By Sylvia Miriyam Findlay, Frost & Sullivan
The pharmaceutical industry has catered to various medical needs of the healthcare community. Though the currently available drugs meet those needs to a certain extent, several aspects require improvement, especially regarding the efficacy, safety, and mode of drug delivery. Pharmaceutical and biotechnology companies are working toward making those improvements, but R&D of new drugs is an ongoing process, and it often takes more than a decade to launch a new drug in the market. The challenges faced by the drug companies lie not only in identifying the right molecule, but also in facing the strict regulatory environment.
Of course, government regulatory agencies are an absolute necessity in the pharmaceuticals and biotechnology industry, especially when it comes to regulating the entry of unsafe drugs in the market. Unsafe drugs not only cause loss of human life, they can also create huge monetary losses to industry companies due to lawsuits. The work of government regulatory agencies helps mitigate the litigation costs that arise from unsafe medicines. The regulatory expenditure (i.e. the cost toward application of regulatory approval for new drugs) is a one-time fee and is considerably lower than the litigation costs that might arise from a lawsuit concerning unsafe drugs.
Key Regulatory Challenges
Need for a Transatlantic Regulatory Integration
Differences in regulatory processes across continents pose challenging issues in drug launches. There is a dire need for integrating the regulatory environment among the EU countries and the United States. Differing regulations have an impact on the drug launches, as less-price-controlled markets witness quicker launches while launches take longer in regulated markets. Transatlantic regulatory convergence offers immense benefits, such as faster technology transfer, regulated approval of unsafe drugs, and patent law harmonization.
Urgent Need for Developing a Sentinel Network for Enhancing Drug Safety Landscape
There lies an imminent requirement to create an interface among industry, academia, healthcare providers, and stakeholders to facilitate data transfer on drug safety. This patient data collected from various sources opens the opportunity to study adverse events in a detailed manner and also enables the regulatory authorities to make informed decisions. The drug safety landscape can undergo dynamic changes if the EU regulatory authority initiates a partnership with industry, academia, and other information sources. Patient electronic health records and pharmacovigilance data gathered from private, public, and commercial databases can be integrated to provide a wholesome outlook to the drug safety scenario.
Need for Fast-Tracking Framework
Apart from the centralized or mutual recognition procedure (MRP), there is no framework for fast-tracking drug approvals in the EU. In order to reduce the delay in the current approval processes, the European commission proposed the fast-track approval for the EMEA (European Medicines Agency) in 2001. The delay in the centralized procedure comes more from the member states, which impose certain controls on the procedure. The fast-tracking system does not address this specific challenge. However, if approved, it could be beneficial to certain companies developing niche or life-saving drugs. This process is not yet adopted and still remains a challenge in the EU drug approval process.
Key Trends in Drug Approval Processes
The United States still dominates the pharmaceutical market in terms of revenues and R&D spending. Research-intensive companies populate both Europe and the United States. There is much investment toward life sciences research; however, the United States scores higher in research funding and also in the number of patents generated.
The current trend is toward the closure of R&D sites in the EU and opening of new sites in China and other Asian countries. The discovery expertise in Europe is slowly moving away to other countries. About 65% of new drug sales are attributed to the U.S. market, while Europe contributes only 24%. The not-so-conducive regulatory environment, varying price controls across the member states, and parallel trading retard the growth of the pharmaceutical industry in Europe.
As there are varied price regulations across Europe, research-intensive firms undertake R&D activities in less-price-controlled markets. This also has an effect on drug launches, as less-price-controlled markets witness faster product launches than the other markets. European-based pharmaceutical companies have also shifted a major portion of their sales to the U.S. market. The number of new molecule entities (NMEs) developed in Europe has decreased over the years, while the NMEs from the United States have been increasing (see chart), showing the dominance of the country in the drug discovery space.
Biosimilars in Europe
As patents for several biopharmaceutical drugs are expiring or nearing expiration, the competition to introduce biosimilars or biogenerics is increasing. Biologics that are facing patent expiration or will eventually face the generic world include insulin, human growth hormone, interferon alpha, interferon beta, epoetin, and colony stimulating factors. However, it has been understood that producing a follow-on biologic is a cumbersome process. Biosimilars are generic versions of biologics; however, they have slight differences to the originator drug due to their complex and sophisticated manufacturing process. The company involved in producing a biosimilar has to redevelop the cell line for the active pharmaceutical ingredient (API), and this has to be similar to the original API.
Since biologics are facing patent expiration, a number of companies are continuing with the manufacturing of biosimilars. This has led to the formation of newer regulatory pathways for biosimilar approvals in Europe. European countries reviewed the pharmaceutical legislation so as to support the adoption of biosimilars. In 2003, the EU amended the secondary legislation governing the marketing authorizations for biosimilars. In 2005, EMEA issued a general guideline for biosimilars, covering the whole range of biotechnology drugs like vaccines, blood derivatives, and gene and cell therapy.
Drug Approval Processes — Can they be Improved?
Clinical trial design and evaluation for both the EU and the FDA should be made consistent on a global scale. The consistency check should be done even among the EU countries. For example, currently there is no harmonization on regulatory approvals for nonmedicine human cell and tissue-based products. Clinical trials should be harmonized throughout Europe.
There also should be proper implementation of clinical trial design and organization. The European commission should draw clear guidelines on implementing the clinical trial design, incorporating any specific national law. Europe-wide harmonization will enable faster approval processes, thereby reducing delays in drug launches. Transatlantic coordination also will aid in streamlining the regulatory costs.
The current regulatory environment lacks transparency and accountability. More effective communication is needed among the various committees involved in the regulatory process. EMEA should encourage frequent dialogues with the patients and industry representatives to ensure a transparent approval process. Such dialogues also will aid in redefining the clinical trial design and will enhance the performance of the drug approval process. www.frost.com.