No-one can accuse the European generic industry of indolence. It supplies huge quantities of medicines to European healthcare suppliers — its volume is estimated at around a half of the market. It is accounting for a growing share of marketing authorization applications in Europe. And its industry association, the EGA, has turned it from being the Cinderella of the pharmaceutical industry into one of the most vocal players on the European pharma politics stage.
The European Generic Medicines Association, to give it its full name, certainly showed a fine sense of timing in late January with the launch of its five-year plan for boosting the use of generics. It came out with its manifesto just days after the European Commission had announced another round of measures to put the squeeze on innovator drug firms that try to hinder the launch of generic copies.?
The combination of initiatives presents a formidable challenge to the innovative industry at what is already a difficult time. The European Commission, which is the EU’s competition authority, has requested a number of originator and generic companies to submit copies of their patent settlement agreements reached last year.
The scrutiny is a further phase of its bid — conspicuously begun with the pharma sector inquiry it conducted two years ago — to prevent what it sees as anti-competitive deals that delay market entry of generics. The Commission says there are “significant risks” that European consumers are being denied access to cheaper medicines. And it claims that as a result of its actions to date, “potentially problematic agreements have decreased significantly.”
Without question, the effect of the Commission’s interventions, including this latest probe, has been to bring new uncertainties into product life-cycle planning for innovative companies — what the Commission artlessly alludes to as “an increased industry awareness of which settlement agreements may attract competition law scrutiny.”
EGA detects an ally in the Commission, and a soft underbelly in the innovative sector. The EGA five-year plan includes demands for changes to the EU regulatory environment “to deal with the growing demand for generic and biosimilar medicines.” It wants a broader interpretation of the EU concept of the reference product “so as to reduce the unnecessary repetition of clinical studies.” It wants measures to prevent “anti-competitive strategies” aimed at delaying the entry of generics and biosimilars. It wants the EU’s decentralized authorization procedure to be streamlined, with “improved” mutual recognition, and modifications to the centralised procedure to make it easier for generics to access it. And it wants member state medicines agencies to provide information on generic and biosimilar medicines, and to prevent “negative campaigns” against them.
The generics industry is on a roll. Naturally, like many other private enterprise concerns, it wants to increase its market share. But it can argue its case by appealing to a less conspicuously self-interested concept that is now, very conveniently for EGA, all the rage in Europe. The generics industry is arguing that generics “hold the key to healthcare sustainability in the EU.” That sounds like an excellent idea to nearly everyone. Sustainability is a good clean word, and hard to argue with. And healthcare authorities in Europe have been bandying it about for months as if the word itself was a panacea.
Recent debates in the European Parliament and the Council of the EU have repeatedly highlighted its importance and given it almost sacred status.? At the same time, EGA is able to exploit to the full the “Big Pharma bad guys” assumptions that underlie much of the current European debate on healthcare in general and medicines in particular, with more than a following wind from the suspicions so publicly aired by the European Commission’s competition investigations. ?But life is not always simple — and certainly not in the world of European medicines.
The “sustainability” being championed is open to question, because while it may mean “cheaper” (and as far as the EGA argument goes, it certainly does), but over the longer term, if it fails to deliver new medicines too, its sustainability may appear quite different.
Similarly, any assumption that the health of competition (and hence the health of the population) is best promoted by extravagant campaigns focusing on end-of-patent situations should equally be subject to challenge.
EGA is a powerful advocate for its view of the world. The innovative medicines sector deserves equally eloquent representation. All the evidence in the EU at present is that research-based companies are not getting their arguments across. They should.
Reflector, Brussels Correspondent.