Intellectual Property Law

Internet Pharmacies & Cross Border Mail Orders in the European Union

By IBLS Editor

Various European Community laws are applicable to the issue of Internet pharmacies and their supply of medical products to buyers located in other Member States.  For instance, the E-commerce Directive 2000/31/EC; the provisions of the Distance Sales Directive 97/7/EC; Directive 2001/83/EC regarding medicinal products for human use; Directive 92/28/EEC on advertising of medicinal products in the EU and currently part of the Community Code; and laws applicable to the free movement of goods throughout the Member States.  Besides these community laws, domestic laws of the Member States may also play an essential role in deciding any particular case on Internet pharmacies and their supply of products to individuals located in other EU countries.  This article presents the EU policies on this topic as enunciated by Court of Justice of the European Community in a 2003 case (2003 ECR I-14887).  

The Court of Justice of the European Community (?CJEC?) decided a land marking case on a controversy involving an Internet pharmacy located in the Netherlands and its supply of medicinal products to buyers in Germany.

 0800 DocMorris NV (?DocMorris?) was an Internet pharmacy located in the Netherlands.   Jacques Waterval is a pharmacist and one of the legal representatives of DocMorris, member of the editorial team, and head of the advisory committee of experts.  DocMorris offered for sale over the Internet prescription and non-prescription medicines for human use.  The Internet pharmacy offered other services like ?patients? forums? where patients could exchange comments; health advice over the Internet, mail, or through a free telephonic conversation.  On the Internet, medicines were listed by name and included their price in Euros.  The website and products were offered in several languages including Dutch, English, and German.  Delivery of the medicines could be done in many ways; special courier, buyers? pick-up, or buyers? selected courier. 

The Deutsche Apothekerverband e.V. (hereafter ?the German authority?), is the German organization in charge of the protection and promotion of the economic and social interests of German pharmacists.  This organization is composed of regional associations and organizations of pharmacists. 

The German authority challenged DocMorris? sale of medicinal products to German citizens over the Internet, claiming that these sales violated German domestic law on the sale of medicinal products; specifically, those domestic provisions that required government authorization for the sale of medicines in Germany and domestic laws related to advertisement of medicines.  Indeed, the German authority claims that DocMorris? express listing of medicines by name, prescription status, package size and price, and offer to take online orders constituted advertising under German law.  

 DocMorris argued that their sales were permitted under domestic Germany law and that even if they were not, any national provision would be contrary to Community Law. 

This case raised many legal issues regarding Internet pharmacies and their cross-border sales.  Yet, one of the most relevant issues addressed by the CJEC is whether those national prohibitions on advertising of medicines were compatible with the free movement of goods and free movement of information society services under the E-commerce Directive. 

The CJEC pointed that Article 14 of Directive 97/7 says ?Member states may ban?the marketing of certain goods or services, particularly medicinal products, within their territory by means of distance contracts??  Yet, after a comprehensive analysis of the legal terms of Directive 97/7 and the German prohibition on advertising of certain medicines, the CJEC held that domestic prohibitions on advertising can hinder access to market and free movement of goods.      The Court expressly said:

?"that a prohibition of advertising ... would render commercialisation, [sic] and consequently access to the market for those goods, appreciably more difficult." With regard to freedom to provide services, the Court has stated that a prohibition that directly affects access to the market in services is capable of hindering intra-Community trade in services.  Merely for the sake of completeness, it should be mentioned that a national measure that restricts the exercise of an economic activity arbitrarily falls within the scope of freedom to provide services.

The CJEC concluded that Article 28 EC and 30 EC should be interpreted as precluding national prohibition on advertising of medicinal products by mail order unless the prohibition serves to protect national authorization rules and is proportionate.  Likewise, article 3(1) of Directive 92/28 should be interpreted as precluding a national prohibition on advertising or prescription medicinal products for human use.  Similarly, article 1(3) of Directive 92/28 must be interpreted as including internet pharmacies in a Member State that takes online orders, lists medicines by name and prices, prescription status, and package size.

Thus, cross-border sales of medicinal products for human use made through Internet pharmacies in the EU are subject to complex analysis of domestic and Community law principles.  Domestic prohibitions on advertising of medicines are allowed provided that they are proportionate.  This concept looks similar to the US prohibition on discrimination on interstate commerce unless it serves a permissible and legitimate state purpose.   

Full post as published by IBLS Internet Law Blog on March 11, 2008 (boomark / email).