Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session
779

4
HOUSE BILL NO.

Introduced by: Hon. Angelina “Helen” D.L. Tan, M.D.

AN ACT

STRENGTHENING THE REGULATORY SYSTEM IN THE COUNTRY TO COMBAT
COUNTERFEIT PHARMACEUTICAL PRODUCTS, DECLARING THE MANUFACTURE,
IMPORTATION, DISTRIBUTION, SALE OR OFFER FOR SALE, OR POSSESSION OF
COUNTERFEIT PHARMACEUTICAL PRODUCTS AS AN OFFENSE INVOLVING ECONOMIC
SABOTAGE, PROVIDING PENALTIES FOR VIOLATIONS THEREOF, REPEALING FOR THE
PURPOSE REPUBLIC ACT NO. 8203, OTHERWISE KNOWN AS THE “SPECIAL LAW ON
COUNTERFEIT DRUGS”

EXPLANATORY NOTE

A study by the United Nations Office on Drugs. and Crime (UNODC) entitled, “Transnational
Organized Crime in Southeast Asia: Evolution, Growth and Impact’, revealed that of the total 673
pharmaceutical crime incidents reported, 460 took place within Southeast Asia, the majority of
which occurred in the Philippines, with 193 incidents followed by Thailand (110), Indonesia (93) and
Viet Nam (49). ‘

The UNODC report found that “...Pakistan, followed by India and China were the most
frequently identified source countries of counterfeit or diverted medicines detected in the Philippines
from 2013 through 2017, while thirteen other countries were also identified as sources”.

Three Pakistanis were arrested on August 2017 for allegedly selling counterfeit brands of
naproxen sodium, paracetamol and a mix of dextromethorphan, phenylephrine and paracetamol. It
was reported that the Bureau of Customs has intercepted P128.9 million worth of various illicit drugs
on January 2018 in separate shipments where several Pakistani nationals have been implicated.
The Food and Drug Administration (FDA) has warned consumers on March 2018 in an advisory
against the purchase and consumption of counterfeit Biogesic paracetamol 500-milligram tablets;

The UNODC study defines ‘falsified’ medicines or “fraudulent” medicines as those which are
marketed with the intention of deceiving buyers as to the content of what they are buying. “These
include misbranded (spurious/fake/falsely labelled) products and those that do not contain what they
purport to — i.e, medicines in which the active ingredients are inert, are less than, more than or
different from what is indicated, or have expired. They are available in both formal and informal
settings, including hospitals, pharmacies, street vendors and online marketplaces. Falsified medical
products are often produced in poor or unhygienic conditions by unqualified personnel, and some
are found to contain lethal levels of the wrong active ingredient or other toxic substances’.

It reveals that the “circulation of falsified medicines presents serious public health and safety
risks and threatens the achievement of Sustainable Development Goal 3, to ensure the right to
access a reliable standard of healthcare and medicine quality for all”.

Incidentally, Republic Act No. 11223, otherwise known as the “Universal Health Care (UHC)
Act” specifically provides that within two (2) years from its effectivity, the Philippine Health Insurance


Corporation or PhilHealth shall implement a comprehensive outpatient benefit, including outpatient
drug benefit and mandates the Department of Health-owned health care providers to procure drugs
and devices.

On the other hand, Republic Act No. 8203, otherwise known as the “Special Law on
Counterfeit Drugs” was enacted on September 1996 to provide the Filipino people protection
against counterfeit drugs. RA 8203 refers to a counterfeit product as a medicine with correct
ingredients in wrong amounts, wrong ingredients, without active ingredients, or with sufficient
quantity of active ingredient that results in the reduction of the drug's safety, efficacy, quality,
strength or purity. It may be deliberately and fraudulently mislabeled with respect to identity and
‘source or with fake packaging and can be applied to both branded and generic products.

Furthermore, it may also be referred to as: (1) the drug itself or the container or labeling
which bears a trademark, tradename or other identification mark or imprint of a Bureau of Patent,
Trademark and Technology Transfer- registered natural or juridical person; (2) a drug product
refilled by unauthorized persons if the legitimate labels or marks are used; (3) an unregistered drug
product except those brought in the country for personal use as confirmed and justified by
accompanying medical records; and (4) a drug which contains no amount of or a different active
ingredient or less than 80% of the active ingredient it purports to possess as distinguished from an
adulterated drug. Under RA 8203, unregistered products as well as those products which were
maliciously produced by unscrupulous entities to deceive and for the purpose of financial gain are in
the same category.

The application of RA 8203, however, took a different tum when the Supreme Court ruled in
Roma Drug versus GlaxoSmithKline (GSK). In this case, it was alleged that Roma Drug had violated
RA 8203 for not registering GSK products which were procured under parallel importation. The
‘Supreme Court took the position that the drugstore had not violated the RA 8203 because RA 9502
clearly reveals an intention of the legislature to abrogate RA 8203 because of irreconcilable
inconsistencies between the two. It ruled that RA 9502 nullifies the reason or purpose of RA 8203
so the latter loses all meaning and function. As a matter of fact, the Court ruled that “For a law that
is intended to help save lives, the SLCD has revealed itself as a heartless, soulless legislative
piece.”

Said ruling affected the interpretation and application of the law by FDA. The Philippine
definition of counterfeit drugs under RA 8203 has been challenged and as a result, FDA no longer
invokes RA 8203 but rather applies the rule of RA 3720 and RA 9711 to cases of unregistered
pharmaceutical products, including those obtained through parallel importation. As a consequence,
three counterfeit drug-related cases reached the Supreme Court and were all decided favoring the
accused.

Several laws were also enacted by Congress affecting certain provisions of RA. 8203. These
includes RA 9711 (FDA Act of 2009), and RA 10918 (Philippine Pharmacy Law) on the definition of
drugs. There is also RA 10175 (Cybercrime Prevention Act of 2012) concerning any of the act
prohibited in Section 4 of RA 8203 when committed by, through and with the use of information and
communication technologies (online selling, online service, online pharmacy), the same shall also
be covered by the relevant provisions of Republic Act No. 10175 and the penalty to be imposed
shall be one (1) degree higher than that provided under R. A. No. 8203; RA 10918 (Philippine
Pharmacy Law) on the definition of counterfeit drugs, as well as declaring that registered pharmacist
shall also be held liable under RA 10918 apart from liability under RA 8203.

Undeniably, in the 22 years since RA 8203 was enacted, there have been many changes in
the industry and in anti-counterfeiting technologies, but the continuing real threat that counterfeit
pharmaceutical products presents to health, to the security of our children, our family and, in
general, to the prosperity of our community cannot be overemphasized. It cannot be denied that we
are faced by a rapid growing flood of illegal and dangerous pharmaceutical products.


The UNODC study concludes that some laws to combat the proliferation of falsified
medicines are outdated and need to be amended if they are to remain applicable to the increasingly
complex nature of pharmaceutical markets and pharmaceutical crimes.

The problem is even more compounded as we have witnessed in the last decade a growth in
internet sales of pharmaceutical products and this has been associated with the increasing cases of
counterfeit pharmaceutical products entering and moving through countries worldwide, including the
Philippines. Given the vast, almost limitless possibilities of the internet, and borderless movement of
goods, it undeniably becomes even more challenging for the FDA to combat the distribution of
counterfeit pharmaceutical products.

Thus, there is an urgent and imperative need to safeguard the interest of the general public
and the government, particularly the FDA under the Department of Health, against the syndicated or
highly organized operations of unscrupulous persons engaged in the illegal manufacture,
importation, distribution, sale or offer for sale, or possession of counterfeit pharmaceutical products.

Indisputably, these nefarious and illegal operations threaten to undermine the people's
confidence in the health regulatory system and have already resulted in the loss of considerable
government revenues.

Last year, no less than President Rodrigo Roa Duterte ordered the Philippine National Police
to arrest persons involved in the manufacture, importation, trade, administering, dispensing,
delivering, distributing counterfeit drugs and charge them with economic sabotage. According to
him, they will be charged with economic sabotage because those acts undermine not only the
‘economy because it will affect the law of supply and demand and affect the prices, but it also
threatens the security of the nation because it endangers the health of the people.

In this light, the bill incorporates as economic sabotage the illegal manufacture, importation,
distribution, sale or offer for sale, or possession of counterfeit pharmaceutical products to a certain
extent to emphasize the seriousness of the prohibited acts and their highly deleterious effect on
people's lives.

In view thereof, the immediate approval of this measure is earnestly sought.

ANGELINA “HELEN’ ol. TAN, M.D.

4th District, Quezon


Republic of the Philippines
HOUSE OF REPRESENTATIVES
‘Quezon City

EIGHTEENTH CONGRESS
First Regular Session

House BILL No._4779

Introduced by: Hon. Angelina “Helen” D.L. Tan, M.D.

AN ACT

STRENGTHENING THE REGULATORY SYSTEM IN THE COUNTRY TO COMBAT
COUNTERFEIT PHARMACEUTICAL PRODUCTS, DECLARING THE MANUFACTURE,
IMPORTATION, DISTRIBUTION, SALE OR OFFER FOR SALE, OR POSSESSION OF
COUNTERFEIT PHARMACEUTICAL PRODUCTS AS AN OFFENSE INVOLVING ECONOMIC
SABOTAGE, PROVIDING PENALTIES FOR VIOLATIONS THEREOF, REPEALING FOR THE
PURPOSE REPUBLIC ACT NO. 8203, OTHERWISE KNOWN AS THE “SPECIAL LAW ON
COUNTERFEIT DRUGS"

Be it enacted by the Senate and the House of Representatives of the Philippines in Congress
assembled:

SECTION 1. Short Title. - This Act shall be known as the “Counterfeit Pharmaceutical
Products Prevention Act”.

SEC. 2. Declaration of Policy. — It is the policy of the State to protect and promote the right to
health of the people and instill health consciousness among them, establish and maintain an
effective food and drug regulatory system, and undertake appropriate health manpower
development and research responsive to the country’s health needs and problems. In furtherance of
this constitutional mandate, this Act aims to adopt, support, establish, institutionalize, improve and
maintain structures, processes, mechanisms and initiatives that are aimed, directed and designed to
strengthen the capability of the State to prevent activities that may result, or detect, investigate,
suppress, and more effectively respond to actions that result in counterfeit pharmaceutical products.

Towards this end, it shall strengthen the prohibitions against counterfeit pharmaceutical
products; declare the manufacture, importation, distribution, sale or offer for sale, or possession of
Counterfeit pharmaceutical products as offenses involving economic sabotage; and provide stricter
penalties for violations of this Act.

‘SEC. 3. Definition of Terms. - As used in this Act:

(a) Biopharmaceuticals shall refer to pharmaceutical products that are used for therapeutic
or for in vivo diagnostic purposes, such as vaccines, sera, and drugs derived from life forms using
biotechnology. These include proteins, nucleic acids, or living microorganisms where the virulence
is reduced and are used for therapeutic or for in vivo diagnostic purposes.

(b) Brokering shall refer to any act of facilitating the disposal or sale of counterfeit
pharmaceutical products, including acts of agency;

(c) CDRR shall refer to the Center for Drug Regulation and Research of the FDA;

(d) Counterfeit pharmaceutical products shall refer to pharmaceutical products which fall
under any of the following conditions, which results in the reduction of the pharmaceutical products’


safety, efficacy, quality, strength or purity:

1. do not contain the amounts as claimed;

2. with wrong ingredients;

3. without active ingredients; or

4. with less than eighty percent (80%) of the active ingredient it purports to possess as
distinguished from an adulterated drug including reduction or loss of efficacy due to expiration.

It shall also refer to products that are deliberately and fraudulently misrepresented with
respect to their identify, composition and/or source. For this purpose, the terms:

i. “Identity” shall refer to the name, labelling or.packaging or to documents that support the
authenticity of an authorized pharmaceutical product;

ii. “Composition” shall refer to any ingredient or component of the pharmaceutical product in
accordance with applicable specifications authorized/recognized by the FDA;

ili. “Source” shall refer to the identification, including name and address, of the marketing
authorization holder, manufacturer, importer, exporter, distributor or retailer, as applicable.

‘Any consideration related to intellectual property rights does not fall within this definition.

(e) Director General shall refer to the Director General of the FDA.

(f) Drugs shall refer to pharmaceutical products that pertain to any chemical compound or
biological substance, other than food, intended for use in the treatment, cure, mitigation, prevention
or diagnosis of disease in humans or animals, including but not limited to:

1. Any article recognized in the Philippine Pharmacopoeia, Philippine National Drug
Formulary, or in any foreign official pharmacopoeias and formularies which are adopted by the FDA
or any documentary supplement to any of them;

2. Any article, other than food, intended to affect the structure or any function of the human
body or animals;

3. Any article intended for use as a component of any chemical compound or biological
substance or articles specified above, not including devices or their components, parts, or
accessories; or

4. Herbal and/or traditional drug which are articles of plant or animal origin used in folk
medicine, which are:

a. recognized in the Philippine National Drug Formulary; or

. intended for use in the treatment, cure, mitigation, prevention or diagnosis of disease
symptoms, injury or body defects in humans; or

. other than food, intended to affect the structure or any function of the human body; and
d. in finished or ready-to-use dosage form; or

e. intended for use as a component of any of the articles specified in clauses (a), (b), (c),
and (4);

(g) Department shall refer to the Department of Health;

(h) Economic Sabotage shall refer to any of the acts which are declared unlawful and


prohibited under this Act when committed and the amount of the counterfeit pharmaceutical
product(s) involve (whether as a single product or totality of different pharmaceutical products) is
One Million Pesos (Php1,000,000.00) or more, as valuied by the Food and Drug Administration, any
provision of law to the contrary notwithstanding.

(i) Establishment shall refer to a sole proprietorship, a partnership, a corporation, an
institution, an association, or an organization engaged in the manufacture, importation, exportation,
sale, offer for sale, distribution, donation, transfer, use, testing, promotion, advertising, or
sponsorship of pharmaceutical product, including the facilities and installations needed for its
activities.

() FDA shall refer to the Food and Drug Administration.
(k) FDRO shall refer to the Food and Drug Regulation Officer of the FDA.

(1) LSD shall refer to the laboratories under the FDA including those private laboratories
accredited by the agency to conduct particular scope of analysis.

(m) LSSC shall refer to the Legal Services Support Center of the FDA.

(n) Medicines shall refer to drugs in their appropriate dosage forms, with assured quality,
safety and efficacy for humans or animals, or both.

(0) Online Service shall refer to the sale, offering for sale, donation, distribution, trafficking,
brokering of pharmaceutical product, or the sale of any punch, dye, plate or any other equipment or
instrument designed to print, imprint or reproduce the trademark, trade name or other identifying
mark for use to any pharmaceutical product, through and with the use of information and
communication technology system. The term shall also cover Online Selling or Online Pharmacy
Services.

(p) Owner shall refer to a person or group of persons who is the registered owner of a
license to operate a business or business undertaking in the Philippines or the branch manager or
operator, license, franchise, or any person acting on behalf of the corporate entity.

Pharmaceutical Products” shall refer to drugs, medicines, biologicals, pharmaceutical and
biopharmaceutical products/specialties, veterinary products, veterinary biologics and veterinary
medicinal products.

(a) Residence shall refer to a private dwelling or abode where a person lives, either as
owner or lessee, or usufructuary including, for purposes of this Act, its yard, garage, storage rooms
or premises; provided that where the yard, garage, storage rooms or premises are used to
manufacture, process, pack, or hold pharmaceutical products for introduction into domestic
‘commerce, the same shall not fall as residence but be considered as establishment.

SEC. 4. Prohibited Acts. - The following acts are declared unlawful and therefore prohibited:

(a) The manufacture, importation, distribution, sale, offering for sale, donation, trafficking,
brokering, exportation, or possession of counterfeit pharmaceutical products as defined in Section 3
hereof.

Any provision of law to the contrary notwithstanding, when any of the acts in the preceding
paragraph is committed and the amount of the counterfeit pharmaceutical product(s) involve
(whether as a single product or totality of different pharmaceutical products) is One Million Pesos
(Php1,000,000.00) or more, as valued by the Food and Drug Administration, they shall be deemed
as an offense involving economic sabotage.


The presence or availability of such counterfeit pharmaceutical product within the premises
of any entity engaged in the manufacture, importation, distribution, sale, offering for sale, donation,
trafficking, brokering, exportation, of pharmaceutical products or in a private residence, or in public
or private vehicle, shall constitute a prima facie evidence of violation of this Act.

The above presumption shall not apply to the legitimate owners of trademarks, trade names
or other identifying marks, or the legitimate or authorized representatives or agents of such owners,
who have in their possession counterfeit pharmaceutical products which bear the trademarks, trade
names or marks if they can show the sales invoices or official receipts evidencing their purchase
from a drugstore, manufacturer or distributor suspected by them of dealing in counterfeit drugs
involving the trademarks, trade names and other similar identifying marks registered in their names:
Provided, that such counterfeit pharmaceutical products shall be reported and immediately turned
over to the FDA within a period of ten (10) days from the date of purchase of such counterfeit
pharmaceutical product as indicated in the sales invoice, official receipt, or other similar documents
abovementioned to the time the counterfeit pharmaceutical product are reported and turned over to
the FDA.

(b) Possession of any such counterfeit pharmaceutical product. However, any person found
in possession of counterfeit pharmaceutical product, in violation of this subsection, shall be
exempted from liability under the provisions of this Act after:

(1) Presentation of sales invoices, official receipt or other legally acceptable
documents evidencing his purchase thereof from a drugstore, distributor, manufacturer,
hospital pharmacy or dispensary; or any other person or place duly licensed to sell and/or
dispense pharmaceutical product, and indicating therein the batch and lot numbers, as well
as the expiry dates of such pharmaceutical product; or

(2) Presentation of certificates and other documents evidencing the importation or
exportation of the counterfeit pharmaceutical product found in his possession as required by
existing laws, including those documents required in the preceding paragraph covering the
commercial transactions involving counterfeit drugs.

In both cases, the subject counterfeit pharmaceutical product must not on its face appear to
be as such, or do not bear any marking or any patently unusual characteristic ‘sufficient to arouse
the suspicion of a reasonable and prudent person that such pharmaceutical product is counterfeit.
Furthermore, the amount or volume of counterfeit pharmaceutical product held is such that it does
not negate or is inconsistent with the averment that the same are for personal use, notwithstanding
the presentation by the possessor of medical records and other similar documents accompanying
and justifying the use of such pharmaceutical product.

When the amount of the counterfeit pharmaceutical product(s) in possession of any person
(whether as a single product or totality of different pharmaceutical products) is One Million Pesos
(p1,000,000.00) or more, as valued by the Food and Drug Administration, the act of possession
shall be deemed as an offense involving economic sabotage.

(c) Photocopying, duplicating, altering, printing, transferring, obliterating or removing the
approved label or any part thereof, lawfully belonging to another person, for the purpose of using
such label or a part thereof on any counterfeit pharmaceutical product: Provided, that if the person
who committed any of the acts enumerated in this paragraph and the person who used the labels
produced thereby are not one and the same person and the former had knowledge of the purpose
for which the labels are intended, the former shall also be liable under the act notwithstanding the
failure of the latter to achieve the intended purpose; and

(@) Making, selling, or concealing any punch, dye, plate or any other equipment or
instrument designed to print, imprint or reproduce the trademark, trade name or other identifying


mark of another registered producer or any likeness thereof, upon any pharmaceutical product or
device or its container or label without authority from the legitimate owners of the trademark or trade
name.

SEC. 5. Parties Liable. - The following persons shall be liable for violation(s) of this act:

a) the manufacturer, importer exporter, distributor, seller, distributor, trafficker,
broker or donor of the counterfeit pharmaceutical product and their agents, as.
the case may be;

(b) the possessor of counterfeit pharmaceutical product as provided in Section 4(b) of this

(c) the manager, operator or lessee of the laboratory or laboratory facilities used in the
manufacture of counterfeit pharmaceutical product;

(6) the owner, proprietor, administrator or manager of the drugstore, hospital pharmacy or
dispensary, laboratory or other outlets or premises where the counterfeit pharmaceutical product is
found who induces, causes or allows the commission of any act herein prohibited;

(e) the licensed and registered pharmacist of the establishment, or the licensed and
registered pharmacist of the outlet where the counterfeit pharmaceutical product is sold or found,
who sells or dispenses such drug to a third party; and

(f) should the offense be committed by a juridical person the penalty shall be imposed upon
the officer or officers of the corporation, partnership, association or entity responsible for the
violation; and if such officer is an alien, he shall, in addition to the penalties herein prescribed be
deported without further proceedings.

SEC. 6. Liability under Other Laws. - Prosecution under this Act shall be without prejudice to
any liability for violation of any provisions of other laws.

SEC. 7. Administrative Proceedings. - The FDA is hereby further authorized to undertake the
following administrative actions.

A. Procedure When Counterfeit pharmaceutical product Is Monitored In the Market Pursuant
To A Routine Inspection of the FDRO.

If the FDRO, in the course of his/her routine/regular inspection of a factory, warehouse,
establishment in which drugs are manufactured, processed, packed, or held, for introduction into
domestic commerce, or vehicle, and all pertinent equipment, finished or unfinished materials,
containers, and labeling therein, upon the authority conferred by Section 27 of Republic Act No.
3720 as amended, shall suspect certain stocks as counterfeit pharmaceutical product, the FDRO
shall conduct an inventory, segregate and seal the suspected stocks, and collect samples for
examination as to the pharmaceutical product's genuineness and authenticity;

B. Procedure When Information is Received About the Presence of Counterfeit
pharmaceutical product in the Possession of Any person or Establishment.

1. Any information, either referred by the government office or officer or from anonymous
sources or person requesting confidentiality of their identities, on the existence of suspected
counterfeit pharmaceutical product in the possession of any manufacturer, seller or distributor, shall
undergo the verification process by the FDRO, or any officer deputized or authorized by the Director
General. Verification process shall follow the existing system and procedure in the conduct of case
build-up, investigation or other appropriate interventions adopted by the FDA.


2. If the counterfeit pharmaceutical product is located in an establishment:

a. Seize the counterfeit pharmaceutical product and take them into custody; and
b. Proceed in filing a criminal complaint and/or administrative complaint.

3. If the counterfeit pharmaceutical product is located in a private residence:

a. Secure a valid search warrant from a competent court;

b. After having obtained the search warrant, inventory and seize such counterfeit
pharmaceutical product and take them into custody; and

c. Proceed in filing a criminal complaint and/or administrative complaint.

C. Findings of Counterfeit Drug/Medicine by Owners of Trademarks, Trade Names or Other
Identifying Marks.

Owners of trademarks, trade names or other identifying marks, or their authorized agents
who have found their pharmaceutical product being counterfeited shall file an administrative case
before the FDA following the procedure in the preceding section.

SEC. 8. Hearing of Administrative Complaints and Institution of Criminal Action. - The FDA
shall hear and decide administrative complaints filed before the agency following the rules of
procedure provided under Republic Act No. 3720, as amended, and its Implementing Rules and
Regulations.

Upon preliminary findings of the conduct of prohibited acts, the Director General shall issue
the proper notices or orders to the person or persons concerned and such person or persons shall
be given an opportunity to he heard before the FDA.

Preventive Closure Order. A summons with preventive closure order shall be issued against
the warehouse, building, factory, store, shop or any other structure where the said counterfeit
pharmaceutical product are contained or stored within fifteen (15) days upon the filing of
administrative complaint. This is for the purpose of preventing the disposition or tampering of
evidence, the continuance of acts being complained of, and/or the flight of the Respondent.

After the lapse of the 30-day period, the preventive closure order is deemed lifted without
prejudice to the resolution of the case.

Both criminal and administrative actions may be instituted separately and independent of
‘one another.

SEC. 9. Penalties. -

A. Administrative Sanctions and Other Remedies

Upon finding that the pharmaceutical product examined is counterfeit and the determination
of the parties liable thereof, the FDA shall impose any or all of the following administrative penalties
and/or pursue other remedies:

1. (i) Minimum Penalty. An administrative fine of not less than One hundred thousand pesos

(PHP100,000.00) but not more than Five hundred thousand pesos (PHP500,000.00) shall be the
minimum administrative penalty.


(ii) Medium Penalty. An administrative fine of at least Three hundred thousand pesos
(PHP300,000.00) but less than Five hundred thousand pesos (PHP500,000.00) and suspension or
revocation of its license to do business shall be the medium administrative penalty.

When any violation of any provisions of this Act comes to the knowledge of the Director
General, of such character that a criminal prosecution ought to be instituted against the offender, he
shall certify the facts together with the laboratory report, the findings of the FDA, or other
documentary evidence on which the charge is based.

The Director General is hereby authorized to call on the assistance of any Department,
Office or Agency for the effective implementation of the provisions of this Act.

(ii) Maximum Penalty. An administrative ‘fine of Five hundred thousand pesos
(PHP500,000.00) and permanent closure of the establishment concerned as well as the revocation
of its license to do business shall be the maximum administrative penalty.

Provided, that if any or all of the instances below occur, the maximum imposable fine of Five
hundred thousand pesos (PHP500,000.00), revocation of its license to do business and permanent
closure of establishment, and permanent disqualification of the person concerned whether natural
or juridical, from owning or operating a drug establishment or outlet, as the case maybe, shall be
imposed:

a. If the Respondent or any of his officer or agent shall conceal, substitute, dispose or
destroy any pharmaceutical product that may have been segregated and sealed by the; or

b. If the Respondent or any of his officer or agent shall break, alter or tamper any mark or
seal used by the FDA to identify those segregated drugs; or

c. As a result of the use of the pharmaceutical product found to be counterfeit, the illness
sought to be cured is aggravated or physical injury or suffering results therefrom, or be the
proximate cause of death or permanent disability of the victim or patient.

Any of the imposable penalties in Paragraphs (i), (ii) and (iii) above shall be accompanied by
forfeiture, confiscation and destruction of the pharmaceutical product(s) found to be counterfeit and
the equipment, instrument and other articles used in violation of this Act or this implementing rules
and regulations.

2. Other Remedies.

a. filing of an appropriate proceedings against the registered pharmacist with the
Professional Regulations Commission for imposition of the appropriate penalties as provided under
Republic Act No. 10918 or the Philippine Pharmacy Act or its amendment;

b. filing of criminal charges against the violator(s), which can be instituted independently
from the administrative case: Provided, That the dismissal of the criminal case shall not lift the
closure order, except when it is a dismissal on the merits or for lack of basis: Provided, further, That
the withdrawal of the private criminal complaint shall not be a ground for the dismissal of the
administrative proceedings; and

B. Criminal Sanctions
‘The commission of any of the acts prohibited under Section 4 of this Act shall be punished by:

4. imprisonment of not less than six (6) months and one (1) day but not more than six (6)


years for mere possession of counterfeit pharmaceutical product as provided for in Section 4 (b) of
this Act; or

2. imprisonment of six (6) years and one (1) day, but not more than ten (10) years or a fine
of not less than One hundred thousand pesos (PHP100,000.00) but not more than Five hundred
thousand pesos (PHP500,000.00) or both such imprisonment and fine at the discretion of the court
in any other case mentioned in Section 4 of the Act; or

3. imprisonment of not less than six (6) months and one (1) day, but not more than two (2)
years and four (4) months if the counterfeit pharmaceutical product is intended for animals; or

4. imprisonment of not less than six (6) years and one (1) day but not more than ten (10)
years for any manufacturer, seller or distributor who shall conceal, substitute, dispose or destroy
any pharmaceutical product as may have been segregated and sealed by the FDA, or who shall
break, alter or tamper any mark or seal used by the: FDA to identify those segregated drugs as
provided for under Section 6(A) of this Act. Any other person who breaks, alters or tampers any
mark or seal used by the FDA to identify the segregated pharmaceutical product shall suffer the
penalty of not less than six (6) months and one (1) day, but not more than six (6) years
imprisonment; or

6. if, as a result of the use of the pharmaceutical product found to be counterfeit, the illness
sought to be cured is aggravated or physical injury or suffering results therefrom, a punishment of
imprisonment from twelve (12) years to fifteen (15) years and a fine ranging from One hundred
thousand pesos (P100,000.00) to Five hundred thousand pesos (PHP500,000.00) shall be meted
out; or .

6. should a counterfeit pharmaceutical product be the proximate cause of death of a victim,
who unknowingly purchased and took a counterfeit pharmaceutical product, the penalty of life
imprisonment and a fine of Five hundred thousand pesos (PHP500,000.00) to Five million pesos
(PHP5,000,000.00) shall be imposed.

Provided that, any provision of law to the contrary notwithstanding, when any of the acts
declared unlawful and prohibited under Section 4 above is committed and the amount of the
counterfeit pharmaceutical product(s) involve (whether as a single product or totality of different
pharmaceutical products) is One Million Pesos (Php1,000,000.00) or more, as valued by the Food
and Drug Administration, it shall be deemed as an offense involving economic sabotage and
punishable by life imprisonment and a fine of Five Million Pesos (Php5,000,000.00) to Ten Million
Pesos (Php10,000,000.00).

In case any Act prohibited in Section 4 of this Act is also punishable under other laws, the
offender shall, if warranted by the evidence, be prosecuted under the law prescribing the highest
penalty.

When the sale, offering for sale, donation, distribution, trafficking, or brokering of counterfeit
pharmaceutical product, or the sale of any punch, dye, plate or any other equipment or instrument
designed to print, imprint or reproduce the trademark, trade name or other identifying mark of
another registered producer or any likeness thereof, upon any pharmaceutical product or device or
its container or label without authority from the legitimate owners of the trademark or trade name, as
prohibited in Section 4 of this Act is committed by, through and with the use of online service, the
same shall also be covered by the relevant provisions of Republic Act No. 10175 or the “Cybercrime
Prevention Act of 2012". Provided, that the penalty to be imposed shall be one degree higher than
that provided under this Act.

SEC. 10. inter-agency, Stakeholders and International Cooperation. — All relevant inter-
agency, other stakeholders and international instruments, programs, cooperation, and


arrangements agreed, whether in regulatory or criminal matters, to the widest extent possible for the
purposes of detection, investigation, suppression, proceedings or effective response concerning
administrative or criminal offenses related to counterfeit pharmaceutical products, or for the
collection of evidence, shall be given full force and effect.

SEC. 11. Establishments’ Responsibilities. - All pharmaceutical product establishments,
including the licensed and registered pharmacist under their employ, shall ensure at all times that
pharmaceutical products satisfies the requirements of pharmaceutical products’ laws and standards
relevant to their activities in the pharmaceutical product supply chain and that control systems are in
place to prevent or eliminate counterfeit pharmaceutical products.

Pharmaceutical product establishments shall be knowledgeable of the specific requirements
and standards of pharmaceutical product laws and regulations relevant to their activities in the
pharmaceutical product supply chain and the procedures adopted by the regulatory authority.

If a pharmaceutical product establishment considers or has reason to believe that a
pharmaceutical product which it produced, processed, imported, distributed, sold, offered for sale is
counterfeit, it shall immediately initiate procedures to withdraw the pharmaceutical product in
question form the market and inform the regulatory authority.

Pharmaceutical product establishments shall allow inspection of their business and
collaborate with the regulatory authority on actions taken to avoid risks posed by the counterfeit
pharmaceutical product they have supplied.

SEC. 12. Rapid Alert System. - The rapid alert system in place for the notification of direct or
indirect risk to human health due to counterfeit pharmaceutical product shall be strengthened by the
FDA.

SEC. 13. Strengthening the Pharmacovigilance System. - The FDA, in coordination with the
DOH or other stakeholders shall strengthen the existing Pharmacovigilance System.

Within one hundred twenty (120) days from effectivity of this Act, the FDA shall establish a
pharmacovigilance unit within its CDRR with appropriate staffing of officers and personnel and
experts and be regularly allocated with appropriate budget.

SEC. 14. Training and Consumer Advocacy and Education. — Training, orientation,
education, and other advocacy activities shall be regularly provided by the FDA to pharmaceutical
product establishments, communities, and other sectors of the community.

A consumer advocacy and education program shall be developed and implemented by the
FDA in partnership with relevant NGOs, private organizations, coalitions, academic institutions, or
other relevant government agencies. The FDA shall allocate and provide funds for the development
and implementation of training and consumer advocacy and education programs.

SEC. 15. Appropriations. - The amount necessary to carry out the provisions of this Act shall
be included in the General Appropriations Act for the year following its enactment and every year
thereafter.

SEC. 16. Enforcement and Implementation. - The FDA of the Department of Health is
hereby authorized to administer and supervise the implementation of this Act subject to the
applicable provisions of Republic Act No. 10175 or the “Cybercrime Prevention Act of 2012”.

SEC. 17. Implementing Rules and Regulations. - The FDA, in consultation with the
stakeholders, shall promulgate the implementing rules, and regulations within One Hundred Twenty
(120) days from the effectivity of this Act.


SEC. 18. Interpretation and Construction in Favor of Protection of Public Health. - All doubts
in the implementation and interpretation of the provisions of this Act, including its implementing rules
and regulations, shall be resolved in favor of protecting public health against counterfeit
pharmaceutical products.

SEC. 19. Separability Clause. — If any provision of this Act is held invalid or unconstitutional,
the same shall not affect the validity and effectivity of the other provisions hereof.

SEC. 20. Repealing Clause. - Republic Act No. 8203 is hereby repealed. All other laws,
decrees, executive orders and rules and regulations contrary to or inconsistent with the provisions
of this Act are hereby repealed, amended or modified accordingly.

SEC. 21. Effectivity. - This Act shall take effect fifteen (15) days after its publication in the
Official Gazette or in a newspaper of general circulation.

Approved,