Saturday, June 15, 2024

Value of Regulatory Data Protection in European Competitiveness

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New data demonstrates the value of regulatory data protection (RDP) and its impact on European competitiveness and patient access to medicines. The European Federation of Pharmaceutical Industries and Associations (EFPIA) highlights that European competitiveness is crucial for retaining cutting-edge science and investment. With the COMPET Council Conclusions emphasizing a strong intellectual property (IP) framework, there’s hope to reverse current trends and build a resilient, strategically autonomous Europe.

For innovative health and life science companies, European competitiveness being at the forefront of the agenda in Brussels and beyond could help reverse the loss of cutting-edge science and investment to other parts of the world. The COMPET Council Conclusions, adopted on 24 May, highlighted that a future-proof industrial policy for Europe, including a strong IP framework, should be an integral part of the Commission’s agenda in the next mandate. It could be the catalyst to prevent further decline, reverse these trends, and build a healthier, more competitive, resilient, and strategically autonomous Europe.

Despite the positive focus on competitiveness, legislative proposals may weaken European IP rights. EFPIA published new data showing the importance of RDP in Europe. Currently, Europe has stronger RDP for small molecules than the US. However, European policymakers are debating reducing RDP duration, which could harm European global investment. The European Commission proposes reducing RDP from 8 to 6 years, while the European Parliament suggests six months. RDP, crucial for companies’ research and development planning, affects about a third of all medicines.

Data Protection

Impact of Reducing Regulatory Data Protection

Reducing RDP duration will worsen the EU’s competitive position compared to the US. Critics argue that each additional RDP year costs the EU €1.23 billion annually, but this represents only 0.07% of EU healthcare spending. The European Commission’s proposals could lead to a €2 billion loss in global R&D investment yearly, affecting major life science hubs like Germany, France, and Belgium.

New data from Copenhagen Economics explores the role of RDP in depth. It clearly shows that reducing the duration of RDP in Europe will exacerbate the EU’s inferior competitive position compared with the US. A criticism leveled at RDP is that each additional year would cost the EU €1.23 billion annually, spread across 27 Member States. However, in context, this figure represents just 0.07% of overall EU healthcare spending and 0.51% of annual pharmaceutical spending. Considering the disease burden these medicines seek to alleviate, the figure represents 0.44% of the annual cost of cardiovascular disease and 0.74% of the cost of cancer in the EU.

Positive Link Between Regulatory Data Protection and Innovation

RDP significantly improves medicine availability and innovation. A study of 53 countries showed patients in countries with RDP have three times higher availability of innovative medicines. In Japan, increasing the RDP baseline to 8 years led to a doubling of clinical trials, highlighting the importance of where clinical trials take place for patient access to new treatments and creating a more attractive research ecosystem.

The data reaffirms previous studies – using different and multiple methodologies – that under the European Commission’s proposals, the EU would stand to lose around €2 billion in global R&D investment across the 27 Member States every year. Major life science hubs, like Germany, France, and Belgium, would see the highest costs. However, they are also set to lose the most in investment, with benefits larger than the costs for almost all countries. This loss of investment runs completely contrary to the calls from Heads of State and Government, who want to see Europe gain its competitive edge. It is counterintuitive from an economic perspective.

Importantly, the research highlights the positive link between RDP and improved availability of medicines and innovation, the combined ambition of the pharmaceutical legislation.A study of 53 countries – with and without RDP – shows that patients in countries with RDP have three times higher availability of innovative medicines than those without.

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Significantly, almost half of the difference in availability (45%) can be attributed to RDP. A single study shows how in Japan – with an advanced life science ecosystem comparable with Europe – a six-year RDP baseline was implemented, increasing to eight years in 2007. In subsequent years, the number of clinical trials in the country more than doubled.

EFPIA urges EU policymakers to consider these figures before making decisions that negatively impact the sector and patients. The European pharmaceutical industry has already seen a 25% decline in its share of global R&D investment over the past two decades. Cutting RDP by two years could stop clinical research on 50 out of 225 new medicines. Revising EU Pharmaceutical Legislation can prevent further weakening of this strategically important industry and ensure Europe remains a leader in developing new treatments.



Resource: European Federation of Pharmaceutical Industries and Associations, May 27, 2024

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