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In this article, we discuss the European Commission’s (EC) proposed Critical Medicines Act (CMA), published on 11 March 2025[1] which aims to improve the availability, supply and production of critical medicines within the European Union (the EU).
A critical medicine is a medicinal product for which insufficient supply results in serious harm or risk of serious harm to patients. The CMA also seeks to improve availability and access to medicines of common interest. These medicines are not critical medicines and are subject to inadequate supply to meet patient needs in three or more Member States (MS) of the EU.
Background
The proposed CMA comes in response to ongoing medicines shortages and increasing concerns about Europe’s supply chain vulnerabilities giving rise to disruptions to critical medicine supplies. These risks were highlighted by recent global events, such as the global increase in demand for critical medical supplies during the COVID-19 pandemic and geopolitical unrest.
The CMA will complement the EC’s proposed measures under the EU Pharmaceutical Reform package published in April 2023 which will provide the legislative basis for the Critical Medicinal Products List (the Critical Medicines List) and introduce important regulatory measures to avert medicine shortages and to strengthen the security of supply of critical medicines.
The CMA
The CMA establishes a legal framework to achieve the objectives of strengthening the security of supply and continuous availability of critical medicines in the EU and to address market failures by improving the availability and accessibility of medicinal products of common interest.
The CMA sets out a framework:
The CMA obliges MS and the EC to work together to strengthen the security of supply and continuous availability of critical medicines in the EU through measures to take full advantage of the potential of the internal market.
The key elements of the CMA toolbox include:
The CMA establishes the Critical Medicines Coordination Group (the CMCG) consisting of EU MS representatives and the EC. The EMA has observer status at the CMCG. The CMCG is required to work closely with the Medicines Shortages Steering Group (the MSSG), the EMA and national authorities responsible for medicinal products and may arrange joint meetings with the MSSG. In essence, the CMCG will coordinate and facilitate the implementation of the CMA and advise the EC, where appropriate, to maximise the impact of the CMA measures and to avoid any unintended effects on the internal market.
In particular, the CMCG will facilitate coordination of financial support for strategic projects by exchanging information on manufacturing capacity within the EU to ensure security of supply of critical medicines. The CMCG will facilitate information exchange among MS and facilitate discussions on potential collaborative procurement initiatives for critical medicines and medicines of common interest as provided in Chapter IV of the CMA.
The CMA is not expected to create significant additional regulatory burden. However, there will likely be an additional information burden on marketing authorisation holders and economic operators in the supply and distribution chains of critical medicinal products and medicinal products of common interest.
Strategic projects
The CMA sets out the criteria and procedure for the recognition of strategic projects and sets out the incentives and benefits which recognised strategic projects may avail of, including potential funding from MS and the EU.
A project located in the EU and related to creating or increasing manufacturing capacity will be considered as a strategic project if it meets at least one of the following criteria:
Each MS will have a designated authority to assess and verify whether projects meet the criteria to be designated as a strategic project. MS must notify the EC of their designated authority for assessing strategic projects and the EC will maintain a publicly accessible webpage listing the contact details and relevant information for each.
A project promoter may request the designated authority to assess whether a project qualifies as a strategic project, while a MS authority may request the designated authority to verify its determination of a project’s strategic status. Projects approved as strategic projects by a MS’s designated authority under the CMA shall be recognised and relied upon by other authorities.
Strategic projects are to be prioritised and fast-tracked though the administrative process, and MS are required, on request, to provide administrative and regulatory support, and expedite the permit-granting procedures for these projects without delay. This regulatory support and expedited processing of regulatory applications extends to streamlined environmental assessments and authorisations, planning and dispute resolution. In addition, MS are to pay particular attention to SMEs.
MS will be able to prioritise financial support to strategic projects that address a vulnerability in the supply chains of critical medicines, subject to State Aid rules. The EC has published ‘Guidance on the application of State aid rules in the context of the Critical Medicines Act’[2] as a working document based on the current draft of the CMA. The beneficiary of financial support from a MS for a strategic project must prioritise supply of the relevant critical medicine to the EU market and use “its very best efforts” to ensure that the medicine remains available in the MS where the product is being marketed for as long as the product is on the Critical Medicines List. Further, the MS that provided financial support may request the beneficiary to provide the necessary supplies of the relevant critical medicine, active substance or key inputs to the EU market to avoid shortages on one or more MS.
The CMA also provides for financial support from the EU for strategic projects including under programmes such as EU4Health, Horizon Europe and the Digital Europe Programme. However, Article 16 is limited to the duration of the current Multiannual Financial Framework 2021 – 2027. To make a meaningful impact, Article 16 will require EU budget support and aligned funding programmes to expand and modernise manufacturing, ensuring sufficient capacity and supply chain resilience. The issue of EU funding for strategic projects under the CMA will need to be addressed based on the EU’s estimate of the investment required to meet the strategic objectives of the CMA.
Demand side measures using public procurement
The CMA introduces public procurement initiatives to incentivise sustainability of supply chains and establish options for collaborative procurement where the EC procures in the name or on behalf of MS or undertakes joint procurement.
The CMA mandates MS to apply procurement requirements beyond price-only award criteria, including stockholding obligations, supplier diversity, supply chain monitoring, and timely delivery commitments. Where MS award criteria include stockpiling requirements, they must ensure that such requirements do not negatively impact security of supply in other MS, and that any requirements on companies in the supply chain to hold contingency stocks are proportionate and respect the principles of solidarity and transparency.
Critical medicines with identified supply chain vulnerabilities and high dependency on non-EU countries require MS contracting authorities, where justified, to apply procurement requirements that favour suppliers manufacturing a significant portion of these products within the EU. In the case of Medicinal Products of Common Interest, the contracting authorities of MS may, where justified by market analysis and public health considerations, apply procurement requirements that favour suppliers that manufacture a significant proportion of these products in the EU. Procurement rules established under the CMA must be applied in compliance with EU international commitments, including those under the WTO Agreement on Government Procurement (GPA) and relevant Free Trade Agreements (FTAs).
MS will have six months to establish national programmes to improve security of supply of critical medicinal products, including public procurement procedures. Additionally, MS must notify their national programmes to the EC acting in its capacity as secretariat of the CMCG.
The CMA sets out the options for joint procurement by MS facilitated by the EC (Article 21), procurement by the EC on behalf of or in the name of MS (Article 22) and joint procurement by MS and the EC (Articles 23).
The Article 21 facilitation procurement procedure applies where three or more MS request cross-border procurement for medicinal products of common interest. The EC will assess the request in light of the CMA and decide whether to accept or decline the request and communicate its decision within three weeks of receiving the request. Successful requests will be given support from the EC and facilitation up to the point that the procurement contract is signed by the participating contracting authorities.
The Article 22 procurement procedure applies where nine or more MS jointly request the EC to procure on their behalf or in their name, medicinal products belonging to one of the following categories:
(a) critical medicinal products for which a vulnerability in the supply chain is identified through a vulnerability evaluation or for which the MSSG recommends a common procurement initiative
(b) medicinal products of common interest for which a joint clinical assessment report has been published or which have undergone clinical assessment under the voluntary cooperation among MS each conducted pursuant to the Health Technology Assessment Regulation (EU) 2021/2282
and the requested procurement procedure will help to improve security of supply and availability of critical medicinal products in the EU or ensure the availability and accessibility of medicinal products of common interest, as applicable.
The EC will assess the request in light of utility, necessity and proportionality and whether the request is justified in light of the objectives of the CMA and shall, in particular, verify whether the procurement could constitute discrimination or restriction to trade or a distortion to competition. The EC will inform the MS of its decision within one month of the request, and in case of refusal provide reasons. The EC may agree to conduct the procurement subject to conditions.
The Article 23 procurement procedure may be initiated by the EC or at the request of at least 9 MS and applies as a joint procurement procedure if a contract is necessary for implementing joint action between the EC and MS. The joint procurement procedure under Article 23 applies to medicinal products coming within one of the categories applicable to the Article 22 procedure as set out at paragraph 5.7 (a) or (b) above, and the EC is subject to identical decision-making criteria, procedures and timeframe for decision.
Joint procurement procedures under Articles 22 and 23 are open to all MS and the EC acting through the CMCG shall inform all MS of the request and invite them to participate.
Conclusion and looking ahead
The CMA will be considered by the European Parliament and the Council as co-legislators, and their respective positions and amendments to the text of the proposed CMA are awaited with interest.
For more information on this topic, please contact Cliona Christle, partner or any member of the Life Sciences team.
Date published: 25 March 2025
