EU pharmaceutical reforms fail to confront reality of medicine shortages

Refusal of strategy to be published this week to address pricing issues for common off-patent therapies likely only to worsen supply issues

The European Commission will shortly present its proposed reform of the bloc’s pharmaceutical regulation, the first big revisions to medicine rules in 20 years. The draft has been subject to speculation, so it’s broadly known what to expect, saving a change before its debate in the European Parliament.

It will arrive against a backdrop of prolonged and intense shortages in the supply of critical medicines in Europe, which has proven over the past 18 months to be neither seasonal nor something that is going to resolve itself over time.

In Ireland, media has been reporting on medicine shortages of everything from HRT treatments to a scarcity of the antibiotic amoxicillin and common painkillers such as paracetamol as well as life-saving treatments for leukaemia, epilepsy and diabetes. The number and the range of medicines missing, the speed at which they disappear and the duration of the shortages should be cause for concern to those steering Irish health policy.

The number of medicines out of stock in Ireland is 248. Twelve months ago, it was 167 – a 48 per cent increase in medicine shortages in just one year. At any one time since the beginning of this year, more than 230 medicines at least have been missing. These statistics are gathered through our own Index that uses Health Products Regulatory Authority (HPRA) open-source data.


The Irish public might be wondering why there’s such a high number of common medicines out of stock given that Ireland has such a high density of pharmaceutical companies. The medicines that are in short supply are largely off-patent, inexpensive and manufactured offshore in low-cost manufacturing environments.

Until now, the Department of Health has turned a cold shoulder to the issues it can directly influence and has failed to meaningfully engage in the wake of unprecedented cost on an already low-margin generics industry.

Ireland faces challenges as a small consumer market. While this is not a problem for newer, expensive medicine, it is when the margins are thin because the volumes are low. Nearly 40 per cent of shortages concern single-source off-patent medicines, meaning they are either originator brands that are no longer protected by patents or generic copies of the originator brand.

One example of a medicine that fits this description is alprazolam, better known by its brand name Xanax, one of the most commonly used medicines to treat anxiety. Ireland has a less competitive price than most of our European counterparts, who pay €8.71 to treat the condition, compared with €2.22 in Ireland, based on a 100 pack of 0.25mg tablets. What might seem to be an advantage – a cost saving – is actually a false positive because the lower the prices and volumes, the less attractive the market is for manufacturers. This can leave few suppliers for some critical medicines.

Ireland spent about €25 million on unlicensed exempt medicinal products in 2022, €7 million more than the entire Budget 2023 allocation of €18 million for innovative high-priced medicines

Thirteen of the medicines in short supply in Ireland are on the WHO Critical Medicines List. For a small, peripheral market such as Ireland, this should spark considerable concern and has ultimately led to an overreliance on medicinal products that are subject to less rigorous regulatory controls and oversight of safety and efficacy standards. These are known as exempt medicinal products whose use has been masking the seriousness of the shortages situation.

Ireland spent about €25 million on unlicensed exempt medicinal products in 2022, €7 million more than the entire Budget 2023 allocation of €18 million for innovative high-priced medicines. Estimates indicate that more than three million packs of unlicensed medicines were dispensed in Ireland last year. The majority of these are being used to cover a lack of availability of licensed products. Exempt medicinal product supply is necessary but it should be on an exceptional basis.

There is growing consensus that pricing is an issue in the debate about medicine shortages. Many European countries have already taken specific national policy measures to date. This month the OECD said low pricing is driving shortages, a sentiment shared by the director general of the European Medicines Agency, who has said that price is among the contributing factors. A European Commission report similarly highlighted that “commercial reasons” are a key factor in medicine shortages.

In spite of this awareness, surprisingly and unfortunately the early indications are that the reforms in the soon to be published report won’t address the pricing problem at European Union level, never mind nationally. If anything, the proposed reforms will increase the administration and reporting requirements, increase stockholding obligations and compel manufacturers to continue to supply long after it is commercially viable, requiring supply chains to have diversified options for supply and potentially levy fines for inability to supply.

A concern is that the regulatory obstacles could prompt manufacturers to leave the Irish market, turning a persisting medicine shortages issue into a chronic problem.

If decision-makers are intent on waiting it out in the hope that factors such as inflation, geopolitical events and supply chain disruptions level out, the underlying systematic problem is only going to worsen.

Sandra Gannon is chief executive of generic medicine producer of Azure Pharmaceuticals