The EU’s new pharma legislation package could be the medicine Europe needs to boost biotech innovation, but industry says it doesn’t go far enough.
Europe has a complex biotech landscape. Along with the United States and China, the EU is a major hub for biotechnology. Yet for the thousands of EU companies trying to discover and develop life-changing therapies, diagnostic equipment, vaccines, and advanced medicinal products [ATMPS], Europe’s rules for innovation and financing are complex and differ across member states.
In April 2023, the European Commission [EC] adopted proposals for a new Directive and Regulation which would revise and replace existing legislation. With a stronger rules-based identity, the hope was that the bloc would become a more attractive and innovation-friendly environment for research, development, and production of medicines. It also aims to ensure timely and equitable access to safe, effective, and affordable medicines for all Europeans.
Globally, the sector generates billions in revenue, with the market on course to be worth 1848.5 BILLION US Dollars by 2030. Many leading biotech companies have their headquarters in Europe.
“We know the EU is lagging behind the US in terms of innovation and approving and developing new medicines,” MEP Tomislav Sokol said at a recent Euractiv event in Brussels, “so we have to do something to remain strong and competitive in the global market and bring production of medicine to Europe as much as possible.”
Sokol said the legislation – currently under the scrutiny of MEPs – must be a game-changer and create the right ecosystem that supports a strong industry by creating a system of incentives to spearhead EU-wide innovation.
Currently, the R&D investment gap between the US and EU stands at 25 billion Euros. China also outspends the EU by over 300 BN Euros on R&D on average year on year. Clinical trials are also on the decline with Europe accounting for only 19 percent of the global market.
New rules – new headache?
The European Commission has come up with a contentious lever to incentivise industry to invest and innovate across the bloc. Changes to regulatory data protection [RDP] would mean the protection period for a new drug, therapy, or clinical trial would be reduced from eight to six years. But when a company launches its product across all 27 member states, it would obtain an additional two years of RDP.
The European Parliament, undertaking their first reading of the new proposals has already diverged from the European Commission. In their draft report MEPs extended RDP to nine years and have deleted the requirement to launch across all 27 member states.
With institutional wrangling on the best formula for regulatory enablers, the industry has voiced its concerns.
Kristin Thompson from EureKARE, a European synthetic biology investment company was less enthusiastic on the merits of the pharma overhaul because she feels it isn’t best protecting European intellectual property.
“It’s not going to be the great equaliser,” Thompson told Euractiv, “In fact, it will worsen a situation that is already critical. Europe’s ecosystem is too slow, too much red tape, and not enough capital.”
Current legislation will not encourage people that Europe is ready to go faster, said Thompson, explaining that while it streamlines some regulatory processes, reducing regulatory protection was not a positive outcome. She argues for more regulation focused on innovation, enabling SMEs to access a greater return on investment and drive innovation.
SME Dilemma – How to compete with big pharma?
European SMEs are a crucial cog in the biotech pipeline – especially for rare diseases. But to continue making medical discoveries, and developing therapies and technologies, they need collaboration with academia and big pharmaceutical companies.
Theracell Advanced Biotechnology specialises in the development and commercialisation of cellular and gene therapy (CGT) products. Its Chief Operating Officer, Vivian Tseveleki, told Euractiv, “It’s very difficult to raise investment and bring a product into the market. The pharma legislation makes it more difficult.”
Tseveleki explained the industry needs clear definitions and timelines. She said: “To attract capital, we need to bridge the gap between researchers and biotech companies to address people’s needs and offer better value to people. All of this is critical to have the best expert knowledge at the stage of early development.”
Collaboration
The dynamics of collaboration were echoed by Hilde Stevens, Co-director, the Institute for Interdisciplinary Innovation in Healthcare at ULB University in Brussels. She said: “We need more transparency of data. It’s very difficult to make evidence-based policy recommendations without it… We need European data registries.”
ATMPs and the case for preventative medicine
Advanced therapy medicinal products (ATMPs) are innovative and transformative drugs and therapies that target orphan diseases and high unmet medical needs. But they are costly to produce and develop.
According to the European Medicines Agency [EMA] the pandemic was the catalyst for a shifting of mindset towards a European pharmaceutical system that was more patient-centred, future-proof, and crisis-resistant.
But is the legislation driving ambition towards life-changing ATMPs and preventative medicine? Not according to EureKARE ’s Kristen Thompson.
“Rare disease innovation must be attractive to investors”, said Thompson, “but currently the payer-prescriber system doesn’t support that. I am a big supporter of preventative medicine, but would I invest in it? No, because my shareholders hold me over the barrel at the end of the day. We need to offer incentives to governments and insurers to see that prevention has value.”
27 Problems
The wider problem is that even if the EU gets its legislation right, pricing and reimbursement is a member state competence and national rules are complex.
MEP Sokol emphasised the need to look at legislation, not in isolation but viewing the whole landscape as a means to reduce industry burdens.
Next steps?
With European Elections upcoming and polarising anti-European voices likely to make gains, the race is on for MEPs to complete their first reading of the legislation before the end of their current mandate.
This article follows the Euractiv-organised policy debate “EU pharmaceutical legislation – Europe’s biotech innovation in the balance?” supported by EuropaBio.
[By Mariam Zaidi, edited by Brian Maguire | Euractiv.com]
