Legislative frameworks to combat illicit trade in medical products in Hungary

1. Hungary has criminalised these activities and specified two criminal offences in this regard:
   1. “Falsification of medicinal products” (Section 185/A); and
   2. “Falsification of healthcare products” (Section 186) which constitute crimes under Act C of 2012 on the Criminal Code of Hungary (the “Criminal Code”).
2. Act XCV of 2005 on Medicinal Products for Human Use and on the Amendment of Other Regulations Related to Medicinal Products contains provisions regarding, e.g. the notification obligation for presumably falsified medicinal products or medicinal products with a quality defect and their withdrawal.
3. Decree No. 52/2005 (XI. 18.) of the Ministry of Health on the placing of medicinal products for human use on the market also establishes some rules on the withdrawal of falsified medicinal products from the market.

It is the National Institute for Pharmacy and Nutrition (the “OGYÉI”) that monitors the route of medicinal products from manufacturers to pharmacies, in the framework of which it supervises, among others, the quality, efficacy and safe use of medicinal products.

Medicinal products and Veterinary medicinal products

Under the Criminal Code, the criminal offence of the falsification of medicinal products can be committed regarding: (i) medicinal products (including medicinal products containing psychotropic substances or their active substance); or (ii) veterinary medicinal products. If the crime is committed regarding medicinal products containing psychotropic substances or regarding their active substances, it is punishable with a longer period of imprisonment.  
According to a commentary to the Criminal Code, a product will be considered a medicinal product if it is presented as being able to treat or prevent diseases and if, although not presented as a product for the treatment of diseases, it contains substances that are capable of producing a medicinal effect. As a result of this approach, the scope covers products sold as non-medicinal products for which the law sets down requirements for ingredients such as in cosmetic products or foodstuffs, and in several other legal acts that contain explicit compositional requirements that can be used to determine whether a medicinal substance has been used in a manner that is in breach of the law.

Healthcare products

The criminal offence of the falsification of healthcare products can be committed regarding healthcare products, which covers the following scope of products based on the legal definition: medical devices, in vitro diagnostic medical devices, and investigational medicinal products.

The commentary sets down that the scope of the Medicrime Convention also covers active substances, excipients, accessories, components and other ingredients and raw materials. Where these ingredients are falsified for the purpose of manufacturing a healthcare product, the criminal offence of the falsification of a healthcare product can be established, if the falsification of such an ingredient of a healthcare product results in a falsified medical product.

According to the OGYÉI, there are some products that are particularly susceptible to counterfeiting in Hungary:

• fat loss products (mainly medicinal products not authorised in Hungary);
• potency enhancers (both imitations of authorised medicinal products and unauthorised medicinal products);
• anabolic steroids (these are typically unauthorised medicinal products in Hungary);
• psychoactive medicinal products (very often imitations of authorised medicinal products);
• products advertised as being of a natural, herbal origin, which in fact contain synthetic active pharmaceutical ingredients.

The falsification of medicinal products and the falsification of healthcare products are two separate criminal offences under Section 185/A and Section 186, which are regulated in the chapter of the Criminal Code dealing with criminal offences that threaten health.

Yes, Hungary ratified the Medicrime Convention on 9 January 2014.

The criminal offence “Falsification of Healthcare Products” was incorporated into the Criminal Code as a result of the implementation of the Medicrime Convention, while the criminal offence “falsification of medicinal products” became a separate criminal offence as of 1 January 2019.

The counterfeiting and falsification of medicinal products and healthcare products constitute criminal liability and are punishable by imprisonment of up to three years. A penalty of imprisonment between one and five years applies to cases where the falsification of medicinal products is committed regarding medicinal products containing psychotropic substances or their active substance.

Longer periods of imprisonment apply where the crime results in permanent disability, serious health impairment or death, and when the crime is committed by a healthcare employee, an employee of an authorised manufacturer, wholesaler or retailer or in criminal association with accomplices. Furthermore, it is also considered a more serious offence when the products become widely available to users.

In addition, preparation for falsification is also punishable with a penalty of imprisonment of up to one year.

There is no separate liability regarding biologics under Hungarian law.

• The OGYÉI is involved in anti-counterfeiting activities in cooperation with other national authorities, such as the police forces and the National Tax and Customs Authority. In addition, the OGYÉI participates in anti-counterfeiting activities on an international level (involvement in the International Medical Products Anti-Counterfeiting Taskforce, Working Group of Enforcement Officers and Operation PANGEA).
• The police forces also play a significant part in combatting the counterfeiting of medicinal and other products as they contribute to the fight against counterfeiting activities by disclosing and investigating related criminal activities. They also actively cooperate in Operation PANGEA.
• The excise officers of the National Tax and Customs Authority (NAV) are in the frontline of anti-counterfeiting measures as they are likely to encounter counterfeited products when conducting surveillance at the borders. The NAV also participates in Operation PANGEA on a regular basis.
• The National Board Against Counterfeiting (HENT) was established to reinforce the fight against the infringement of intellectual property as well as to prepare related action plans and coordinate their enforcement. The HENT has a working group designated specifically to anti-counterfeiting activities concerning medicinal products. Among others, the OGYÉI, the police forces and the NAV are all members of the HENT, along with certain ministries, such as the Ministry of the National Economy.

The rights of manufacturers, MAHs and IP rights holders mainly depend on what stage the investigation is at or what type of proceedings was initiated.

A criminal investigation is often initiated by the OGYÉI or the NAV ex officio regarding the falsification of medicinal or healthcare products into which an investigation commences. Depending on the circumstances, such investigation could result in the prosecution of suspects and criminal proceedings.

Apart from the abovementioned two criminal offences, these activities may also infringe said entities’ IP rights, which could be a criminal offence under the Criminal Code.

In terms of IP infringement, it is also possible to enforce rights in the framework of civil proceedings for, e.g. patent infringement or trademark infringement. 

Yes. In the event of a patent or trademark infringement, the holder of the patent may demand compensation for damages in accordance with the provisions of civil liability.

Over-the-counter medicinal products and medical aids which are not reimbursed by the social security system

Can be advertised and sold online to consumers.

• In relation to prescription only medicinal products or medicinal products, medical aids reimbursed by the social security system, only product description for the purpose of providing objective information to patients with the content specified by law can be made available on the websites of manufacturers, distributors.
• Online sale of medicinal products may legally be conducted by authorised pharmacies provided that they notified such activity and the title of their website to the OGYÉI – who keeps records of Hungarian pharmacies legally engaged in online sales and makes these records available for verification purposes. Additionally, in line with the EU framework, Hungarian online pharmacies should indicate the common logo set forth by the Commission Implementing Regulation (EU) No. 699/2014 with the hyperlink leading to the national list of pharmacies operating in line with legal provisions in Hungary.
• Online sale of medical aids (incl. contact lenses) can be generally conducted by medical aid specialist shops in possession of the required licenses and in line with applicable laws.

Veterinary medicinal products

As with human medicinal products, can be prescription only products or products not subject to prescription. Within the category of over-the-counter veterinary medicinal products, the relevant laws differentiate between products subject to a marketing license or products that can be marketed freely. Prescription only veterinary medicinal products can be bought upon the presentation of a prescription, hence their online sale to consumers is not permitted. Over-the-counter veterinary medicinal products subject to a marketing license can only be sold by persons authorised to market such products based on the operating license. Over-the-counter veterinary medicinal products that can be freely marketed may be sold by other commercial (self-service) establishments as well. In all instances, the pre-requisite for online sales of over-the-counter veterinary medicinal products is the operation of a commercial establishment in accordance with applicable laws.

In Hungary, the safety features placed on the outer packaging of certain medicinal products consist of two elements:

• unique identifier: a two-dimension barcode similar to a QR code that incorporates: (i) the product code; (ii) the serial number; (iv) the expiry date; and (iii) the lot number. 
• anti-tampering device: a safety feature preventing the packaging from being opened or altered in an undetected manner since it left the manufacturer.  

With certain exceptions, the safety features should be placed on the outer packaging of all prescription-only medicinal products. Additionally, the features should be applied to the outer packaging of certain over-the-counter medicinal products judged to be at risk of falsification.

No, currently there are no legislative developments in the sphere of combating illicit trading and other illegal activities involving counterfeited/falsified medicinal products and other products.