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Bold New Vision for Pharma Legislation in the EU: Towards a Future of Innovation, Access, and Resilience

15 May 2023

The European Health Union was established in September of 2020 in response to the COVID-19 pandemic. The objective was to provide cross-border protection to all EU countries and address the inequities across all EU Member states. In 2023, the Union reached a significant milestone, as the European Commission (EC), European Centre for Disease Prevention And Control (ECDC), and the European Medicines Agency (EMA) underwent a major reform to enhance the life sciences industry's responsiveness, adaptability, and agility in meeting the demands of the twenty-first century.'

In late April 2023, the EU Commission published reforms to modernize the pharmaceutical industry. Their patient-centered strategy focuses on promoting innovation and competition while maintaining strict standards for approving safe and high-quality medicines. The aim is to bring together all 27 EU countries as a "Single market" and make the European Pharmaceutical System more patient-centered, future-proof, and crisis-resistant.

It also appears that the reform aims to enhance the security of supply of medicinal products by addressing systemic shortages and supply chain challenges. This is a critical aspect of ensuring access to and continued supply of critical medicinal products during health crises, which complements the EU's overall health response and the mission of the Health Emergency Preparedness and Response Authority (HERA) which was founded in 2021 post Covid-19 pandemic.

Divided Views: The Industry's Conflicting Opinions

Over the past three years, the European Commission (EC) has actively engaged in stakeholder consultation strategies to gather input and viewpoints from different groups. These consultations have informed the impact assessments conducted for revising the general pharmaceutical legislation and the orphan drugs and pediatric use legislation. The assessments have analyzed policy options A, B, and C, providing companies with a range of choices to consider.

Option A builds on the status quo and achieves the objectives mainly through new incentives.
Option B reaches the objectives through more obligations and oversight.
Option C adopts a 'quid pro 'quo' approach in the sense that positive behavior is rewarded and obligations are only used when there are no alternatives.

All the options included have a combination of incentives, obligations, and common elements aimed at simplifying and streamlining regulatory procedures leaving pharmaceutical companies to choose the best suitable policy for themselves.

But before EC announced the policies, many life sciences organizations expressed their mixed opinions on the proposed legislation, either directly or through trade associations. A predominant section appears to be more inclined to register their drugs in the EU regardless of changing regulations, as they find benefits in working through costing and reimbursement approaches, intellectual property rights, incentives, patient exposure, and brand recognition.

'Non-supporters' believe this change will be problematic for both large and small-scale life sciences organizations, as they may struggle to establish the new drugs. The critics indicate that major concerns revolve around reduced incentives, reduction of marketing exclusivity periods, and the introduction of a conditional data protection system that will affect intellectual property decisions on developing or launching new products in all-EU member states.

Five critical sections of the reform and actionable items for life sciences organizations

Life sciences organizations can consider the following strategies and actionable items:
Issues/ Key Reforms Practical Steps for Life Sciences Organizations
Issue: Unmet medical needs and market failures for non-orphan and pediatric medicines

Key reform: New framework supports innovation in highly unmet medical needs (HUMN) with incentives and obligations, including extended market protection. Invest in R&D but consider profit loss from access incentives and generics/biosimilars.
Embrace innovation and research for highly unmet medical needs (HUMN).
Leverage extended market protection (Option A/C) to maximize returns on HUMN innovations.
Seek additional rewards (Option A/C) by meeting milestones and improving healthcare.
Mitigate profit loss from access conditions and generics/biosimilars with diversification and lifecycle strategies.
Engage stakeholders (advocacy groups, healthcare professionals, etc.) to shape and implement the new framework.
Issue: Unequal access to affordable medicines for patients across the EU:

Key reform: The current reform emphasizes the need for a “Single Market for medicines” to ensure that all patients across the EU have timely and equitable access to safe, effective, and affordable medicines. This reform includes stricter obligations on companies, such as earlier reporting of pharmaceutical shortages and withdrawals and creating and upkeep plans to prevent shortages.
Support a "Single Market for medicines": Advocate for a unified and harmonized market
Strengthen reporting and transparency: Report shortages and withdrawals promptly and enhance transparency in pricing and availability to promote fair access.
Create comprehensive plans to prevent medicine shortages, and identify risks, for a resilient supply chain.
Leverage technology and innovation: Explore digital solutions, telemedicine, and research new delivery models to enhance access and efficiency in healthcare services.
In a nutshell, use all means to enhance patient centricity- ensuring timely availability of safe and effective medicines to all patients in need.
Issue: Inefficiency and administrative burden of regulatory procedures:

Key reform: Modified approach to Regulatory submissions and approvals will enable the EU to accelerate developing and approving new medicines, thereby improving patient access to innovative treatments. For instance, EMA will have 180 instead of 210 days for its assessment. For the authorization, the Commission will have 46 instead of 67 days. This will help to reduce the current average of around 400 days between submission and market authorization.
Faster and more efficient Regulatory reviews/authorizations will call for an even greater preparedness- Streamline internal processes to ensure efficiency and compliance to the revised demands and plan accordingly for scientific advice, submissions, HA query management, audits and inspections preparedness, manufacturing, supply chain management, product launch, and post marketing requirements.
Collaborate with regulatory authorities: Proactively communicate and seek scientific advice to expedite evaluation and approval.
Involve patients: Incorporate patient perspectives to enhance the development and evaluation of medicines.
Embrace technology: Utilize digital solutions for data management and streamline documentation.
Stay updated and adapt: Monitor regulatory changes and adjust strategies accordingly.
Issue: Vulnerability of supply of medicines, quality, environmental challenges, and sustainability:

Key reform: The reform aims to establish a system of cooperation and exchange of information between Member States and the European Medicines Agency (EMA) to detect and prevent shortages. It includes measures to improve the management of stocks and production, such as greater transparency of stock levels, early notification of supply chain issues, and mandatory reporting by manufacturers of potential supply shortages.
Collaborate with member states and EMA to detect and prevent medicine shortages. Improve stock management, enhance transparency, and provide early notification of supply chain issues.
Artwork and labeling to be made even more efficient to ensure availability of the most updated information to patients and healthcare practitioners, while promptly managing the supply chain and logistics.
Strengthen measures to assess and minimize the environmental risks of pharmaceuticals. Increase transparency and traceability of medicines. Implement measures to prevent falsified medicines from entering the supply chain.
Issue: Tackling antimicrobial resistance (AMR):

Key reform: In addition to the incentives for investing in innovative antibiotics, the EU is also taking measures to improve the responsible use of antimicrobials. Overall, the EU is committed to taking a comprehensive and multi-faceted approach to address AMR, recognizing the urgency and severity of this global health threat.
Collaborate with stakeholders to develop and implement national action plans for responsible use of antimicrobials. Support initiatives to strengthen surveillance of resistance patterns.
Invest in R&D of new diagnostic tools for more accurate and targeted prescribing of antibiotics.
Engage in partnerships and collaborations to support the R&D of new antimicrobials and alternative therapies. Advocate for incentives that encourage investment.
Contribute to public awareness campaigns about AMR by educating healthcare professionals and patients about the risks and appropriate use of antibiotics.
In addition to specific actionable items, life sciences organizations must consider these common steps:
Evaluate options A, B, and C: To understand suitability, benefits, and drawbacks of each option before adopting the reform
Foster collaboration and partnerships: Participate actively in discussions with stakeholders, contribute insights to shape policies, and foster partnerships
Embrace digital transformation: Leverage digital technologies to streamline processes, enhance data management, and improve decision-making

Conclusion

The regulation will now be discussed by the Parliament and the Council and after finalization, the adoption date of the new legislation will be released.

Although acceptance of any change is always challenging, and such a profound impact regulation change will come with a certain implementation period. By then, industries can be prepared to welcome the legislation and work towards changes that immediately impact the company. As has always been, an early move will decide who derives the maximum benefit from this reform.

Overall, with the new reforms coming into action, the potential benefits to patients, healthcare providers, and companies are enormous. The companies must continue to innovate and stay on top of best practices to remain competitive and focus on patient safety, while ensuring the right use and timely availability of medicines. A combination of strategic regulatory approach, continuing dialogue and discussions with Regulatory Authorities, proactive planning and agile implementation, patient centricity, and an effective compliance framework along with strategic partnerships can help companies stay ahead in the game.

These measures will go a long way in helping derive value out of the EU initiative on the many reforms, aimed at making the entire drug development process and availability much more efficient and streamlined.

Author

Vladimir Penkrat
Vladimir Penkrat
Dr. Sonica S. Batra
Dr. Sonica S. Batra
Lakshmi Nair
Lakshmi Nair