Proposed Amendments to the EU Regulatory Framework for Medicinal Products

On April 26, 2023, the European Commission (the Commission) published its long-awaited proposed amendments to the EU regulatory framework for medicinal products (the Proposals). This is the culmination of a number of years’ work by the Commission, starting with the new pharmaceutical strategy for Europe (the Strategy) announced on November 25, 2020. We set out a summary of and reasons behind the Strategy in a previous Advisory, noting that the Strategy sought to ensure a high level of public health by increasing the availability, accessibility, and affordability of medicinal products throughout the EU and harmonize the internal market.

To meet these goals, the Commission has proposed substantial changes to the EU regulatory system, including to the regulatory protections available for medicinal products and orphan medicinal products and has included a  procedure relating to shortages of medicinal products. We set out the key takeaways from these Proposals below.

The Proposals will now follow the ordinary legislative procedure involving the European Parliament and the Council — the institutions will review and comment on the Proposals, with the aim of the legislative changes being finalized by 2024/2025. However, this timeline may be delayed given the European Parliament elections in 2024. Once finalized, the new Regulation (defined below) will apply 18 months after entry into force, and Member States will have up to 18 months to transpose the new Directive (defined below) into national law (subject to various transition periods and potential changes during the ordinary legislative procedure).

New Regulatory Framework

The proposed revision of the pharmaceutical legislation consists of two legislative proposals, which aim to allow for simplification and increased coherence:

• Directive 2001/83/EC (medicinal products for human use) will be repealed and replaced by a new directive (the Directive).
• Regulation (EC) No 726/2004 (authorization and supervision of medicinal products), Regulation (EC) No 141/2000 (designation of medicinal products as orphan medicinal products), and Regulation (EC) No 1901/2006 (medicinal products for pediatric use) will be combined into one regulation (the Regulation).

The Key Elements of the Proposals

The Proposals discuss important initiatives concerning several areas that, according to the Commission, would streamline innovation and competition. Based on our initial review of the documents published today, the key regulatory changes impacting the life cycle of medicinal products foreseen in the Proposals include, but are by no means limited to, the following:

• Regulatory data protection (RDP): The RDP period will be reduced from eight years to six years. However, additional periods of RDP may apply if certain criteria are met:

• For products addressing an unmet medical need (UMN) at the time of initial marketing authorization, six additional months will be granted.
• For products containing a new active substance where comparative clinical trials are conducted, six additional months will be granted.
• For products “released and continuously supplied into the supply chain in a sufficient quantity and in the presentations necessary to cover the needs of the patients in the Member States in which the marketing authorization is valid” within two years of grant of the marketing authorization (or within three years for small- and medium-sized enterprises (SMEs), not-for-profit companies, and “unexperienced” companies), two additional years will be granted.
• If, during the RDP period, the marketing authorization holder (MAH) obtains authorization for a new therapeutic indication with significant clinical benefit, one additional year will be granted; this extension can only be granted once.

These periods appear to have an additive effect, which means the cumulative duration of the RDP for a product could be up to 10 years from the date initial marketing authorization is granted.

After the expiration of RDP, there is a fixed period of two years of market protection.

• Orphan medical products (OMP): The “standard” duration of the new orphan market exclusivity (OME) will be nine years. As a major change, there will be no new full period of exclusivity for authorization of additional orphan indications in additional orphan conditions other than two one-year extensions for new indications as set out below. The length of time will vary depending on several factors:

• Ten years for orphan medicinal products addressing a “high unmet medical need” (HUMN)
• Five years for orphan medicinal products based on well-established use applications
• Nine years for all remaining orphan products

The nine or 10 year period of OME can be extended as follows:

• One year where the product is released in and continuously supplied within two years of grant of marketing authorization (or within three years for SMEs, not-for-profit companies, and “unexperienced” companies), in sufficient quantity, in Member States in which the marketing authorization is valid
• One year for new indications in new orphan conditions authorized not later than two years before expiration of the OME. This extension may be granted twice if the new therapeutic indications are for different orphan conditions.

Therefore, the cumulative duration of the OME for a product cannot exceed 13 years from the date the initial marketing authorization is granted. 

These extensions of orphan market exclusivity cannot be combined with extensions of RDP for launch and unmet need.

The validity of the orphan designation, obtained before authorization, is limited to seven years, although this can be extended if justified.

• Supply of medicinal products across the EU: Readers will note that one of the conditions available to extend both RDP and orphan exclusivity relate to supply of the product. Where a medicine is granted a marketing authorization via the centralized procedure, which will include all orphan medicinal products, this would mean that, to qualify for the additional year, the product would need to be supplied in all 27 Member States within the two-year (or three-year) deadline. This is a hurdle that many companies would likely find impossible to overcome, and particularly so for orphan medicinal products. However, supply in all Member States has always been a key point for the Commission and has been raised throughout the Strategy. 
  
  Member States may waive the condition of launch in their territory for the purpose of prolongation of RDP. This could be very important for companies, assuming Member States accept that launch in a particular Member State is materially impossible. Note also that where a Member State does not provide a reply to the MAH’s request for a waiver within 60 days, it shall be understood that a statement of non-objection has been provided.

• UMN and HUMN: A medicinal product is designated as UMN if at least one of its indications relates to a life-threatening or severely debilitating condition and no medicinal product is authorized in the EU for that condition or where, despite medicinal products being authorized for such disease in the EU, the disease is associated with a remaining high morbidity or mortality and the use of a medicinal product results in meaningful reduction of morbidity or mortality for the relevant patient population. All orphan medicinal products are designated as UMN.
  
  In addition, some orphan medicinal products will be classified as HUMN where there is no satisfactory diagnosis, prevention, or treatment method for the orphan condition or, where such method does exist, the product will bring exceptional therapeutic advancement in addition to having a significant benefit. In addition, in both cases, the product must meaningfully reduce disease morbidity or mortality for the relevant part of the population.

• Medicines for pediatric use: Where a product treats a disease or condition which occurs only in adult populations, a waiver will not be possible on the basis of scientific evidence on the mechanism of action, where the product could be effective against a different disease in children. Where a deferral is in place, this will be capped at five years unless an extension is justified. In addition, an adapted pediatric investigation plan (PIP) may be used whereby the PIP shall contain only the details and the timing of the measures proposed, together with precise timing of when updated versions of the pediatric investigation plan will be submitted.
  
  

  A six-month patent or supplementary protection certificate extension will be granted for the completion of a PIP. There will be no pediatric extension to OME for OMPs.

  Further, in relation to placing on the market, where a medicine is authorized for a pediatric indication following completion of a PIP, and the medicine is already marketed with other indications, within two years of the authorization of the pediatric indication, the MAH must place the medicine on the market taking into account the pediatric indication in all Member States where it is already on the market. This has been an area of dispute under the current legislation.

• RDP for repurposing: Repurposed medicinal products will receive four years of RDP with respect to a new therapeutic indication not previously authorized in the EU, provided that: (1) adequate non-clinical or clinical studies were carried out demonstrating that it is of significant clinical benefit and (2) the medicinal product is authorized as a generic product and has not previously benefitted from RDP, or 25 years have passed since the granting of the initial marketing authorization of the medicinal product concerned. This RDP period may only be granted once for any given medicinal product.

• Forced variations: The new Regulation provides a route for not-for-profit entities to submit substantive pre-clinical or clinical evidence for a new indication for medicinal products that is expected to fulfill an UMN. The EMA may “at the request of a Member State, the Commission, or on its own initiative and on the basis of all available evidence make a scientific evaluation of the benefit-risk of the use of a medicinal product with a new therapeutic indication that concerns an unmet medical need.” These provisions also state that “marketing authorization holders of the medicinal products concerned shall submit a variation to update the product information with the new therapeutic indication.” This is likely to be an area to watch for the future.

• Security of supply and shortages: MAHs will be required to prepare and keep updated a shortage prevention plan (SPP). The MAH will need to notify the competent authority in the relevant Member State or the EMA of potential and actual shortages, as well as:
  
  
  • The intention to permanently cease marketing of a medicinal product, 12 months before last supply
  • The intention to temporarily suspend marketing of a medicinal product, six months before temporary disruption
  • The request to permanently withdraw the marketing authorization, 12 months before last supply
  • Temporary disruption in supply, as soon as MAH is aware and no less than six months before expected disruption

  The European Medicines Agency (EMA) Executive Steering Group on Shortages and Safety of Medicinal Products (MSSG) will adopt an EU list of critical medicines requiring EU-level action and common methodology for reporting of shortages, and will include specific requirements to ensure security of supply and mitigate shortages in relation to these critical medicines. The EMA also has increased powers in these areas.

  In addition, when a MAH intends to permanently withdraw a marketing authorization for a critical medicinal product, it must first offer “on reasonable terms” to transfer the marketing authorization to a third party or to allow a third party, which has declared its intention to place the critical medicinal product on the market, to use the pharmaceutical, preclinical, and clinical documentation contained in the file of the medicinal product with a view to submit an application for an authorization for such a medicinal product.

• Requirements for generics and biosimilars: The applicant for a generic of a reference medicinal product shall not be required to provide the results of preclinical tests and of clinical trials if equivalence of the generic medicinal product with the reference medicinal product is demonstrated. To do so, the applicant shall submit equivalence studies, or a justification as to why such studies were not performed, and demonstrate that the generic medicinal product meets the relevant criteria as defined in the guidelines. In relation to biosimilar medicines, applicants are required to submit results of “appropriate comparability tests and studies.” As with updated guidance in the UK, such applications will not require pre-clinical or clinical data unless such data is justified. The Proposals also create the new concept of “bio-hybrids” covering biosimilars with changes in strength, pharmaceutical form, route of administration, or therapeutic indications, compared to the reference biological medicinal product. For bio-hybrids, the applicant must submit the results of the appropriate non-clinical tests or clinical studies “to the extent necessary to establish a scientific bridge to the data relied upon in the marketing authorization for the reference biological medicinal product, and to demonstrate the safety or efficacy profile of the biosimilar medicinal product.”
  
  

  The Proposals also include other factors that will ease the authorization of generic products, including that the bolar exemption will cover all studies and trials for marketing authorization, health technology assessment, pricing, and reimbursement, and that no risk-management plans will be required for generics and biosimilars if no additional risk minimization measures exist for the reference medicinal product.

• ATMPs and the hospital exemption: The manufacture of advanced therapy medicinal products (ATMPs) under a hospital exemption will need to be authorized by national competent authorities. Member States will collect data on use, safety, and efficacy of ATMPs prepared under the hospital exemption and report this data to the EMA annually. While the strengthening of the regulatory oversight of the hospital exemption would be a welcome development, it cannot be excluded that the Member States will seek to significantly amend this element of the Proposals in the legislative process.

• Antimicrobial resistance: To promote the development of antimicrobials that can address antimicrobial resistance, transferable data exclusivity vouchers (TEV) are introduced. New “priority antimicrobials” will be eligible for a TEV. An antimicrobial will be considered a “priority antimicrobial” if preclinical and clinical data underpin a significant clinical benefit with respect to antimicrobial resistance and it has at least one of the following characteristics: (1) it represents a new class of antimicrobials, (2) its mechanism of action is distinctly different from that of any authorized antimicrobial in the EU, or (3) it contains an active substance not previously authorized in a medicinal product in the EU that addresses a multi-drug resistant infection or a serious or life threatening infection.
  
  

  The TEV will grant an additional year of RDP to the developer of the priority antimicrobial (in addition to the RDP period set out above), which the developer can either use for any centralized product in their own product portfolio or sell to another MAH. The TEV may only be used once, must be used within the first four years of RDP, and is valid for five years. A maximum of 10 vouchers may be granted by the Commission over a 15-year period, after which all TEV provisions will cease to apply, unless extended. The value of sold TEVs will need to be disclosed to the EMA and made public. Eligibility criteria and the validity of the voucher are also linked to obligations for supply of the priority antimicrobial in the EU.

  In addition to the legislative amendments, the Commission has published a Council Recommendation to step up the fight against antimicrobial resistance (AMR).

• Other points to note:

• Marketing authorizations for medicinal products (other than nationally authorized medicinal products) will remain valid for an unlimited period (though the Commission or competent authorities may limit this to five years in certain instances) and will not lapse if the product is not placed on the market for three years (i.e., the removal of the sunset clause).
• There will be a phased (i.e., rolling) review of complete data packages for individual modules of particulars and documentation in cases of exceptional therapeutic advancement for medicinal products for life-threatening conditions.
• Temporary emergency marketing authorizations to address public health emergencies may be granted by the Commission. In addition, when a compulsory license has been granted to address a public health emergency, the data and marketing protection shall be suspended for the duration period of the compulsory license.
• New technologies may be granted temporary approval through a “regulatory sandbox,” which will be established by the Commission to provide a temporary controlled environment for developing or testing innovative or adapted solutions that facilitate the development and authorization of products that might be regulated as medicinal products. A regulatory sandbox may be set up, for example, where it is not possible to develop the medicinal product in compliance with the regulatory framework due to scientific or regulatory challenges arising from characteristics or methods related to the product.
• New rules on comparative advertising will be established. Advertising that suggests the product is safer or more effective than another product will be prohibited unless this is demonstrated and supported by the summary of product characteristics. This requirement may prove challenging to comply with in practice.
• Where justified for public health reasons and when the active substances cannot be combined within a fixed-dose combination medicinal product, a marketing authorization may, in exceptional circumstances, be granted to a multi-medicinal product package, subject to prior agreement of the competent authority.
• The structure of the EMA will be simplified, reducing the number of scientific committees to two: the Committee on Medicinal Products for Human Use (CHMP) and the Pharmacovigilance Risk Assessment Committee (PRAC). The other scientific committees relating to Advanced Therapies, Orphan Medicines, Pediatric, and Herbal Medicines will be retained but organized into working parties, advisory groups, and pools of experts. The aim is for greater coordination and cooperation of the EMA with third countries, international partners, and other EU agencies on inspections and scientific advice.

Conclusion

The Proposals are extensive and detailed and have clearly been the subject of intense discussion by the institutions. The industry may feel relieved that some of the more restrictive proposals and definitions have not been adopted. However, the reduction in RDP and OME is disappointing in the context of continued calls to ensure Europe is pro-innovation and fosters a thriving pharmaceutical industry. We know from public reports that there has been a debate among Member States between being pro-innovation and supporting patient access to authorized medicines. These Proposals seek to maintain that balance, but industry will need to follow the developments closely and engage with the various consultations to ensure its views are heard.

Join the Discussion

Please join our webinar, which will be held on April 28, 2023. In the webinar, we will dive into all of the above topics and more, providing an in-depth analysis into what these changes mean and how industry can best prepare.