Parallel distribution of medicinal products

The parallel distribution market opened on 1st January 1995 when Norway was included in the European Economic Area (EEA) with respect to pharmaceutical products. As from this date pharmaceuticals could be freely sold to and from Norway on similar terms as for any other EU member state.

 

Parallel distribution involves the transfer of genuine, original branded products marketed in one member state of the EEA at a lower price to another EEA member state by parallel distributor, and placed on the market in competition with a therapeutically identical product already marketed there at a higher price by or under licence form the owner of the brand's intellectual property (the direct-distributed product). 

 

Parallel distributors are an established component of the distribution process in Europe for medicinal products for human use. They follow exactly the same manufacturing and distribution regulations as other market players, including multinational companies.

 

The parallel distribution process allows third-party players and consumers to realise savings. These are both:

• Direct - based on lower cost of parallel-distributed products, and
• Indirect - based on price competition between the direct-distributed and parallel-distributed products.

Parallel distribution acts as a counterweight to the monopoly situation of the direct-distributed product. 

 

Total sales from parallel trade in Norway are around NOK 500 million or approximately 5% of the total pharmaceutical market.