Reforming EU Pharmaceutical Regulations to Boost Innovation and Investment, Experts Urge

Recent research conducted by Bayes Business School, in collaboration with biopharmaceutical leader Merck KGaA, highlights the urgent need for the European Union (EU) to reform its pharmaceutical regulatory landscape. The study emphasizes that for Europe to attract greater investment from the global pharmaceutical industry and foster innovation, member states must enhance their collaboration, offer stronger incentives for developing new medicines, and streamline access to pharmaceuticals—especially when compared to other international regulatory bodies.

The pharmaceutical sector operates in a highly competitive environment, where regulatory frameworks play a critical role in shaping innovation, attracting investment, and ensuring timely access to vital medicines. Major players such as the FDA in the US, EMA in Europe, MHRA in the UK, NMPA in China, and PMDA in Japan are all vying to expedite the approval of groundbreaking therapies, often favoring markets like the US due to faster approval processes, supportive regulatory policies, and more attractive incentives.

This disparity results in Europe lagging behind in the approval and development of new medicines, including biologics and orphan drugs. Factors such as lower pricing, smaller market size, complicated reimbursement policies across member states, rising costs, and limited access to capital and clinical trial opportunities contribute to this challenge. To counteract this, experts suggest measures such as introducing regulatory sandboxes, fostering joint scientific advice sessions for drug development, adopting electronic product information, and simplifying existing regulatory procedures—including removing restrictions like mandatory reauthorization every five years.

The study’s lead author, Professor Stefan Haefliger, remarks that Europe's regulatory processes have fallen behind those of other regions, citing the UK’s rapid COVID-19 vaccine deployment as a notable exception attributable to its distinct regulatory approach post-Brexit. Concerns are mounting over potential industry relocations, especially amidst recent tariff disputes and regulatory uncertainties, which could further weaken Europe's standing in pharmaceutical innovation.

Supporting this view, the 2024 Draghi Report underscores the stagnation in the EU’s pharmaceutical sector and advocates for comprehensive reforms in regulatory systems, capital access, and technological adoption. While the EU possesses a pool of diverse expertise, the lack of cohesive synergy remains a barrier to becoming a more attractive hub for pharmaceutical research and development. Without significant improvements, Europe risks further falling behind in securing innovation, investment, and high-caliber research talent.

In conclusion, harmonizing and modernizing the EU’s pharmaceutical regulations is crucial for revitalizing its market competitiveness. These reforms may not only accelerate the availability of advanced medicines but also restore Europe's position as a key player in global pharmaceutical innovation.

Source: https://medicalxpress.com/news/2025-05-eu-pharmaceutical-reforms-investment-experts.html