In a world reshaped by COVID-19, Brexit, and other major supply-affecting developments, EU regulators have put addressing economic disruptions due to medicinal product shortages at the top of their agenda. Pharmaceutical companies operating on the EU market are well advised to closely monitor legal and regulatory developments and assess the footprint and security of their global supply chain.
EU regulators are introducing new rules and setting up new response bodies in an effort to address the causes of shortages of medicinal products.
For example, on October 28, 2021, the European Parliament and Council reached a provisional agreement (see press release here) to make the European Medicines Agency (EMA) more effective in tackling shortages of medicines. Under the provisional agreement, the EMA will set up and manage the European Shortages Monitoring Platform to facilitate the collection of information on shortages, supply, and demand of medicinal products. The EMA will also establish a public webpage with information on shortages of critical medicinal products.
Further, the EMA will set up a shortages steering group for medicinal products to coordinate urgent actions and draw up lists of critical medicinal products so that their supply could be managed; this may include advice on how to safeguard product quality, safety, and efficacy. This draft update is part of the broader European Health Union package, which was put forward by the European Commission on November 11, 2020. As a next step, the provisional agreement has to be approved by both the European Parliament and Council before the formal adoption procedure of the proposal for the expansion of EMA’s mandate is launched.
Further, on September 16, 2021, the European Commission launched the European Health Emergency Preparedness and Response Authority (HERA) to prevent, detect, and rapidly respond to health emergencies. As one of its main tasks, HERA will promote procurement and tackle challenges related to their availability and distribution and increase stockpiling capacity to avoid shortages and bottlenecks in logistics. HERA will anticipate threats and potential health crises through intelligence gathering and building the necessary response capacities. HERA will work closely with other European and national health agencies, industry, and international partners to improve the EU’s readiness for health emergencies.
In the event of an emergency, HERA’s aim will be to ensure the development, production, and distribution of medicinal products and medical devices. Emergency funding and launch mechanisms for monitoring, new targeted development, procurement, and purchase of medical materials will be available, and under the steering of a high-level Health Crisis Board a swift decision-making process has been foreseen. As it would take too long to set up an entirely new agency, HERA will be integrated as an internal structure to the European Commission. This should allow HERA to become operational in early 2022.
Last but not least, and as foreshadowed in our previous alert (here), the European Commission is in the process of reviewing the basic pharmaceutical legislation (including Directive 2001/83/EC and Regulation (EC) 726/2004). This initiative is part of the Pharmaceutical Strategy for Europe, that is, the effort to establish a future-proof and crisis-resilient medicines regulatory system. Proposed solutions to address medicinal product shortages include (1) stronger obligations for supply and transparency, such as shortage prevention plans and mandatory safety stocks; (2) earlier notifications of shortages and market withdrawals to national authorities in a common format; (3) enhanced transparency of stocks through monitoring of supply and demand at a national level; and (4) stronger EU coordination and mechanisms to monitor, manage, and avoid shortages. Interested parties are advised to continue monitoring this development and consider participating in the public discussion by filling in a questionnaire before December 21, 2021. In addition to the public consultation, we understand that the Commission will also be organizing more opportunities for stakeholder input, notably a six-week targeted consultation expected before December.
Pharmaceutical companies operating in the EU market are well advised to closely monitor the described legal and regulatory developments and anticipate future demands. Such demands may include a requirement on pharmaceutical companies to better assess the footprint and security of their global supply chain, cooperate with new response bodies such as the European Shortages Monitoring Platform and HERA, and set up mechanisms to more strategically respond to supply and demand, for example, through regional or local supply. Pharmaceutical companies operating in the EU market should consider submitting comments through the various channels the EU agencies provide for stakeholder participation.
Attorney Advertising—Sidley Austin LLP is a global law firm. Our addresses and contact information can be found at www.sidley.com/en/locations/offices.
Sidley provides this information as a service to clients and other friends for educational purposes only. It should not be construed or relied on as legal advice or to create a lawyer-client relationship. Readers should not act upon this information without seeking advice from professional advisers. Sidley and Sidley Austin refer to Sidley Austin LLP and affiliated partnerships as explained at www.sidley.com/disclaimer.
© Sidley Austin LLP