ALLIANCE FOR NATURAL HEALTH

RE: PROPOSED AMENDMENTS TO DIRECTIVE 2001/83/EC

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OPINION
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1.	I have been asked by the Alliance for Natural Health to give my view on the likely effect of a number of proposed amendments to the Pharmaceuticals Directive (“PD”; Directive 2001/83/EC on the Community code relating to medicinal products for human) use which are contained in Common Position (EC) No 61/2003 of 29 September 2003 adopted by the Council with a view to adopting a directive of the European Parliament and of the Council amending Directive 2001/83/EC.
Definition of “medicinal product”
2.	Of particular concern to those instructing me is the wide scope of the definition of “medicinal product”, which it is feared would lead to the application of the PD to products such as food supplements or cosmetics, although they are already subject to separate more appropriate specialist regulatory regimes.  Notably in the area of food supplements, a Food Supplements Directive (“FSD”; Directive 2002/46/EC on the approximation of the laws of the Member States relating to food supplements) was only recently adopted.
3.	The fact that there is a likelihood of overlap is apparent from a look at the Community law definitions of “medicinal product” and “food supplement” alone.  The proposed amended definition of “medicinal product” in Article 1(2) of the PD is as follows (emphasis supplied): 
Medicinal product:
(a) Any substance or combination of substances presented as having properties for treating or preventing disease in human beings; or
(b) Any substance or combination of substances which may be used in or administered to human beings with a view to making a medical diagnosis or to restoring, correcting or modifying physiological functions.
The definition of “food supplement” in Article 2(a) of the FSD reads:
“food supplements” means foodstuffs the purpose of which is to supplement the normal diet and which are concentrated sources of nutrients or other substances with a nutritional or physiological effect, alone or in combination, marketed in dose form, namely forms such as capsules, pastilles, tablets, pills and other similar forms, sachets of powder, ampoules of liquids, drop dispensing bottles, and other similar forms of liquids and powders designed to be taken in measured small unit quantities;
4.	It is thus clear that any food supplement which has a physiological effect will automatically fall into the definition of “medicinal product” in the PD: a substance with a physiological effect must at the very least be capable of being used “with a view to … modifying physiological functions” and will thus satisfy the second limb of the “medicinal product” definition.
5.	I am instructed that moreover any substance with a nutritional effect will as a matter of science automatically also have a physiological effect.  Assuming this is the case, it is apparent that the definition of “food supplement” is completely subsumed by the proposed “medicinal product” definition and every food supplement will automatically be a “medicinal product” for the purposes of Community law.
Consequence for the FSD Regime
6.	The consequence of this would in my opinion be to render the FSD Regime as a matter of law devoid of any effect for 3 distinct reasons:
(1)	The operation of Article 1(2) of the FSD would eliminate all food supplements from the FSD’s scope of application, thus leaving no products to which it could apply.  The same is true as regards other sectorial regulatory regimes, including most notably cosmetics.
(2)	As all food supplements would satisfy the definition of “medicinal product” in the PD, there would always be a “ doubt” as to which regime should apply and the proposed Article 2(2) of the PD would always resolve that doubt in favour of the PD.
(3)	The proposed insertion of a clarification into Recital 7 would, mainly because of its position in a recital, not be capable of curing the effects of the clear wording of the substantive provisions of both the FSD and the PD identified in (1) and (2).
I now turn to these three points in more detail.
1. Article 1(2) of the FSD
7.	Article 1(2) of the FSD limits the ambit of the regulatory regime for food supplements by excluding from its ambit medicinal products as defined in the PD.  It reads:
This Directive shall not apply to medicinal products as defined by Directive 2001/83/EC of the European Parliament and of the Council of 6 November 2001 on the Community code relating to medicinal products for human use.
8.	The underlying concern of this provision clearly is to ensure that there is no overlap between the FSD regime and the PD regime, which would lead to legal uncertainty; in that regard it is not dissimilar to the Article 2(2) which it is proposed to insert into the PD.  The provision is moreover consistent with a policy objective also underlying other items of sectorial legislation such as the Community regime for cosmetics: a product which can be classified as a medicinal product should be treated as such in the interest of health and consumer protection, irrespective of whether it might also satisfy the definition of separate sectorial legislation.  In other words: in case of overlap between the PD and another regulatory regime, it is the PD regime that prevails.
9.	This approach is reflected in the case law of the European Court of Justice (“ECJ”), which has notably had a number of opportunities of adjudicating the applicability of the precursor to the PD (Directive 65/65/EEC) to cosmetic products regulated by Directive 76/768/EEC.  In Upjohn, the ECJ held that even though it may fall within the definition of cosmetic products given in Article 1(1) of Directive 76/768/EEC, a product must nevertheless be treated as a medicinal product as defined in Directive 65/65 if it falls inside that definition.
10.	The position in Community law was appositely summarised by Advocate General Cosmas in Österreichische Unilever as follows:
… the assumption that the product in question is by definition a cosmetic product within the meaning of Directive 76/768 does not necessarily mean that it falls within the legislative ambit of that Directive. If a product is presented as having not only cosmetic but also medicinal properties (however ancillary or supplementary the latter may be in relation to the former), it is necessary to determine whether it is subject to the Community secondary legislation on medicinal products. It is clear from the Court’s case-law that, where a product has the characteristics of a medicinal product and also those of another type of product (foodstuff, cosmetic product, etc.), it is necessary to apply the provisions concerning medicinal products which, being more stringent and offering better protection to health and to consumers, take precedence over all others. 
11.	The same principle applies for food supplements.  The definition of “medicinal product” is used not only to determine the sphere of application of the PD.  Its position in the scheme of Community law is much more fundamental: it delineates the applicability of all the relevant sectorial regimes and any widening of the legal definition of “medicinal product” has the effect of restricting the applicability of the sectorial regimes.  It is therefore of significant importance for the coherence of Community law in the area that the legal definition of “medicinal product” maps out precisely the desired dividing line between “medicinal products” in the proper sense of that word on the one hand and food, food supplements, medical devices, biocides or cosmetics on the other.
12.	It is in this context important to note that as regards the distinction between medicinal products and food supplements, the way in which Article 1(2) of the FSD is framed loads the determination process heavily in favour of the PD regime,  irrespective of any further provision in the PD itself.  Under Article 1(2) of the FSD there is no “weighing up” of whether a product fits better into the definition of “medicinal product” or that of “food supplement”.  The only question is whether the it falls into the definition of “medicinal product” in the PD.  If it does, the FSD automatically becomes inapplicable as a whole and the question of whether the product is a “food supplement” never arises.  As a matter of Community law, Article 2 of the FSD, which defines “food supplement” for the purposes of Community law, would simply not be applicable in the first place.
13.	In summary, a legal definition of “medicinal product” which is so wide as to potentially subsume products which are commonly thought of as food supplements emasculates the food supplements regime under the FSD and results in the application to those products of a regime designed for an entirely different type of product which is liable to be less suitable.
2. Proposal for an amended Article 2(2) of the PD
14.	The primacy of the PD regime over the Community law regimes governing other products is likewise sought to be enshrined in the amended PD’s Article 2(2), which it is proposed should read as follows:
In cases of doubt, where a product falls within the definition of ‘medicinal product’, this Directive shall apply, even in cases where the product also falls within the scope of other Community legislation.
15.	In as far as food supplements are concerned, this Article 2(2) of the PD would essentially be the mirror image of the existing Article 1(2) of the FSD.  Article 2(2)  PD ensures that the PD applies wherever a product falls within the definition of “medicinal product” while Article 1(2) ensures that the FSD does not apply in such circumstances.  The proposed Article 2(2) can largely be seen as codificatory of the case law of the European Court of Justice.  It confirms and entrenches the hierarchy between the PD and other sectorial regimes: where a product fulfils the definition of “medicinal product” in the PD, it is the PD which is applicable to the exclusion of any other regulatory regime.
16.	It is important to note that it is in its own terms merely aimed at “cases of doubt” and, was designed to deal with “borderline” products.  The Commission justification for the amended Article 2(2) was:
Since the possible duality of certain “borderline” products (medical devices, cosmetics, biocides etc.) has led to differences of interpretation as to the applicable legislation, it is proposed that, when a product fully meets the definition of a medicinal product, but may also meet the definition of other regulated products, the pharmaceutical legislation should apply (Article 2(2)).
17.	However, while it is certainly desirable to have a provision which eliminates legal uncertainty, in the context of an extremely wide legal definition of “medicinal product” which subsumes all food supplements, the effect of the provision becomes a wholly different one.  Where the “medicinal product” definition is this wide, every case becomes a “case of doubt” and every product becomes a “borderline” product.  In such circumstances, Article 2(2) does not tidy up marginal cases; rather, it shifts fundamentally the dividing line between sectorial regulatory regimes.
18.	In my respectful opinion the legislative “problem” however does not lie in the proposed Article 2(2) but rather in the proposed definition of “medicinal product”.  It is the all-embracing and consequently vague nature of that definition which creates the doubts which trigger the application of Article 2(2) in situations where it should not be.
3. Proposed Recital 7
19.	I have been specifically asked to consider the impact on the position brought about by the dual application of Article 1(2) of the FSD and Article 2(2) of the PD of a passage in proposed Recital 7 which it is sought to introduce into the directive amending the PD.  This is currently worded as follows (emphasis supplied):
Particularly as a result of scientific and technical progress, the definitions and scope of Directive 2001/83/EC should be clarified in order to achieve high standards for the quality, safety and efficacy of medicinal products for human use. In order to take account both of the emergence of new therapies and of the growing number of so-called "borderline" products between the medicinal product sector and other sectors, the definition of "medicinal product" should be modified so as to avoid any doubt as to the applicable legislation when a product, whilst fully falling within the definition of a medicinal product, may also fall within the definition of other regulated products. Also, in view of the characteristics of pharmaceutical legislation, provision should be made for such legislation to apply. With the same objective of clarifying situations, where a given product comes under the definition of a medicinal product but could also fall within the definition of other regulated products, it is necessary, in case of doubt and in order to ensure legal certainty, to state explicitly which provisions have to be complied with. Where a product comes clearly under the definition of other product categories, in particular food, food supplements, medical devices, biocides or cosmetics, this Directive should not apply. It is also appropriate to improve the consistency of the terminology of pharmaceutical legislation.

Conflict between Recital 7 and Article 1(2) FSD and Article 2(2) PD
20.	On its face, the highlighted passage appears to contradict the sweeping wording of both Article 1(2) FSD and the proposed Article 2(2) PD, which I set out again for ease of reference (emphasis supplied):
Article 1(2) FSD provides:
This Directive shall not apply to medicinal products as defined by Directive 2001/83/EC of the European Parliament and of the Council of 6 November 2001 on the Community code relating to medicinal products for human use.
The proposed Article 2(2) PD provides:
In cases of doubt where a product falls within the definition of ‘medicinal product’, this Directive shall apply, even in cases where the product also falls within the scope of other Community legislation.
21.	The question arises what is to happen to a product which falls within the definition of a “food supplement” in the FSD but also falls within the definition of “medicinal product” in the PD.  (As set out at § 5 above, it is likely that this will be the case for all food supplements under the current definition of “medicinal product”.)
22.	In my view the clear and unambiguous effect of Article 1(2) FSD and the proposed Article 2(2) PD is that a product falling within the definition of “medicinal product” must be treated as a matter of Community law as a medicinal product, irrespective of whether it also falls within the definition of a “food supplement” in the FSD.  It is irrelevant for these purposes whether the product in question is merely arguably a food supplement or whether it is “clearly” a food supplement.  As set out at § 12 above, the question of whether it is a food supplement would simply never arise as the FSD would by its own terms be inapplicable.
Role of Recital 7
23.	It is clear as a matter of law that the insertion of a sentence in Recital 7 could not operate to avoid this consequence.  This is the case for four distinct reasons.
24.	Firstly, recitals are in legal terms mere statements of intent, providing the background and reasoning behind the substantive provisions of an item of legislation.  A recital does not on its own created rights or obligations; only the substantive provisions do.  Given a conflict between a recital and a substantive provision, the substantive provision prevails.
25.	Secondly, while recitals are often relied upon in order to interpret substantive provisions where there is uncertainty as to the proper construction of the substantive provision, there is no scope for resort on a recital where the substantive provision is clear and unambiguous.  In my view Article 1(2) FSD and the proposed Article 2(2) PD are clear and unambiguous in their effect and not capable of construction in line with the proposed wording of Recital 7.  In the circumstances, the Recital would remain ineffective.
26.	Thirdly, this would be all the more so as regards Article 1(2) of the FSD as the recital in issue is neither contained in the FSD itself, nor even in a measure directly aimed at the FSD or food supplements.
27.	Finally, as regards the proposed Article 2(2) of the PD, the proposed directive in issue is merely an amending directive and Recital 7 would therefore not become part of the amended PD whereas Article 2(2) would.  I have been asked to set out in detail why it is that the text of Recital 7 would not be reflected in the amended PD.  I do this immediately below.
Amendment Mechanism
28.	The proposal currently under consideration follows the usual structure of an amending directive: a very voluminous Article 1 which lists the changes which are to be made to the PD and some very brief final provisions in Articles 2 to 4 which deal with the machinery of bringing the new provisions into force.
29.	The directive also contains the usual series of recitals which explain the reasoning behind the adoption of the proposed amending directive.  It is however clear that those recitals are not intended to be inserted into the directive which is being amended.  That would only be the case if actual amendments were being made to the recitals of the amended directive.  If it were desired to add a new recital to the PD, it would be necessary to include the text of that recital somewhere in Article 1 of the proposed amending directive.  It is only Article 1 which lists actual amendments, as its opening words (“Directive 2001/83/EC is hereby amended as follows: … ”) demonstrate.
30.	The mechanics of amending directives can be illustrated taking as an example Directive 2000/70/EC of the European Parliament and of the Council of 16 November 2000.  This Directive was, like the directive currently being considered, an amending directive.  It amended Council Directive 93/42/EEC of 14 June 1993 concerning medical devices by making a number of changes to the Annexes of that directive and by notably inserting the following new paragraph 4a into its Article 1:
4a. Where a device incorporates, as an integral part, a substance which, if used separately, may be considered to be a medicinal product constituent or a medicinal product derived from human blood or human plasma within the meaning of Article 1 of Directive 89/381/EEC(8) and which is liable to act upon the human body with action ancillary to that of the device, hereinafter referred to as a 'human blood derivative', that device must be assessed and authorised in accordance with this Directive.
31.	Directive 2000/70/EC in the usual way contained a number of recitals explaining the motivation behind its provisions, including for example the following Recital 2:
(2) This Directive accordingly aims at amending Directive 93/42/EEC so as to include in its scope only devices which incorporate, as an integral part, substances derived from human blood or plasma. However, medical devices incorporating other substances derived from human tissues remain excluded from the scope of the said Directive.
32.	Nevertheless, as can be seen from the consolidated text of Directive 93/42/EEC published by the Office for Official Publications on 10 January 2002, merely the new Article 1(4)a, but none of the recitals form part of the text of the amended Directive 93/42/EEC.  (Amendments by Directive 2000/70/EC are marked “M2” in the margin.)
Finding a Solution
33.	I have been asked to consider how the Common Position could be amended so as to create a workable solution which ensures that food supplements are regulated as food supplements, medicinal products are regulated as medicinal products and where a product does not fit clearly into the one or other definition, it is treated as a medicinal product.
Views expressed on the proposals Article 2(2) and Recital 7
34.	In order to arrive at a solution acceptable to all the institutions participating in the legislative process, it is necessary to consider the legislative history of the proposal to date.  For ease of reference, I set out briefly below the views expressed by the various Community institution on the proposals for Article 2(2) and the relevant passage of Recital 7.
Commission Proposal
35.	The original Commission proposal did not contain the relevant wording of Recital 7.  As already highlighted at § 16, the Commission’s justification for the amended Article 2(2) was:
Since the possible duality of certain “borderline” products (medical devices, cosmetics, biocides etc.) has led to differences of interpretation as to the applicable legislation, it is proposed that, when a product fully meets the definition of a medicinal product, but may also meet the definition of other regulated products, the pharmaceutical legislation should apply (Article 2(2)).
Parliament – 1st Reading
36.	The Parliamentary Report for first reading disagreed recommending a deletion of Article 2(2) which was justified as follows:
The proposal would include a series of products such as food products and medical devices which are already regulated by other Community legislation. This would create legal uncertainty.
37.	The Parliament expanded on this in the justification for its proposed Amendment 19:
The most serious objection to the proposed text of Article 2 is the overlapping between medicinal products and ‘borderline products’, to which on the one hand specific European rules apply for the purposes of marketing authorisation, such as food supplements, cosmetics and medical devices, and unregulated products which are supplied as having a certain medicinal effect but are not regarded as medicinal products as defined in this directive.
The Commission proposal is based on a hierarchy of legislation on medicinal products: in case of doubt as to whether a product is a medicinal product, the legislation on medicinal products (Directive 2001/83) applies. In relation to regulated products, this provision creates a lacuna, as the specific European legislation provides that Directive 2001/83 does not apply to these products. The registration procedure provided for by Directive 2001/83 is not suitable for unregulated products with a medical claim (e.g. dietary products).
This amendment provides for the addition of a negative list to the directive, explicitly listing the products which do not fall within the scope of Directive 2001/83 (Article 2(2)).
These […] include the products in respect of which specific European market authorisation rules have been adopted, i.e. medical devices, cosmetics, biocides and food supplements. In addition, a directive concerning processed body materials is being drafted on the basis of Article 95 of the EC Treaty.
[…]
38.	An Amendment 22 furthermore proposed the addition of “Food supplements as defined in Directive 2002/46” to the list of exceptions contained in Article 3 of the PD, the aim being “To avoid cumulation of directives for products already covered by specific rules.”  I should note in passing that if this amendment had been adopted, a lacuna would have arisen as a product falling into both the definition of a medicinal product and the definition of a food supplement would not have been covered by a regulatory framework at all: the new provision in the PD would have prevented the PD from applying and the FSD would have remained inapplicable by virtue of its Article 1(2) (set out above).
Commission Amended Proposal
39.	It was the Commission’s Amended Proposal which for the first time introduced the wording here in issue into the text of the proposal, having insisted on the inclusion of Article 2(2).  The Amended Proposal contains the following relevant passage:
 -      Amendment 18 on the situation that a given product could fulfil the definition of different regulatory regimes. In order to improve the legal certainty, the provision of Article 2(2) needs to be maintained. But its objective can be clarified by amending Recital 7. A rewording of this recital allows equally taking account of amendments 20, 21, 22 and 23 on the exclusion of food, food supplements, medical devices and cosmetics from the scope of Directive 2001/83/EC. While it is unnecessary to add a provision in the operative part of the Directive, the underlying idea can be stated in a recital:
"Recital 7:
Particularly as a result of scientific and technical progress, the definitions and scope of Directive 2001/83/EC should be clarified in order to achieve high standards for the quality, safety and efficacy of medicinal products for human use. In order to take account, both of the emergence of new therapies and of the growing number of so‑called "borderline" products between the medicinal product sector and other sectors, the definition of "medicinal product" should be modified so as to avoid any doubt as to the applicable legislation, when a product, whilst fully falling within the definition of a medicinal product, may also fall within the definition of other regulated products. With the same objective to clarify situations, where a given product comes under the definition of a medicinal product, but could also fulfil the definition of other regulated products, it is necessary, in case of doubt and in order to provide legal certainty, to state explicitely which provisions have to be complied with. Where a product comes clearly under the definition of other product categories, in particular food, food supplements, medical devices or cosmetics, this Directive does not apply. It is also worth taking advantage of this opportunity to improve the consistency of the terminology of pharmaceutical legislation."
For the avoidance of doubt, I should note that I would for the reasons already given respectfully disagree with the Commission’s view in the above passage that “it is unnecessary to add a provision in the operative part of the Directive”. 
Council
40.	The Council broadly agreed with this view and in particular the amended text of Recital 7.  Its statement of reasons for its Common Position contains the following passage in relation to the amendments in question and the effect of Recital 7 (emphasis supplied):
VI. AMENDMENTS OF THE EUROPEAN PARLIAMENT REJECTED PARTLY OR IN TOTAL
[…]
4. The Council shares the aim of amendments 18, 19, 20, 154, 21, 22 and 23 of resolving the issue of the delineation of medicinal products and other products but can not agree to the concrete text of these amendments, as this would in the view of the Council not solve the problem of the so called borderline products, i.e. products that fulfil the definition of medicinal products for human use and the definition of products regulated under one or more other legislative acts. As stated by the Commission in its amended proposal, Article 2(2), which reflects the case law of the European Court of Justice, is necessary to take account of the borderline cases and to ensure legal certainty. Further, the Council agrees with the Commission in that the addition to recital 7 will clarify the interpretation of Article 2(2) by setting out that when a product clearly comes under the definition of a range of other sectorial legislation, the product should not be regulated as a medicinal product. Specifically, on amendment 19 on empowering the Agency to decide borderline cases, the Council refers to the Commission's explanation that the Directive is to be applied by national authorities and that the issue can be addressed in the context of the mutual recognition procedure.
Suggestion for a Solution 
41.	In my respectful view, a solution might reasonably be built on the following essential factors:
(a)	There seems to be broadly common ground between both the Council and the Commission that wording along the lines of the wording first suggested by the Commission for Recital 7 should be included in the proposed directive and is acceptable.
(b)	As demonstrated above, in the light of the very firm wording of Article 1(2) of the FSD and the proposed Article 2(2) of the PD, inclusion in a recital would be insufficient to bring about the desired effect and inclusion in the substantive parts is necessary.
(c)	The fundamental underlying problem appears to be the very wide “catch-all” definition of “medicinal product” which has far reaching repercussions because directive other than the PD rely on it to define their respective scope.
(d)	A wide definition of “medicinal product” is desirable in order to “catch” products which would otherwise be unregulated, but the definition should not be so wide as to include products which are already regulated by other specialist sectorial measures, such as notably food supplements and cosmetics.
42.	It appears that simply moving the wording currently contained in Recital 7 of the Common Position to the definition of “medicinal product” with some consequential amendments would satisfy all of the above aims.  The medicinal product definition might for example be framed as follows (amendment emphasised):
Medicinal product:
(a) Any substance or combination of substances presented as having properties for treating or preventing disease in human beings; or
(b) Any substance or combination of substances which may be used in or administered to human beings with a view to making a medical diagnosis or to restoring, correcting or modifying physiological functions.
Where a product comes clearly under the definition of other product categories, in particular food, food supplements, medical devices, biocides or cosmetics, it shall not be considered a medicinal product.
43.	This wording would have the further attraction of eliminating legal uncertainty as regards true borderline products in that Article 2(2) could be retained in full.

Brick Court Chambers	CARSTEN ZATSCHLER
7-8 Essex Street	14 December 2003
London WC2R 3LD