The European Federation of Pharmaceutical Industries and Associations (EFPIA) has published new research suggesting that the European Commission’s (EC) pharmaceutical legislation proposals could accelerate pharma innovation decline.
According to the EFPIA, if the new rules become law, they will accelerate the negative innovation trend in the EU and will majorly affect small and medium-sized enterprises (SMEs).
In April 2023, the EC published its proposed overhaul of laws governing the EU’s pharmaceutical industry to end issues with access to drugs and pricing between countries.
The Commission proposed to cut the length of basic market exclusivity that drugmakers receive before generics can enter the market to eight years instead of ten.
The EFPIA commissioned the Dolon consultancy to undertake competitiveness checks on the proposed legislation.
Results showed that, over the next 15 years, the EC’s proposals to reduce regulatory data protection will reduce the incentive to invest in medicines by 55% in Europe, having a significant impact on European innovation and competitiveness.
Additionally, by 2040, Europe’s share in global research and development (R&D) could be reduced by up to a third (from 32% of global R&D expenditure to 21%), equating to €2bn lost in investment per year.
In particular, the EU’s biotech sector, SMEs, would be hit hard by the proposals, further worsening the EU’s biotech base’s ability to move to financial ecosystems in the US and China.
In a previous report, Dolon estimated that the deterioration of the research ecosystem would lead to a loss of 45 new treatments for rare diseases, along with €5bn of research lost to Europe.
EFPIA president and chief executive of Novo Nordisk, Lars Fruergaard Jorgensen, said: “The measures currently being considered in the pharmaceutical legislation… will have a negative impact on the European economy, and, most importantly, on the lives of millions of people in Europe who need innovation in medicine to transform their lives.”
“Europe needs to strengthen, rather than erode, its IP protections for new medicines and vaccines,” said EFPIA director general, Nathalie Moll. “Trying to legislate an industry into staying in any region does not work.”