Pharma companies are leveraging the United States’ threat of tariffs on drug imports to push for policy changes in the EU.
In a letter sent to European Commission President Ursula von der Leyen, 32 pharma companies demanded more favorable policies in order for them to maintain operations in the EU amid the threat of U.S. tariffs. The letter was reported earlier by French newspaper Les Echos.
The CEOs of Amgen, AstraZeneca, Biogen, Bristol Myers Squibb, Eli Lilly, Gilead Sciences, GSK, Merck & Co., Novartis, Novo Nordisk, Pfizer, Roche, Sanofi and Takeda were among those who signed on to the letter, according to a copy obtained by Fierce Pharma.
The letter, dated April 11, is a follow-up from a meeting between industry CEOs and von der Leyen about how to help make the EU more competitive, a spokesperson for the European Federation of Pharmaceutical Industries and Associations (EFPIA) told Fierce Pharma.
The firms voiced their concerns in a statement published by EFPIA last week. In it, they warned von der Leyen of an EU pharma investment exodus to the U.S.—potentially worth as much as 103.2 billion euros ($113 billion) by 2029—unless Europe implements “rapid, radical" policy changes to counter upcoming U.S. drug tariffs from the Trump administration.
In the letter, the pharma leaders again warned that much of the development and manufacturing of medicines in Europe will be redirected to the U.S. if the region doesn’t provide “clear signals and radical policy change.”
The CEOs wrote that European countries should rethink their drug pricing policies and enable a better commercial environment for innovative medicines. Industry contributions to public expenditures on medicines have increased from 15% to 22% over the past few years, a trend that suggests that the industry has been shouldering the increase in spending linked to the introduction of new medicines, the letter noted.
Consistent with their previous calls, the pharma companies asked the EU to simplify drug development regulations and to “enable a coordinated, single-approval model to shorten the process for multi-country trials.”
The firms further called for improvements in intellectual property protection provisions. These include increasing Europe's regulatory data protection baseline to 10 years, plus an additional two years of market protection, as well as increasing orphan market exclusivity to 12 years from the current 10 years.
The biopharma leaders also complained about a new EU wastewater treatment fee that drug manufacturers need to pay. The revised Urban Wastewater Treatment Directive approved by the European Parliament last year puts the burden on manufacturers of pharmaceuticals and cosmetics to clean up micro-pollutants in European waters.
By the European Commission’s estimate, the new rule would translate into 3.8 billion euros ($4.3 billion) in additional costs for those manufacturers across member states. However, some studies have put the total costs at around 1 billion euros per member state, according to a blog post by the law firm Covington & Burling.
The changes proposed by the industry are needed to ensure Europe remains a competitive location to research, develop and manufacture medicines, Lilly and Novartis said in their separate statements to Fierce Pharma.
“We look forward to working together in the days and weeks to come to ensure we can transform these proposals into reality for the benefit of Europe’s patients and its economic development,” the companies said in the letter.
The developments come amid President Donald Trump’s push to introduce tariffs on pharmaceuticals. The administration recently launched a Section 232 investigation looking into the national security effects of pharma imports, and findings from the probe may justify the President’s tariff actions.
“They are just going to be part of making sure we reshore the core national security items that need to be made in this country,” Commerce Secretary Howard Lutnick recently said of potential industry-specific tariffs on ABC News. “We need to make medicine in this country.”
The EU is a major production base for medicines. A February survey by the trade group the Biotechnology Innovation Organization found that 94% of companies polled expect tariffs on EU countries to drive up manufacturing costs.
Editor's note: The story has been updated with more details from the letter.