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The EU has agreed to cut protection for new drugs to allow cheaper generics on to the market a year earlier to curb the rise in public spending on health.
But the pharmaceutical industry has warned that the move will dent research and innovation in one of the bloc’s most valuable sectors, hastening a drift to the US and Asia.
The early morning deal by negotiators of the European parliament and member states cuts from 10 years to nine years the time that new medicines receive market exclusivity.
Drugmakers will also have to share data with generics companies after eight years, so their copycats can hit the market “the day after the patent has gone”, said Dolors Montserrat, a Spanish MEP who negotiated the deal.
“Generics give sustainability to our public health system because we want universal public health systems,” she added.
Generic producers can also get regulatory and administrative approvals while the new drug is patent protected, to avoid further delays after it expires.
Adrian van den Hoven, director-general of Medicines for Europe, which represents the generics industry, said it was an “important step forward”.
The patent law exemption allowing manufacturers to take earlier steps to prepare generics is ‘‘critical to reduce frivolous litigation and misuse of, for example, divisional patents to create artificial delays to competition and wider access to medicines for all Europeans”, van den Hoven said.
“The digitalisation and harmonisation of pharmaceutical regulation is another important component of the legislation which is needed to support access to medicines and to improve shortage mitigation efforts.”
New drugs can receive another year of exclusivity under certain conditions, such as addressing an unmet medical need. That could include companies developing new antibiotics to overcome growing resistance to existing drugs.
Big pharmaceutical companies such as Novo Nordisk of Denmark and Bayer of Germany have warned that cutting market protection would make some research unviable because the potential return on investment would not be high enough.
The EU-made branded drugs face 15 per cent tariffs entering the US after a trade deal with Donald Trump’s administration. This has accelerated growing moves by drugmakers to invest there.
Sophie Løhde, health minister of Denmark, which holds the rotating presidency of the EU, said the deal would contribute to “both innovation and to ensuring that patients in Europe have access to the medicines they need”.
Companies will have to agree to enter sincere talks with every member state that wishes to do so to market their drug there.
Rich, populous countries such as Germany often receive new treatments more than two years before others, and Latvians have access to less than half as many novel treatments as Germans.
Businesses must also commit to providing enough medicines in an attempt to address persistent shortages.