Newsletter
Amendments to the "Pharmaceutical Affairs Act" and "Articles 3 and 28 of the Drug Injury Relief Act" Enacted
On January 30, 2026, the Legislative Yuan (Taiwan's Parliament) passed the third reading of the draft amendments to certain provisions of the Pharmaceutical Affairs Act ("PAA") and the draft amendments to Articles 3 and 28 of the Drug Injury Relief Act ("DIRA"). The legislative intent of these amendments is as follows: (1) strengthen monitoring of essential drug supply; (2) ensure stable pharmaceutical supply and public access to medication; and (3) improve the drug injury relief system. The key highlights of the amendments for pharmaceutical firms, pharmacies, and medical institutions are summarized below:
I. Draft Amendments to Certain Provisions of the PAA (the "PAA Amendments")
1. Obligation of Pharmaceutical Firms to Proactively and Periodically Report on Essential Drugs
The PAA Amendments require pharmaceutical firms holding marketing authorizations ("MA") of drugs designated as "essential drugs" (必要藥品) by the central competent health authority (the "Competent Authority") to periodically report relevant information. These firms must report to the Competent Authority on the manufacturing, importation, and supply status of these essential drugs. The report must include: (1) current inventory levels; (2) actual monthly shipment volumes for the past period; and (3) plans for future manufacturing, importation, and supply.
Furthermore, the PAA Amendments authorize the Competent Authority to establish unified standards governing the method, scope, frequency, and content of said reporting obligations.
2. Measures to Ensure Pharmaceutical Supply
The PAA Amendments grant the Competent Authority explicit powers to act in the event of a drug supply shortage or incidents significantly impacting public health (e.g., amoebic dysentery, cryptosporidiosis, or vaccination requirements for citizens traveling to high-risk yellow fever areas), including:
(1) Expansion of Contingency Measures for Drug Supply Shortages
When the Competent Authority becomes aware of a potential shortage of a MA-registered drug, it may grant special project approval (專案核准) for the manufacture or import of said drug or its substitute on a case-by-case basis. The PAA Amendments expand the scope of such special project approval (previously limited only to essential drugs) to now cover all MA-registered drugs.
(2) Restrictive Measures on Pharmaceutical Firms
During emergencies or incidents significantly impacting public health, the Competent Authority may impose restrictions on the scope, duration, quantity, target recipients, or methods of supply for MA-registered drugs or drugs under the aforementioned special project approval, among other measures.
(3) Expansion of Grounds for Special Project Approval
The PAA Amendments add "incidents significantly impacting public health" as valid grounds for the Competent Authority to grant special project approval for the manufacture or import of specific drugs.
3. Penalties and Procedural Safeguards Regarding Restrictive Measures
The PAA Amendments stipulate penalties for non-compliance with the aforementioned "obligation to proactively and periodically report on essential drugs" and "restrictive measures":
(1) Violation of Reporting Obligations Regarding Essential Drugs
Where a pharmaceutical firm fails to report periodically on essential drugs as required, submits false information, or fails to report within the prescribed deadline, the Competent Authority may: (1) publicly announce the name of the firm, its address, the name of the responsible person, the name of the drug, and the details of the violation; and (2) in cases of a serious violation or repeat offense, impose an administrative fine of not less than NT$60,000 and not more than NT$300,000.
(2) Violation of Restrictive Measures
Where a pharmaceutical firm violates the restrictive measures imposed by the Competent Authority in response to emergencies or incidents significantly impacting public health, it shall be subject to an administrative fine of not less than NT$60,000 and not more than NT$300,000, and shall be notified to remedy the violation within a prescribed deadline; failure to remedy within the deadline may result in consecutive penalties.
II. Draft Amendments to Articles 3 and 28 of the DIRA (the "DIRA Amendments")
In alignment with the PAA Amendments, the DIRA has been synchronized to include drugs manufactured or imported under special project approval in response to "insufficient supply of MA-registered drugs" and "emergencies or incidents significantly impacting public health" within the scope of "Legal Drug" (合法藥物) eligible for relief under the DIRA.
Regarding the implementation timeline, the provisions in the PAA Amendments concerning the reporting of essential drugs, supply shortages, special project approval, restrictive measures during public health emergencies, and related penalties shall take effect on a date to be separately determined by the Executive Yuan (Taiwan's Cabinet) following its promulgation. As the DIRA Amendments serve as a supporting measure to the PAA Amendments, both shall enter into force simultaneously.
Our Life Sciences & Healthcare Practice Group has extensive experience in assisting with related matters. Should you require further analysis, business planning, or consultation regarding the PAA/DIRA Amendments, please do not hesitate to contact our experts.