EN Official Journal of the European Union C 332/8

REPORT

on the annual accounts of the European Medicines Agency for the financial year 2004 together with the Agency's replies

(2005/C 332/02)

CONTENTS

1-2 INTRODUCTION

3-6 THE COURT'S OPINION

7-9 OBSERVATIONS

Tables 1 to 4

The Agency's replies

INTRODUCTION

1. The European Medicines Agency (hereinafter referred to as the Agency) was created by Council Regulation (EEC) No 2309/93 of 22 July 1993 which was replaced by Regulation (EC) No 726/2004 of the European Parliament and of the Council of 31 March 2004 (1). The Agency operates through a network and coordinates the scientific resources made available by the national authorities in order to ensure the evaluation and supervision of medicinal products for human or veterinary use. Table 1 summarises the powers and activities of the Agency on the basis of the information supplied by it.

2. For information, the annual accounts drawn up by the Agency for the financial year 2004 are summarised in Tables 2, 3 and 4.

THE COURT'S OPINION

3. The Court's opinion is addressed to the European Parliament and the Council in accordance with Article 185(2) of Council Regulation (EC, Euratom) No 1605/2002 (2); it was drawn up following an examination of the Agency's accounts, as required by Article 248 of the Treaty establishing the European Community.

4. The Agency's accounts for the financial year ended 31 December 2004 (3) were drawn up by its Executive Director, pursuant to Article 68 of Regulation (EC) No 726/2004, and sent to the Court, which is required to give its opinion on their reliability and on the legality and regularity of the underlying transactions.

5. The Court conducted an audit in accordance with its policies and standards, which are based on international auditing standards that have been adapted to the Community context. The audit was planned and performed to obtain reasonable assurance that the accounts are reliable and the underlying transactions are legal and regular.

6. The Court has obtained a reasonable basis for the opinion expressed below.

Reliability of the accountsThe Agency's accounts for the financial year ended 31 December 2004 are, in all material respects, reliable.Legality and regularity of the underlying transactionsThe transactions underlying the Agency's annual accounts, taken as a whole, are legal and regular.The observations which follow do not call the Court's opinion into question.

OBSERVATIONS

7. The Agency's Management Board has set up an Audit Advisory Committee to advise the Executive Director on matters regarding quality assurance and risk-mitigating strategies. The existence of such a body and its operating procedures, including the recruitment procedure for its members, must be provided for, on account of its permanent nature, in the rules which govern the Agency's internal organisation.

8. The contracts concluded with the banks have been in force for over five years even though the detailed rules for the implementation of the Agency's financial regulation lay down that there should be a new invitation to tender at least once every five years (4).

9. The Court notes that the Agency's new financial regulation, as finally adopted after receipt of the Commission's opinion, takes account of the observations which the Court made in its previous report (5). Similarly, the system for managing the Agency's fixed assets has been considerably improved (6).

This Report was adopted by the Court of Auditors in Luxembourg at its meeting of 5 October 2005. For the Court of Auditors Hubert WEBER President

(1) OJ L 214, 24.8.1993, p. 1 and OJ L 136, 30.4.2004, p. 1. Pursuant to the latter Regulation the Agency's original name, European Agency for the Evaluation of Medicinal Products, was changed to European Medicines Agency.

(2) OJ L 248, 16.9.2002, p. 1.

(3) These accounts were drawn up on 29 September 2005 and received by the Court on 29 September 2005.

(4) Article 53(3).

(5) See paragraph 7 of the Report for the financial year 2003 (OJ C 324, 30.12.2004, p. 31).

(6) See paragraph 10 of the Report for the financial year 2003).

Table 1 European Medicines Agency (London) Areas of Community competence deriving from the Treaty Competences of the Agency Regulation (EC) No 726/2004 of the European Parliament and of the Council of 31 March 2004 Governance Resources made available to the Agency (2003 figures) Products and services (2003 figures) A high level of human health protection shall be ensured in the definition and implementation of all Community policies and activities. Community action, which shall complement national policies, shall be directed towards improving public health, preventing human illness and diseases and obviating sources of danger to human health. (…) (Article 152 of the Treaty) Objectives — To coordinate the scientific resources that the Member States’ authorities make available to the Agency for the authorisation and supervision of medicinal products for human and veterinary use; — to provide the Member States and the institutions of the European Union with scientific advice on medicinal products for human or veterinary use. Tasks — To coordinate the scientific evaluation of medicinal products which are subject to Community marketing authorisation procedures; — to coordinate the supervision of medicinal products which have been authorised within the Community; (pharmacovigilance); — to advise on the maximum limits for residues of veterinary medicinal products which may be accepted in foodstuffs of animal origin; — to coordinate verification of compliance with the principles of good manufacturing practice, good laboratory practice and good clinical practice; — to record the status of marketing authorisations granted for medicinal products. 1. The Committee for Proprietary Medicinal Products, consisting of two members from each Member State, advises on any question relating to the evaluation of medicinal products for human use. 2. The Committee for Veterinary Medicinal Products, consisting of two members from each Member State, advises on any question relating to the evaluation of veterinary medicinal products. 3. The Management Board, consisting of two representatives of each Member State, two representatives of the Commission and two representatives appointed by the European Parliament. The Board adopts the work programme and the annual report. 4. The Executive Director is appointed by the Management Board on a proposal from the Commission. 5. External audit: European Court of Auditors 6. Discharge is given by the Parliament on a recommendation from the Council. Final budget: 99,1 million euro (84,2 million euro) including the Community contribution (excluding subsidy for orphan medicines): 24,7 % (22,9 %) Staff numbers at 31 December 2004: 314 (287) posts provided for in the establishment plan Posts occupied: 290 (256) + 50 (48) other posts (auxiliary contracts, seconded national experts, local staff, employment agency staff) Total staff: 340 (304) Assigned to the following duties: operational: 271 (242) administrative: 69 (62) Medicinal products for human use Applications for marketing authorisations: 51 (39) Favourable opinions: 34 (39) Average evaluation time: 187 days (190 days) Opinions after authorisation: 926 (941) Pharmacovigilance: 64 186 reports (45 538 reports) Periodic reliability reports: 253 (276) Monitoring measures: 948 (1 025) Scientific opinions: 77 (65) Procedures for mutual recognition: 7 081(4 080) Veterinary medicinal products New applications: 8 (10) Applications in respect of variants: 40 (64) Inspection: 93 (76) Source: Information supplied by the Agency.

Table 2 European Medicines Agency — Implementation of the budget for the financial year 2004 (1000 euro) Revenue Expenditure Origin of revenue Revenue entered in the final budget for the financial year Revenue collected Allocation of expenditure Appropriations in the final budget Appropriations carried over from the previous financial year Appropriations available (2004 budget and financial year 2003) entered committed paid carried over cancelled outstanding commitments paid cancelled appropriations committed paid carried over cancelled Community subsidies (1) 29 073 29 022 Title I Staff 36 064 34 151 33 509 642 1 913 534 424 110 36 598 34 685 33 933 642 2 023 Own revenue 67 000 67 350 Title II Administration 23 994 23 878 12 943 10 935 116 7 265 6 749 516 31 259 31 143 19 692 10 935 632 Other revenue 3 016 3 013 Title III Operating activities 39 031 38 686 27 512 11 174 345 8 316 7 878 438 47 347 47 002 35 390 11 174 783 Total 99 089 99 385 Total 99 089 96 715 73 964 22 751 2 374 16 115 15 051 1 064 115 204 112 830 89 015 22 751 3 438 Source: The Agency's data — This table summarises the data provided by the Agency in its annual accounts.

Table 3 European Medicines Agency — Revenue and expenditure account for the financial years 2004 and 2003 (1000 euro) 2004 2003 (2) Revenue Fees relating to marketing authorisations 68 412 58 657 Commission subsidy including contributions received from the EEA 20 529 19 786 Community subsidy for orphan medicines 4 026 2 814 Contributions for Community programmes 0 1 208 Administrative revenue 1 973 1 703 Sundry revenue 1 473 1 788 Total (a) 96 413 85 956 Expenditure Staff expenditure 34 333 29 663 Administrative expenditure 11 224 10 835 Operating expenditure 38 573 32 838 Depreciation 3 650 2 364 Other expenses 280 0 Total (b) 88 060 75 700 Operating result (c = a – b) 8 353 10 256 Financial result (e) 1 160 676 Economic outturn (f = c + e) 9 513 10 932 Source: The Agency's data — This table summarises the data provided by the Agency in its annual accounts.

Table 4 European Medicines Agency — Balance sheet at 31 December 2004 and 31 December 2003 (1000 euro) Assets 2004 2003 Liabilities 2004 2003 Intangible assets 5 109 3 401 Own capital Outturn carried over from previous financial years 13 767 6 872 Fixed assets Economic outturn 9 513 10 932 Plant, machinery and tools 2 480 1 635 Subtotal 23 280 17 804 Furniture and vehicle fleet 1 375 1 011 Computer equipment 3 151 2 548 Current liabilities Subtotal 7 006 5 194 Amounts owed in social security charges 320 0 Amounts owed to Community institutions and bodies 4 910 479 Current assets Current liabilities 13 151 11 936 VAT paid and to be recovered 1 888 1 105 Other accounts payable 106 127 Amounts owed by Community institutions and bodies 148 107 Advances from customers 11 250 8 845 Sundry accounts receivable 1 795 1 034 Subtotal 29 737 21 387 Sundry receivables and advances 2 061 64 Subtotal 5 892 2 310 Available assets 35 010 28 286 Total 53 017 39 191 Total 53 017 39 191 Source: The Agency's data — This table summarises the data provided by the Agency in its annual accounts. (1) Including subsidies received from the European Economic Area. Source: The Agency's data — This table summarises the data provided by the Agency in its annual accounts. (2) The data for the financial year 2003 have been reprocessed to make them comparable to those of 2004. Source: The Agency's data — This table summarises the data provided by the Agency in its annual accounts.