5 MINUTES WITH: Elisabeth Stampa, CEO, Medichem S.A.
By

Elisabeth Stampa
CEO
Medichem S.A.

DCAT Value Chain Insights’ “5 Minutes With,” part of the new DCAT Member Community section, features interviews with business and industry leaders on issues impacting the bio/pharmaceutical manufacturing value chain. 

This “5 Minutes With” features Elisabeth Stampa, CEO, Medichem S.A., to discuss the impact of recent EU policy initiatives on the EU API industry. 

Q: The European Commission has taken several steps to address the supply chain of pharmaceutical ingredients into the European Union, most notably through the Structured Dialogue process as it works to finalize the Pharmaceutical Strategy for Europe. From the perspective of an active pharmaceutical ingredient (API) producer, what do you see as the most important issues emerging from this policy process?

Stampa (Medichem): I believe it’s already big progress to have the European Commission entertaining this Dialogue with the industry and wanting to understand the supply chain of pharmaceutical ingredients. The European Commission has devoted and is devoting substantial time and efforts to understand how the pharma supply chain works and why shortages occur. It has considered in the update of the EU’s Industrial Strategy that strategic autonomy needs to be enhanced in several specific areas, including in strategic value chains for pharmaceutical ingredients. 

The most relevant conclusions emerging from the Structured Dialogue are the extreme cost-containment policies (i.e., price-only tenders in many countries for finished drugs), as well as the lack of incentives and environmental constraints that have pushed the production of some essential intermediates and APIs toward other geographies. The fragility of the pharma supply chain was known pre-pandemic, but COVID-19 has (unfortunately), along with several market studies performed in the past 12 months, highlighted that some essential medicines and their APIs (mostly for off-patent drugs) were only produced many kilometers away. With the temporary closing of some borders, less fluent transportation, and strong patient need, this reality became very worrisome. This was the trigger of the Pharmaceutical Strategy roadmap and the starting of the Structured Dialogue.

More recently, the European Parliament has been clear on the need for a strategically autonomous and resilient pharmaceutical industry that is supported by an effective incentive system for manufacturers and governed by a sound and flexible regulatory system. Published on November, 21, 2021, the European Parliament outlined that it  “…Calls on the Commission to promote dialogue with the Member States and all relevant stakeholders to promote ‘Made in Europe’ pharmaceuticals by strengthening manufacturing and supply resilience, by assessing additional criteria for national pricing, at no additional cost to patients and without prejudice to the sustainability of the health system; [and] stresses that these criteria should include high environmental manufacturing standards, robust supply-chain management and investment in innovation and research.”

We are now looking forward to concrete and consistent policy measures that can support industry’s efforts to address strategic dependencies and to develop necessary strategic capacity.

Q. There are other policy initiatives ongoing in the European Union that would impact the production and supply of key starting materials, intermediates, and APIs, including the European Green Deal, the European Chemical Strategy, and the European Industrial Strategy. Can you outline the key proposals or measures under these initiatives most impactful to EU API suppliers?

Stampa (Medichem): For the time being, few policies have been published and are definite yet. The Chemical Sustainability Strategy is covering the overarching targets established by the European Green Deal and is currently being drafted. The real impact of these initiatives is still to be seen.

The only definitive legislation is on emissions (volatile organic compounds) to the air, with the consequence that many manufacturers will have to invest significantly in the years to come to comply with the regulations. The overall cost of these investments may put European manufacturers’ competitiveness at risk if the measures are not accompanied by appropriate incentives.

All those policy initiatives must be consistent with the desired goals of creating a more attractive environment for EU manufacturing and supply-chain competitiveness as well as ensure enforcement to level the playing field for the EU API industry compared to other territories.

Q: The twin goals of these policy initiatives are to improve EU supply-chain resiliency and competitiveness while meeting “green targets” for sustainability/EHS measures. On an industry level, what are some key measures, in your opinion, to make the EU API industry more resilient and competitive and green at the same time?

Stampa (Medichem): The aim of the EU API industry is to have a competitive and strong industry that ensures accessibility and affordability of medicines for patients and attracts investment and talent. The different political initiatives should support these goals. Providing a fertile environment for manufacturers to achieve those goals is only possible under the following conditions:

  • Reforms in the procurement, pricing, and reimbursement laws and regulations to stop the unsustainable low-price trend that affects both medicines and APIs; it has been proven that actions around public procurement can foster competition and improve access.
  • Funds to support manufacturing investments or incentives for new technologies and innovation by adapting the EU State Aid Temporary Framework, which is designed to help businesses recover in the wake of the COVID-19 pandemic, to other APIs and medicines beyond COVID-19.
  • Digitalization and a more efficient and harmonized regulatory system to provide for simplification and to streamline the approval and variation procedures; and
  • Ensure a strong EU presence globally. The pharmaceutical sector is economically strategic for Europe in terms of global trade. Therefore, it is key to ensure reciprocal access to other markets and promote regulatory convergence to facilitate global development of pharmaceuticals. 

One of the requests of API manufacturers would be to have consistent policies: the Pharmaceutical Strategy, the Industrial Strategy, and the Chemical Sustainability Strategy by assessing the interaction as well as the impact of the different regulations on the competitiveness of the European industry. As an example, currently many key starting materials cannot be produced in Europe due to European environmental standards, thereby causing these starting materials to be sourced somewhere else.

Ideally, the competitiveness of the European API industry could be strengthened if a level playing field exists, where environmental, safety, and intellectual property conditions in other parts of the world become at least as stringent as those prevailing in the European Union.

Elisabeth Stampa is CEO of Medichem S.A., a Barcelona-headquartered CDMO of APIs and finished dosage forms, and a member of the Medichem Board of Directors. Prior to becoming CEO, she was Executive Chairwoman at the Corporate family business (Medichem S.A. and the former Combino Pharm S.L.), having started her career in marketing at Laboratorios Esteve. Overall, she has more than 20 years of industry experience.

She has been an active member of international associations throughout her professional career and advocated for legislative changes that improve patient accessibility and strengthen the European industry at a global level. She represented EU API manufacturers on behalf of the European Fine Chemicals Group in the GDUFA II negotiations with the US Food and Drug Administration. In October 2021, as member of Medicines for Europe’s Board, she presented on API global manufacturing and supply chains at the Medicines for Europe’s Conference in Athens. The conference also included participation from Margaritis Schinas, Vice President of the European Commission, and Adonis Georgiadis, Greece’s Minister for Development and Investments.