Around The Globe

What Did 2018 Bring the EU?

John Lisman
Lisman Legal Life sciences


018 has been a challenging year for politics in the UK. Politicians claim to choose the path out of Europe that the people had voted for in 2016.

Brexit: Deal or No Deal

In reality, their exit votes were not based on a realistic picture of the consequences. As a result, Prime Minister May will not be able to deliver the “promised land” and has instead presented a deal that is much better than no deal, but less than what the exiteers voted for. As this Global Forum goes to (the virtual) press, it is still unclear what the course will be, but Brexit will be an expensive option for the entire country as well as for the remaining member states.

29 March 2019

With respect to the life sciences industry, companies in the UK as well as in the EU are preparing for the worst by stockpiling medicinal products and medical devices; public healthcare is impossible without these products and contingency planning is required, especially if there is still “no deal” on 29 March. In this “cold turkey” Brexit, the UK will have no trade agreements with any EU member state on 30 March. Moreover, all EU trade agreements will no longer apply to the UK so the country will have to negotiate new agreements with the EU and with each third country they want to trade with before import and export can take place.

Planning of future policies will take place after 29 March, but this planning will depend on whether the UK exits the EU with a deal (and a transitional period) or no deal. In any case, UK will have to negotiate new trade agreements with the EU and other trading parties.

New EMA building in Amsterdam

The new EMA building project started in 2018 on the Amsterdam South Axis and the building has already reached its final height. More and more EMA staff will move to Amsterdam in 2019, first to the Spark Tower and another smaller building, and by the end of 2019 entirely to the South Axis. In London, an empty building will remain. Hotels and restaurants around it will feel the impact.

Expensive Medicines: New Initiatives & Decisions

In many EU member states, concerns have arisen about the high prices of some medicinal products, particularly very expensive orphan medicinal products. To solve this issue, a number of pathways are being explored by the EU member states and the European Commission.

HTA, preferably together with other agencies

For many EU countries, the main principle is solidarity. This means that the healthy help pay for treatment of the ill. This is all fine until the price of one patient’s treatment is so high that the money spent could have treated a number of patients with other conditions. Health Technology Assessment (HTA) is employed to address the issue of cost effectiveness. Because Ministers of Health and other politicians do not like to publicly turn down requests for reimbursement from actual patients, HTA agencies play an important role in underpinning these sometimes political decisions. HTA agencies may use the unit Quality Adjusted Life Year (QALY) relative to the annual price of a treatment to choose between alternative treatments.

Because reimbursement and financing of healthcare are national responsibilities not within the EU remit, much is expected from voluntary collaboration between HTA authorities under the EU flag through EUnetHTA. Aimed at sharing work and sharing results, the EUnetHTA collaboration is supported by the European Medicines Agency.

Beneluxa initiative

In an attempt to improve the efficacy of their collaboration with the pharmaceutical industry, the governments of the Netherlands, Belgium, Luxembourg, Austria, and Ireland have reached an agreement to address the issue of high prices together. The Beneluxa Initiative aims “to ensure sustainable access to innovative medicine at an affordable cost for our patients.” As the concerned member states all have organised systems of public reimbursement, this collaboration in fact aims at decreasing their national medicines bills. The idea of Beneluxa is to share information based on horizon scanning – for example, which new expensive medicinal products can we expect in the coming years? – as well as HTA results to come to a better starting position for negotiations with suppliers of expensive medicines.

Compulsory licences

Sometimes prices (or price increases) are so high that national politicians find them unacceptable. A think tank in the Netherlands, the RV&S, published a report advising the government to encourage pharmacy preparation of commercially available medicinal products, to allow patients to order medicines themselves online with a doctor’s prescription, and to grant compulsory licences in case of excessive prices. The option of compulsory licensing in case of emergencies is based on provisions in international treaties (e.g., article 31 of the Trade-Related Aspects of Intellectual Property Rights [TRIPS] agreement). The question remains if extreme pricing of necessary medicinal products really counts as an emergency allowing a country like the Netherlands, where the cost of all medicines combined makes up only 1 % of the GDP, to make use of this instrument.

Compounding an authorised medicinal product

There has been much discussion in the Netherlands about the price of the medicinal product CDCA. The pharmaceutical company Leadiant has gained authorisation for this medicinal product for the indication Cerebrotendinous Xanthomatosis (CTX). However, its price is considered far too high. In the spirit of the RV&S recommendation, one university hospital started to compound a CDCA product in its pharmacy. After a complaint from Leadiant, the healthcare inspectorate IGJ prohibited marketing of the compounded medicinal product during the period of their investigation. The IGJ recently published their report, which concluded that production and marketing of the pharmacy preparation is permitted under EU and national legislation, provided that the starting materials used comply with the relevant monographs of the European Pharmacopeia.

Less Expensive Medicinal Product Concerns

One practical problem in EU pharmacies, as in other regions of the world, is continuous supply. The Netherlands has established a hotline to register medicine shortages. Registration of shortages may lead to competent authorities allowing importation of similar medicinal products from other countries, or similar responses. About 600 shortage cases were reported in 2018.

Reasons for shortages often relate to the global materials or ingredients industry. One manufacturing problem or contamination detected in one specific active pharmaceutical ingredient could affect the global availability of the products in which it is used if there are no other suppliers. Cost containment policies for generic medicinal products of small profitability also lead to shortages because generic pharmaceutical companies tend to withdraw products that do not generate sufficient profit. In addition, generic company mergers can lead to rationalization of their common portfolio, further diluting the availability of medicines from different sources. Finally, healthcare insurers’ preference policies may lead to a steep sales decline of specific products if they designate a competitor’s product as preferred. Stocks of such products are kept relatively small.