Global ‘side effects’ of the EU’s pharmaceutical reforms and their impact on access to medicines in LMICs

e-drug
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[Katrina Perehudoff in the British Medical Journal (BMJ Global Health) – cross posted with thanks from HAI news / Jaume Vidal]

https://gh.bmj.com/content/10/4/e017789

Global ‘side effects’ of the EU’s pharmaceutical reforms and their impact on access to medicines in LMICs

Katrina Perehudoff

Summary box

  • In reforming its pharmaceutical legislation, the European Union (EU) has intentionally leveraged the single market to incentivise companies to plan global antimicrobial access and mitigate antimicrobial resistance caused by medicines manufacturing outside of Europe.
  • The proposed EU reforms mandating mandatory public disclosure of the public research and development (R&D) subsidies a company received for a new medicine and the proposed introducing transferable data exclusivity vouchers for antimicrobial R&D, may unintentionally influence pharmaceutical policy decisions outside the EU.
  • The EU’s proposed reforms could enhance protection from antimicrobial resistance and access to novel antimicrobials globally, as well as aid non-EU countries in negotiating lower medicines prices through transparency of public R&D funding.
  • These global influences are often overlooked in EU policy and are scholarly debated because they rely on LMIC low- and middle-income countries’ foreign lawmakers and/or companies active in developing countries to voluntarily align or comply with the EU’s rules.
  • These findings complement existing research about how the EU’s current pharmaceutical legislation influences medicines markets and access globally and are important amid the USA’s politically-driven data purges and cuts to funding for medicines testing and provision worldwide.

The European Union’s (EU) general pharmaceutical legislation impacts on access to medicines and human health in low- and middle-income countries (LMICs) by influencing foreign laws and rules, pharmaceutical company behaviour, health system sustainability and patient care.1 Until now, the EUMedicines4All procedure has been the primary global health tool in the EU’s pharmaceutical legislation. This procedure allows the European Medicines Agency (EMA), in cooperation with the WHO and third country regulators, to provide scientific opinions on medicines intended for use in third countries.2 Now, the EU’s pharmaceutical legislation is up for major revisions. Five EU regulations and an EU directive (concerning the authorisation and supervision of medicines in general and for children, orphan conditions and advanced therapies, and the EMA) will be replaced by a new regulation and a new directive that are currently being negotiated by EU lawmakers. In 2023, the European Commission published its proposals, which were amended by the European Parliament in 2024 and are now being considered by the Council of the EU.3–6 Although the European Parliament has acknowledged the role of the EU’s pharmaceutical legislation in attaining global public health objectives, little research or expert opinion has explored the plausible worldwide reach of the proposals to revise the Union’s legislation.7

This commentary proposes that the revision of the EU’s general pharmaceutical legislation will likely influence access to medicines in LMICs in new, intentional and unintentional ways. This commentary discusses the potential global influence of some of the proposed revisions and then briefly explains why the EU should consider the impact of its internal market law on pharmaceuticals access in LMICs. These global influences are often overlooked in EU policy and scholarly debates because they rely on the voluntary action by LMIC lawmakers and companies active in developing countries to align or comply with the EU’s rules. This commentary complements existing work revealing how the EU’s current pharmaceutical legislation influences medicines markets and access globally (e.g. through regulatory reliance, ethical requirements in clinical trials, etc.).1,2,8⇓ Understanding the EU’s role in and influence over medicines policy and funding globally is crucial, given recent politically-motivated purges of clinical trials diversity data (e.g., at the US FDA) and major funding cuts for testing and providing certain medicines (e.g., USAID closure).

Antimicrobial access and AMR prevention beyond Europe

In the reform process, EU lawmakers have proposed revisions that would expand the global health tools in the Union’s pharmaceutical law in two important ways. First, securing a reliable and sufficient supply of antimicrobials is a challenge for EU and non-EU countries alike.9 Although subscription models are thought to help stabilise supply, such models are scarcely available to and underused by most LMICs.9 Now, the European Parliament proposed a subscription-based procurement scheme in which purchasers (ie, EU Member States and others) would conclude a multi-year agreement with an antimicrobial manufacturer for a continuous and sufficient supply of these products (which meet pre-defined criteria) in exchange for regular payments (amendment 148).5 The Parliament’s proposed procurement scheme also includes a requirement for antimicrobial manufacturers to establish a global access plan for non-EU countries in ‘critical need’ to obtain a supply of the same product (amendment 148).5 This new proposal seeks to strategically mobilise the EU’s single market for medicine procurement to incentivise manufacturers to plan to introduce their product in third countries in need. Second, effluent released into the environment during pharmaceutical production can drive antimicrobial resistance, which disproportionately affects LMICs.10 The European Commission proposes new requirements for Environmental Risk Assessments of pharmaceuticals seeking market approval. The proposed rules would require pharmaceutical manufacturers to identify, prevent and mitigate the potential environmental risks of antimicrobial production in the Union and in third countries (articles 4 (33) and 22(4)).4

Both proposals (if adopted) would promote global health through the EU’s general pharmaceutical legislation. Establishing an access plan is an important first step towards expanding meaningful global access. Piloting an access plan requirement for antimicrobials in EU law can yield important evidence about whether and how such a legal requirement could be expanded to other medicines needed globally. Moreover, the EU’s revised Environmental Risk Assessment requirements for protecting the environment and human health from risks inherent in the antimicrobial supply chains (if adopted) may offer some protection in foreign countries with weaker regulation in these areas.

Whether these requirements can meaningfully influence company behaviours to market their antimicrobials in third countries and/or to take steps to prevent AMR through manufacturing abroad depends on the EU’s bargaining power (ie, how dependent the company is on sales to the EU market) and whether the importance of EU sales outweighs the company’s ‘adaptation costs’ (eg, to establish a plan for global access or for AMR mitigation). Notably, the European Parliament’s proposal for a global access plan lacks a lever for enforcement. This absence may diminish company compliance because it could still receive the benefits of a multi-year procurement agreement with the EU without having to implement its access plans for the same product in third countries. By contrast, the Commission proposes to deny an application for EU market approval if an Environmental Risk Assessment is incomplete or insufficient (article 15 (1)(d)), which could promote company compliance with this rule.3

Unintentional global reach of EU pharma rules

This section introduces two salient examples of proposals for new rules that may unintentionally be disseminated outside the Union through externalisation and/or mimicry (described elsewhere).8 What these examples share in common is that the EU’s rules, standards and/or decisions travel globally due to the Union’s sheer presence on the international scene, rather than purely its active (self-)promotion.

First, introducing more transparency to the components of a medicine’s price is one strategy some lawmakers use to help negotiate or set more affordable prices. In that light, the European Commission proposed new requirements for pharmaceutical manufacturers to report the public contributions towards the R&D of a particular medicine covered by a national or central market authorisation (article 57(1-2)).4 These reports would be made available in a public EU database. If adopted, this requirement would be the first rule in the world to oblige a form of financial disclosure at the point of market authorisation. The EU’s rule would be one step towards greater disclosure of the price components of a pharmaceutical, in line with the World Health Assembly Resolution 72.8 on the transparency of pharmaceutical markets, towards which progress is still needed.11 If adopted, the EU’s legal text may serve as a source of inspiration for legal reform in other countries. Moreover, the EU’s database of public R&D subsidies may be used by procurement agencies (both international agencies serving LMICs and those in LMICs) to inform their negotiations and purchase agreements with pharmaceutical companies.12 It is also conceivable that some foreign lawmakers may be inspired by the EU’s political will to regulate corporate financial disclosures and thereby introduce similar regulations. Consequently, greater price transparency is a logical step to inform better medicine price negotiation between public bodies and private companies and may support lower purchase prices, which can positively impact on patient access and human health in LMICs.

Second, the dearth of innovative antimicrobials is leading lawmakers to experiment with new forms of R&D incentives. To that end, the European Commission proposed a new regulatory incentive - a transferable data exclusivity voucher - to incentivise the antimicrobial R&D by providing 12 additional months of (transferable) data protection. During those 12 months competitors (eg, lower-priced generics or biosimilars) would be blocked from entering the EU market (article 40).3 If adopted, the voucher would be the first policy measure of this type globally, and, according to pharmaceutical companies, it is ‘an opportunity for the EU to lead’ in cases where the voucher is replicated elsewhere.13 Foreign lawmakers may copy or adapt this voucher system abroad, with similar consequences as those anticipated in the EU: high prices for other medicines may be maintained without necessarily ensuring the novel antimicrobial in question is available on the EU market.7 14

Health protection, solidarity and poverty reduction as EU’s values and objectives

The EU’s global pharmaceutical reach should be a reflection of its core values and objectives in Union law and its ambition to lead in global health. According to its constitutional treaties, the EU must ensure a high level of health protection across all its policies and activities while also demonstrating solidarity and respect for human dignity and rights in its interactions with the wider world. These obligations also reinforce the main objective of the EU’s development cooperation: to reduce and eliminate poverty—a challenge to which expensive and unavailable medicines in LMICs substantially contribute.15 Reviewing the EU’s pharmaceutical legislation presents an opportunity to reflect on how the Union advances these values and objectives for patients worldwide.

Conclusion

This commentary argues that the review of the EU’s pharmaceutical legislation could intentionally and unintentionally influence LMIC medicines markets, which in turn impacts patient access and human health worldwide. From a global perspective, the EU’s reforms (if adopted) may promote access to novel antimicrobials outside the EU and facilitate medicines price negotiations in LMICs with more information about public R&D funding the company received. The latter information is one ingredient supporting the negotiation of (lower) medicines prices in LMICs. Moreover, foreign lawmakers who replicate the EU’s proposed transferable data exclusivity voucher system for incentivising novel antimicrobials may face similar consequences as those feared in the Union: high prices for other medicines (protected by the voucher) with little assurance that the novel antimicrobial is available on the foreign market. Overall, EU lawmakers should align their proposed reforms to the EU’s pharmaceutical legislation with the Union’s values and objectives and with global health needs for access to innovative and affordable medicines. Future debates about the EU’s global role in medicines policy should also explore the implications of the proposed Critical Medicines Act, including its strategies for securing supply chains through international partnerships and joint procurement.

  • Handling editor: Fi Godlee
  • Contributors: KP conceived of, wrote and revised the manuscript. KP is the guarantor of this manuscript.
  • Funding: This commentary is part of the ‘Global access to medicines through EU law and policy’ project of the Veni talent research programme which is financed by the Dutch Research Council (NWO).
  • Competing interests: None declared.
  • Provenance and peer review: Not commissioned; externally peer reviewed.
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