Explainer: After COVID and drug shortages, EU revamps drug laws
LONDON, April 26 - The EU is revamping laws governing the 136 billion euro ($148 billion) pharmaceuticals industry aimed at reviving investment and boosting access to affordable drugs at a time when health budgets have been drained by the costs of treating COVID-19.
Shortages of critical drugs from antibiotics to painkillers this winter and the COVID pandemic exposed problems caused by declining manufacturing in Europe, complicated supply chains and a lack of preparedness for a global public health emergency.
Brussels has faced growing pressure to fix this.
The reforms, however, pit the industry - from big pharma to biotech startups which together represent about 1.5% of the bloc's GDP - against patient groups, with little consensus other than a need to overhaul outdated rules.
The European Commission published its draft - the biggest overhaul of existing medical laws in two decades - on April 26.
EU Health Commissioner Stella Kyriakides told a news conference the proposals aimed to give all Europeans equal and timely access to medicines at more affordable costs, while supporting an innovative and competitive industry.
Here are the details:
GENERALLY SHORTER PROTECTION
Brussels proposes to shorten the period of protections companies get before generics can enter the market from 10 to eight years.
But in an attempt to improve access to medicines across the EU, the Commission will offer companies an option to gain back two years of exclusivity for a product if they launch it in all 27 member states.
Under the existing 2004 law, companies can get up to 11 years of protection. The new proposals could see companies get up to 12 years of protection in certain limited cases, for example if the product addresses an "unmet medical need".
Drugmakers like Denmark's Novo Nordisk (NOVOb.CO) and Germany's Bayer (BAYGn.DE), and biotech firms criticise the plan. They say Europe is already losing out as a destination for research and development (R&D) and innovation is suffering.
Big pharma lobby EFPIA says R&D investment in Europe has fallen by 25% over the past 20 years.
Cuts to market exclusivity would damage work on so-called “orphan” drugs which treat rare conditions affecting fewer than five in 10,000 people in the EU, it warns.
Companies will be obliged to disclose some R&D costs, including public funding received for a new drug, when filing for regulatory approval and the information will be made public. The Commission hopes this will support EU states in negotiations with drugmakers to make medicines more affordable.
Consumer groups, which say pharma companies exaggerate costs to justify high drug prices, welcome this, particularly after Brussels ceded to drugmakers' requests to keep terms of COVID vaccine contracts secret.
The Standing Committee of European Doctors (CPME), a group of national medical associations, praised the emphasis on R&D transparency as a win for patients.
A MODERN REGULATOR
Several proposals aim to streamline the European Medicines Agency (EMA), reducing the number of scientific committees and cutting the time the regulator takes to review new medicines. The review period is on average nearly double that of U.S. authorities.
The proposed legislation calls for the agency to establish a "regulatory sandbox" to rapidly test innovative technologies and treatments, potentially easing the path to market for companies with novel products.
The reform also proposes that paper leaflets for medicines be replaced by digital ones, cutting production costs. Consumer groups warn this risks patients having inadequate information about prescription drugs
TACKLING DRUG SHORTAGES
The draft proposes that companies notify the EMA earlier of shortages or withdrawals of their products and hold bigger stocks of medicines deemed essential, such as the antibiotics in shortage this winter.
Brussels believes this will help avoid future shortfalls. Companies say it is difficult to predict supply issues months ahead, while medical associations say regulators and doctors need time to react to shortages and withdrawals of medicines.
The draft calls for the EU to develop a "critical medicines list" to help monitor the availability of essential medicines.
Companies want the EU to establish a bloc-wide database on medicine consumption to help forecast surges in demand like those that contributed to this winter's antibiotics crisis, but this was not included in the draft.
After decades without a breakthrough in antibiotics discovery, the EU wants to incentivise drugmakers to invest in developing new ones. Experts warn the problem of drug-resistant "superbugs" is growing and could spawn a global emergency worse than the COVID pandemic.
Companies bringing a new antibiotic to market may get an additional year of exclusivity in the EU for another medicine they have on the market. The number of so-called "exclusivity vouchers" - which the EU estimates will cost 500 million euros each - will be limited to 10 and the scheme will be evaluated after 10 years.
Fourteen member states have written to the Commission, criticising the idea as costly and harmful for consumers as it could disrupt the generic drugs market.
WHEN WILL THE CHANGES BECOME LAW?
Now the Commission has published the draft, it will thrash out the final details with the European Parliament and member states.
Lawyers representing industry don't expect legislation to be adopted before 2025. Next year's EU elections may delays things further.
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