Executive Summary
- Historic legislative revamp: The EU’s first major pharmaceutical law overhaul in 20 years has advanced, with the Council agreeing its position on the “Pharma Package” on 4 June 2025. This paves the way for new rules on drug approvals, exclusivities, and obligations aimed at a fairer, more competitive market.
- Exclusivity period reset: Regulatory data protection will remain at 8 years, but market exclusivity is shortened to 1 year (from 2), extendable to 2 years if key access goals are met. This effectively reduces baseline protection to 9 years (from 10), pressuring launch strategies. A new transferable exclusivity voucher for novel antimicrobials offers up to 1 extra year data protection, but with strict limits (sales <€490 m, use only in year 5) to prevent misuse.
- Access and competition measures: To spur earlier patient access and competition, the Council’s mandate adds a Member State supply obligation (companies may be required to supply sufficient product across EU markets) and expands the Bolar exemption so generics/biosimilars can pursue pricing, reimbursement, and tender submissions before patent expiry. Orphan drug exclusivity is maintained at 10 years, safeguarding incentives for rare diseases while introducing a “Global Orphan” concept to prevent stacking multiple exclusivities per product.
- Strategic implications: Pharma launch sequencing will need rethinking – firms are incentivized to launch broadly across Europe faster to earn full exclusivity, impacting EU differential pricing dynamics. HTA and payer negotiations may speed up as joint EU clinical assessments roll out and generics prepare day1 market entry (thanks to earlier HTA/tender prep). Payer leverage could rise with shorter monopoly periods and new obligations improving competition and supply. Companies should prepare now for trilogue outcomes, a 2026–27 implementation horizon, and adapt strategies to thrive under the new rules.
What Has Changed in the Pharma Package?
The Council’s agreed text on the Pharma Package introduces several key legislative changes to the EU pharma framework. These changes alter how long new drugs enjoy market exclusivity, impose new duties to ensure availability, and create novel incentives – all with the aim of a “fairer and more competitive” pharmaceutical sector. Below are the major elements:
Regulatory Data Protection & Market Exclusivity
Exclusivity periods are being recalibrated. Under the Council’s mandate, innovative drugs will keep 8 years of regulatory data protection (RDP). Market Protection baseline is set at 1 year (one year less than the current 2 year period), and can be extended by 1 year if:
- The product addresses an Unmet Medical Need (UMN)
The product meets all the requirements:
- An appropriate comparator was used (where possible and appropriate)
- Clinical trials were conducted in more than one EU Member State
- The MAA is submitted to the EU first, or no later than 90 days after the first submission outside the Union
However, the period of regulatory market protection (RMP) (during which a generic cannot enter the market even with an approved application) will be 1 year by default, down from the current 2 years, extendable to 2 years if certain predefined objectives are met. In practice, this means a new drug gets 9 years of protection as standard (8 + 1) instead of 10, but can reach 10 years total if the manufacturer achieves specific public health targets (for example, broad launches across EU markets). This “modulated” incentive structure is a compromise between the European Commission’s initial proposal (which had slashed baseline exclusivity to 6 + 2 years with addon rewards) and industry calls to maintain the full 10year period. Industry groups note that even with the Council’s adjustments, the baseline protection of 9 years is one year shorter than today’s 10, prompting concerns about Europe’s attractiveness for investment. At the same time, the ability to regain the extra year by expanding access is meant to encourage faster, wider availability of new medicines across all Member States.
Transferable Exclusivity Vouchers (for Antimicrobials)
A high profile and controversial new incentive is the introduction of transferable exclusivity vouchers (TEVs) to reward development of crucial antimicrobials. These vouchers grant up to 1 additional year of data exclusivity to a drug and can be transferred (sold) once to another product. The Council broadly supports the voucher scheme but has imposed strict conditions to prevent market distortion. Notably, if a voucher is sold to another company, it can only be applied in the fifth year of that product’s data protection period (not earlier). Furthermore, the marketing authorization holder must show that the product’s annual EU sales did not exceed €490 million in any of the prior four years for the voucher to be usable. These caps act as safeguards against windfall profits for blockbuster drugs and aim to keep the incentive targeted at truly needed antimicrobials.
Obligation to Supply EU Markets
To address medicine shortages and unequal availability, the Council added a new Obligation to Supply provision. This would empower EU Member States to require a drug’s marketing authorization holder to make the product available in sufficient quantities to meet patient needs in that country. In essence, companies could be mandated to supply smaller or less profitable markets to avoid situations where a drug is authorized but not sold, or where patients face stockouts. This measure responds to growing concern about drug shortages and the fact that some new medicines never reach certain EU countries.
Bolar Exemption Expansion (Generics & Biosimilars)
The Bolar exemption – which allows generic and biosimilar manufacturers to conduct trials and prepare regulatory dossiers on a patented drug – is being broadened to speed up post patent competition. The Council’s position clarifies and expands the scope of Bolar so that it explicitly covers activities related to pricing and reimbursement and participation in procurement tenders. In practice, this means a generic manufacturer can complete HTA submissions and even bid in national tenders for hospital contracts before the originator’s exclusivity expires, as long as actual product sale only happens after expiry. The legislation aims to ensure day1 availability of generics and biosimilars: once the patent or exclusivity period ends, competitive products can launch immediately without bureaucratic delays.
Orphan Drug Incentives and Paediatric Provisions
For medicines treating rare diseases (Orphan Medicinal Products, OMPs), the Council chose to maintain the core incentive of 10 year market exclusivity for designated orphan drugs. However, the new package is set to include a Global Orphan Marketing Authorization (GOMA) concept that prevents companies from obtaining multiple separate exclusivity periods for the same active substance in different orphan indications.
Other Notable Changes
Beyond the headline items above, the Pharma Package encompasses numerous other updates to the regulatory system, including support for EMA’s PRIME scheme and regulatory sandboxes, environmental and manufacturing measures, and transparency rules aimed at encouraging timely launch in all Member States.
Strategic Implications for Pricing & Reimbursement
The agreed reforms under the Pharma Package will have far reaching implications for pricing, market access, HEOR, and realworld evidence (RWE) strategies in pharma. These new rules could reshape launch strategies, evidence requirements, and competitive dynamics across Europe.
Launch Sequencing & EU Differential Pricing
One of the most significant shifts comes from the incentives (and pressures) to launch new medicines broadly across the EU faster. With the Council tying an extra year of exclusivity to achieving certain access objectives, such as making the product available in most or all Member States, companies can no longer rely on a long 10year blanket exclusivity while sequencing launches selectively.
Access Disparity CallOut
Across Europe, the average time from EMA approval to patient access is 531 days – ranging from just 126 days in Germany to 804 days in Poland. The Pharma Package’s incentives for wider, earlier launches aim to reduce such inequities.
From a differential pricing perspective, compressing the launch timeline could intensify price convergence pressures. Companies might adopt regional launch clustering or innovative pricing schemes to manage reference pricing impacts and will need to engage earlier with payers in smaller markets.
HTA Timelines & Payer Leverage
The Pharma Package coincides with implementation of the EU Joint HTA Regulation, which from 2025 will introduce centralized clinical assessments for new drugs. The expanded Bolar exemption means generics can engage in HTA processes even before exclusivity ends, strengthening payer leverage. Companies should therefore invest in robust evidence generation and HEOR strategies early in the product lifecycle.
Orphan Drugs & Incentives for Rare Diseases
Maintaining the 10year market exclusivity for orphan drugs provides continuity for rare disease innovators, but the GOMA principle means firms must plan indication expansion carefully. Payforperformance models and collaborative evidence generation with patient groups may also grow in importance.
Rare Disease Insight
Over 260 orphan medicines have been developed since the EU introduced a 10year market exclusivity for OMPs – a testament to how predictable incentives fuel investment.
Generic Entry Timing & Shortage Mitigation
Shorter exclusivity and a broadened Bolar exemption mean originator companies must expect generic and biosimilar competition earlier and more synchronously across Europe. Innovators should explore earlier contracting with payers and strengthen lifecycle management strategies such as line extensions or authorized generics. Robust supply chain planning will also be essential to comply with new obligations and avoid penalties.
Key Next Steps and Timeline
- Trilogue negotiations (mid2025 onwards): Council, Parliament, and Commission aim to reconcile positions, with possible final agreement by late 2025 or early 2026.
- Formal adoption and publication: Once adopted, the new Regulation and Directive will be published in the Official Journal; most provisions are expected to apply around 2027–28 after a transition period.
- Member State readiness: National authorities will update laws and guidance; companies should anticipate greater scrutiny of launch and supply decisions.
- Company actions: Monitor legislative developments, map launch sequence scenarios, adapt pricing and contracting approaches, bolster evidence generation for HTA, strengthen supply chain resilience, and leverage new incentives where relevant.
Our Perspective – Strategic Recommendations for Pharma
- Embrace an access first mindset. Prioritize earlier launches in more markets to secure regulatory rewards and build trust with authorities and patients.
- Reevaluate the value of exclusivity. Conduct a productbyproduct “exclusivity audit” under various scenarios to inform commercial decision making.
- Strengthen stakeholder engagement. Establish an EU market access taskforce to align pricing strategies and maintain dialogue with regulators on supply obligations.
- Invest in agility and internal capabilities. Build processes and teams capable of handling parallel launches and simultaneous HTA submissions.
- Plan for a competitive endgame. Prepare early for generic competition through authorized generics, value added services, or line extensions.
Conclusion
The European Union’s Pharma Package is poised to reshape the pharmaceutical landscape – rewarding those who deliver widespread and timely access while tightening controls on prolonged monopolies and supply shortages. For senior pricing, market access, HEOR, and RWE professionals, the reforms bring both challenges and opportunities. By acting now to futureproof market access strategies and embracing a holistic product lifecycle view, companies can turn policy change into a competitive advantage in the European market.
Need support navigating these changes? Contact the Remap Consulting team to discuss how we can help optimise your EU pricing and market access strategy.