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Data-based Study Quantifies Adverse Impact on Innovation and Market Access of Key Aspects of EU Pharmaceutical Package

  • 28/11/2023
  • News

Earlier this month, the European Federation of Pharmaceutical Industries and Associations, EFPIA, published a study prepared by the strategic market access consultancy Dolon (the Study) providing for a data-based impact assessment of the proposed Pharmaceutical Package (the Proposal) of the European Commission (Commission).
The Study relies on risk-adjusted net present value (rNPV) modelling to assess the potential impact of key aspects of the Proposal (changes to regulatory approval, modulation of regulatory data protection (RDP), introduction of an unmet medical need definition and of launch-and-supply conditionalities) on real-life investment and launch decisions by pharmaceutical companies. An rNPV model quantifies the strength of the economic proposition for investment or launch in a single figure. In doing so, it provides a conceptual framework for assessing the Proposal’s impact.
The Study relies on two variations of the rNPV model.
The first variation model quantitatively assesses the impact on innovation at the time of initiation of clinical development (phase I of R&D) of the Proposal’s proposed modulation of the RDP duration (reduction of default RDP duration from eight to six years, with possibilities for extension – see, Van Bael & Bellis Life Sciences News and Insights, 3 May 2023) for medicines which rely on RDP as their last form of IP protection (i.e., more than one in three medicines – RDP products). The model relies on a mix of inputs, including Technopolis’ impact assessment as prepared at the Commission’s request, the published academic literature and EFPIA resources (Study, p. 9). While the Proposal imposes EU-wide market release and continuous supply within two years of marketing authorisation as a condition to regain two years of RDP, the Study’s data show that this condition will not be satisfied by any product. This is because, to date, no RDP product has been successfully launched in all 27 EU Member States (the maximum number of countries is 20) (Study, p. 11). The Study finds that one in five projects (22%) to research and develop RDP products will become economically inviable by 2035. This represents a loss of 50 medicines, which corresponds to up to 16 million Years of Life Lost and a loss of up to EUR 2 billion of annual R&D activity within the EU (Study, p. 16). Thus, the EU’s position as a global innovator will deteriorate further as compared to the USA, Japan and China (Study, p. 18). Germany (-EUR 626 million), Belgium (- EUR 381 million) and France (- EUR 326) are set to be hit hardest (Study, p. 17). Within the pharmaceutical sector, SMEs will be most impacted by the Proposal. The Study estimates that only about one in ten SME-developed products will be economically viable (Study, p. 19).
The second variation model assesses the economic case for launch across EU Member States at the time of marketing authorisation. Despite being schematic in the absence of reliable public data (Study, p. 14), the Study’s model finds that reducing RDP duration makes filing across all Member States even more challenging for industry than it already is today. Again, this holds especially true for SMEs, and is more pronounced for rare diseases than more prevalent conditions (Study, p. 20).
Because of its reliance on real world evidence and its solid methodology, the Study should be a cause of concern for Members of Parliament considering adopting the Proposal in the form put forward by the Commission. The Proposal will adversely impact the pharmaceutical industry and, more importantly, will also harm patients.

A copy of the Study is attached


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