Radical Shake-Up In Store For Entire EU Pharma Legislation
Commission Proposals Tackle Regulation, Pricing, Shortages, Innovation – And Much More
Executive Summary
The EU pharmaceutical strategy published on 25 November will be the first step in a “complete overhaul” of the medicines legislative framework to be proposed in about two years’ time, says the European Commission.
The new EU pharmaceutical strategy presented today encompasses a whole raft of proposed legislative and regulatory changes, such as the streamlining of drug approval procedures, better access to affordable medicines, and strengthened EU-level cooperation on pricing and reimbursement.
On the cards are measures to boost competition from cheaper generic and biosimilar drugs, align clinical trials to patient needs, and strengthen supply chains to avoid drug shortages. The strategy, part of the proposed "EU Health Union," will also endeavor to support R&D into new treatments and vaccines and increase the competitiveness of the European pharmaceutical industry.
The importance of what is being proposed was reflected in the fact that two senior European Commission officials were on hand to present the ambitious plans.
“We will be completely overhauling the entire legislative medicines framework – a set of rules that is 20 years old and badly needs modernization,” commission vice-president Margaritis Schinas told a press conference on 25 November.
“But it will be long process. Today is only the beginning and concrete proposals will be presented not only in the next two years – this is a strand of work that will take us throughout the mandate of this commission.”
“We will be completely overhauling the entire legislative medicines framework – a set of rules that is 20 years old and badly needs modernization” – European Commission vice-president Margaritis Schinas
Schinas said the ambition was to build a “solid, modern EU legislative framework for pharma, and this will allow us once again to affirm that the EU Health Union is not just a soundbite or a slogan, but an emerging reality.”
The pharmaceutical strategy has been under development for some time. A “roadmap” for the strategy was put out for consultation in June, and the outcomes of the consultation, and the key issues needing to be addressed, were discussed at a TOPRA conference at the beginning of October. (Also see "EU Pharma Strategy To Balance Innovation Incentives & Competition" - Pink Sheet, 5 Oct, 2020.) The commission says that COVID-19 has thrown a spotlight on many of the deficiencies in the current regulatory arrangements.
Health commissioner Stella Kyriakides told the press conference that the COVID-19 pandemic had shown that access to affordable medicines was “a fundamental right” for citizens, “especially where health care systems are under pressure.” The pharmaceutical strategy aimed to “deliver at all times for patients,” she said, and would also help to ensure the pharmaceutical industry could “continue to be a world leader.”
The strategy will be discussed at political level by EU ministers on 2 December, and its implementation is due to begin immediately after adoption. The various actions and projects will be rolled out gradually, starting with the first proposals in the coming months, including the ongoing revision of the European Medicines Agency fees regulation and the EU orphan and pediatric legislation.
“Depending on the evaluation process, the strategy plans a proposal for revision of the basic pharmaceutical acts in late 2022,” the commission declared.
Regulatory Approaches To Be Reviewed
The commission says the strategy is needed to tackle “long-standing weaknesses” in the medicines area in the EU, which have been “further exacerbated and thrown into sharp focus by the current COVID-10 pandemic.” The key challenges the EU faces is affordability and access to medicines, drug shortages, and the need to help the pharma industry to innovate and “be a world leader in a fast changing global environment.”
On the regulatory front, it says there is a need to look at new approaches to assessing safety and efficacy evidence, and to “bring EU regulatory approval times onto par with those in other parts of the world.” The experience of the EMA during the COVID-19 pandemic, for example in the rolling review of incoming evidence on vaccines to speed up assessment, “will inform future action.”
"Long-standing weaknesses [in the area of medicines in the EU] have been further exacerbated and thrown into sharp focus by the current COVID-10 pandemic" – European Commission
The commission plans to revisit the role of the existing regulatory tools, such as priority review and scientific advice, in the development of innovative products for unmet medical needs. It will also look at simplifying and streamlining procedures and reduce costs, with the management of variations and the assessment of quality data on active substances a key area of focus.
EMA Funding
In light of concerns that the EMA needs more resources to do its work properly, the commission says that “regulators also need to adapt to new scientific and technological developments by upscaling necessary expertise and achieving operational excellence to deal with novel and more complex therapies.”
The commission identifies the “the availability of sufficient funding at all levels" as one important factor in this respect. "The EMA fees system is key in funding regulatory activities at EU level and ensuring coverage of the relevant costs. The commission will consider this in the upcoming revision of the EMA fee legislation.”
"The commission will revise the basic pharmaceutical legislation to enhance security of supply and address shortages – European Commission
On tackling medicines shortages, the commission points out the complex nature of the root causes such as marketing strategies, parallel trade, weak public service obligations, supply quotas and pricing and reimbursement policies. It says it will "therefore revise the basic pharmaceutical legislation to enhance security of supply and address shortages.”
The commission is to address these issues in a study that has just begun and which Schinas said was expected to be completed sometime next year. Shortages will also be monitored, and measures taken to mitigate them, under the proposed EU Health Union package, in tandem with the establishment of a European Emergency Response Authority (HERA). (Also see "EU Prepares To Reveal Pharma Strategy" - Pink Sheet, 19 Nov, 2020.) “We are now opening a process that will lead to legislative initiatives, which might include obligations of supply and transparency of stocks,” Schinas added.
Linked to this is the need to achieve “strategic autonomy” in the supply of medicines and raw materials to the EU, “while preserving an open economy,” the commission says. Concern has been expressed that “onshoring” more pharmaceutical production to the EU would be a form of protectionism that could harm other countries manufacturing these materials. But Kyriakides rejected this suggestion, saying: “I want to be clear that protectionism is not in the DNA of the EU.”
EU member states “increasingly face uncertainties over the real-life effectiveness and related overall costs of new medicines" – European Commission
Another key aim of the strategy is to increase the availability of affordable medicines. “The business model has moved from selling blockbusters to marketing ‘niche-busters’,” the commission says. “Often, new products are priced even higher, with growing uncertainty as to their real-life effectiveness and related overall costs.”
EU member states “increasingly face uncertainties over the real-life effectiveness and related overall costs of new medicines,” it continues. “Moreover, competition, which should in principle drive down prices and thereby increase affordability, is becoming less straightforward over time as new types of products make up a growing share of budgets.”
The commission therefore proposes to support greater cooperation on pricing and reimbursement policies among the member states. It will “foster transparency of price information to help member states take better pricing and reimbursement decisions, also considering possible knock-on effects for innovation”. A new group will be launched to “steer cooperation between national pricing and reimbursement authorities and healthcare payers” over the 2021-24 period.
This will be complemented by promoting collaboration on health technology assessments through the proposed EU HTA Regulation, particularly in terms of cooperation on clinical evidence requirements and clinical trial design, to support “timely and evidence-based decision making” on patient access to new medicines.
Also at EU level, action will be taken to encourage national drug purchasers to cooperate on “smart and innovative” public procurement mechanisms for medicines and medical devices in order to “foster competition and improve access.”
Price pressure will also be brought to bear through stronger generic and biosimilar competition – the commission says that targeted policies for such products will be considered, including “removal of barriers that delay their timely entry to market.”
In a related move, the commission will look at strengthening the EU competition rules to better address strategies by originator companies that “hinder the entry or expansion of the more affordable medicines of their generic and biosimilar competitors.”
On top of that, the system of incentives and obligations in the pharmaceutical legislation will be reviewed to address the “lack of transparency of research costs or return on investment” that the commission says can affect affordability and access.
Promoting Innovation And Competitiveness
Since the current pharmaceutical legislation was adopted, “the so-called ‘fourth industrial revolution’ has shown us that science evolves and new technologies and digitalization provide new opportunities,” the commission notes.
One topical example is that “vaccines developed for COVID-19 relying on new techniques (eg, mRNA) show how innovative trends can transform traditional development approaches, and reduce timelines.”
"A competitive and resource-efficient EU pharmaceutical industry is of strategic interest” in terms of public health, economic growth, jobs, trade and science – European Commission
In that context, “the current pharmaceutical legislation may need to be revisited to avoid bottlenecks or regulatory gaps and to encourage innovation, new breakthroughs and EU competitiveness.” The commission will “work to ensure that the new framework supports innovative trial designs” and support more “patient-oriented design, planning and conduct of clinical trials.”
A “competitive and resource-efficient EU pharmaceutical industry is of strategic interest” in terms of public health, economic growth, jobs, trade and science, the commission says. A number of actions will be taken in this direction to create a “stable and flexible regulatory environment that offers legal certainty for investment and accommodates technological trends.”
This, it notes, includes having “balanced and fair incentives to reward and protect innovation and create the right conditions for companies of all sizes in the EU to be competitive.”
By 2025, it proposes to establish “interoperable data access infrastructure for the European Health Data Space in order to facilitate secure cross-border analysis of health data, which will be tested in 2021, followed by a pilot project involving the European Medicines Agency and the national authorities in the 2021-2025 period."
Intellectual Property Action Plan
The pharmaceutical strategy also mentions the “Intellectual Property Action Plan,” which the commission revealed on the same day and is intended to “simplify and streamline the EU pharmaceutical IP system.”
The action plan has a particular focus on strengthening the supplementary protection certificate regime, but also calls for more pooling of IP rights in the event of future health crises. More details of the plan will be given in a future Pink Sheet article.