◁ Back

COVID-19 spotlights the need for a new pharma strategy in Europe

December 2, 2020

COVID-19 pandemic has brought to light concerns about the efficiency of the European drug industry business model. The exceptional situation of the coronavirus spotlighted the insufficiencies of the pharmaceutical production sector and the need for prioritisation and strategic decision-making for self-sustainability in terms of markets (EU) or even countries.

Europe has struggled to fulfil the demand in pharmaceutical raw materials during the COVID-19 crisis and thus revealed its vulnerability, due to dependence on third countries.

Europe needs API manufacturing to head back from abroad

One of the greatest causes of concerns, refers to the dependence of Europe’s pharmaceutical supply chain, both for active pharmaceutical ingredients (APIs) and raw materials, on third countries.

Increasing costs, high-priced raw ingredients and intense competition have forced European pharmaceutical industries, over the last 30 years, to join the race for profitability and source from China and India APIs and other raw materials.

According to the 2008 impact assessment for Falsified Medicines Directive21 (SEC(2008)2674) [1], 90% of APIs for generic medicines are sourced from India and China. Many APIs, especially for innovative medicines, are also produced in Europe, yet even for this local production most of the raw materials are sourced from China.

This dependency can put at risk the supply chain of essential medicines, threaten EU’s self-sufficiency and, under crisis circumstances, lead to a major health security issue.

What is next for the European Pharma model?

Today, it is more crucial than ever to develop a strategy for the European pharmaceutical industry that will enhance its competitiveness, secure the supply chain, and ensure EU’s strategic autonomy.  

The European Commission services have already started a dialogue with Member States representatives in the framework of the Pharmaceutical Committee to collect information and identify potential solutions in preventing medicine shortages.

Europe is currently at a turning point, and although it will take time to change the European pharma business model, the call for European pharma manufacturing renaissance is well understood.


1. https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52008SC2674&from=EN