Download Online Pharmacies- at the Borderline of Legality

Online Pharmacies- at the Borderline of Legality?
Introduction
Most of us have received spam emails advertising the sale of medicines such as Prozac,
Viagra or Phentermine by mail order from websites despite the fact that the online sale of
medicines will be illegal in many cases.
In most countries, the supply of pharmaceuticals to consumers is strictly regulated.
Regulation restricts the supply of pharmaceuticals to pharmacies and requires the
pharmacist to demand a doctor's prescription before he or she is allowed to dispense
medicines classified as prescription-only to consumers. The supply of pharmaceuticals by
online pharmacies undermines this system for the protection of the health of consumers.
Suppliers are frequently located in a different jurisdiction, so that prosecution and
enforcement of the law will be difficult or impossible.
Online pharmacies1 are essentially businesses supplying prescription-only and other
medicines via a website, accepting credit card payment and sending the goods via mail or
courier to the customer. These businesses operate under different business models. Some
of them require a hardcopy prescription to be sent by post or courier or some other
verification mechanism, such as a doctor calling the pharmacy, before a prescription-only
medicine is sent to a consumer (e.g. Drugstore.com, DocMorris.com). Others require the
consumer to fill in a more or less detailed health questionnaire and claim that a registered
doctor reviews the completed questionnaire before issuing a 'prescription'. This
prescription is then transmitted to the pharmacist, who sends out the medicine (e.g.
Pillsupplier.com, Online-pharmacy.cc). Others again do not request consumers to fill in a
health questionnaire and simply send out all medicines without a prescription (e.g.
Inhousepharmacy.co.uk).
Looking at the websites of these online pharmacies, the most popular medicines ordered
online seem to be the so-called 'embarrassment drugs', i.e. drugs for conditions which
consumers are reluctant to consult a doctor about. Other drugs may not be available in
some countries. If consumers have to pay for the medicines, supplies over the Internet
may be cheaper (and probably more convenient). Medicines for weight loss, erectile
dysfunction, sexual stimulants, hair loss, anti-depressants, sleeping pills, birth control
pills and antibiotics seem to feature on most of these websites.
From a policy perspective there are clear advantages to the supply of medicines via
websites in terms of convenience and lower costs for consumers. Additionally, it
empowers consumers to obtain medicines, which they might otherwise have no access to,
and therefore gives the individual more control over his or her medication. However there
are significant health risks involved in the online supply of pharmaceuticals:

1
Consumers can obtain medicines without proper medical advice or examination,
See e.g. www.inhousepharmacy.co.uk, www.drugstore.com, www.online-pharmacy.cc,
www.pillsupplier.com or www.docmorris.com



Consumers can obtain medicines without diagnosis of their symptoms by a medically
qualified person,
Counter-indications, interactions with other medicines and proper dosage may not be
assessed and
The uncontrolled supply raises questions about the quality and purity of the medicines
delivered, as consumers are not equipped to examine whether the drugs supplied
contain the correct substances, are within the sell-by date or have been stored
correctly.
This Feature considers the law on the online supply of medicines in the UK, examines
whether UK law is in conformity with EU law and concludes whether and how the law in
the UK should be changed, based on the recent change of law in Germany.
Legality of Online Pharmacies in the UK
In the UK, medicines are divided into three legal categories: Prescription Only Medicines
(POM), Pharmacy Medicines (P) and General Sales List Medicines (GSL)2. The
appropriate Minister has the power to specify which medicines should be classified as
POM or GSL. There is a presumption that if a medicine is not classified as POM or GSL,
it will be a Pharmacy Medicine. The legal category a medicine is classified under
determines the conditions for supply in the UK.
If a medicine is a POM, under section 58, it must be prescribed by a practitioner (such as
doctors, dentists and certain nurses). At present, the practitioner must sign the
prescription in ink. The pharmacist must be in possession of the signed document before
he or she can legally dispense POM medicines. For online pharmacies, at present, this
would mean that patients would have to send in the signed paper prescription (by post or
other courier).
It is noteworthy that the Government is introducing electronic prescriptions and has
legalised these on a trial basis in SI 2001/2889, the Prescription Only Medicines (Human
Use) (Electronic Communications) Order 2001. However it is important to point out that
this legalisation of electronic prescriptions is limited to the purposes of pilot schemes.
Electronic prescribing has been tested in three pilot schemes, but has not been generally
implemented in the UK.
However the greater obstacle to online pharmacies is section 52 of the Medicines Act
1968. Section 52 provides that medicines classified as POM or P may only be sold or
supplied 'by or under the supervision of a pharmacist on premises, which are a registered
pharmacy'. Thus, clearly if an online pharmacy, which is not a registered pharmacy,
supplies POM or P medicines to UK residents, it is acting in contravention of section 52.
However, if a UK pharmacist operates an online pharmacy from UK registered premises,
would this be contrary to section 52? The answer to this question depends on the
2
Section 51 of the Medicines Act 1968
interpretation of section 52 and in particular on whether the supervision requirement
means that the patient (or other person collecting the medicine on behalf of the patient)
has to be physically present on the pharmacy premises. Looking at the wording of section
52 and in particular the words 'on premises' suggests that the patient or his/her
representative has to be physically present at the pharmacy to collect the medicine.
The reason for this may be that it is easier for a pharmacist to give the patient (or
representative) advice and answer questions, if he or she is on the premises..
For the purpose of effective advice, the pharmacist could use interactive communication
methods over the Internet (such as email, chat, instant messaging) or the telephone to
communicate with to the patient or his/her carer. If a pharmacist uses these forms of
communication this could probably be interpreted as a supply 'by or under the
supervision of a pharmacist', but it is doubtful that it could be regarded as a supply 'on
premises, which are a registered pharmacy'. Thus at present, under UK law, the supply
of POM or P medicines by online pharmacies (whether UK or foreign) is unlawful,
whether or not the supplier is a licensed pharmacist and whether or not the supply is
carried out from registered pharmacy premises. Section 52 seems to require physical
presence.
A breach of section 52 (sale of POM or P medicines in registered pharmacies only) or
section 58 (prescription requirement) is a criminal offence3, punishable on summary
conviction by a fine not exceeding £400 and on indictment, by a fine and/or
imprisonment for a term not exceeding two years4.
This leaves only GSL medicines for sale in online pharmacies. If GSL medicines are not
sold at a registered pharmacy, there are certain restrictions in section 53 of the Medicines
Act. The premises, from which GSL medicines are sold, must be lockable (to prevent
unauthorised access) and the medicines must be pre-packed in sealed containers.
Furthermore, regulations made under this section limit the quantities by stipulating
maximum pack sizes (e.g. for painkillers).
Contravention of section 53 is an offence punishable by summary conviction only by a
fine not exceeding level 3 on the standard scale.5
Provided the above requirements are complied with, the sale of GSL medicines by online
pharmacies should not pose any problems.
Section 7 (3) of the Medicines Act 1968 provides that a product licence is required for the
import of medicines into the UK. However, UK residents buying medicines for
themselves or a member of their household from an online pharmacy established in
another country would not contravene this section. Section 13 (1) provides an exemption
for importation for use by the person importing it or for any member of his or her
3
Section 67 (2) of the Medicines Act 1968
Section 67 (4) of the Medicines Act 1968
5
Section 67 (5) of the Medicines Act 1968
4
household. Thus, an individual buying a POM, such as antibiotics from a foreign online
pharmacy would not be guilty of an offence under this section.
Apart from this exception for personal use, any person commercially supplying, selling,
exporting or importing medicines requires a product licence in accordance with section 7.
In other words, it is illegal to sell medicines in the UK without licence. Clearly this
provision would apply to an online pharmacy.
Furthermore there are restrictions on advertising in the Medicines (Advertising)
Regulations 1994 and the Medicines (Monitoring of Advertising) Regulations 1994,
which online pharmacies would have to be careful to comply with.6
First of all, there are various restrictions on advertising medicines to the general public.
POM medicines must not be advertised to the general public7, the advertising of such
medicines is restricted to medical practitioners. As we have seen above the sale of POM
via a website would be illegal. Likewise, advertising POM on a website with unrestricted
public access would be an offence. This of course does not prevent advertising POM on
websites with access restricted to medical practitioners.
Likewise, advertisements mainly directed to the general public must not refer to serious
diseases listed in Schedule 1 to the Medicines (Advertising) Regulations 1994 and
advertisements to the general public for medicinal products to be used for abortion are
also prohibited.8 Again access to any websites containing such advertisements must be
restricted to medical practitioners.
Furthermore, Regulation 99 contains a long list of claims and other content (whether true
or false) which must not be used in an advertisement directed to the public. For example,
an ad must not give 'the impression that a medical consultation or surgical operation is
unnecessary, in particular by offering a diagnosis or by suggesting treatment by post, fax
or telephone'.10 Likewise an ad, which might by a description or detailed representation
of a case history, lead to erroneous self-diagnosis would be prohibited under the
Regulations.11 Websites advertising and offering medicines for sale may contain detailed
medical information, which may give the user the impression that consultation of a doctor
is unnecessary and may give the user the impression that he or she can come to a selfdiagnosis of his or her symptoms. This is a provision online pharmacies have to be
careful not to breach.
6
These Regulations implement Council Directive 92/28/EEC concerning the advertising of medicinal
products for human use and Council Directive 92/73/EEC concerning homoeopathic medicinal products for
human use. Directive 92/28/EC has since been repealed and replaced by the Community Code with effect
from 18. December 2001- Directive 2001/83/EC of 6. November 2001 on the Community Code relating to
medicinal products for human use.
7
Regulation 7 of the Medicines (Advertising) Regulations 1994, SI 1994/1932, implementing Article 88 of
the Community Code
8
Regulation 6, Medicines (Advertising) Regulations 1994, SI 1994/1932
9
of the Medicines (Advertising) Regulations 1994, SI 1994/1932, implementing Article 90 of the
Community Code
10
Regulation 9 (a)
11
Regulation 9 (i)
Secondly, with the exception of homoeopathic products, advertising relating to a
medicinal product for which no market authorisation is in force, is prohibited.12
Furthermore, advertisements of medicines must comply with the following three general
principles13:



The ad must comply with the particulars listed in the summary of product
characteristics;
The ad must encourage the rational use of the product 'by presenting it objectively
and without exaggerating its properties';
The ad must not be misleading.
Regulation 23 of the Medicines (Advertising) Regulations 1994 establish criminal
offences for the contravention of these advertising restrictions, punishable on summary
conviction to a fine not exceeding the statutory amount and on indictment by a fine
and/or imprisonment for a term not exceeding two years.
UK Enforcement
The main UK enforcer is the MHRA (Medicines) Enforcement Group14- they are tasked
with investigating cases and bringing (mainly criminal) prosecutions. Department of
Health lawyers usually conduct the criminal prosecutions. For example in 2002 a person
was sentenced to 12 months' imprisonment (six months suspended) and a confiscation
order was issued against him for supplying viagra via a website.15 OFCOM also has some
enforcement powers regarding advertising in broadcast media and the radio16. In addition
the OFT has regulatory powers in respect of the advertising of medicines under the
Enterprise Act 2002. Authorities from other EU Member States may bring an action
under the Injunctions Directive.
European online pharmacies and free movement of goods
Imagine an online pharmacy established in one European Member State offering a range
of medicines for sale on its website in all other Member States. Even if this online
pharmacy requires patients to send in the original doctor's prescription by post, it could
not lawfully sell POM in the UK. Nor could it lawfully sell P medicines in the UK (see
above). This raises the question whether the requirement that POM and P medicines must
12
Regulation 3, Medicines (Advertising) Regulations 1994, SI 1994/1932, Article 87 of the Community
Code
13
Regulation 3 A, Medicines (Advertising) Regulations 1994, SI 1994/1932, implementing Article 2 (2)
and (3) of Directive 92/28/EEC, inserted by the Medicines (Advertising and Monitoring of Advertising)
Amendment Regulations 1999/267
14
See http://www.mca.gov.uk. This website contains a list of recent prosecutions.
15
In the case of R v Mark Groombridge (Menscare UK Ltd), subject to appeal, see
http://www.mca.gov.uk/
16
Communications Act 2003 (Amendment of the Medicines (Monitoring of Advertising) Regulations
1994) Order 2003/3093
be sold in real world pharmacies17 is in breach of Article 28 of the EC Treaty (free
movement of goods) or Article 3 (2) of the E-commerce Directive 2000/31/EC (country
of origin rule).
Article 28 of the EC Treaty prohibits quantitative restrictions on imports and measures
having equivalent effect. The question is therefore whether a requirement that certain
medicines must be sold in pharmacies constitutes a measure having equivalent effect to a
quantitative effect.
In the Keck and Mithouard18 jurisprudence, the Court has held that mere selling
arrangements, which affect the marketing of domestic and imported goods in the same
manner, do not fall within the scope of Article 28. Consequently, in the case of
Hünermund19 the Court held that a rule of professional conduct prohibiting pharmacists
to advertise certain products outside their pharmacy was not caught by Article 28.
Likewise a requirement in Greece that baby formula processed milk could only be sold in
pharmacies was held to be not covered by Article 28 in Commission v Greece20.
Arguably, therefore under Keck and Mithouard national rules restricting the channels of
sale are not caught by Article 28, even if they decrease the volume of sales of imported
goods, as long as these rules do affect the marketing of domestic and imported goods in
the same manner. However arguably a prohibition of online sales by pharmacies to the
end-consumer does affect the supply of medicines by a pharmacy in another EU Member
State more than domestic pharmacies.
This has been held in the recent Doc Morris case21. The Court stated that22 'even if
commercial rules do not relate to the actual characteristics of the products but govern the
arrangements for their sale, they may constitute measures of equivalent effect for the
purposes of Article 28 EC if they fail to meet two conditions. Those conditions are that
such rules must apply to all relevant traders operating in national territory and must affect
in the same manner, in law and in fact, the marketing of both domestic and those from
other Member States.'
The Doc Morris case concerned a requirement under German law similar to section 52 of
the Medicines Act that certain medicines can only be sold in pharmacies and a
prohibition on mail order sales23. German legislation also prohibited the advertising of
mail order sales of medicinal products24.
17
Contained in section 52 Medicines Act 1968
Joined Cases C-267 & 268/91 Criminal Proceedings against Keck; Criminal Proceedings against
Mithouard [1993] ECR I-6097
19
Case C-292/92 Hünermund v Landesapothekerkammer Baden Würtenberg [1993] ECR I-6787
20
Case C-391/92 Commission v Greece [1995] ECR I-1621
21
Case C-322/01 Deutscher Apothekerverband eV v 0800 DocMorris NV
22
Ibid para. 68
23
Para. 43 (1) Arzneimittelgesetz
24
Para. 8 Heilmittelwerbegesetz
18
Doc Morris is a Dutch pharmacy which, in addition to its traditional retail pharmacy
business offers online sale of medicines on its websites, targeting its supplies to Germany
(inter alia). The ECJ had to decide whether the German law was compatible with Article
28 of the EC Treaty.
The ECJ found that Keck and Mithouard did not apply and that the German restrictions
were within the scope of Article 28.25 The Court found that the German legislation did
not affect the domestic and imported goods in the same manner, as the restrictions did not
only lead to a reduction of volumes of sales of the affected medicines but impeded access
to pharmacies outside Germany. The Court held that the emergence of the Internet as a
tool for direct sales to consumers meant that foreign pharmacies were more affected by
these restrictions than pharmacies established within Germany. Thus the Court held that
the German measures were a restriction falling within Article 28.
In a next step the Court examined whether the restrictions were justified by mandatory
requirements of public health under Article 30. It stated that the only adequate reasons for
the restrictions could be those relating to the need to provide individual advice, the need
to check that prescriptions are genuine and to ensure that medicinal products are widely
available.26 The Court then made a distinction between prescription medicines and nonprescription medicines. It found that the absolute prohibition of distance selling of nonprescription medicines by pharmacies established in another Member State cannot be
justified.
The Court pointed out that selling non-prescription medicines via a website may have
certain advantages for the consumer, such as convenience or having more time when
making a purchase. Concerning the need to ensure that the consumer received correct
advice by the pharmacist, the Court found that this can be fulfilled if the virtual
pharmacist uses online interactive features to advise patients. Finally, as to the need to
guarantee that a wide range of medicinal products is available, the Court found that the
pharmacy established in another Member State (in the case of Doc Morris in the
Netherlands) is equally under public service obligations.
However in relation to prescription-only medicines, the ECJ found that the prohibition
may be justified, because of the greater risk involved with these medicines. The Court
held that 'the need to be able to check effectively and responsibly the authenticity of
doctors' prescriptions and to ensure that the medicine is handed over either to the
customer himself or to a person to whom its collection has been entrusted by the
customer' 27 justifies the restrictions.
Consequently the ECJ also held that the general prohibition on advertising the supply of
non-prescription medicines by mail order contained in the German legislation was not
compatible with EU law.28
25
Ibid paras 71-75.
Para. 106
27
Para. 119
28
Para. 148
26
The country of origin rule in the E-commerce Directive
The E-commerce Directive 2000/31/EC provides for a country of origin rule for
information society services in Article 3 (2). This means that a service provider
established in an EU Member State is free to provide information society services within
the scope of the Directive in other Member States without being subject to the laws of
these other Member States. The concept of this country of origin rule is that only the laws
of the Member State in which an information society service provider is established
governs its activities within the EU. The Doc Morris case arose before the E-commerce
Directive was in force, so that the Court did not answer the question whether an online
pharmacy such as Doc Morris could rely on the country of origin rule in the E-commerce
Directive.
The first obstacle here is the scope of the country of origin, defined in the so-called 'coordinated field' in Article 2 of the Directive. Article 2 (h) (ii) makes clear that the coordinated field does not cover 'requirements applicable to goods as such'. It is submitted
that requirements as to the manufacture, quality, packaging and labelling of medicines,
rules on which medicines can be legally sold in a Member State (e.g. authorisation) and
for which medicines a doctor's prescription is required are 'requirements applicable to the
goods as such'. Such requirements would therefore be outside the scope of the country of
origin rule. By contrast, rules on advertising and mode of sale are within the scope of the
country of origin rule. Thus, it is likely that a prohibition on mail order sales of certain
medicines or a requirement that certain medicines must be sold in a pharmacy with the
pharmacist present (such as section 52 of the UK Medicines Act 1968) will be covered by
country of origin regulation.
Article 3 (4) of the E-commerce Directive means, however that Member States can
choose to derogate from the country of origin rule and apply their own national
legislation (such as section 52 UK Medicines Act 1968) in specific, individual cases.
Such a derogation must be justified and the justification operates in manner similar to the
justification under Article 30 of the EC Treaty, i.e. it must be for a legitimate reason and
necessary. Member States can derogate for the protection of public health. Taking the
principles enunciated in the Doc Morris case Member States cannot rely on such a
derogation to justify an absolute and general ban on online sales of non-prescription
medicines. However Member States could be justified to introduce a ban on the online
sale of prescription medicines.
However the E-commerce Directive is stricter, in the sense that Member States cannot
derogate generally, but have to assess the appropriateness of the enforcement measures in
each case. Such measures would have to be directed against the activities of a specific
online pharmacy. Under the derogation procedure Member States must assess for each
individual online pharmacy whether it is necessary for public health reasons to prohibit
the sale of prescription-only medicines. Member State would also have to follow the
derogation procedure (i.e. notification of the Commission and the Member State of
origin).
Relying on their power of derogation under Article 3 (4), Member States could also
impose specific conditions for the online sale of non-prescription medicines, if such
conditions are necessary to protect public health. Such conditions could, for example
stipulate that a properly qualified pharmacist answers a customer's questions through
interactive communications technology before sending the requested non-prescription
medicine. Again, such a measure would have to be directed against a specific provider
and the Member State concerned must follow the procedure set out in Article 3 (4).
Amendment of German law
Germany has changed its legislation on medicines as part of the general reform of health
law in November 2003.29 The changed framework legislation provides that the mail order
or e-commerce sale of medicines is allowed for pharmacies, which have obtained a
licence for this.30 This legislation is not limited to non-prescription medicines, so that this
permission equally applies to prescription-only medicines.31
The changed legislation32 allows the import of medicines by end consumers for personal
use, if they buy by way of mail order from a pharmacy licensed and regulated for this
activity in Germany or another EU/EEA Member State, which provides safety and
quality standards equivalent to German law33.
German legislation details these safety standards34, which are a pre-condition for
obtaining a license to carry on the business of a mail order pharmacy. By way of
illustration the most important of these safety standards under the German legislation are:

A licence is only given to public pharmacies with a physical presence- mere virtual
pharmacies are not allowed.

The medicine is packaged, transported and delivered in such a way that its quality and
effectiveness are not affected.

The medicine is handed over to the person specified in the order.

The customer receives advice in German by a pharmaceutically qualified person.
29
Gesetz zur Modernisierung der gesetzlichen Krankenversicherung GMG
Para. 43 of the Arzneimittelgesetz, amended version of 14. November 2003, in force since 1. January
2004
31
Albeit that one of the safety standards (see below) as a condition of obtaining a licence is that the
pharmacist verifies the prescription. Para. 48 of the Arzneimittelgesetz envisages electronic prescribing by
giving the relevant Minister the power to make regulations for electronic prescriptions.
32
Para. 73 (1) 1a of the Arzneimittelgesetz, amended version of 14. November 2003, in force since 1.
January 2004
30
33
34
Para. 11 a of the amended version of the Apothekengesetz of 25. November 2003
Para. 11 a of the amended version of the Apothekengesetz of 25. November 2003

The medicine is sent out two days after the order, unless something else has been
agreed or the customer is informed that this deadline cannot be met.

There must be a system in place, which allows the online pharmacy and the customer
to communicate about latent risks, which become known after delivery.

The online pharmacy must be prepared to arrange a second delivery, free of charge, if
the recipient is not present at the time of the first delivery.

The online pharmacy must track the status of each order and insure the transport.
Conclusion
After the Doc Morris case and the entering into force of the E-commerce Directive, what
conclusions can be drawn for the interpretation and application of the Medicines Act
1968?

UK law, like German law does not only divide medicines into two categories, i.e.
prescription-only and non-prescription, but into three categories, i.e. prescriptiononly, pharmacy medicines and general sales. The Doc Morris case has now made
clear that Member States cannot generally prohibit pharmacy medicines being sold at
a distance online, by a registered pharmacy established in another Member States.

This is not to say, however, that Member States cannot impose conditions on a
pharmacy in another Member State selling pharmacy medicines to consumers on its
territory. Such conditions could be, for example that a qualified pharmacist advises
consumers by interactive communications technology (email, instant messaging, chat,
telephone). The need for such conditions must be examined in each case and Member
States have to follow the derogation procedure in the E-commerce Directive. The
German system may be a useful example for such conditions.

For online pharmacies established in another Member State section 52 of the
Medicines Act 1968 must not be interpreted to mean that a EU registered pharmacy
may not dispense medicines to UK consumers or that a pharmacist must be physically
present when medicines are dispensed. In other words, online sales by EU established
pharmacies must be allowed for non-prescription medicines. Therefore, ideally
section 52 should be changed to clarify this.

Measures against EU online pharmacies dispensing prescription-only medicines could
be justified. However the UK authorities would have to show in each case that these
measures are necessary, e.g. by looking at the methods for verifying the prescription
and deciding whether these methods are effective. It would not be sufficient for the
UK authorities to rely on section 58 of the Medicines Act 1968- a case-by-case
assessment has to be made. If the UK authorities decided that derogation was
necessary, they would have to follow the derogation procedure.

The UK restrictions on advertising do not conflict with EU law, as the UK law mainly
implements harmonised EU Directives and the Community Code.

The Doc Morris ruling has no application to non-EU based online pharmacies or
domestic pharmacies. Thus, the activities of online pharmacies based in the US or the
UK are not affected by the Doc Morris ruling.