Disruption of medical supply chains in the EU due to COVID-19 and unilateral national measures

Subject: Disruption of medical supply chains in the EU due to COVID-19 and unilateral national measures

Currently, up to 90 % of all active ingredients used in medicines are produced in India and China. The increasing concentration in the market and quality problems in production have led to price increases and global supply constraints. The COVID-19 crisis shows how vulnerable the EU has become due to its dependence on pharmaceuticals from third countries, which undermines national health systems and put patients at risk. The current crisis is further exacerbated as some Member States restrict the intra-community movement of pharmaceuticals by imposing export bans. This often affects medicines which are neither used in treating coronavirus nor at risk of shortages in the exporting Member State. These actions may cause unnecessary shortages in the supply of medicines urgently needed by EU patients to the recipient country.

1. Does the Commission agree that unilaterally imposed export restrictions for pharmaceuticals, especially those that are neither essential in treating COVID-19 nor at risk of shortages, are incompatible with the free movement of goods?

2. How does it plan to tackle increasing medicine shortages in the EU, particularly in times of crisis?

3. What incentives does it propose to strengthen the EU’s pharmaceutical industry and reduce its dependence on third countries?

Answer given by Mr Breton on behalf of the European Commission

(14 September 2020)

Whilst the Treaty on the Functioning of the European Union allows for exceptional restrictions to the fundamental principle of free movement of goods, these need to remain appropriate and proportionate to the objective pursued. In line with its guideline s (1), the Commission reacted actively to any export restriction imposed by the Member States during the pandemic. National restrictions have now been lifted. Immediate action was taken to ensure the free circulation of goods, and issuing concrete guidance to prevent negative impact on critical staff.

To further prevent shortages, the Commission set up a COVID-19 Clearing House for medical equipment. It cooperates with national authorities and industry to facilitate the identification of available supplies and accelerate their matching with demand by Member States. The Commission announced its support to specific cooperation projects initiated by industry to prevent shortages of critical COVID-19 medicines. The Commission further issued a comfort letter to clear, from a competition law perspective, planned coordination in the pharmaceutical industry to increase production and to improve supply of critical medicines. Such support included a commitment (2) to provide antitrust guidance and support to facilitate the proper and swift implementation of industry cooperation. The proposal for the new EU4Health programme adopted in May 2020 (3), with a budget of EUR 9.4 billion, will support further action in this area (4).

The Commission actively supports the research actions to tackle the coronavirus pandemic (5), developed jointly with national authorities.

A Communication on Pharmaceutical Strategy (6) will address the issue of shortages and reliance of the pharmaceutical manufacturing chain on third countries.

⋅1∙ Annex 2 of the communication on the coordinated economic response to the COVID-19 outbreak COM(2020) 112 of 13.3.2020 and guidelines on the optimal and

rational supply of medicines to avoid shortages during the COVID-19 outbreak C(2020) 2272 of 8.4.2020. ⋅2∙ C(2020) 3200 of 8.4.2020.

⋅3∙ COM(2020) 405 of 28.5.2020.

⋅4∙ For example: structural stockpiling of crisis relevant products (including medicines), investments directed at strengthening production capacity, and, more generally,

actions to increase the availability of medicines in the Union.

⋅5∙ Among other via the ERAvsCorona Action Plan.

⋅6∙ Expected in Q4 2020.