Critical Medicines Unavailable in Croatia, Awaiting EU ‘Pharma Reform’

The modernization of the pharmaceutical sector across the European Union aims to ensure fair and timely access to medicines for all citizens, whether from developed or less developed EU countries, strengthen pharmaceutical supply chains, and enhance the competitiveness of the entire European pharmaceutical industry. These are the primary goals of the new European pharmaceutical legislation reform, which could come into effect as early as 2026. Brussels is already refining proposals for a new Directive and Regulation, as well as a proposal for the Critical Medicines Act, with support from the pharmaceutical industry, which states that the reform should also stimulate development and investment in biomedical research in Europe.

Favorites of Wealthy Markets

One of the most important goals of the reform is to improve the availability of medicines in all member states. In practice, this means that pharmaceutical companies will no longer be able to restrict certain medicines to wealthier markets but will have to ensure their availability in smaller or poorer EU countries, such as Croatia. Currently, patients in poorer Eastern EU countries, including ours, receive new medicines years after their Western, more developed counterparts. Sometimes they never receive them at all. Pharmaceutical regulatory approvals are paid for each European market separately, which is both expensive and time-consuming, leading some companies to avoid accrediting new medicines for poorer markets as they consider such business logic unprofitable. Favoritism towards wealthy Western countries that pay more for medicines will no longer be tolerated, especially not for medicines intended for children or for rare diseases.

The new reform aims to address another challenge that has only recently come to light. The COVID-19 pandemic and all subsequent disruptions in global supply chains have highlighted the fragility of the pharmaceutical autonomy of the Old Continent. The Critical Medicines Act therefore anticipates strengthening production capacities within the EU and reducing dependence on raw materials from China and India. Plans include creating a European list of critical medicines, monitoring stocks, and diversifying supply routes to avoid new shortages.

EU – Leader in Innovations?

The reform also aims to restore the EU’s position as a global leader in pharmaceutical innovations. The new model for market data protection will be more flexible, and companies that develop innovative medicines and make them available in all Union markets will receive additional years of exclusivity.

This is particularly important for the entire pharmaceutical industry, as confirmed by Roberta Savli, Executive Director for Public Relations at EFPIA (European Federation of Pharmaceutical Industries and Associations), who tells Lider that the EU has lost 25 global investments in biomedical research over the last two decades, mostly to the benefit of the USA.

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Roberta Savli

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– The USA currently leads in all key investment indicators, from capital availability, intellectual property protection, drug approval speed, to innovation reward systems. Geopolitical uncertainty and ambitious strategies from other global regions have further accelerated the need for decisive European action. If nothing is done, negative trends will continue – warns Savli, noting that Europe is currently the slowest region in approving new medicines. On average, approval takes 426 days, while in the USA, the process takes only 244 days.

It is Crucial to Seize the Opportunity

The revision of European pharmaceutical legislation provides an exceptional opportunity to adopt a regulatory framework that encourages innovation, and it is important to take advantage of this opportunity. If Europe does not take decisive measures and invest in a globally competitive pharmaceutical ecosystem, it risks becoming solely a consumer of innovations from other parts of the world, which would have serious consequences for the health and safety of the European population – states Savli, raising another issue: clinical trials. She adds that the USA and China offer the industry more attractive conditions and incentives, which is why European research and production capacities are shifting towards those countries.

– China has doubled the number of commercial clinical trials and now holds an 18 percent share of the global market, while the European share has fallen from 22 percent in 2013 to just 12 percent in 2023, which means about 60,000 lost trial sites for European patients – said the EFPIA representative.

Incentives for Startups

She also added that the lack of dedicated funding at the EU level is forcing many biotech startups to seek support outside Europe. Between 2018 and 2020, she says, only 25 percent of new biotech companies were launched in Europe, while as many as 65 percent were established in the USA, and this also needs to change with incentives for small and medium-sized enterprises and biotech startups.

The reform of EU pharmaceutical legislation is aimed at improving access to medicines in all EU countries, including the Republic of Croatia, even in the production of generic medicines, states Ana Gongola, President of HUP – Association of Pharmaceutical Manufacturers and a member of the management board of Sandoz Croatia.

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Ana Gongola

photo Ratko Mavar

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– About 70 percent of all issued medicine boxes in Europe are generic medicines, and in Croatia, this share is around 65 percent. However, in recent years, there has been a consolidation of the generic medicine industry and globalization of supply chains, leading to increased risks of shortages across the EU. When we compare 2024 with the period ten years ago, we see that 30 percent of medicines classified as critical have completely withdrawn from the market at the EU level. The situation is even more alarming in Croatia, where as much as 40 percent of critical medicines have been withdrawn, and as a country, we lead in the number of withdrawals compared to 17 other countries included in the research – emphasizes Gongola.

Awaiting the Council of Europe!

The key reason for this, she warns, is the excessively low market price of medicines, which is highly regulated and not determined by market mechanisms of supply and demand, nor is it aligned with production costs, increasingly expensive raw materials, rising labor costs, and increased regulatory and green requirements. As in any other economic sector, the production of medicines is not possible if the prices of those medicines do not even cover the costs of their production, concluded Gongola.

Now it is up to the Council of Europe! The European Commission has presented a draft of the new so-called pharma package to the Council of Europe and the European Parliament, which provided its comments on the European Commission’s proposal in April 2024. Now the Council of Europe is awaited, specifically the Working Group on Medicines and Medical Devices composed of experts from relevant fields. Each member state needs to adopt its framework national position on the legislative solutions devised by the Commission and on compromises, if necessary, which still needs to be discussed. After an agreement is reached in the Council of Europe, the phase of tripartite negotiations begins between the so-called co-legislators, which are the member states represented by the presiding member state of the Council of Europe based on the mandate from the compromise text, the European Parliament, and the European Commission. During negotiations and exchanges of views, the final text, i.e., the new Regulation and new Directive, which are binding for all member states, is agreed upon.