TTIP - Comparison between pharmaceutical regulatory frameworks in the EU and in the US

The draft interim report of the Trade Sustainability Impact Assessment (TSIA) on the Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US has been published online. The report contains the overall economic, social, human rights and environmental impacts analyses and it will be presented during the Civil Society Dialogue on the 30^th of May in Brussels.

Here’s some highlights on the pharmaceutical sector extracted from Chapter 8 “Potential TTIP impact on the chemicals and pharmaceutical sectors”:

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Regarding the pharmaceutical sector, the industry has identified several areas for regulatory cooperation that would promote innovation and patient access in the US and the EU. The mutual recognition of Good Manufacturing Practice (GMP) inspections is a common request that has been put forward by both the innovative and the biosimilar and generic industry. Further harmonisation of requirements for the development of medicinal products including non-clinical and clinical testing is another common request from the industry although the priority areas for this harmonisation depend on the type of products that are developed.

The European Public Health Alliance (EPHA) considers it vital to look at the potential of the Intellectual Property Chapter, price of medicines and competition of generics medicines in this TSIA. The reason to look at this is that several civil society organisations fear that there will be more restrictive IP systems following TTIP. However when we compare the EU and US patent systems, we find that the US has a regime of 12 years for biologics, but 5 + 3 years for new chemical entities (e.g. small molecules), while the EU has 8 + 2 + 1 years for both biologics and new chemical entities – so there is not much difference between the EU and US in terms of the time periods for regulatory data protection. Moreover the EC has indicated several times that they are not seeking to change either the EU or the US IP regime for pharmaceuticals. It is therefore not likely that TTIP will lead to a more restrictive IP system in the EU. 

In addition, pharmaceutical, some specific cosmetics and herbal products face lengthy approval procedures in the US – as laboratory tests must be performed. These are especially burdensome for products that are classified as over-the-counter (OTC) drugs in the US, but not in the EU. According to the FDA OTC drugs can be defined as: “drugs that are safe and effective for use by the general public without seeking treatment by a health professional.” Many of these products are not seen as drugs in the EU, like e.g. sunscreen, Aquafresh toothpaste or some types of AXE deodorant. When exported to the US these products need to go through additional testing which would be similar to the testing needed for a drug. However not all OTC drugs need a preliminary approval by the FDA, some can be imported in the US as long as they respect the US labelling requirements. Still the imported products come from countries with equally sophisticated regulatory systems.

Regulatory divergences of a cross-cutting nature also affect pharmaceutical trade: differences in testing requirements, safety pre-shipment inspections, regulations regarding terms of payment for imports, and transfer delays and slow customs procedures. In the US additional state level regulations are possible and in fact in place for pharmaceuticals.

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Related links:

• TSIA-TTIP draft Interim Report