As part of the EU's aim to create a stronger European Health Union, the European Commission ("Commission") published a Pharmaceutical Strategy for the EU ("Strategy") in November 2020. More recently, the COVID-19 pandemic has highlighted several shortcomings in the EU's current pharmaceutical system and showed the vulnerability of global supply chains. The Commission now plans to review and revise the EU's general legislation on medicines for human use to ensure "a future-proof and crisis-resistant medicines regulatory system". Simultaneously, the Member States of the EU, such as Finland, are dealing with some severe challenges with the economic sustainability of their healthcare systems. We are now facing a true challenge - how to boost the pharmaceutical sector's global competitiveness and create a regulatory environment, which is attractive for innovation and investment in an economically sustainable way?
Although the whole package of measures is yet to be released, the Strategy is likely to influence the EU's pharmaceutical regulatory framework significantly and affect pharmaceutical companies in many ways. The Commission is considering a potential reform in a wide range of areas. The three main areas of the Strategy are: (i) the availability and accessibility of pharmaceutical products, (ii) needs driven innovation and global competitiveness and (iii) crisis-resistant supply chain for pharmaceutical products.
Unmet medical needs gain the spotlight
Currently investments in the pharmaceutical sector do not focus on the greatest unmet needs as such needs lack commercial interest or the science is limited. The Commission is hoping to put research priority on and direct investments to areas of high medical need and is looking to create a tailored system of incentives to stimulate innovation.
The incentives do not come without obligations. The Commission is looking into measures to encourage pharmaceutical companies to market their market-approved products in most or all member states instead of just focusing on the largest markets. In addition, more transparent reporting of R&D costs has been addressed as well. The aim of transparency is to help Member States to make better pricing decisions.
Both conditions create new risks for pharmaceutical companies. Entering markets, which have previously been out-of-focus means, e.g., finding new stakeholders to assist in the steps it takes to launch new products. On the other hand, smaller markets, such as Finland, can benefit from the broader launches as they increase patient access to pharmaceutical products which would only enter the larger markets without such incentive. To minimise the risks associated with reporting of R&D expenses, the framework of what is considered as an R&D cost should be clear. The risk of revealing confidential information when reporting transparently should also be acknowledged.
Boosting the personalised medicine ecosystem
The Commission has a number of other initiatives ongoing in the pharmaceutical legal and regulatory framework. The other initiatives, such as the reviews of orphan and paediatric regulations and supplementary protection certificate regulation, together with the revision of human medicines law are likely to lead to significant changes in the coming years for pharmaceutical companies and investments in the pharmaceutical sector.
Notwithstanding the challenges, Finland is in a unique position in the creation of an innovation-friendly ecosystem for personalised medicine. Among other things, significant legislative efforts have been made to promote the advanced use of genomic data. The initiative on a Genome Act addresses the establishment of a genome centre and the use of genomic data. The ongoing comprehensive revision of the Biobank Act of 2013 reconciles with many needs, one of which is the implementing of GDPR. The recent Act on the Secondary Use of Health and Social Data aims to facilitate the processing of and access to health data for secondary purposes. Together with the EU-level work, Finland is taking steps to becoming an even stronger player in the pharmaceutical research field.
Yet, many aspects are still to be resolved; to harness the full potential of genomic data for personalised medicine, it should be made possible to link it to other data types and to enable cross-border transfers of such data. There is an urgent need for harmonisation. The final outcome of the wider EU regulatory framework for personalised medicine, including e.g. the regulation on the European Health Data Space and the EU Data Governance Act, will determine whether and how the advanced use of genomic data will be enabled and enhanced.
Future outlook
The proposal for the changes in the EU's general legislation on medicines for human use was expected from the Commission by the end of this year, but there has been a report that an impact assessment on the planned changes has been rejected by the Regulatory Scrutiny Board ("Board") within the Commission1. The Board's job is to ensure the quality of major EU legislative initiatives. Due to the rejection, the proposal is not likely to be published before 2023. As the revision will be major to industry stakeholders, the Commission should take the required time to review the Board's comments and ensure the proposal is acceptable for both the industry and patients.
It is too early to evaluate whether the changes will achieve the aims of the Strategy and to what extent they will affect the operators in the pharmaceutical field. It is likely that various stakeholders will experience the impact of the package differently, based on which segment of the pharmaceutical field they operate in.
Footnote
1 Politico. Push for fairer pharma rules hits brick wall of business interests. https://www.politico.eu/article/push-for-fairer-pharma-rules-hits-brick-wall-of-business-interests/, accessed 4 October 2022.
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