European Commission reveals action plan to address medicines shortages

Background on E.U. medicines shortages

• Medicines shortages have been identified as a major health concern in Europe for many years now. A 2017 European Parliament resolution called on the European Commission and the European Council “to formulate a better definition of the concept – and analyse the causes – of shortages of medicines.” The European Parliament also “notes with concern that the EU lags behind the USA as regards a standardised and transparent reporting mechanism on the causes of medicines shortages.” A 2020 European Parliament resolution said that the problem had “worsened exponentially in recent years.” Shortages increased by 60% between 2017 and 2019 in select European countries, the U.S., and Canada, according to a report from the Organisation for Economic Cooperation and Development (OECD).
• The Pharmaceutical Group of the European Union (PGEU) conducted a survey finding shortages worsened in 2022 compared to 2021, with most European countries reporting worsening. All but one of the 29 countries surveyed reported shortages of more than 50 medicines, with seven reporting more than 600 medicines in shortage.
• In 2020, the European Commission adopted the Pharmaceutical Strategy for Europe, noting that medicines shortages “have been a serious concern in the EU for several years.” Pillar three of the strategy addresses this concern directly, calling for better crisis preparedness and response mechanisms, as well as diversified and secure supply chains. The Pharmaceutical Strategy document notes that Covid-19 just compounded medicines shortages that had already impacted patient health and the E.U. healthcare systems for years. Currently, only Article 23a and Article 81 of Directive 2001/83/EC address medicines supply across the E.U.

Several legislative efforts are under way to ensure supply of medicines in the E.U.

• In response to challenges brought to light during the Covid-19 pandemic, including shortages of medical products, the European Commission issued proposals to establish a “European Health Union.” Regulation (EU) 2022/123 became applicable on March 1, 2022, with the exception of most provisions related to medical devices. The regulation expanded EMA’s mandate to monitor and mitigate shortages, as well as establish lists of critical medicines during major events that affect public health. It also established the Health Emergency and Preparedness and Response Agency (HERA). [See AgencyIQ’s analysis of EMA’s milestones.]
• The “European Health Union” regulation gave EMA a key role in mitigating shortages, while also requiring supply chain actors to engage in additional transparency measures. According to a press release, NICOLÁS GONZÁLEZ CASARES, the proposal’s lead rapporteur, noted: “The new regulation makes both the Agency and all actors in the supply chain more transparent […] And, with the new European Shortages Monitoring Platform, we provide the Agency with a key tool to monitor medicines supply and prevent shortages.” [See AgencyIQ’s analysis of the proposal on strengthening the EMA and milestones.]
• Notably, in April 2023, the European Commission unveiled its proposed revision to the pharmaceutical legislation, which contains extensive provisions to address and prevent shortages. Under the proposal, these elements would be addressed within the revised pharmaceutical regulation, thereby addressing drug shortages at a consistent, E.U.-wide level. [See AgencyIQ’s analysis of the proposed regulation.]
• A non-paper drafted by the Belgian government in May 2023, obtained by POLITICO Pro EU, calls attention to the continuing issue of medicine supply shortages. The document, titled “Improving the security of medicines supply in Europe,” notes that antibiotics, thrombolytics and insulin have been “difficult to obtain” over the past few months and that antipyretics and painkillers are in short supply. The non-paper (an informal document used in closed negotiations within E.U. institutions) then reviews the multi-factorial causes for these shortages across the E.U.
• The non-paper suggests three action points complementary to current legislation. In the short-term, the non-paper calls for installation of a solidarity mechanism within the Executive Steering Group on Shortages and Safety of Medicinal Products (MSSG) as a temporary bridge strategy. For the mid-term, the non-paper proposes monitoring the supply and production chain of a list of critical medicines. And in the long-term, it recommends a “Critical Medicines Act” to reduce dependency on only a few suppliers of critical medicines and ingredients. [Read AgencyIQ’s analysis of the non-paper.]
• The European Commission presented its stance on ensuring medicines supply in a European Parliament plenary meeting on October 3, 2023. STELLA KYRIAKIDES, European Commissioner for Health, emphasized that addressing ongoing issues with availability of safe, effective and affordable medicines has been a priority since the beginning of the mandate. The proposed pharmaceutical legislation provides additional tools to identify and mitigate shortages. The European Commission promised to release a communication providing a toolbox of actions to enhance security and availability of medicines at all times. [See AgencyIQ’s analysis of the Parliament discussion.]

Several pandemic-era mechanisms to monitor medicine supply and prevent shortages are still in effect

• Article 81(2) of Directive 2001/83/EC obligates marketing authorization holders to “ensure appropriate and continued supplies” of an authorized medicine. The provision aims to ensure patient access to medicines where they have been marketed. Article 23a of the directive requires marketing authorization holders to notify competent authorities of any intent to cease temporarily or permanently to market a certain medicine with justification. However, unforeseeable events or commercial decisions still lead to medicines shortages.
• The Executive Steering Group on Shortages and Safety of Medicinal Products (MSSG) has supported E.U. level coordination to address critical shortages. Regulation (EU) 2022/123 reinforced and expanded the EMA’s mandate to play a more significant role in E.U.-wide monitoring and mitigation of shortages. EMA takes a leading role in the coordination shortage prevention, management and communication among Member States, industry and the public, and also consults with industry and Member States to determine if a certain situation requires specific recommendations. The regulator released good practice guides for industry and patients/healthcare providers.
• Joint procurement and stockpiling were two effective mechanisms to ensure medicines supply during the Covid-19 pandemic. According to the EC, “joint procurement of medicines or the procurement of medicines on Member States’ behalf (e.g. in the case of the COVID-19 pandemic) provided a powerful tool to improve access, affordability, and security of supply” of medicines. The Union Civil Protection Mechanism (UCPM) provides cross-border assistance while rescEU developed specific medicine reserves during the pandemic.
• However, the EC recognizes the need for new approaches to address shortages.. The European Council invited “the Commission to propose an initiative for urgent measures to ensure sufficient production and availability of the most critical medicines and components in Europe and to diversify international supply chains” in its June 2023 conclusions. Kyriakides noted during the October 3, 2023 Parliament discussion that proposing new legislation would be a significant undertaking. This week, the EC released a Communication that, in the absence of legislation, still puts forth imminent and longer-term structural changes to address medicines shortages.

Definitions: “Critical medicines“ and “critical shortages”

• The commission’s Questions and Answers document notes that “critical medicines are medicines for which no appropriate alternative is available and for which insufficient supply would result in a serious harm or risk of harm to patients. These medicines are considered to be essential to ensure the continuity of care, the provision of quality healthcare and guarantee a high level of public health protection in Europe.”
• “A shortage occurs when the supply of a medicine does not meet the demand for that medicine,” explains the EC. Critical shortages are those shortages that “require coordinated action at the European level, with close involvement of the European Medicines Agency (EMA) and Member States, to resolve the situation.”
• The European Commission issues “ communications” as a way to outline future policies. Communications may include policy evaluations, commentary or explanations of action programs or brief outlines on future policies or agreements concerning details of current policy,” according to the E.U. Monitor. The current document seems to provide a combination of those information types.

Immediate short-term actions aim to prevent medicines shortages this winter season

• A key priority for this winter season is availability of antibiotics that the EMA and HERA have identified as critical. The regulators simulated supply against demand to determine potential shortages. The three key measures to achieve this are “deploying regulatory flexibility,” joint procurement, and a Voluntary Solidarity Mechanism (see below for more detail). Other measures suggested to ensure adequate supply include continuous monitoring and repeated runs of the simulation, stakeholder measures such increasing manufacturing capacity, information exchange and solidarity with international regulators, and encouraging prudent use through information to the public.
• The European Commission plans to establish a list of critical medicines by the end of 2023, with work well underway in collaboration with the EMA and Member States. The list will potentially include pediatric medicines and antibiotics, with ongoing analysis ensuring that the list stays updated as new health threats emerge and new therapeutics are developed. An analysis of supply chain vulnerabilities based on this list will inform further recommendations, such as for supply chain diversification or increasing production.
• Processes for forecasting medicines demands to anticipate supply needs could be improved. Demand forecasting can provide an early warning about potential shortages, supply and production capacity, as shown in a reflection paper providing recommendations and examples based on Covid-19 learnings. The EC calls for a best practice guide to improve comparability between forecasts. The commission is also working to establish a mechanism for demand signaling and is evaluating longer term demand trends. The E.U. Shortages Monitoring Platform established by Regulation (EU) 2022/123 Article 13 should be up and running by 2025.
• The proposed pharmaceutical legislation revision includes various provisions that could enhance security of medicines supply. “Key elements include a new European alert system with earlier notification of shortages and withdrawals by companies, harmonised reporting criteria, mandatory shortage prevention plans and coordinated management of shortages by EMA,” according to the Commission’s announcement this week. Although the proposed provisions only come into force after the legislation itself would enter into force, the EC notes that some of the actions on prevention and mitigation of shortages are already ongoing. Communication seems to be key to reducing the risk of shortages, including information-sharing on critical shortages to ensure E.U. coordinated actions, recommendations by the EC and EMA on shortage mitigation, and continuous EMA-industry communication during critical shortages.
• “Regulatory flexibilities” can mitigate shortages and ensure supply of safe and effective medicines, including facilitating fast authorization and supply of alternative medicines, scaling up production, authorizing alternative raw material or finished product suppliers, product redistribution, and temporary shelf-life extension. Such flexibilities during the Covid-19 pandemic showed that safety and quality standards were not compromised. The MSSG has released a toolkit with a set of recommendations on flexibility in times of medicines shortages, though some of the recommendations can only be used in exceptional circumstances.
• Joint procurement can improve access, affordability, and supply security. The EC suggests that joint procurement could enhance the Member State negotiation position, enhance supply predictability through multi-year contracts and incentivize increased production capacity and supply chain diversification. Beneficial procurement practices include market consultation, awarding contracts to multiple bidders to minimize the risk of supply disruptions, and making contracts long enough to provide predictability and long-term availability. In early 2024, the EC plans to issue guidance on procurement that will include such measures as making supply security an award criterion; a law in Germany already ties the tender award to production of the active pharmaceutical ingredient in Europe.

The EMA’s Medicines Shortages Group (MSSG) implemented a Solidarity Mechanism and a shortages toolkit

• A new “Voluntary Solidarity Mechanism for Medicines” enables Member States to flag medicines in critical shortage, alerting other Member States who can then check stock availability in their country. The UCPM can be activated for urgent needs, with the European Response Coordination Center helping with logistics. This mechanism will be supported by a “matchmaking platform” where stakeholders can indicate capabilities and collaboration needs in mid-2024.
• “The solidarity mechanism is a voluntary mechanism which allows MS [Member States] to request assistance from the MSSG in obtaining stocks of a medicine during critical shortages,” according to the MSSG guideline. The mechanism only serves as a last resort; five specific conditions must be met: 1. no available alternative treatments, 2. prior EMA notification of the shortage, 3. foreign stock or other urgent measures don’t address the shortage, 4. the situations is urgent with a shortfall within 1 month, and 5. insufficient stocks for critical indications must be met. Member states have to meet all five criteria and provide complete information to trigger the Solidarity Mechanism.
• Once the Solidarity Mechanism has been launched, Member States will have 5 working days to respond with their ability to provide assistance, with an extension of up to an additional five days. The MSSG will determine whether the request is complete within two working days. The EMA will compile the information and facilitate communication between the requesting Member State and those Member States that can provide assistance. Further discussions with he MSSG will be initiated if no Member State can provide support.
• The MSSG has also issued a toolkit with options to address medicines shortages. According to the toolkit, “recommendations will be assessed by the MSSG on a case-by-case basis, considering their proportionality, and tailored individually according to the medical need and criticality of the shortage of concern.” The recommendations address six key areas: 1. Supply monitoring, 2. E.U. cooperation, 3. Supply increase and fair distribution, 4. Regulatory flexibilities, 5. Communication and engagement and 6. International cooperation. Member States need to report the actions they take, and justify any divergence from recommendations, to the EC or MSSG.
• Regulatory flexibility recommendations address three key areas: Prompt implementation of certain source and manufacturing changes, support for “agile product redistribution between markets,” and shelf-life extension. Changes that could be implemented rapidly include using different sources of raw materials and/or finished product, packaging, or changes to batch sizes, manufacturing sites, and equipment. Although most measures can be used generally to address shortages, the toolkit also contains some measures that can only be used in exceptional circumstances, such as applying the Exceptional Change Management Process.
• The Exceptional Change Management Process (ECMP) allows implementation of changes which would generally require regulatory approval, if the changes will prevent or mitigate a critical shortage. The process includes imposing certain conditions to ensure quality despite a deferral of complete evaluation of the change, and the ECMP can only be used based on a recommendation by the MSSG and upon instruction from relevant regulators. It does not apply to changes that can be implemented through Type IA variations.

A “Critical Medicines Alliance” will support mid- and long-term structural changes to ensure greater resilience in medicines supply across the E.U.

• Kyriakides mentioned during the Parliament discussion that new legislation requires extensive preparation, including the assessment of economic impacts. Therefore, the EC is currently not planning to propose a “Critical Medicines Act,” but rather plans to “launch a dedicated, preparatory study by the end of 2023, paving the way for an impact assessment.” [See AgencyIQ’s analysis of the Parliament discussion.]
• A “Critical Medicines Alliance” for coordinated E.U. action against shortages will be set up by early 2024. This alliance would be a forum for national authorities, the EC, other E.U. agencies and civil society representatives to use available tools to manage and mitigate shortages. A first order of business would be to identify supply chain bottlenecks and the tools that can mitigate the E.U. structural risks that lead to shortages. The Critical Medicines Alliance should be able to “better leverage and align EU and national funding,” ensuring long-term predictability of investment.
• Public procurement practices could ensure greater supply chain resilience and hit targets for an adequate supply to meet needs. Medium-term contractual incentives prioritizing diversification and “the next generation of manufacturing” could enhance predictability of supply. Another approach suggested in the communication is to use “capacity reservation contracts” similar to those employed in the EU FAB project, where manufacturing capacity is reserved ahead of time for critical medicines, as was done for vaccines through EU FAB.
• Shortage risks could be limited through “Services of General Economic Interest (SGEI)” and “Important Project of Common European Interest (IPCEI)” initiatives. The alliance will be tasked with exploring options to “boost Europe’s capacity to produce and innovate in the manufacturing of critical medicines and ingredients in coordinated and competitive way.” Services would be contracted based on specific criteria and Union priorities. The alliance could consider IPCEIs to support development of advanced technologies and sustainable manufacturing for generics, for example.
• The EC plans to build a common strategic approach to medicines stockpiling with E.U. Member States in the first half of 2024. National legislation in some E.U. Member State obliges supply chain actors to maintain a contingency stock but the cost and potential waste of unused but expired medicines, as well as potential impacts on other Member States, are drawbacks of national stockpiles, the document points out. The EC plans to launch a joint action on stockpiling to define needs for E.U. critical medicines stockpiling and to improve national stockpiling strategies. The action will draw on experience gathered through the UCPM and rescEU.
• Additionally, the EC plans to work with international partners to diversify supply chains and ensure regulatory convergence. Pharmaceutical supply chains are complex, and the commission plans diversification through a “broad range of essential inputs” to reduce supply chain vulnerabilities. The EC plans to “set up strategic partnerships with third countries for production of critical medicines” and active pharmaceutical ingredients to ensure diversification and supply chain resilience. A “network of international partners” could bring together manufacturers and “key consuming countries” for knowledge sharing and crisis preparedness. Additionally, regulatory convergence through measures such as implementation of International Conference on Harmonization guidelines could reduce regulatory obstacles and supply bottlenecks.

Summary of proposed timeline for EC and EMA action points

What’s next

• Although the EC has no immediate intent to develop a Critical Medicines Act, this communication paves the way for future legislation. Notably, the planned dedicated preparatory study provides a basis for a future impact study to determine if a Critical Medicines Act would be economically possible. Going through these and other steps, such as a formal impact assessment and consultation, means such an Act won’t be seen soon. European Parliament elections are set for June 6 – 9, 2024, so incoming legislators may change course completely on any future legislation.
• The communication establishes a long list of actions, mostly over the next year. Recommendations in the communication mainly focus on immediate and short-term actions and are less detailed on longer term structural changes. However, several actions planned to be conducted by early 2024 should provide insight into the future directions for long-term shortage prevention policies. For example, the list of critical medicines is expected by the end of this year and the EC plans to have analyzed the supply chain vulnerabilities of those medicines by April 2024. This study would provide insight into root causes and further actions needed that likely would impact the pharmaceutical industry, such as recommendations for reshoring and ramping up E.U.-based production.
• Although the recommendations are generally for regulators and legislators, industry stakeholders should review the communication. Some proposed actions may either pose challenges or provide opportunities for industry stakeholders. Better aligned E.U. and national funding and a manufacturing capacity reservation program, for example, may provide opportunities for some stakeholders. However, the need to diversify supply chains for critical medicines might be challenging if manufacturers are limited for the active pharmaceutical ingredient or other ingredients. Familiarity with this array of new actions could enable an agile response as these plans unroll.

To contact the author of this item, please email Kirsten Messmer ( kmessmer@agencyiq.com).
To contact the editor of this item, please email Kari Oakes ( koakes@agencyiq.com).

Key Documents and Dates

• Press release – Commission steps up actions to address critical shortages of medicines and strengthen security of supply in the E.U., October 24, 2023
• Press release – EMA takes further steps to address critical shortages of medicines in the E.U., October 24, 2023