Republic of the Philippines

Department of Health

OFFICE OF THE SECRETARY

ADMINISTRATIVE ORDER No. 2013 - ___________

SUBJECT:

Rules and Regulations on the Licensing of Drug Establishments and Other Related Authorizations Further Amending for this Purpose Administrative Order No. 56 s. 1989 on the Revised Regulations for the Licensing of Drug Establishments and Outlets, and for other Purposes

I.

RATIONALE Section 15, Article II of the 1987 Constitution declared it the policy of the State to protect and promote the right to health of the people and instill health consciousness among them. The Constitution also mandates the State to adopt an integrated and comprehensive approach to health development which shall endeavor to make essential goods, health and other social services available to all the people at affordable cost (Section 11, Article XIII). Republic Act No. 3720 as amended by RA 9711 and its implementing rules and regulations, and RA 7394, in implementing the above Constitutional policy, declares further as a policy of the State to insure safe and good quality of food, drugs, and cosmetics, and to regulate the production, sale, and traffic of the same to protect the health of the people. In so doing, the same laws empower the Food and Drug Administration to issue licenses to establishments manufacturing and/or distributing pharmaceutical products. Republic Act No. 8792 or the Electronic Commerce Act of 2000 declares it as an objective to facilitate domestic and international dealings, transactions, arrangements, agreements, contracts and exchanges, and storage of information through the utilization of electronic, optical and similar medium, mode, instrumentality and technology to recognize the authenticity and reliability of electronic documents related to such activities and to promote the universal use of electronic transaction in the government and general public. The above objective of RA 8792 and its Implementing Rules and

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Regulations mandate the use of electronic data messages, electronic documents and electronic signatures in government transactions. Republic Act No. 9502, otherwise known as the Universally Accessible Cheaper and Quality Medicines Act of 2008 and its Implementing Rules and Regulations provides as a policy of the State that when the public interest or circumstances of extreme urgency so require, it shall adopt appropriate measures to promote and ensure access to affordable quality pharmaceutical products for all through an effective competition policy in the supply and demand thereof. Therefore, pursuant to the foregoing, to streamline regulatory approaches in licensing of drug establishments; provide faster access of pharmaceutical products to the public; and promote transparency through the universal use of electronic transaction in the government and general public, the following rules and regulations in the licensing of drug establishments as provided below are hereby adopted and prescribed for the information and compliance of all concerned. II. AUTHORITY/BASES This Order is issued by virtue under Section 26 of Republic Act No. 3720 as amended by Republic Act 9711 otherwise known as FDA Act of 2009; Republic Act No. 7394 or the Consumer Act of the Philippines; Republic Act No. 9502, otherwise known as the Universally Accessible Cheaper and Quality Medicines Act of 2008; Republic Act No. 6675 or the Generics Law of 1988 as amended; Republic Act No. 5921 or The Pharmacy Law as amended; Executive Order No. 292 or the Administrative Code of 1987; and Section 27, Part IV of Republic Act No. 8792 or the Electronic Commerce Act of 2000. III. OBJECTIVES This Administrative Order is promulgated to: 1. Further amend the existing rules and regulations in the licensing of drug establishments to align with the recently promulgated laws and adopted policies affecting drug establishments; 2. Ensure the public that establishments licensed by FDA comply with current regulatory standards such as, but not limited to, Good Manufacturing Practices (GMP), Good Distribution Practices (GDP), Good Storage Practices (GSP), Good Pharmacy Practices (GPP) and Good Dispensing Practices.

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3. Prescribe the use and implementation of new innovations, such as but not limited to, electronic data messages, electronic submission of documents and electronic signatures in the Food of Drug Administration pursuant to Republic Act No. 8792 or the Electronic Commerce Act of 2000. IV. SCOPE This Order shall apply to all drug establishments, including local government units, government owned and controlled corporations, nongovernment organizations, other government offices and instrumentalities engaged in the manufacture, importation, exportation, sale, offer for sale, distribution in wholesale and/or retail basis and transfer of pharmaceutical product. Entities engaged in the activities such as donation, promotion, advertising, or sponsorship of pharmaceutical product shall be responsible therefor and shall secure an authorization. V. DEFINITION OF TERMS As used in this Order, the following words, phrases or terms shall have the following meaning: 1. FDA shall refer to the Food and Drug Administration. 2. Drug Establishment 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 in wholesale and/or retail basis, donation, transfer, use, testing, promotion, advertising, or sponsorship of pharmaceutical product including the facilities and installations needed for its activities 3. PIC/S means Pharmaceutical Inspection Co-operation Scheme. 4. Pharmaceutical products are the same as drug or medicinal products as defined in AO 2012-0008 Adoption and Implementation of PIC/S Guides for the Good Manufacturing Practice for Medicinal Products 5. License to Operate (LTO) is an authorization or permission embodied in a document granted by FDA to any natural or juridical person engaged in the manufacture, importation, exportation, sale, offer for sale, distribution, and transfer of pharmaceutical products 6. Professional Regulation Commission (PRC)- is a national government agency created by Presidential Decree (P.D.) No. 223 dated June 22, 1973. 7. Special Permit- is a form of authorization granted to national government, local government unit, non-government organization

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and other entities that procures medicines for use of their constituents, medical missions and other health programs, and other purposes such as donation, promotion, advertising, or sponsorship of pharmaceutical product 8. Pharmacy Compounding - is a practice in which a licensed pharmacist combines, mixes, or alters ingredients in response to a prescription to create a medication tailored to the medical needs of an individual patient. Poor compounding practices can result in contamination or in medications that don't possess the strength, quality and purity required. Moreover, compounded medications are not FDA-approved and have not verified their quality, safety and effectiveness. 9. Specialty pharmaceuticals - generally defined as products used to treat chronic, high-cost, or rare diseases and can be injectable, infusible, oral, or inhaled medications VI. GENERAL PROVISION A. No drug establishment shall manufacture, import, export, sell, offer for sale, distribute, transfer, promote, advertise and/or sponsor any activity that involves pharmaceutical product, without a license or appropriate authorization from FDA pursuant to this Order. B. The recipient of donated pharmaceutical products, whether foreign or locally manufactured, for purposes of either medical missions or other health related programs, shall secure a special permit prior to the products distribution. The products covered herein shall not be available for sale in the market. C. Any pharmaceutical product sold in its original packaging (container), the seal of which has not been broken or tampered with, the liability of ensuring its safety, efficacy, quality and/or purity, rests upon all the stakeholders involved in the supply chain shall be held liable thereof. D. All drug distributors shall not sell directly to the general public or consumer, unless they have license as a retailer. E. The application must meet the required documentary and/or technical requirements or appropriate standards.

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F. Misrepresentations, false entries, or withholding of any relevant data contrary to the provisions of the law, rules and regulations or appropriate standards shall mean disapproval of the application. G. A violation with any of the terms and conditions of its license shall likewise result in the disapproval of the application. H. Applications may also be disapproved for similar causes as determined by the FDA. I. All licensed drug establishments must continuously comply with the existing requirements, regulations and standards, otherwise the establishment may be ordered close or their licenses suspended or revoked motu proprio or upon petition by any person. J. Any pharmaceutical product imported or offered for import, the sale or use of which has been banned or withdrawn for health and safety reasons in the country of manufacture or country of origin, shall likewise be banned and refused admission in the Philippines. K. Any pharmaceutical product that is declared by the Secretary of Health or the FDA Director-General to be imminently injurious, unsafe or dangerous shall be ordered for their immediate recall, seizure or banning from public sale or distribution. L. All entities, whether government or non-government offices, that regularly procure medicines on wholesale basis from any FDA authorized drug establishment for use of their constituents must be licensed as a drugstore/pharmacy or distributor (see Sec. 25 of RA 5921 and RA 3720) M. Institutional Pharmacies procuring medicines on a wholesale basis from any FDA authorized drug establishment for use of their employees and dependents must likewise be licensed as drugstore/ pharmacy. N. Every pharmacy, drugstore, institutional or hospital pharmacy whether owned by the government or a private person or firm shall at all times when open for business be under the personal and immediate supervision of a registered pharmacist except otherwise allowed by pertinent laws. O. All establishment applying for a license to manufacture, import, distribute, sell vaccines and other biological products are hereby
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directed to comply with the Cold Chain Management requirement. Likewise, existing establishment handling the same shall upgrade their cold chain management capabilities. P. The FDA shall have the authority to verify all original or authenticated copies of the submitted documents for LTO (See Sec 27 & 28 of RA 3720). Q. The FDA shall endeavor to integrate all electronic submissions or processes into electronic format pursuant to Republic Act No. 8792 or the Electronic Commerce Act of 2000 R. Rule 17. Non-Discriminatory Clause of IRR of RA9502

VII.

CLASSIFICATION OF DRUG ESTABLISHMENTS G. Drug Manufacturer Drug Manufacturer shall refer to any establishment engaged in any and all operations involved in the production of pharmaceutical products including preparatory processing, compounding, formulating, filling, packaging, repackaging, altering, ornamenting, finishing and labeling with the end in view of its storage, sale or distribution; provided, that the term shall not apply to the compounding and filling of prescriptions in drugstores and hospital pharmacies. For this purpose, a drug manufacturer can be further classified into the following: 1. Drug Manufacturer-Repacker refers to any establishment that repacks a finished drug product into smaller quantities in a separate container and/or into secondary packaging, including but not limited to relabeling, stickering, & bundling for promo packs with the end view of storage, distribution, or sale of the product. Provided, it shall not cover repacking of drugs at the time of purchase for purposes of dispensing. 2. Drug Manufacturer-Packer refers to any establishment that packages a bulk drug product into its immediate container with the end view of storage, distribution, or sale of the product. 3. Drug Manufacturer-Trader refers to any establishment which is a registered owner of a pharmaceutical product and the formulation and procures the raw materials and packing components, and provides the production monographs, quality control standards and procedures, but subcontracts the manufacture of such product to a
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licensed manufacturer. In addition, a trader may also engage in the distribution and or marketing of its products. A trader shall be categorized as a manufacturer.

H. Drug Distributor-Exporter Drug Distributor-Exporter refers to any establishment that exports raw materials, active ingredients and finished products for distribution to other drug establishments outside the country. I. Drug Distributor-Importer

Drug Distributor-Importer refers to any establishment that imports raw materials, active ingredients and/or finished products for wholesale distribution to other local FDA- licensed drug establishment. J. Drug Distributor-Wholesaler

Drug Distributor-Wholesaler refers to any establishment that procures raw materials, active ingredients and/or finished products from a local FDA licensed drug establishment for local distribution on wholesale basis.

K. Drugstore/Pharmacy/Botica and similar outlets such as hospital pharmacy and institutional pharmacy Drugstore/Pharmacy/Botica, including hospital pharmacy and institutional pharmacy shall refer to drug establishment where registered drugs, chemical products, specialty pharmaceutical and dental, medicinal and household remedies are dispensed directly to the general public on a retail basis. Botika ng Barangay and its variants that sell prescription product shall be reclassified and required to secure LTO as a drugstore. L. Retail Outlet For Non-Prescription Drugs (RONPD) Retail Outlet for Non-Prescription Drugs shall refer to drug establishments such as supermarkets, convenient stores and other similar retail establishments licensed to sell registered non-prescription or Over-the-Counter (OTC) drugs which are sold in their individual original and primary packaging and are dispensed directly to the general public on a retail basis.
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Botika ng Barangay and its variants that sell non-prescription or OTC product only shall be reclassified and required to secure LTO as a RONPD.

VIII.

REQUIREMENTS FOR SECURING A LICENSE TO OPERATE Any qualified natural or juridical person desiring to engage or operate in the manufacture, packing, repacking, importation, exportation, sale, offer for sale, distribution or transfer of pharmaceutical products shall comply with the requirements that FDA is authorized to promulgate through the appropriate issuance including amendments thereto.

IX.

RENEWAL OF LICENSE TO OPERATE (LTO) A. Application for regular renewal of license may be filed within six months from its expiration. An application received after expiration of the LTO shall be subject to a surcharge or penalty equivalent to twice the renewal licensing fee and an additional ten percent (10%) per month or a fraction thereof of continuing non-submission of such application up to a maximum of one hundred twenty (120) days. Any application for renewal of license filed beyond the 120 days after the original expiration shall be considered expired and shall be subject to a fee equivalent to the total surcharge or penalty plus the initial license fee. Such application shall undergo the initial filing and evaluation procedure. For applications for renewal filed within one hundred twenty (120) days from its original expiry, the LTO shall be considered valid and existing until a decision or resolution by the FDA is rendered on the application for renewal.

B. Automatic renewal shall apply to the following conditions: 1. The application is filed before the expiration date; 2. The prescribed renewal fee is paid upon filing of the application; 3. A sworn statement indicating no change or variation whatsoever in the establishment is attached to the application. C. In considering both renewal application, FDA shall ascertain the

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continued compliance by the establishment with the existing standards and requirements. In either case above, the instances provided in Section 4, Article I, Book II of the IRR of RA 9711(Paragraph E, Item VI above) shall be grounds for non-renewal of application.

X.

APPLICATION FOR AMENDMENT FDA shall issue a certification for those FDA licensed establishments applying for amendment during the validity of their Licenses to Operate. This certification shall form an integral part of the LTO attachment issued at the time of LTO renewal. Consequently, all amendments shall be incorporated once the LTO is re-issued for renewal. Thus, previous LTO and certifications related to amendments shall be surrendered to this Office. Amendment referred hereto shall include the following: 1. Inclusion or deletion of product (finished or raw material) and/or product line 2. Inclusion or deletion of sources (including toll manufacturer/repacker, trader) 3. Change in business name/address of the source and/or manufacturer 4. Change of key personnel for Quality Assurance, Quality Control, Production Manager, Authorized Person and Pharmacist as reflected in the LTO 5. Inclusion or deletion of activity e.g. from Manufacturer to Toll Manufacturer/Repacker/ Importer/Exporter or Trader to Trader/Importer/ Exporter (raw materials or finished bulk products) Other amendments, as enumerated below, shall require re-issuance of License to Operate after the conduct of inspection as these particulars are reflected in the LTO itself: 1. Change of business name, ownership and transfer of location of the establishment 2. Re-classification of the establishment (e.g. from Distributor/Importer to Distributor/Wholesaler), except for those which were reclassified into another class of establishment (e.g. from Distributor/Importer/ Wholesaler to Trader). Payment for the amendments shall be collected in accordance with the existing regulations pertaining thereto. No change in the previously approved circumstances of the application of the establishment shall be effected unless proper notification and submission

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of necessary documents to the FDA and approval of such change(s) has been made. NOTE: Change of address for drug manufacturer is considered opening, hence all the documentary requirements for initial application shall be submitted and payment of the initial license fee shall be made. XI. LICENSING PROCESS A. Filing of Applications An application, whether initial, renewal, automatic renewal or amendment, is deemed filed upon submission of duly accomplished application form and Self-Assessment Checklist (SAC) with the complete attached required documents, payment of required fees and acceptance of the authorized FDA officer. Failure to comply with the requirements within the prescribed period shall mean denial of the application. Any application not pursued by the applicant within three (3) months from filing shall be deemed discarded and will be automatically cancelled and delisted from the application list. B. Where to File An application shall be filed with the respective Regional Field Offices having jurisdiction over the establishment or as defined in accordance with issuance. C. Period to File Initial application. It shall be filed prior to operation subject to compliance of the requirements and conduct of site inspection but in no case shall the establishment commence to operate until the issuance of the corresponding License to Operate. Renewal application. Regular renewal shall be filed six (6) months prior to expiration of the original validity of the LTO. Automatic renewal shall be filed prior to the expiration of the original validity of the LTO.

XII.

LICENSING GUIDELINES A. Place of Business, Warehouse or Plant All the office, warehouse and plant shall be covered by a single license notwithstanding their distance or different locations within one locality indicating merely their address in the license, except when any of the

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office, warehouse and plant carries an entirely different and complete stage of operation for different product, in which case, each shall be covered by separate license. In this instance, the principal office address shall be reflected at the front page of the LTO while the others at the back page thereof or secondary page appended thereto. The place of business should be situated in accordance with the zonal site.

B.

Display of Signboard and License

Every licensed establishment shall cause the public display the duly issued license in a conspicuous place within the premises of the establishment. E. Request for Information

Any request for information whether by the company or any other party shall be governed by the existing policies on disclosure.

XIII. LICENSE TO OPERATE A. Validity

All Licenses to Operate shall have the following validity for any classification of drug establishments from the date of issuance reflected as such and renewal thereafter. a. Initial Initial LTO issued shall be valid for one year b. Renewal- Renewed LTO shall be valid for two years In either case, the LTO shall be valid only in the address indicated therein and the warehouse or plant covered. B. Lost or Destroyed LTO

An LTO shall be re-issued upon the filing of request with affidavit of loss or affidavit of such destruction and other documents whenever necessary and payment of the prescribed fee. Provided that there is no change whatsoever in the establishment, otherwise the same shall be treated as amendment or initial as the case may be. C. Cancellation of LTO

a. Automatic. Any application for renewal of a LTO filed after one-hundred twenty (120) days after the expiration of the original validity shall be automatically considered expired and cancelled. Likewise, unrenewed LTO for

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successive years shall be automatically cancelled and deleted from the list of registered establishments. b. Voluntary. The owner or authorized person of a licensed establishment may apply before the FDA or its regional field office having jurisdiction over the establishment for voluntary cancellation of its existing license by filing a formal notification together with the original LTO issued, or in case of loss or destruction, an appropriate affidavit therefor. Any voluntary cancellation intended to defraud the government, its creditors, and/or its workers shall not deprive FDA jurisdiction to perform acts in ensuring the safety of the public. c. Involuntary- This shall be effected only on the grounds and procedures provided in the Rules of Administrative Procedure provided in the IRR OF RA 9711 or other relevant rules and regulations in case of violation or upon petition by any party. Nothing in this section shall restrict the FDA or the DOH in imposing the penalty of suspension, revocation, or cancellation of LTO or other authorization for administrative violations of any other relevant laws or their implementing rules and regulations. Any notice of disapproval of applications for license or authorization or suspension, revocation, or cancellation of an existing license, or authorization must clearly state the ground/s on which the disapproval, suspension, revocation, or cancellation is based. XIV. VIOLATIONS AND ADMINISTRATIVE SANCTIONS Violations and administrative sanctions shall be covered by separate issuance. A. Re-application after Disapproval The disapproval of an application is without prejudice to re-application. However, disapproval of application shall mean outright forfeiture of payment. B. Resumption after Suspension The lifting of the order of suspension and the resumption of the operation of an establishment that have been issued a suspension of its LTO, shall take effect only after due application and satisfactory compliance of the deficiencies for which it was suspended. C. Re-application after Revocation Unless permanently barred, any establishment whose LTO have been revoked may apply for initial application after three years from date of revocation.

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XII. SCHEDULE OF FEES Upon application for license to operate, the drug establishment shall be charged with the corresponding non-refundable fees for each type of activity or classification that it will engage into. The fees shall be based on the existing Administrative Order on schedule of fees including any applicable amendment thereto. XIV. SEPARABILITY CLAUSE If any of the provisions of this administrative order is found by a court of competent jurisdiction to be void or unenforceable, in whole or in part, such provision shall be deemed deleted from this Order but the remaining provisions thereof shall remain in full force and effect. XV. REPEALING CLAUSE All provisions of existing administrative orders, circulars, regulations and other issuances inconsistent with this Order are hereby repealed or amended accordingly. XVI. EFFECTIVITY CLAUSE This Order shall take effect after fifteen (15) days following its publication in a newspaper of national circulation and upon submission to the University of the Philippines Law Center. This AO is subject for review after 2 years from its issuance.

ENRIQUE T. ONA, MD Secretary of Health

Center for Drug Regulation and Research, Food and Drug Administration Food and Drug Administration Health Policy Development and Planning Bureau Office of the Secretary

Maria Lourdes C. Santiago, MSc, MM Officer-in-Charge Date:

Kenneth Y. Hartigan-Go, MD Acting Director IV

Lilibeth C. David, MD, MPH, CESO III Director IV

Jaime Lagahid, MD Head Executive Assistant

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