On 11 March 2025, the European Commission published its Critical Medicines Act proposal. The new Regulation aims to improve the security of supply of critical medicines and other medicines of common interest in the European Union and to strengthen the European pharmaceuticals industry and Europe’s general resilience. The new Regulation addresses the rising issue of drug shortages exacerbated through global crises, geopolitical tensions and over-reliance on either a small number of manufacturers or manufacturers located outside the European Union. The initiative stems from the existing EU pharmaceutical strategy and other measures against drug shortages – in particular the Commission’s proposed reform of EU pharmaceutical legislation, in which it has already proposed regulations to improve the availability of medicines and to enhance the security of their supply.
Objectives of the proposal
The proposal essentially pursues four objectives:
- Addressing the vulnerabilities in medicine supply chains and reducing dependency on third countries in the supply of critical medicines
The list of medicines categorised as critical has already been defined by the European Medicines Agency (EMA) in cooperation with European Commission and the Heads of Medicines Agencies (HMA). For the future, the Commission’s proposed reform of EU pharmaceutical legislation contains a detailed procedure for establishing and adopting a Union list of critical medicinal products, to which the CMA proposal refers (Article 2(1), Article 3(4) CMA Proposal). Parts of the CMA Proposal (in particular the procurement rules in Chapter IV) also cover other medicinal products of common interest whose availability and accessibility is not sufficiently ensured (Article 2(2), Article 3(5) CMA Proposal). - Strengthening the manufacture of critical medicines in the European Union through targeted investment and support for strategic products
- Facilitating collaborative procurement by Member States and the Commission to improve purchasing power and security of supply
- Diversifying supply chains through international cooperation
Core elements
The key points of the proposal are:
- Promotion of strategic projects: A procedure will be established to recognise strategic pharmaceutical projects in the EU related to the creation, expansion or modernisation of manufacturing capacity for critical medicinal products, active substances or other key inputs as well as the roll-out of technologies required to manufacture them. Member States will each designate an authority to identify these projects (Articles 5 and 6 CMA Proposal) and ensure that the relevant licences are granted in the fastest way possible (Article 7 CMA Proposal).
Every strategic project will also receive administrative support from the Member States, including help with complying with administrative regulations, granting permits and informing the public about such projects (Article 8 CMA Proposal). Good Manufacturing Practices (GMP) inspections will be prioritised for strategic projects, ensuring that they are carried out without delay (Article 11 CMA Proposal). When requested by project promoters, the European Medicines Agency (EMA) will provide dedicated advice to help them develop projects that rely on innovative manufacturing processes.
The proposal also aims to prioritise financial support (Articles 15 and 16 CMA Proposal) to boost the establishment, expansion or modernisation of production capacities for critical medicinal products or their active substances in the EU. This includes financial support from both Member States and the EU (in particular from the EU4Health Programme and Horizon Europe). However, that financial aid from Member States will remain subject to the state aid restrictions set out in Articles 107 and 108 TFEU. The Commission has published extensive Guidance on the application of State aid rules in the context of the Critical Medicines Act. - New award criteria: When procuring critical medicinal products under the General Procurement Directive (Directive 2014/24/EU), Member States must in future implement measures to promote resilience of supply, such as requirements relating to stockholding obligations, the number of suppliers and supply chain monitoring and transparency (Article 18(1) CMA Proposal). However, they must ensure that such requirements do not have a negative impact on security of supply in other Member States (Article 20 CMA Proposal).
In cases where the EU’s strategic autonomy is jeopardised by significant reliance on third countries, the proposal promotes a “Buy European” approach (Article 18(2) and (3) CMA Proposal). Companies that manufacture a significant proportion of their products in the EU are to be favoured in future procurement procedures.
Within six months of the CMA’s entry into force, Member States must establish national programmes to improve security of supply of critical medicinal products, including in public procurement procedures, and notify these programmes to the Commission (Article 19 CMA Proposal). Multi-supplier approaches (multi-partner models) are specifically highlighted in this context. - Collaborative procurement: The proposal expands the existing possibilities for collaborative procurement involving Member States and the Commission. It sets out the options for joint procurement by Member States (facilitated by the Commission), centralised procurement by the Commission on behalf of or in the name of Member States and joint procurement by Member States and the Commission (Articles 21 to 24 CMA Proposal).
- Establishment of a Critical Medicines Group: The Group is tasked with supporting the implementation of the Regulation and, where appropriate, advising the Commission so as to maximise the impact of the measures envisaged and avoid any unintended effects on the internal market (Articles 25 and 26 CMA Proposal). The Critical Medicines Group may submit proposals to the Member States for adapting their national programmes to improve security of supply (Article 19(2) CMA Proposal).
- International cooperation: The Commission will explore potential partnerships with third countries with the aim of diversifying supply chains and existing partnerships will be expanded when possible (Article 27 CMA Proposal).
Opportunities for the pharmaceutical sector created by the Critical Medicines Act
From the perspective of the pharmaceutical industry, the draft offers a number of opportunities. The following aspects are particularly noteworthy in this respect:
- Investment incentives: Companies will benefit from financial support and regulatory relief for strategic projects.
- Strengthening the EU as a pharmaceutical hub: The Regulation will make the EU a more attractive market for the production of medicines.
- Security and predictability: More stable supply chains will reduce risks and dependencies.
Opportunities and challenges for public contracting authorities
The proposal will facilitate the efforts of public contracting authorities to design their procurement procedures in a way that improves the security of supply with regard to critical medicines. The trend towards stockholding obligations and buying European is in line with the German Act to Improve the Supply of Medicines and Avoid Shortages (Arzneimittel-Lieferengpassbekämpfungs- und Versorgungsverbesserungs-Gesetz, “ALBVVG”) of 27 July 2023, Federal Law Gazette I Nr. 197, p. 1). However, the proposal does not derogate from the General Procurement Directive. In this respect, it remains a challenge for public contracting authorities to implement security-of-supply requirements and criteria in procurement procedures. Furthermore and despite the “Buy European” approach, the proposal does not dispense with the obligation to observe the international procurement agreements to which the Union is party (Article 18(2) and (3) CMA Proposal), in particular the General Procurement Agreement (GPA). It remains to be seen to what extent the national programmes at Member State level will provide more specifics and further assistance for contracting authorities.
Outlook
The proposal now goes to the European Parliament and the Council, where there could be numerous amendments and lengthy voting processes. It is therefore not yet possible to predict whether, when, or in what specific form the proposed Regulation will come into force.
Forward