.106/07 as amended from time to time) and the related regulations/bylaws adopted by the Ministry of Health of the Republic of North Macedonia. These regulations generally align with the corresponding EU directives, reflecting the country’s commitment to harmonizing its pharmaceutical legislation with European standards as part of its EU accession process. However, certain good practices are still not implemented and should be recognized, whereas legal mechanisms should be created for their enactment.

Latest Developments and Regulatory Reforms

North Macedonia has benefited from several EU-funded projects aimed at improving pharmaceutical infrastructure and research capabilities. A key project is the EU-funded Twinning project – Harmonization of the legislation for medicinal products with EU legislation and building capacities for its implementation. This project played a key role in reforming the Macedonian Agency for Medicinal Products and Medical Devices to meet international standards and to harmonize national legislation with EU legislation.

A proposal for a special Law on Medicinal Products was developed within this project. This proposal aims to split the regulation of medicinal products and medical devices into two separate laws: the proposed Law on Medicinal Products and a future Law on Medical Devices.

According to the latest publicly available draft of the proposed Law on Medicinal Products, this law will provide rules for medicinal products for use in human medicine, the conditions and method for ensuring their quality, safety, and efficiency, and the method and procedures for their production, testing, labeling, classification, placing on the market, sales, pharmacovigilance, price formation, quality control, advertising, and inspection. Narcotic drugs, psychotropic substances, and precursors needed for the production of medicinal products are also intended to be subject to regulation by this law. Two EU regulations and one directive are transposed in the draft Law on Medicinal Products, i.e., (1) Directive 2001/83/EC on the Community code relating to medicinal products for human use; (2) Regulation (EU) no. 536/2014 on clinical trials of medicinal products for human use and repealing Directive 2001/20/EC; and (3) Regulation (EC) no. 1234/2008 on the examination of the variations to the terms of marketing authorizations for medicinal products for human use and veterinary medicinal products.

Expected Benefits

By harmonizing national legislation with EU legislation (EU acquis) in the field of medicines, North Macedonia should accomplish the essential goal set out by Directive No. 2001/83/EC. Specifically, it should adopt the necessary uniform rules as possible for the production, distribution, and use of medicinal products in order not to hinder the development of the pharmaceutical industry and trade in medicinal products within the European Community (for example, rules applicable to tests and trials, compiling dossiers, and examination of applications). At the same time, the harmonization of national legislation in the field of clinical trials with Regulation (EU) No. 536/2014 should contribute to the ultimate goal of protecting the rights, safety, dignity, and well-being of test subjects. To enable independent control of compliance with these principles, a clinical trial should be carried out, subject to prior approval.

Pharmaceutical companies and other stakeholders have actively participated in providing comments and proposed amendments to the draft Law on Medicinal Products during the public discussion and review process.

In conclusion, it is not clear when the proposed special Law on Medicinal Products will be adopted, nor when we can expect the draft Law on Medicinal Products to be made available for public discussion and review. However, these reforms facilitate the country integrating seamlessly into the European pharmaceutical market, fostering innovation and ensuring compliance with international regulatory norms.

By Marija Filipovska Jelcic, Partner, and Martin Ivanov, Attorney-at-Law, CMS

This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.