The pharmaceutical industry is undergoing some significant changes to business models that have been in place for decades. Increasing consumer safety and licensing requirements, especially in emerging markets, mean that certification and compliance processes and procedures need adjustment and customisation. Appearance of generic manufacturers has led to increased competition and a changing approach to IP management. Historically inefficient supply chains require re-assessment because of increased cost competition and the proliferation of Free Trade Agreements. And the personalisation of care has resulted in a wider variety of entirely new products shipped in smaller quantities.
We work with our pharmaceutical clients on many diverse projects resulting from these changes. Examples range from the development of the most cost efficient supply chain and manufacturing strategies to on-the-ground implementation of efficient and customs procedures. We understand how pharmaceutical production processes and distribution channels typically fit together and when typical opportunities and regulatory concerns will arise.
Our experience it that that the most prevalent customs and trade challenges facing the pharmaceutical industry in the Asia Pacific region include:
Pharmaceutical manufacturers and distributors typically run a high risk of non-compliance with local regulations. This can easily result in damage to reputation, particularly if no in-country dedicated or experienced regulatory resource. Using our in-country expertise WMS can guide you through license and registration application processes, assess the impact on lead times and provide support in checking product coverage.
Read about how we helped our pharmaceutical clients in the Asia Pacific region
A pharmaceutical company in Japan engaged an overseas toll manufacturer to produce pharmaceutical ingredients and provided the toll manufacturer with raw materials and technical support. The pharmaceutical company compensated the toll manufacturer using milestone payments.
Since there was no sale value for the pharmaceutical ingredients between the pharmaceutical company and the toll manufacturer WMS advised as to how the customs value should be determined.
WMS conducted a thorough review of the toll manufacturing agreement and looked into the commercial substance, based on a deep understanding of common manufacturing arrangements in the pharmaceutical sector as well as Japan’s customs laws and regulations. This included:
A pharmaceutical manufacturing company at the "clinical trial" phase of product development was importing a comparable product as manufactured by a third-party in order to complete a "double-blind" test with selected consumers. No sale for export to China existed and an "invoice for Customs purposes" was used to support the transfer and importation. China Customs challenged the value stated on the "invoice for Customs purposes" was too low, therefore resulting in an underpayment of customs duty and import VAT.
WMS conducted an independent review of the declared dutiable value and provided strategies to defend the said value as being acceptable for customs valuation purposes.
The review included:
We achieved success in not escalating this case to the Anti-smuggling Bureau, which saved the company from administrative penalties and other commercial exposures.
We improved the compliance level for the company in relation to the determination of dutiable value for drugs imported for "double-blind" test purposes.