The new system aims to make medicines more affordable and available for citizens across the bloc but the sector is criticising key measures.
"Epic" and "enormous" were two of the words used by European Commission Vice-President Margaritis Schinas to describe the biggest planned reform to the EU's pharmaceutical legislation in 20 years.
The delayed proposal, presented on Wednesday, aims to increase medicine accessibility and affordability for EU citizens as well as fight against resistance to antibiotics.
But making the drugs more accessible and affordable means slashing the standard regulatory protection period that big pharma is currently enjoying. A disappointment for the companies which lobbied intensively against the move.
"A short way to describe [the proposal] is the triple A", said Schinas. These stand for access, affordability and availability. Access to drugs, both innovative and generics, has been one of the main challenges for the Commission as shortages increase all over Europe.
"We want our citizens all over the European Union to have the same level of access to drugs. It is not a secret that big member states up to now had better chances to obtain certain drugs faster," the Vice-President added.
For Health Commissioner Stella Kyriakides, the current situation is "unacceptable".
"Patients in the Western and bigger member states have access to 90% of newly approved medicines. In the Eastern and smaller member states the number is as low as 10%. Citizens wait from months to two or three years for these [new] medicines".
The boost in accessibility should also come with "more generics coming in and prices falling down", said Schinas. This will be done by increasing transparency of public funding to give leverage to member states when negotiating medicines prices.
Schinas is aware that "pricing is a national competence" but "there are many things we can do [at EU level] to influence the ecosystem of pricing".
Yearly the cost of medicines in the EU equals 2 to 3% of GDP, something that the new reform aims to bring down.
Reduced data protection for big pharmas
Under the Commission's proposals, the regulatory protection granted to companies developing innovative medicines is to be reduced to eight years including six years for data protection and two years for market protection — compared to 10 years at the moment.
This means that by year six new companies will be able to start developing a generic medicine that could enter the market on "day one after" the protection expires, Kyriakides stressed.
But the companies will be able to increase this protection period up to a maximum of 12 years, up one year from the current maximum, if they take additional steps.
For instance, if they launch the medicine in all member states they can secure another two years, if the medicine addresses an unmet medical need they can claim an additional six months, just as if comparative clinical trials are conducted
But this has already brought anger from pharma companies.
"The approach set out in the pharmaceutical legislation penalising innovation if a medicine is not available in all member states within two years is fundamentally flawed and represents an impossible target for companies," Nathalie Moll, director general of the European Federation of Pharmaceutical Industries and Associations, said in a statement.
The Commission flatly disagrees with Kyriakides arguing that the bloc "will continue to have one of the most competitive and industry-friendly incentive systems in the world."
Tackling the "silent pandemic"
The EU's executive also addressed the "silent pandemic" that leads to 35,000 lives being lost across the bloc every year: antibiotics resistance. This problem also costs about €1.5 annually.
The European Commission will recommend antibiotics' use be reduced by 20% and plans to introduce a "voucher" system to incentivise companies to invest in innovative antimicrobials that can "treat resistant pathogens, addressing the current market failure".
There is currently little research into new antibiotics due to their low revenues.