Online sale of drugs: recent trends in EU case law

Within this framework, national legislation is increasingly required to reckon with the evolving case law of the European Courts, which aim to safeguard both the freedom of competition and the free exercise of economic activity within the internal market.

Italian legal framework governing online sales of drugs

The online sale of drugs is governed at the national level by Article 112-quater of the Drugs Code and further detailed in two notes issued by the Ministry of Health in January and May 2016. More specifically, the online sale of non-prescription drugs is permitted under the following conditions: (i) only pharmacies and certain authorized commercial establishments are permitted to engage in distance selling; (ii) these authorized entities must obtain prior authorization from the competent local authority, following the submission of specific information (e.g., business name, commencement date of online sales, website address); (iii) the website used for such sales must include certain mandatory elements, including the official Ministry logo with a hyperlink to the Ministry’s website, where the details of the authorization granted are published.

The procedure for online sales thus comprises two distinct phases: an initial authorization phase by the competent local authority, followed by an “accreditation” phase in which the Ministry issues the unique logo and corresponding hyperlink.

Given that the online sale of drugs  is permitted only when conducted by authorized entities (i.e., pharmacies and para-pharmacies) through duly authorized websites – strictly linked to the physical premises dispensing the products to the public – the Ministry of Health, through its 2016 note, expressly prohibited at the national level the use of intermediary websites, e-commerce platforms (marketplaces), or mobile applications (apps) for the online sale of drugs. It also prohibited the use of intermediary technological platforms that, based on the product selected by the user, redirect the user to an accredited seller chosen by the system.

According to the Ministry, the use of such intermediary platforms is incompatible with the right of citizens to freely choose their pharmacy, as enshrined in Law No. 475/1998. This clarification effectively prohibits, at the national level, not only the sale of drugs through such platforms but also any intermediary activity that merely facilitates the matching of supply and demand for medicinal products.

Intermediation in the online sale of drugs under CJEU case law

The distinction between selling drugs and intermediation services was recently addressed by the Court of Justice of the European Union (CJEU) in its judgment of 29 February 2024, Case C-606/21. The Court clarified the circumstances under which Member States may impose restrictions and limitations on the activities of operators. The Court’s interpretation appears to legitimise the mere intermediation of non-prescription drugs, which are not subject to the constraints of the Directive.

First and foremost, the CJEU defines the activity of intermediation in medicinal products, within the meaning of the relevant European legislation (Directive 98/34/EC, now replaced by Directive 2015/1535), as the activity of connecting pharmacists and customers for the sale of non-prescription drugs. This intermediation activity falls under the definition of an “information society service,” which, by its nature, is not subject to any prior authorization and is defined as “any service normally provided for remuneration, at a distance, by electronic means and at the individual request of a recipient of services.” More specifically:

a) Remuneration: The remuneration for the service need not be paid by the beneficiary of the service. It is therefore irrelevant that the service is provided free of charge to the person purchasing the medicinal product, as it gives rise to a contractual relationship between the service provider and each pharmacist using the service, accompanied by a payment. In this regard, the CJEU held that it is also irrelevant whether pharmacists pay a flat fee or subscribe to a monthly plan.

b) Distance selling and electronic provision: A service is provided at a distance and by electronic means when the connection between the customer and the pharmacist is established via a website, without the simultaneous physical presence of the service provider and the customer or pharmacist.

c) Individual request by a pharmacist: Typically, pharmacists must register with the intermediary’s website/platform to benefit from the service; conversely, customers must create an account to access the pharmacists’ websites in order to purchase drugs.

According to the CJEU, where a service meets the above criteria and merely connects customers with providers of another, distinct service, it must be classified as a service of intermediation, and not as the direct sale of drugs. Once the distinction between intermediation and the online sale of medicinal products is established, the Court held that Member States may not, on the basis of the Directive, prohibit the provision of an online service that merely connects pharmacists and customers for the purpose of selling non-prescription medicines on the pharmacists’ own websites, since such a service does not constitute the public supply of medicinal products.

In the area of online intermediation of medicinal product sales, the CJEU’s decision thus appears to favour a liberalisation of such activity, in contrast with the position taken by the Ministry of Health in its note of 2016, which appears to be more restrictive than what is expressly provided for under Italian law. Pending a possible revision of the note, new business models offering intermediation services for the purchase of drugs – potentially including price comparison tools or similar features – may be explored with greater confidence. Naturally, this is provided that the intermediation platform limits itself to connecting users and sellers, without intervening in the sale itself.

Discounts and other promotional initiatives

With regard to discounts on drugs paid for out-of-pocket by patients, it should be recalled that, under the current national regulatory framework^[2], pharmacies and authorized retailers may apply discounts directly to customers, provided that adequate prior information is given to the clientele and that the same conditions are applied to all purchasers without any discrimination. Accordingly, as also specified in the Ministry of Health’s circular of January 2016, the same discounts must be applied to medicinal products regardless of whether they are purchased in a physical retail outlet or remotely via an authorized website.

On this point, a divergent position has been expressed by the Italian Competition Authority (Autorità Garante della Concorrenza e del Mercato, AGCM), which has advocated for a shift towards greater market openness and liberalisation of pricing policies. The AGCM supports allowing discounts and commercial strategies that benefit consumers, such as loyalty cards, cashback schemes, or discounts based on customer categories. More specifically, in its 2024 reform proposals for the annual competition law^[3], the Authority argued that: (i) the current legislation on discounts for drugs should already be interpreted as requiring only that “adequate information” be provided to customers, without mandating that the discount be applied “uniformly to all purchasers”; and (ii) to eliminate any ambiguity, it should be made explicit that discounts on all drugs distributed by pharmacies, para-pharmacies, and authorized retailers may be applied freely, including in a differentiated manner (i.e., allowing for loyalty schemes, reward systems, or discounts for specific patient categories).

The position of the EU Court of Justice on promotion initiatives

While the Court of Justice has introduced elements of openness and liberalisation with respect to the concept of intermediation in the purchase of medicinal products, the same cannot be said for discounts and promotional initiatives. In the recent DocMorris case^[4], the Court was called upon to assess certain promotional practices implemented by the company DocMorris, including:
(i) the application of discounts on non-prescription drugs; and (ii) the offer of vouchers – redeemable either by the customer or a friend – for the subsequent purchase of non-prescription drugs or other non-medicinal goods.

The preliminary question referred to the CJEU concerned whether such initiatives could be classified as advertising of drugs and whether national legislation restricting such initiatives was legitimate.

Starting from the definition of advertising as “any form of information, canvassing activity or inducement designed to promote the prescription, supply, sale or consumption of medicinal products,” the Court held that advertising exists where the promotional message is intended to influence the choice of a specific medicinal product, rather than merely the choice of pharmacy.

On this basis, the Court found that initiatives such as those under point (i), which concern prescription-only drugs – where the decision to prescribe lies exclusively with the physician – cannot influence the customer’s decision to purchase a specific medicinal product. Therefore, the promotional message conveyed by such actions does not qualify as advertising.

Conversely, the promotional actions under point (ii), which concern not only prescription drugs but also other products (notably non-prescription drugs), must be classified as advertising of medicinal products. These promotional strategies encourage the purchase of non-prescription drugs: in the absence of a prescribing physician, the recipient of the voucher, attracted by the economic benefit, may use it to obtain non-prescription medicines at a reduced price.

In the case at hand, the Court concluded that promotional actions such as those described under point (ii), by assimilating non-prescription drugs to other consumer goods offered by a pharmacy, may lead to irrational and excessive use of such products. This assimilation, according to the Court, diverts the consumer from an objective assessment of the need to purchase the medicinal product.

Having clarified this, the Court held that both types of initiatives may be prohibited by Member States, provided that such restrictions are aimed at protecting consumers where there is a serious and substantial risk of harm (which must be assessed concretely). Moreover, as with any restriction on the fundamental freedoms guaranteed by the TFEU, the limitation must meet the requirements of necessity and proportionality in relation to the objective pursued.

Potential national impact

With this ruling – which notably diverges from the conclusions of the Advocate General in the same case, delivered on 24 October 2024 – the Court of Justice appears to take a step back from the path of liberalising commercial initiatives concerning non-prescription drugs, as it brings such initiatives under the category of medicinal product advertising, which may be restricted or prohibited by Member States.

Evaluating this position in light of the Italian context, it is certainly consistent with the interpretation historically adopted by the Ministry of Health (see, for example, the Ministry’s note of 30 December 2020, which addressed a promotional initiative very similar to that assessed by the Court and expressed a negative opinion on its admissibility).

However, this position appears open to criticism: on the one hand, asserting that discounts on prescription drugs do not constitute advertising – because the decision lies with the prescribing physician and thus cannot influence consumer choice – would imply that no form of promotion for such medicines could be classified as advertising, thereby rendering the prohibition on public advertising of prescription drugs effectively meaningless. On the other hand, classifying as drug advertising (and thus allowing Member States to prohibit or restrict) any purely commercial initiative relating to non-prescription drugs – on the grounds that it might encourage excessive consumption – runs counter to the liberalisation of pricing in favour of competition and consumer benefit, as advocated by the AGCM and, in other contexts, supported by the Court itself^[5].

With regard to the first point, we do not believe that this decision will have a significant impact on the Italian regulatory framework, where the application of discounts on prescription-only medicinal products is permitted, provided that such products are paid for directly by the patient (while discounts are not allowed on medicines reimbursed by the National Health Service). Following this interpretation, one could argue that it is permissible to advertise discounts on prescription medicines paid out-of-pocket by patients. However, since the online sale of prescription medicines is prohibited in Italy, such an opening appears to be of limited practical relevance, unless one envisages communication through alternative channels. Conversely, this ruling may serve to reinforce the restrictive interpretation adopted by the Ministry of Health with regard to various types of commercial initiatives – albeit previously justified on different grounds, namely the requirement to apply uniform conditions to all potential purchasers.

[1] Legislative Decree No. 219/2006.

[2] Article 5 of Legislative Decree No. 223/2006; Article 32 of Law Decree No. 201/2011; Article 11 of Law Decree No. 1/2012.

[3] AGCM Report “AS2045 – Proposte di riforma concorrenziale ai fini della legge annuale per il mercato e la concorrenza – anno 2024”, dated 20 December 2024.

[4] Court of Justice of the European Union, Case C-517/23, judgment of 27 February 2025.

[5] This position appears to be consistent with the earlier Euroaptieka case (Case C-530/20), decided by the CJEU on 22 December 2022.