Strategic Implications of the Proposed EU Pharmaceutical Regulation

The proposed revision of the EU pharmaceutical legislation represents a shift in the regulatory landscape, with the primary objectives being enhancing patient access to medicines and securing the supply of medicinal products across the EU. The reform introduces a series of measures designed to streamline regulatory processes, foster innovation and address unmet medical needs. 

Key changes include:

• A new system of variable incentives for orphan and paediatric drugs.
• A strengthened framework for scientific and regulatory support from the European Medicines Agency (EMA).
• The simplification of the EMA's committee structure. 
• Additionally, the legislation proposes new mechanisms for granting temporary emergency marketing authorisations in response to public health crises.

The reform's strategic implications for the pharmaceutical industry are significant, particularly for companies operating within the EU. The proposed changes will require firms to adapt their strategies to remain competitive in an increasingly complex regulatory environment. This summary provides an overview of the most significant aspects of the proposed regulation as well as their potential impact on the industry.

The overarching goal of the proposed legislation is to guarantee a high level of public health by ensuring the quality, safety and efficacy of medicinal products available to EU patients. This is to be achieved through the harmonisation of the internal market for the supervision and control of medicinal products, ensuring consistent standards across all member states.

More specifically, the reform seeks to:

• Ensure that all patients across the EU have timely and equitable access to safe, effective and affordable medicines.
• Enhance the security of supply, ensuring that medicines are consistently available to patients regardless of their location within the EU.
• Create a competitive and innovation-friendly environment that encourages research, development and production of medicines within Europe.
• Promote the environmental sustainability of medicinal products, aligning with broader EU environmental goals.

These objectives reflect the EU's commitment to addressing both the immediate needs of patients and the long-term sustainability of the pharmaceutical industry.

The proposed reform introduces several key changes aimed at enhancing the efficiency and effectiveness of the EU pharmaceutical regulatory framework.

Variable incentives for rare diseases and paediatric medicines

One of the most notable changes is the introduction of a new system of variable incentives for the development and authorisation of medicinal products for rare diseases and children. This system is designed to better align incentives with the level of unmet medical needs, patient access and innovation.

Under the new framework, market exclusivity for orphan drugs and paediatric medicines will be modulated based on the extent to which these products address unmet medical needs and provide exceptional therapeutic advancements. This approach aims to better reward companies that develop treatments for diseases with no existing therapies while also promoting faster competition from generics and biosimilars, ultimately improving affordability and access for patients across the EU.

Strengthened EMA framework

The reform also proposes a strengthened framework for scientific and regulatory support from the European Medicines Agency (EMA), particularly for medicinal products that address unmet medical needs, such as anti-microbials. Building on the experience gained from initiatives like the PRIME scheme and the regulatory responses to the COVID-19 pandemic, the EMA will be empowered to offer enhanced legal and scientific support, including accelerated assessment and authorisation processes for breakthrough therapies.

This strengthened framework is intended to facilitate the development and rapid approval of innovative medicines, particularly in areas such as anti-microbial resistance where the need for new treatments is critical.

Simplified EMA structure

In an effort to streamline the regulatory process, the proposed legislation includes a simplification of the EMA's committee structure. The number of scientific committees will be reduced to two main committees: the Committee for Medicinal Products for Human Use (CHMP) and the Pharmacovigilance Risk Assessment Committee (PRAC). This change is expected to reduce the complexity of the approval process, making it more efficient while retaining the necessary expertise through specialised working groups and pools of experts.

Additionally, the responsibility for orphan drug designations and the management of the Union Register of designated orphan medicinal products will be transferred from the European Commission to the EMA. This move is intended to create a more streamlined and effective procedure for managing these critical areas.

Emergency marketing authorisations

Recognising the need for flexibility in times of public health emergencies, the proposed reform introduces the possibility of granting temporary emergency marketing authorisations. These authorisations would allow medicinal products to be made available on the market more quickly during a crisis, provided the benefits of immediate availability outweigh the risks associated with the absence of complete clinical data. This measure is designed to enhance the EU's ability to respond rapidly to health emergencies, ensuring that patients have access to necessary treatments when they are most needed.

Changes to Paediatric Investigation Plans (PIPs)

The proposed revision of the EU pharmaceutical legislation also introduces changes to PIPs aimed at creating a more flexible and responsive system for paediatric drug development. These changes reflect the need to adapt the regulatory framework to the unique challenges of developing medicines for children, where early-stage clinical planning can be particularly complex and uncertain.

Evolutionary Paediatric Investigation Plans

A key change is the introduction of the concept of evolutionary Paediatric Investigation Plans (PIPs). Traditionally, developers of paediatric medicines were required to submit a comprehensive clinical development plan at a very early stage, often before sufficient data was available. This requirement has proven problematic, particularly when dealing with novel molecules or first-in-human studies, where assumptions about outcomes must be made prematurely.

The proposed reform allows for a more agile and flexible approach to PIPs. Under the new system developers can initially submit a high-level clinical development plan, with the understanding that the plan will evolve as more data becomes available. The European Medicines Agency (EMA) will work closely with developers to agree on the plan's initial stages as well as the timing for submitting additional information as the development progresses. This evolutionary approach is expected to reduce administrative burdens and provide greater flexibility in paediatric drug development, ultimately leading to more effective and timely treatments for children.

Case-by-case abolition of waivers

Another change is the proposed case-by-case abolishment of waivers for PIPs. Currently, waivers are granted when a medicine intended for adult use is unlikely to be effective for any paediatric indication, such as when the disease does not exist in children. However, this approach has limitations, particularly in cases where a drug’s molecular mechanism of action suggests potential efficacy in treating a different paediatric condition.

The new legislation proposes that in such cases the product must be studied for use in children, even if it was originally developed for an adult condition. This requirement is expected to increase the number of medicines that are adequately studied and authorised for paediatric use, promoting innovation and expanding treatment options for paediatric patients.

This change aims to ensure that children benefit from the same advancements in medicinal products as adults.

Market exclusivity for orphan drugs

The proposed revisions to market exclusivity rules for orphan drugs introduce a more nuanced approach designed to balance rewarding innovation with promoting broader access to treatments. The key points are as follows:

• The standard duration of market exclusivity for orphan medicinal products is set at nine years.
• Orphan drugs that address High Unmet Medical Needs (HUMN) will receive an extended market exclusivity period of ten years.
• Orphan medicinal products with a well-established use and a significant track record will be granted five years of market exclusivity.
• A bonus extension of one year of market exclusivity can be granted if the product achieves patient access in all relevant member states within a specified timeframe.
• To discourage "evergreening" while encouraging further development, the first two new indications of an already authorised orphan medicinal product will each be rewarded with an additional one year of market exclusivity, applicable to the entire medicinal product.

These changes are intended to continue incentivising the development of orphan drugs while ensuring that patients across the EU have timely access to these essential treatments.

Anti-microbials

The proposed legislation also addresses the critical issue of anti-microbial resistance, which is a growing public health threat. To incentivise the development of new anti-microbials, particularly those that can combat resistant strains, the reform introduces the concept of transferable data exclusivity vouchers.

• Transferable data exclusivity vouchers: These vouchers will grant an additional year of regulatory data protection to the developer of a priority anti-microbial. The developer can either use this voucher for any product in their portfolio or sell it to another marketing authorisation holder. The sale of these vouchers provides an additional incentive for companies to invest in anti-microbial research.
• Strict criteria for voucher eligibility: The categories of anti-microbials which are eligible for these vouchers are strictly defined to ensure that only products that address the most critical needs receive this benefit. The number of vouchers issued will be capped at a maximum of 10 over a period of 15 years, maintaining a balance between incentivising development and ensuring access.
• Stewardship plan requirement: Holders of anti-microbial marketing authorisations will be required to develop a comprehensive stewardship plan. This plan must include risk mitigation measures, monitoring and reporting on resistance to the medicinal product. The stewardship plan is designed to ensure that new anti-microbials are used responsibly, minimising the risk of further resistance development.

Other simplifications

In addition to the major changes outlined above, the proposed reform includes several other measures aimed at simplifying and modernising the regulatory framework. These include:

• Reduction of regulatory burdens through increased digitalisation, including the electronic submission of marketing authorisation applications and electronic product information.
• Abolishment of the renewal and sunset clause, which will streamline the lifecycle management of medicinal products.
• Measures to ensure the regulatory framework can accommodate emerging scientific developments, such as adaptive clinical trials, real-world evidence and the secondary use of health data.

For Swiss-based pharmaceutical companies, the proposed revisions to the EU pharmaceutical legislation present both challenges and opportunities. As key players in the European market, these companies will need to carefully consider the implications of the new regulatory environment and adapt their strategies accordingly.

Key considerations include:

• Adaptation to new incentive structures: Swiss companies developing orphan or paediatric drugs will need to align their development strategies with the new variable incentives system, ensuring that their products meet the criteria for extended market exclusivity.
• Leveraging EMA support: The strengthened framework for scientific and regulatory support from the EMA offers opportunities for Swiss companies to accelerate the development and approval of innovative products, particularly in areas of unmet medical needs.
• Navigating simplified procedures: The simplification of the EMA's committee structure and the transfer of orphan designations to the EMA may streamline regulatory processes for Swiss companies, but they will need to stay informed about the new procedures to fully benefit from these changes.
• Preparing for emergency scenarios: The introduction of temporary emergency marketing authorisations presents an opportunity for Swiss companies to bring products to market more quickly during public health emergencies, provided they can meet the necessary requirements.