Concern has been mounting about the future of Europe’s regulatory environment for medicines and medical technology, but the growing anxiety isn’t limited to Brussels, London or Munich. Companies from Boston to Tel Aviv to Singapore have a lot riding on Europe. For better or worse, the unease being felt around the world is a mark of both how important the healthcare products sector is to Europe and how important Europe is to the global healthcare products sector.
Europe’s Position as Key Hub for Medicine, Healthcare
Europe comprises about 29% of the global medtech market and 22.2% of the global market for pharmaceuticals. It is easily the second largest market in the world for these vital healthcare products after the United States, and is worth more than €300 billion (nearly $350 billion). Both European and global life sciences companies have invested significantly in European operations with nearly 2,000 pharma companies and 27,000 medtech companies operating in Europe, employing a total of more than 1.4 million people in the region.1
Factor in the indirect employment these industries generate—estimated to be up to 3 million additional jobs created by pharma alone—and investment in Europe-based research and development, and we are talking about a significant portion of the European economy, one of the world’s top three along with the United States and China. Any disruption in the European healthcare product sector reverberates across the continent and around the globe.
As regulatory professionals know well, understanding and comprehensively addressing European regulations is an essential element of any truly global regulatory strategy. Unfortunately, this task has been made much more challenging by the current regulatory environment in Europe, which is experiencing something of a perfect storm of uncertainty.
Time Running Out to Prepare for New Device, IVD Regulations
As we have known for some time now, the EU’s new Medical Device Regulation (MDR) is set to take effect next year, and the In Vitro Diagnostic Regulation (IVDR) will become law in 2022. These two laws will enact sweeping changes to Europe’s regulatory framework for medical technology and remake the way medtech companies develop and market products in the EU. Despite the relatively short time until scheduled implementation, much more preparation is needed, and many questions remain.
The deadlines for key actions leading to full implementation of the MDR are now extremely tight. A number of critical implementing acts have yet to be completed. Stakeholders are awaiting guidance documents needed to understand and navigate the new framework. The central European database appears unlikely to be fully ready and fully operational. And there are serious questions about whether there will be enough notified bodies and capacity ready in time, as only one has been officially designated under the new MDR and none under the IVDR to date.
This is all compounded by the lack of any grandfathering of regulatory CE marking clearance under the current directives. Legacy CE marked devices will have to address any gaps in data required to comply with the new regulations, but determining how much additional data may be required to do so still has not been fully clarified.
Last year, RAPS partnered with KPMG to survey device makers’ regulatory and quality professionals about preparations for the MDR, and 78% said they did not sufficiently understand the new law. Since then, regulators have made incremental progress addressing outstanding questions. The European Commission updated its implementation rolling plan in February. The Council of the European Union issued corrigenda for both MDR and IVDR in March. But more is needed and it’s not clear how much better prepared most device companies are today. For IVD manufacturers, while they do have more time to prepare, they also have significantly more adjustments to make to transition from the old directive to the new IVDR, which requires extensive product reclassification and far greater notified body oversight.
Clinical Trials Overhaul Moves Closer to Reality
On the pharma side, implementation of the new Clinical Trials Regulation (CTR) has been repeatedly delayed by technical problems since its 2014 release, but could finally be rolled out next year. If that happens, drugmakers may be making the transition to CTR compliance at the same time medtech companies are contending with MDR implementation.
The CTR is intended to harmonize the clinical trials process among EU Member States, bringing increased efficiency and minimizing the need to navigate multiple, different regulations at the national level. It also aims to bring greater transparency to the entire process. If successful, it will help make the EU more attractive to researchers, stem the decline in EU-based clinical trials and improve oversight of patient safety.
Implementing the CTR will require the pharma industry to overhaul current practices as the regulatory system for trials shifts from a decentralized one to a more centralized and unified structure. Drug sponsors will need to adjust internal processes and technology to work with the EU’s new e-submissions portal, and Member States’ National Competent Authorities and Ethics Committees will have to adjust their work to align with the new system. Although these changes are not unexpected, there will be a learning curve during the transition period.
The Brexit Factor
On top of pending new major regulations, there is of course, Brexit. While the deadline for the UK’s planned exit from the EU has been pushed back again, little else is certain and there is still no EU-UK deal in place to define the two entities’ post-Brexit relationship.
It has been more than two years since the Brexit referendum and we still do not have full clarity on how separate EU and UK regulatory systems will operate, or what regulator expectations will be going forward. The hope is that a deal will be reached, and that regulations, processes and procedures will remain well-aligned between the two systems, but a no-deal Brexit is a very real possibility, and until we know for sure whether or not there will be an agreement, what such an agreement will entail and whether there will be full regulatory reciprocity between the regions, regulated companies must plan for a wide range of contingencies.
The Challenge and Potential Consequences of Uncertainty
Although planning for the unknown, navigating gray areas and adjusting regulatory strategy along the way are essential elements of regulatory affairs, those whose scope of work includes products developed or marketed in Europe are really being stretched right now.
With so many critical regulatory questions unanswered and so many important items still on the to-do list, this may be one of the most challenging periods ever for Europe’s life sciences sector. And prolonged ambiguity could have serious consequences. It could threaten the availability of current life-saving and life-sustaining medical products. It could slow the launch of new and innovative treatments as medtech and pharma companies proceed more cautiously. And it undoubtedly raises costs for companies that must invest time and resources into planning for not only major regulatory changes, but also for multiple potential scenarios.
Even without Brexit as a factor, the new CTR, MDR and IVDR all have the potential to require significant additional resources, add time to market, increase overhead costs, and create additional regulatory uncertainty for both new and legacy products.
Productive Dialogue is Vital
How the European and British governments, regulated industry and the European regulatory professional community handle this transitional period will affect not only the future of medicine and healthcare in Europe, but also throughout the world. The degree of unease around the globe, and continuing calls for clear understanding of Europe's current regulatory expectations and capacity to respond is testament to this.
Both government and industry stakeholders need to move quickly to resolve outstanding questions while ensuring important details concerning harmonization, supply chain, notified body capacity and other key issues are addressed. A productive and informed dialogue among stakeholders is vital, and RAPS is committed to providing the relevant information and resources to the regulatory community, as well as a forum for these important conversations.
RAPS will host the inaugural RAPS Regulatory Conference – Europe 2019, in Brussels, 13–14 May, where regulatory experts, and representatives from the European Commission, the European Medicines Agency, the UK’s Medicines and Healthcare products Regulatory Agency and other regulators will present.
1Figures according to The Pharmaceutical Industry in Figures, 2018, EFPIA, https://efpia.eu/media/361960/efpia-pharmafigures2018_v07-hq.pdf; and The European Medical Technology Industry – in figures, 2018, MedTech Europe, https://www.medtecheurope.org/wp-content/uploads/2018/06/MedTech-Europe_FactsFigures2018_FINAL_1.pdf