Pharma lobby group warns EU could lose edge with proposed law

[June 22, 2023]  BRUSSELS (Reuters) - Europe's pharmaceutical sector could lose out to increased competition from emerging markets, China and the U.S. in terms of research and innovation if a proposed European Union health package is not amended, its key industry group said on Thursday.

The EU Commission presented a proposal to overhaul a wide range of rules governing health and medicines in the 27-member bloc in April, but the move has met with backlash from the industry.

Among the new measures, the EU wants to reverse the decline of regional manufacturing, avoid a repeat of the drug shortages caused by the COVID-19 pandemic, improve access to healthcare and affordable drugs, as well as putting an end to the parallel medicines market that takes advantage of price disparities between EU countries.

The European Federation of Pharmaceutical Industries and Associations (EFPIA) said in a statement while it supported the crackdown on the parallel market its estimates to be worth over 6 billion euros ($7 billion), it views other parts of the package as damaging.

The EFPIA's members include European pharmaceutical giants such as AstraZeneca, Pfizer, Novo Nordisk, Bayer and Sanofi.

People queue up outside a pharmacy after a decree orders for the whole of Italy to be on lockdown in an unprecedented clampdown aimed at beating the coronavirus, in Rome, Italy, March 10, 2020. Only a limited number of people are allowed inside the pharmacy at a time due to the strict measures. REUTERS/Emily Roe/File Photo

The industry group expects a 25% relative decline in research and development and a drop in Europe's global share of clinical trials from 25% to 19% if the law is passed.

"The proposed legislation does begin to evolve Europe’s regulatory system, which has not been extensively modernised in the last twenty years and is increasingly slower than the United States," the EFPIA statement said.

"However, it significantly reduces European intellectual property (IP) rights while adding complex incentives for additional IP protection which in practice makes it impossible to achieve these incentives."

Brussels has proposed shortening the period of IP protections companies get before generics can enter the market from 10 to eight years.

($1 = 0.9116 euros)

(Reporting by Julia Payne; Editing by Jamie Freed)

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