The European Union plans to expand drug production in the bloc by offering manufacturers state aid and incentives for EU-made products, Politico reports.
After more than 12 hours of discussions, the European Parliament and the Council of the EU agreed on new public procurement criteria that would move away from giving preference to the cheapest drugs and instead focus on supply chain security. The new law aims to reduce dependence on countries like India and China for critical medicines, diversify supply chains and support local production.
During the Covid-19 pandemic, reliance on a few countries outside the EU led to shortages of critical medicines. This has been a long-standing problem for the bloc, and any disruption in production affects EU stocks.
Cypriot Health Minister Neophytos Charalambides said people should not worry about whether their nearest pharmacy or hospital will have access to essential medicines, such as antibiotics. The minister stressed that the agreement was a move to reduce the bloc’s vulnerabilities and boost Europe’s ability to produce medicines and their components closer to home.
Over the past decades, European pharmaceutical supply chains have increasingly shifted to third countries where production is cheaper. The medical sector has said that
the trend has been exacerbated by EU countries’ large-scale procurement, which prioritises the cheapest medicines.
The Critical Medicines Act addresses this issue, as does US efforts to expand production of medicines. The EP’s lead negotiator on the law, Tomislav Sokol, said it was an effort to preserve European industry, which he said was essential.
The changes to procurement rules were among the most controversial measures agreed by EU lawmakers in the early hours of the 12th of May, with more than four hours spent on the subject alone. The EP wanted to give priority to critical medicines that are at least 50% produced in the EU in the procurement of medicines. The compromise reached allows procurers to give preference to products manufactured in the bloc, with remuneration increasing in line with the proportion of medicines produced in Europe.
National governments have opposed the mandatory inclusion of EU-made products, as these medicines are expected to be more expensive. Given that European healthcare systems are already under financial pressure, the costs of more expensive medicines will be difficult to include.
The new text also includes criteria for so-called EU industrial strategic projects,
which are designed to build, modernise and increase the production capacity of critical medicines. The projects will receive state or EU financial support, but they will have to comply with clear conditions, including a commitment to work primarily for the European market.
The Parliament’s success is also the inclusion of expensive medicines intended for the treatment of rare diseases in the law, which means that they will be included in both state aid programs and joint procurement, thus making medicines more accessible, especially in the bloc’s smaller member states.
The changes envisage abandoning the previously mandatory redistribution of medicines by the EU, when medicines are transferred to countries that currently lack them. At the same time, the countries agreed to increase the transparency of stocks.
In the future, countries will be able to join forces to purchase medicines, thus increasing purchasing power and ensuring wider access to medicines, however, the section that allowed the European Commission to participate in joint medicine purchases, which was considered an interference in the work of the countries, has been removed from the law.
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