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The challenges facing US companies entering Europe

Tony Baker Vice-president of NDA Group

Pharma companies, big and small, face multiple challenges when contemplating the development strategy for their new compounds. The failure rate of early stage compounds has been welldocumented, and most large companies have invested significant amounts of time and effort in trying to understand why compounds succeed or fail.

Elaborate algorithms have been devised to assist both scientists and executives figure out the development strategy. It is these challenges that sometimes result in companies deciding to undertake staged development, perhaps initially focusing on one region and then trying to retro-fit development studies for one region into the requirements of another. This article focuses on the challenges that US companies face when entering Europe and poses a number of questions that need to be considered when embarking on drug development. As will become apparent, failure to address these issues early in the development cycle will potentially delay the introduction of the product.

However, first of all let us consider what a typical global development strategy might look like. Most large pharma companies aim to produce a global development plan that includes:

• a pre-IND meeting with FDA
• a micro-dosing strategy with several related compounds
• an early interaction with the European Paediatric Development Committee (PDCO) in order to agree the studies for the Paediatric Investigation Plan (PIP)
• an early PMDA interaction that includes both single and multiple ascending doses in Japanese patients
• a personalised medicine plan and a companion diagnostic development strategy
• a global Phase III development plan including entering patients from China
• pivotal studies that incorporate pharmacoeconomic endpoints

This global development strategy will result in a simultaneous global submission and ‘market access’ plan that sees the first market introduction, with a companion diagnostic, less than five years from the first dose being administered to man. Does this sound familiar? No? The scenario describes what could be a global development strategy in the future, although some major pharma companies are already embarking on this path. However, most companies are more cautious, given the attrition rates in R&D and other economic considerations that are different for different companies. Often a more staged development programme is preferred with staged investment, based on the achievement of key milestones based on emerging data.

For the purposes of this article, I am going to address what a US company needs to consider when entering Europe.

Q. I’ve held a pre-IND meeting with FDA and want to ensure that the agreements I’ve made for the US will also hold for Europe. How do you suggest I do that?
There are two ways to obtain formal scientific advice in Europe. One way is nationally through individual regulatory agencies in different countries, and the second is via the scientific advice procedure run on behalf of the Committee for Medicinal Products for Human Use (CHMP) by the European Medicines Agency (EMA). There are pros and cons in using either procedure, but both are effective depending on the product and the eventual commercial strategy for the company. In addition, companies can seek advice from consultancy companies who may have relevant expertise.

Q. Surely if I’ve agreed a development strategy with FDA it will be the same for Europe?
Not necessarily. There are many examples of products that have been approved in the US but not in Europe, and vice versa. Often this is because a national, rather than a global, development strategy has been employed, but not always. The regulatory agencies are independent and sometimes come to different decisions, albeit based on the same dataset. In addition, comparator products and/ or approved dose can be different between the US and Europe – or even within the EU between different countries. Seeking appropriate regulatory advice in these situations is highly recommended.

Q. Isn’t scientific advice expensive in Europe? I can get it for free from FDA.
There is a charge for scientific advice in Europe either nationally or centrally. However, given the cost or running clinical studies it is a worthwhile expenditure.

Q. I’ve heard that in Europe you need to conduct paediatric studies much earlier than we need to in the US. Is that true?
Yes, that is correct. Companies can not submit a marketing authorization application (MAA) in Europe unless they have an approved PIP. This is a plan that is formally approved by the PDCO: it may be a waiver if the disease being treated is not present in children, but usually studies in children will be required, as may a paediatric formulation of the product. The guidelines for companies recommend that the PIP should be in place by the end of Phase I in adult patients. For some US companies, the interaction with the PDCO may be the first interaction with a regulatory agency in Europe.

Q. Do I need a legal presence in Europe to develop or commercialise my product?
If the company does not have a representative presence in Europe, regulatory advice can be obtained and clinical studies can be undertaken via third party consultants and/or CROs. In order to commercialise a product, the company will need a legal presence in one of the EU member states – for pharmacovigilance, for product release and for medical information.

Q. There are several different regulatory procedures for MAAs in Europe. Which one is best?
There are three different regulatory procedures: the national route, the decentralised and the centralised procedure. For some products there is a choice that companies can make which depends on the commercial strategy for the company. For most new products, companies need to use the centralised procedure which is governed by the EMA.

Q. Is it true that if I use the centralised procedure then I need to launch the product in all countries in Europe? What if I can’t?
The European Union comprises a single market of 27 member states. A centralised approval applies to all member states and requires that the company makes the product available throughout the single market. If that does not happen, the European Union (the legal entity that that grants the approval) has the powers to cancel the marketing authorisation although, in practice, that power has never been used. It is therefore important that the commercial strategy for the company needs to be considered early in the development of the product.

Q. Does the European Medicines Agency approve companion diagnostics in the same way as FDA?
The EMA is responsible for the approval of medicinal products that fall within the pharmaceutical legislation. If the companion diagnostic is classified as a medical device (eg, in vitro diagnostics) the applicable legislation is contained in the Medical Devices Directive and the regulatory approval is via the ‘CE’ mark that is granted via a notified body and not through the EMA. It is important to seek appropriate advice while considering the development strategy for the product.

Q. What about pricing and reimbursement in Europe? How does that work?
Seeking approval for a product in Europe results in a scientific/ technical approval. The pharmaceutical legislation requires that companies demonstrate safety, quality and efficacy of the product. In order that the product can be made available and prescribed in individual countries, an individual national approval for the price and/or reimbursement may be required to enable listing in national formularies. This process is referred to as ‘market access’ and is a separate national process that usually follows the regulatory approval process. Obtaining regulatory approval does not necessarily guarantee market access. There are health technology assessment (HTA) bodies in many member states in Europe (eg, NICE in UK, IQWiG in Germany) that undertake an assessment as to whether a product is effective before approving it for use within the individual country’s health service. The HTA bodies require an economic assessment of the value and/ or effectiveness of a new product versus existing therapy. These assessments are undertaken nationally and, although one country may use the assessment of another, the ‘HTA strategy’ needs to be an important component of the overall development strategy that will also include the ‘regulatory strategy’. Companies can consult some HTA bodies (or consultancy organisations) for advice about appropriate pharmacoeconomic endpoints in clinical studies.

This article has outlined a number of important elements that US based companies need to consider when embarking on the development of new products that they wish to place on the European market. There was a view that this author has heard in the past that “if it’s good enough for FDA, then it must be good enough elsewhere”. This is too simplistic and is a somewhat polarised view on how to develop new medicines. The different regulatory agencies around the world have sometimes reached different conclusions on the same dataset for the same product. Regulators do talk to one another on a regular basis, and where different conclusions are drawn then significant conversations do occur between agencies and with the company.

Whereas there are many similarities in the regulatory systems, and many guidelines for the development of products have been harmonised through the ICH process, medical practices are sometimes different between different countries. These differences need to be recognised and taken into consideration when developing new medicines. The US and Europe are different and this article has highlighted some considerations for US companies when entering Europe.