EU capitals propose Chips Act for medicines

A majority of EU countries have rallied behind a proposal to create a “Critical Medicines Act” that would replicate European efforts toward self-reliance in microchips.

The act would encourage production of key medicines, as well as pharmaceutical ingredients and more basic chemical inputs, reducing dependencies on major producers like China and India.

The idea is put forward in a position paper dated Tuesday, drawn up by the Belgian government and backed by 18 other countries, including France and Germany.

The EU capitals point out that 40 percent of all pharmaceutical ingredients globally are sourced from China, and that production for many of these products is concentrated in just a handful of manufacturing sites. “As a result, Europe (and the world) depend on a few manufacturers for a large bulk of their medicines supply,” notes the paper.

It doesn’t spell out in detail how this would be achieved, but states that future legislation should follow the example of the European Chips Act and the Critical Raw Materials Act. The bloc is pouring €43 billion in investments to encourage microchip manufacturing, as well as setting aspirational targets to bring the EU’s share of the global semiconductor value chain to 20 percent by 2030.

The pandemic put into focus the fragility of Europe’s pharmaceutical supply chains after India banned the export of paracetamol and other life-saving drugs to deal with the wave of COVID-19 infections. Rising tensions with China, the biggest exporter to the EU, have bolstered calls for governments to take a more active role in managing production under the banner of “strategic autonomy.”

Countries cannot write EU legislation by themselves, but the strong majority support for the measure will pressure the European Commission to consider an official proposal.

Other ideas in the paper include a voluntary EU solidarity mechanism that would let countries quickly exchange stocks of medicines when there are shortages, as well as the creation of a European list of critical medicines for special monitoring, a measure that’s also included in legislation expanding the mandate of the European Medicines Agency adopted last year.

Besides Belgium, France and Germany, the position paper was signed by Austria, Netherlands, Luxembourg, Czech Republic, Spain, Estonia, Slovenia, Romania, Latvia, Lithuania, Greece, Malta, Poland, Italy and Portugal. The proposal comes ahead of an informal meeting of the EU’s health ministers in Sweden on Thursday.