Introduction to the EU Pharmaceutical Reform

After the European Commission published the proposed regulation regarding the EU pharmaceutical reform on 26 April 2023, the ENVI (Committee on the Environment, Public Health and Food Safety) proposed several amendments. The European Parliament adopted these amendments without changes as its position on 10 April 2024.

 The new regulation will replace Regulation (EU) 141/2000 on orphan medicinal products, as the current legislation no longer meets the needs of both patients and the pharmaceutical sector. Currently, 95% of the 6000+ recognised rare diseases have no treatment options. 

Below, we outline the main changes addressed in the European Commission proposal compared to the current legislative framework and the proposals following the European Parliament’s position, taking the new proposals into account.

Prevalence criterion and specific designation criteria

Following the European Commission proposal, the prevalence criterion (not more than five affected persons per 10,000) is still maintained as the appropriate threshold under the proposed directive. However, since this criterion is not suitable for all rare diseases, the European Commission will be able to establish specific designation criteria for certain conditions, such as those with a short duration and high mortality rate. 

Significant benefit criterion and removal of ROI criterion

The additional criterion of “no satisfactory method” (or alternatively establishing “significant benefit” over existing methods) also remains in place. The previous alternative criterion, which required medicinal products to likely not generate a sufficient return on investment to qualify for an orphan designation, has been omitted from the proposed directive. 

Another change to the current legislation is the proposed limitation of the current unlimited validity of the designation to 7 years, with the possibility of an extension. The European Parliament, in their adopted text of 10 April 2024, takes the position that an orphan medicine may lose its orphan status if the population criterion is no longer met.

New framework for market exclusivity

In their initial proposal, the European Commission aims to adopt a new framework for market exclusivity of variable duration, replacing the (in principle) 10-year market exclusivity for orphan medicinal products. According to proposed article 71(2)(a), the market exclusivity for orphan medicinal products will last for nine years in principle.

It was proposed by the European Commission that orphan medicinal products addressing a high unmet medical need would have market exclusivity for 10 years (article 71(2)(b)). Orphan medicinal products which have been authorised based on bibliographic data according to article 13 of the proposed new regulation would have a 5-year market exclusivity (article 71(2)c)). However, in the adopted proposal of the European Parliament, the market exclusivity for orphan medicinal products addressing a high unmet medical need is amended to 11 years, and the market exclusivity for orphan medicinal products authorised based on bibliographic data will be 4 years.

As already followed from the European Commission proposal, the market exclusivity can be extended for a year based on meeting certain supply obligations in all Member States. The criteria to derogate from market exclusivity remain the same as in the current legislation. Where a marketing authorisation holder holds more than one orphan marketing authorisation for the same active substance, these authorisations will not benefit from separate market exclusivity periods.

Aims of the New Market Exclusivity Framework

The European Commission aims for the new market exclusivity framework to improve competitiveness and reduce prices, providing manufacturers of generics and biosimilars with opportunities for faster market entry. The proposed regulation seeks to achieve this through article 71(6), which ensures that the application for and granting of a marketing authorisation for similar medicinal products is not prevented by the initial market exclusivity of orphan medicines, if the remainder of this initial market exclusivity is less than two years.

According to article 73 of the proposed regulation, the working arrangements referred to in the new fee regulation will set out total or partial reductions for EMA fees related to orphan medicinal products. Other support for orphan medicinal products development, by means of scientific and regulatory advice, will be further strengthened under the proposed regulation. According to article 60(1)(b), the EMA can offer enhanced scientific and regulatory support for orphan medicinal products which are likely to address a high unmet medical need.