Revision of the general pharmaceutical legislation – policy brief

By David Ponente, Account Executive, Brussels

Background

In November 2020, the European Commission presented a Pharmaceutical Strategy for Europe , placing patients at the centre of the project whilst simultaneously allowing the European pharmaceutical industry to thrive.

Prior to this, the most recent comprehensive revision took place in 2004. In the almost 20 years since this revision, the pharmaceutical sector has changed, becoming more globalised, both in terms of development and manufacturing. In the meantime, the roles of “big pharma“ and SMEs have transformed increasingly, driving innovation and development, with these changes taken over by big pharma through acquisitions or licence agreements.

However, there continues to be unmet medical needs, and medicines approved in Europe are still not reaching patients quickly enough or are not equally accessible across all Member States. Indeed, not all patients benefit from innovation, as medicines can sometimes be unaffordable and security of supply remains uncertain. While the pharmaceutical legislation creates regulatory incentives for innovation and regulatory tools, these products do not always reach the patient, with differing levels of access across the EU.

Shortages of medicinal productsin many EU/EEA countries are growing and causing concerns for policymakers and patients. Consequences of such shortages include decreased quality of treatment received by patients and increased burden on health systems and on healthcare professionals, who need to identify and provide alternative treatments.

Scientific and technological developments and digitalisation are not fully exploited, and the environmental impact of medicinal products needs attention. In addition, the authorisation system could be simplified to keep up with global regulatory competition. In response to these issues, the pharmaceutical strategy for Europe should, in theory, be the solution to the EU’s supply of safe and affordable medicinal products and supporting the EU pharmaceutical industry’s innovation efforts.

Analysis and objectives of the legislation

Overall, the general objective of the new pharmaceutical package is to guarantee a high level of public health by ensuring the quality, safety and efficacy of medicinal products for EU patients; and to harmonise the internal market for the supervision and control of medicinal products and the rights and duties incumbent upon the competent authorities of the Member States.

Nonetheless, more specifically, the proposal will aim to:

1. Make sure all patients across the EU have timely and equitable access to safe, effective, and affordable medicines;
2. Address medicine shortages and enhance security of supply;
3. Ensure medicines are always available and affordable to all European patients;
4. Offer an attractive innovation-and competition-friendly environment for R&D, and production of medicines in Europe, especially for unmet medical needs;
5. Reduce the regulatory burden and provide a flexible regulatory framework;
6. Make medicines more environmentally sustainable.
7. Finally, the proposal will give a special focus to tackle AMR.

The European Commission has developed this proposal with a patient-centric approach. The objective aims to (1) promote equal access to medicines for all EU citizens across the bloc, including in smaller Member States, after a timely authorisation under the EU pharmaceutical system. After a medicine has been developed and becomes available under the EU pharmaceutical system, patient access has two dimensions. The first one focuses on equal access to/market entry of innovative medicines across the EU while the second one aims to ensure continuous supply and limited shortages of all medicines. Regarding the first dimension (i), the Commission aims to provide motivation to companies through incentives to rapidly reach an agreement with Member States. As for the second one, the objective is to enhance and harmonise notification requirements and obligations to ensure appropriate and continued supply across Member States.

In parallel to the previous point, the text of the proposal also includes (2) new requirements for monitoring shortages of medicines by national authorities and the European Medicines Association, as well as a stronger coordination role for the latter. Furthermore, the revision is also planning earlier notifications of shortages and withdrawals of medicines and the development and maintenance of shortage prevention plans. An EU-wide list of critical medicines will be established, and supply chain vulnerabilities of these medicines will be assessed, with specific recommendations on measures to be taken by companies and other supply chain stakeholders.

In addition, one of the objectives is (3) to enable competition, to promote affordability of medicines for health systems across the EU and ensure healthcare costs are sustainable for Member States. The message of the Commission is that affordability should not be promoted at the expense of innovation. Therefore, the underlying ambition is to create a balance where innovation is encouraged and rewarded for faster market entry of generic and biosimilar medicines to improve competition across the EU.

In terms of innovation, the European Commission is looking with this proposal (4) to promote R&D with a special focus on unmet medical needs, which represent a significant EU health burden. The revision should enable major biomedical research advances and ensure a pipeline of innovative new medicines for use across the EU. It should also support pharmaceutical R&D and strengthen the competitiveness of the research-based EU pharmaceutical sector. The Commission is also planning to encourage innovation to grant regulatory protection of up to a maximum of 12 years for innovative medicines, combined with the existing intellectual property rights. However, the reform will move the current system away from its regulatory protection of 10 years to propose a minimum period of regulatory protection of 8 years that can be extended.

Additionally, in order to further promote innovation and competitiveness, the proposal will (5) create a more flexible framework to reduce regulatory burden. Through simplifying and integrating requirements and pathways and reducing the burden for industry and public authorities alike, this initiative aims to increase the attractiveness of the EU regulatory system. The goal is to provide clarity on the appropriate bureaucratic pathway and reduce approval times and costs while maintaining high standards and robust assessment of the quality, safety, and efficacy of medicines. Leveraging digital technology and the use of electronic product information could support this objective.

Furthermore, the regulation also intends to strengthen the protection of the environment (6) by reducing the impact of pharmaceuticals and minimising medicine residues in the environment from their production, use, and disposal.

Finally, tackling antimicrobial resistance (AMR) is considered a priority. As part of the incentives offered by the Commission, vouchers will be granted to companies that invest in novel antimicrobials that can treat resistant pathogens, addressing the current market failure.

The revision also includes proposals for a new Directive and a new Regulation, which revise and replace the existing pharmaceutical legislation, including the legislation on medicines for children and for rare diseases.

Initial reactions

Pharmaceutical industry

By shaving off two years of incentives and allowing generics to be put onto the market more quickly, the proposal fails to encourage competitiveness and competition and is risking pushing pharmaceutical companies to move their production overseas.

According to the Director General of the European Federation of Pharmaceutical Industries and Associations (EFPIA), Nathalie Moll, the “proposal manages to undermine research and development in Europe while failing to address access to medicines for patients”.

Alexander Natz, Secretary General of the European Confederation of Pharmaceutical Entrepreneurs (EUCOPE), also warned that the proposals “risk reducing the EU’s global competitiveness in life sciences, thereby limiting the development and availability of innovative therapies.”

Civil societies

Consumer groups and civil society organizations have broadly welcomed the moves. Among others, the European Public Health Alliance (EPHA), an umbrella group of organizations that include civil society and health professionals, as well as Doctors Without Borders welcomed the proposal and communicated that with some polishing, it could restore balance in the European pharmaceutical scene.

European Parliament

For Members of the European Parliament, there seems to be a consensus that the proposal is heading in the right direction but willneed more work.

The Greens’ Tilly Metz stated that “it goes in the right direction, giving a more prominent place to the impact of the pharma industry on the environment, and accessibility and affordability of medicines in Europe,” she tweeted.

Renew’s Véronique Trillet-Lenoir showed cautious optimism and concern over the antimicrobial vouchers. Trillet-Lenoir said the proposal was “heading in the right direction … However, there are still many areas for improvement.”

Next steps

A feedback period has been launched on the open consultation page of the European Commission, which will run until 28 June 2023.

At the European Parliament level, Politico reported that the centre-right European People’s Party (EPP) and the centre-left Socialists and Democrats (S&D) will split responsibility for the two legal proposals contained in the new pharmaceutical package.

The two legislative texts will be officially referred to the ENVI committee by the Parliament President after consultation with the Parliament’s technical services. It will then be up to the political groups to appoint their official negotiator, known as a rapporteur, who will handle the files.

After the Parliament’s legislative position is negotiated in the committee, the European Parliament will vote before heading into negotiations with the Council of the EU. It will be compelling to follow the course of the procedure considering the priorities of the current Swedish and upcoming Spanish presidencies of the Council of the EU. Especially as Stockholm highlighted the importance of orphan drugs and the need to tackle medicine shortages.

Nonetheless, it is safe to assume that this proposal will prove delicate and divisive, especially considering the timing. Taking into account the upcoming EP election in 2024, the EU institutions will most likely try to make as much progress as possible before MEPs’ attention shifts to their re-election campaign.

For further insights or to get in touch with our EU policy experts, contact us here