The European Federation of Pharmaceutical Industries and Associations (EFPIA) has released a detailed position paper on the Biotech Actincluding a thorough impact assessment of the European Commission‘s proposals to extend Supplementary Protection Certificates (SPCs) by 12 months. This assessment is the first to analyze both the costs and benefits to the economy, patients, and health systems.
As the European Parliament deliberates on the Biotech Act, EFPIA’s analysis suggests that the current scope of the SPC extension is too narrow to drive substantial impact. By expanding the scope and eligibility criteria, the EU could attract over €45 billion in inward investment and create up to 24,500 new clinical trial places over 15 years.
The Current Landscape and Global Competition
Recent research indicates that the EU lags behind the US, UK, and Switzerland in terms of intellectual property offerings, just ahead of China. In its current form, the proposal is unlikely to significantly influence company investment decisions. To remain competitive, Europe must enhance its offerings.
A new report commissioned by EFPIA from Copenhagen Economics provides a comprehensive cost-benefit impact assessment of the European Commission’s SPC proposals. The research evaluates the impact on patient access to new medicines, the value for healthcare systems and society, and the economic benefits through employment and Gross Value Added (GVA) contributions. It also examines the effects on R&D expenditure, the number of clinical trials, and the future medicines pipeline.
Key Findings and Scenarios
The analysis explores eight scenarios, revealing that the scope and eligibility criteria are the largest drivers of benefits, while the duration of the extension primarily drives costs. This suggests that Europe can maximize the effectiveness of the SPC extension by focusing on a broad scope and flexible eligibility criteria, while maintaining a minimum 12-month extension.
Under the Commission’s proposal, an estimated 2,200 more patients could be enrolled in clinical trials, with two new innovative medicines brought to the market over 15 years. However, broadening the scope could significantly increase these numbers to 24,500 more patients in clinical trials and 18 new medicines developed in the EU over the same period.
Investment and Economic Impact
The report highlights a ten-fold increase in R&D investment under the broadest scenarios compared to the narrowest for both 12- and 24-month extensions. The investment ranges from approximately €4 billion to €45 billion for a 12-month extension and €8 billion to €90 billion for a 24-month extension.
All scenarios generate benefits to patients, and six out of eight scenarios are likely to generate a positive return on investment for the European economy. The estimated increase in spending is limited, with a 12-month SPC extension for biologics with narrow eligibility increasing healthcare spending by just 0.003% and pharmaceutical spending by 0.02%. Expanding the scope to all compounds and applying broad eligibility criteria increases the impact to 0.07% of healthcare spending and 0.5% of pharmaceutical spending. Only under the most expansive scenario does the increase reach 1%.
Industry Support and Future Outlook
The industry continues to support the implementation of the Biotech Act, emphasizing the need for harmonization and shortening of clinical trial timeframes, alongside a coherent and predictable regulatory framework. However, the Act and SPC extension alone cannot deliver the required change for Europe to compete with the US and China.
Nathalie Moll, Director General of EFPIA, stated, “While the Biotech Act offers great potential, the benefits risk being derailed if Europe takes an overly narrow approach to the SPC extension. As global competition increases, every research project that happens elsewhere represents a lost opportunity for European patients, investment, skilled jobs, and future growth. Europe cannot afford to let the world’s most innovative medicines research happen elsewhere. This would be completely at odds with the recommendations of the 2026 Draghi report.”
