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EU pharma reform: Winners and losers

EU pharma reform: Winners and losers

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If you want to understand the EU’s revision of its pharmaceutical rules, you could do worse than listen to Bono. 

“Where you live shouldn’t determine whether you live or die,” said the Irish frontman — a line repeated by Health Commissioner Stella Kyriakides at the unveiling of the legislative package on Wednesday.  

The first major overhaul of the bloc’s medicines regulations in 20 years aims to make access to medicines more secure and affordable, encourage innovation and reduce red tape. It touches on everything from medicines access to drug shortages, and the bloc’s pharma regulator.

The ink hasn’t even dried and it’s already provoking strong reactions, with the pharmaceutical industry lobby slating it, and patient activists giving it a cautious cheer. The battle lines seem set for the next stage of the process — heated discussions between lawmakers in the European Parliament and between EU countries in the Council. They’ll be racing against looming European Parliament elections in 2024.

But all that is to come. For now, POLITICO breaks down the main planks of the legislation for you — along with likely winners and losers.   

Carrots and sticks   

At the moment, patients in the EU’s poorer Eastern countries get new medicines years after their Western counterparts. The tough new proposals want to change that by shaving two years off the amount of time new branded medicines have to themselves on the market before competitors launch — and only allowing pharmaceutical companies to claw back these two years if they launch in all 27 EU markets. That means no more playing favorites with rich Western countries who pay more for medicines.

Companies can earn more competition-free time on the market in other ways — but they’re all designed to achieve particular goals. Medicines that treat an “unmet medical need” will get an extra six months, as will drugs for which the developer conducts a head-to-head clinical trial with a rival medicine (which makes drug pricing talks easier). Medicines that treat other diseases as well as their prime target will get an extra year of protection.

Under the proposals, branded medicines will be theoretically able to benefit from 12 years of competition-free market access — but very few drugs will meet all the criteria. The EU is essentially proposing to eat into pharma companies’ bottom lines to shape drug development in Europe — and it’s set to be one of the most heavily debated measures of the legislation.

Winners: Eastern European countries, patients with hard-to-treat diseases

Losers: Pharmaceutical companies

European Medicines Agency

Want to know how the Commission is touting this package as a win for pharma? Take a look at the regulator. There are big changes for the European Medicines Agency (EMA). They include more scientific advice to drugmakers, and faster assessments of the data. The proposals ax three specialized committees and maintain just two: One to assess if a drug meets market standards (CHMP), the other to review any safety concerns (PRAC). 

The agency will also be able to test out leftfield ideas in a regulatory sandbox and it will introduce two measures that globally showed their worth in the pandemic: rolling reviews and temporary emergency authorizations. Some procedures will be simplified, such as abolishing many marketing authorization renewals and moving to fully digital submissions.

Taken together, the Commission is advertising this as a score for pharma, presenting the EU as pro-innovation, with the agility to adapt with the science and flexibility for whatever is around the corner. Whether pharma agrees remains to be seen.

Winners: Pharma, potentially

Losers: Anyone in the EMA sidelined by the shakeup

Drug shortages

A leaked draft of the legislation, published by POLITICO in January, included a suite of proposals to avert drug shortages, which were a big problem for the Continent this winter. Following some vocal criticism from MEPs questioning whether Europe was doing enough to secure supply, these measures have been beefed up.

The important addition is the possibility of stockpiling: The Commission “may decide to adopt an implementing act to impose contingency stocks” of medicines or their ingredients. Companies or wholesalers would need to have bigger buffers, but potentially “other relevant entities” too — possibly the EU’s fledgling Health Emergency Preparedness and Response Authority (HERA).

Other measures include a requirement for companies to notify authorities six months ahead of possible supply issues and for companies to prepare shortage prevention plans. The EMA will establish a list of critical medicines by the end of this year to monitor their availability and help coordinate a response if critical shortages occur. It will also host a publicly available website listing all critical shortages of medicines.

Winners: Transparency campaigners, pharmacists, patients

Losers: There’s a lot of heavy uplift for industry, national regulators and the EMA to get this stuff up and running

Overriding drug patents 

The Commission wants to make it significantly easier to implement a compulsory license during an emergency — a tool that allows governments to override drug patents to ensure supply. The measures would allow governments to also suspend regulatory data protection — which protects the data that generics companies need to get approval for a copycat drug.

It’s a significant win for civil society. Data protection has been a thorn in the side of access-to-medicines campaigners as it prevents another company from being able to produce a drug even if a compulsory license is issued. Doctors Without Borders’ Dimitri Eynikel said that the plans “would be historic and should encourage other countries and regions to adopt similar measures to secure the availability of affordable medicines.”

The addition comes with several provisions, including that the data protection suspension complies with the specific duration and scope of the compulsory license. 

Winners: Civil society, countries without key drugs in emergencies 

Losers: Pharmaceutical companies

Beating the microbes  

The Commission has mooted a controversial incentive that would award developers of new antibiotics with a sellable voucher that grants a year of data protection for a drug of the company’s choice. The policy fix is aimed at combating the growing immunity of bacteria and other bugs to common medicines (antimicrobial resistance), and is favored by the pharmaceutical industry but opposed by many member countries because of its high cost. 

To qualify, the new antibiotic has to be considered a “priority antimicrobial.” That means it has to show “significant clinical benefit” in tackling antimicrobial resistance, and has to either: be a new class of antimicrobial drug, show a new mechanism of action different from any drug already authorized, or use a new active substance that can tackle especially tough infections.

The legislation sets an initial cap of 10 vouchers within a 15-year period after it enters into force.  

Winners: Branded pharmaceutical companies, people in hospitals at risk of infection 

Losers: Member countries’ health budgets, microbes  

Cleaning up the environment 

Toothless” is how one environment-focused think tanker has described current EU environmental rules for the pharmaceutical industry. That is set to change. For the first time, the EMA will be able to refuse to approve a medicine in cases where a medicines developer doesn’t provide enough information about potential environmental risks of their medicines. Also a first: developers of antibiotic drugs will need to evaluate the risk of exacerbating antimicrobial resistance through the manufacturing of their drugs, even in cases where it takes place outside the EU. 

Winners: The planet 

Losers: Pharmaceutical companies 

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