The Executive Committee of Medicines for Europe, an industry organization representing generics and biosimilars manufactures in Europe, has issued an open letter to European Union (EU) health ministers, the EU Commissioner of Health and Food Safety, and other EU Commissioners calling on them to address inflation in pharmaceutical manufacturing.

In the open letter, the Executive Committee of Medicines for Europe expressed concern over the impact of inflation on the supply of essential medicines. The Committee includes executives from Sandoz (the generics and biosimilars business of Novartis), Teva, Viatris, and other bio/pharmaceutical companies.

“For the last decade, off-patent medicines have been subject to strict price regulation, budget austerity measures, and lowest-price tender rules, causing substantial price erosion and an unsustainable situation for manufacturers,” said the letter. “This has been exacerbated by the COVID-19 crisis and the war in Ukraine, which has dramatically increased general inflation [and] raw material and transportation costs.”

The group estimates that inflation in Europe has risen to over 7%, and external factors, such as energy costs and related supply issues, logistics, inputs and raw materials, and skilled human resources, are exacerbating inflation further.

“Our industry cannot operate in an environment combining rampant cost inflation with policies that continuously lower prices,” said the letter. “We therefore call on the EU to help us tackle this challenging situation with sustainable policies that are aligned with European strategic autonomy.”

It outlined six measures for the EU to potentially adopt to address concerns of inflation in the EU:

• Recognizing the prescription medicines sector as critical in EU and national emergency plans for gas/oil supplies;
• Encourage EU member states to address inflation under their transparency directive obligations related to availability and the efficiency of medicines production;
• Adopt measures to mitigate the impact of inflation on cost of goods;
• Reform medicines procurement and pricing model by addressing what it calls “unreasonable” tender practices and pricing systems and make it a high priority in EU law;
• Reduce the complexity and cost of regulatory compliance.
• Support EU manufacturing investment, by, for example, allowing the generic industry to participate in EU resilience funded projects such as the health-related projects of the Projects of Common European Interest, which are strategic instruments for the implementation of the EU’s Industrial Strategy.

Source: Medicines for Europe