COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the document Proposal for a Regulation of the European Parliament and of the Council on the fees payable to the European Medicines Agency (EMA) for the conduct of pharmacovigilance activities in respect of medicinal products for human use
Date: 2013-06-26
Institutions: European Commission
Subjects: European Medicines Agency, drug surveillance, financial instrument, impact study, medicinal product, product safety

EUROPEAN 
COMMISSION 

Brussels, 26.6.2013  
SWD(2013) 235 final 

COMMISSION STAFF WORKING DOCUMENT 

EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT 

Accompanying the document 

Proposal for a Regulation of the European Parliament and of the Council on the fees 
payable to the European Medicines Agency (EMA) for the conduct of 
pharmacovigilance activities in respect of medicinal products for human use 

{COM(2013) 472 final} 
{SWD(2013) 234 final} 

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COMMISSION STAFF WORKING DOCUMENT 

EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT 

Accompanying the document 

Proposal for a Regulation of the European Parliament and of the Council on the fees 
payable to the European Medicines Agency (EMA) for the conduct of 
pharmacovigilance activities in respect of medicinal products for human use 

1. 

INTRODUCTION AND PROBLEM DEFINITION 

The  EU  pharmacovigilance  legislation  has  been  subject  to  a  major  review  and  an  impact 
assessment that lead to the adoption of a revised legislation in 20101, which strengthens and 
rationalises the system for monitoring the safety of medicines on the European market. This 
legislation  provides  for  a  number  of  EU-wide  procedures  to  assess  pharmacovigilance  data. 
Some additional adjustments were introduced in 20122. 

In order to finance these activities, the 2010 Pharmacovigilance legislation provides for fees 
to be charged to marketing authorisation holders (MAH). 

The impact assessment has evaluated the various options for charging fees to MAHs for the 
pharmacovigilance  activities  performed  at  the  level  of  the  EU  involving  the  European 
Medicines Agency (EMA).  

The  specific  problems  posed  by  the  absence  of  fees  for  pharmacovigilance  activities  of  the 
EMA can be outlined under the following areas.  

1.1. 

Inexistence  of  financial  instrument  to  implement  the  pharmacovigilance 
legislation and inadequate funding for the related activities 

Prior  to  the  amended  pharmacovigilance  legislation,  the  EMA  was  only  tasked  with 
pharmacovigilance of products with an EU-wide marketing authorisation. The new legislation 
has substantially increased the scope of EMA competence in pharmacovigilance, by including 
also products which are authorised via national procedures. The introduction of assessments 
to  be  carried  out  at  EU  level  in  the  context  of  specific  pharmacovigilance  procedures  laid 
down  in  the  legislation  i.e.  for  the  assessment  of  PSUR3s,  the  assessment  of  PASS4s  and 
assessment  in  case  of  pharmacovigilance  referrals,5  leads  to  a  substantial  workload  with 
associated  costs.  Furthermore, 
the  EU-wide  assessments  require  adequate  EU-wide 
information technology tools. 

All  the  fees  currently  payable  to  the  EMA  are  laid  down  in  Council  Regulation  (EC)  No 
297/956  which  at  present  does  not  include  any  provisions  on  specific  fees  for  the 
pharmacovigilance  activities  provided  for  in  the  legislation.  Therefore,  the  legal  instrument 

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Regulation  (EU)  No  1235/2010  amending  Regulation  (EC)  No  726/2004  and  Directive  2010/84/EU 
amending Directive 2001/83/EC. 
Directive  2012/26/EU,  OJ  L  299  of  27.10.2012,  and  Regulation  (EU)  No  1027/2012,  OJ  L  316  of 
14.11.2012. 
Periodic Safety Update Reports. 
Post-Authorisation Safety Studies. 
A  pharmacovigilance  referral  is  a  procedure  in  which a  safety  concern is  referred  to  the  EMA  and  is 
examined at EU level with respect to all concerned products authorised in the EU. 
Council Regulation (EC) No 297/95 of 10 February 1995 on fees payable to the European Agency for 
the Evaluation of Medicinal Products, OJ L 35, 15.2.1995, 

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that would enable the EMA to charge fees for these activities is missing. As a consequence, 
the existing fee structure of EMA does not reflect the requirements set out in the legislation 
and there is no adequate funding for pharmacovigilance activities at EU level. This has direct 
consequences  as  regards  rapporteurs  from  the  Member  States  (MS)  who  are  currently  not 
remunerated  for  their  assessment  work  within  the  EU  procedures.  This  situation  is 
unsustainable even in the short term. 

1.2. 

Lack of transparency and clarity in the current situation of pharmacovigilance 
fees across the EU 

In  general,  the  existing  fees  for  pharmacovigilance  activities  in  the  EU  do  not  reflect  the 
requirements and parameters set out in the 2010 pharmacovigilance legislation. 

At the level of the EMA, as described above, there are no specific fees for the financing of 
EMA's pharmacovigilance activities laid down in the 2010 pharmacovigilance legislation. 

At  national  level,  some  MS  currently  charge  fees  for  pharmacovigilance.  For  these  MS  it 
would be difficult to adapt, if appropriate, their fees to the new pharmacovigilance legislation, 
unless the fees for pharmacovigilance activities of the EMA are actually introduced. The EU 
is not competent with respect to national fees and it is therefore reasonable to expect that any 
adaptation of these fees, if considered necessary by the MS, would only take place after the 
for  EU-wide 
introduction  of  pharmacovigilance 
pharmacovigilance procedures. This would in particular allow MS to ensure that there is no 
double charging at national level for the activities performed at the level of the EU for which 
a fee is charged by the EMA.  

fees  collected  by 

the  EMA 

2. 

OBJECTIVES 

The general objective of this initiative is to ensure a high level of human health protection in 
the EU as well as to promote the functioning of the internal market.  

The specific objective is to ensure the proper implementation of the 2010 pharmacovigilance 
legislation  through  defining  the  structure  and  the  level  of  the  fees  charged  to  MAHs  for 
pharmacovigilance activities performed at the level of the EU. In order to ensure that adequate 
funding for pharmacovigilance activities of the EMA is available, such fees should allow the 
EMA to cover its estimated costs, including remuneration of rapporteurs from the MS for the 
work  that  they  provide.  The  fee  structure  should  also  underpin  a  transparent,  fair,  activity-
based and cost-based fee system for pharmacovigilance activities of the EMA. 

ANALYSIS OF SUBSIDIARITY 

3. 
The EMA is a decentralised Agency of the EU7 and hence decisions on its funding, including 
through charging fees, are taken at the EU level. 

The  pharmacovigilance  legislation  enables  the  EMA  to  charge  fees  for  pharmacovigilance. 
Only the Union can act to introduce new types of fees for the Agency.  

4. 

POLICY OPTIONS 

It  is  proposed  to  introduce  a  self-standing  legal  instrument:  Regulation  of  the  European 
Parliament and of the Council. 

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The founding Regulation of the EMA is Regulation (EC) No 726/2004 of the European Parliament and 
of the Council of 31 March 2004, OJ L 136, 30.4.2004 

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Based on estimated annual costs of pharmacovigilance at EU level, several policy options to 
collect pharmacovigilance fees were considered.  

Option 1: No change to the current situation (baseline scenario) 

No introduction of specific pharmacovigilance-related fees to be charged by the EMA.  

Option 2: One annual flat fee covering all pharmacovigilance activities 

An annual flat fee for all pharmacovigilance activities of the EMA would be introduced and 
would be applicable to all MAHs having medicinal products authorised in the EU.  

A decreased annual flat fee for medicinal products for which the MAH is a small or medium-
sized enterprise would be set at the level of 60 % of the full annual flat fee. No fee would be 
charged for medicinal products for which the MAH is a micro-enterprise.  

A  fee  reduction  of  20%  would  be  applied  to  authorised  generic,  homeopathic  and  herbal 
medicinal products and medicinal products authorised on grounds of well-established use.  

Option 3: A combination of separate fees for procedure-based activities and an annual 
flat fee for all other activities 

Two types of fees would be charged. (1) Fees for specific pharmacovigilance procedures that 
are provided for in the legislation, i.e. for the assessment of PSURs, the assessment of PASSs 
and assessment in case of pharmacovigilance referrals, would be charged to all MAHs having 
a medicinal product that is subject to the procedure in question. Additionally,  (2)  an annual 
flat fee would be charged to all MAHs having medicinal products authorised in the EU. This 
additional annual flat fee would be based only on the costs of pharmacovigilance activities of 
the EMA other that those related to the specific procedures.  

Small  and  medium-sized  enterprises  would  pay  60%  of  the  full  fee  and  no  fee  would  be 
charged for medicinal products for which the MAH is a micro-enterprise. 

A  fee  reduction  of  20%  in  respect  of  the  annual  flat  fee  would  be  applied  to  authorised 
generic,  homeopathic  and  herbal  medicinal  products  and  medicinal  products  authorised  on 
grounds  of  well-established  medical  use.  However,  where  these  medicinal  products  are 
included in the pharmacovigilance procedures, the normal procedure-based fee would apply.  

Option 4: Procedure-based fees only 

All costs of EU-level pharmacovigilance activities would be used as a basis to set fees to be 
charged  only  to  those  MAHs  having  a  medicinal  product  involved  in  one  of  the  three 
procedures outlined in option 3. 

Small and medium-sized enterprises would pay 60 % of the full fee per procedure and no fee 
would be charged to MAH which are micro-enterprises.  

5. 

ASSESSMENT OF IMPACTS 

In view of the operational objectives, the assessment criteria are: 

• 

• 

Transparency – a clear relationship between the type and level of fee and the 
corresponding work carried out.  

Fairness  –  MAHs  should  contribute  to  the  financing  of  pharmacovigilance 
activities on the basis of potential safety concerns of their products and double 
charging should be avoided.  

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• 

Stability  –  providing  for  a  stable  fee  system  based  on  the  highest  possible 
degree of financial predictability and avoiding variable remuneration of similar 
scientific services.  

• 

Simplicity – minimum additional administrative burden.  

Option 1: No change to the current situation  

MAHs  would  not  benefit  from  the  enhanced  and  rationalised  pharmacovigilance  system 
introduced  by  the  legislation.  The  expected  public  health  benefits  would  not  be  achieved. 
Moreover,  stakeholders  would  lack  clarity  as  regards  the  sustainability  and  the  funding  of 
pharmacovigilance activities in the EU. 

The  EMA  would  not  be  in  a  position  to  implement  its  new  tasks  with  regard  to  the  2010 
legislation, due to the absence of adequate funding for the costs incurred by the performance 
of these tasks. 

As a consequence, the rapporteurs from the Member States would not be remunerated by the 
EMA for their work within the EU-wide procedures. 

Option 2: One annual flat fee covering all pharmacovigilance activities 

Each MAH would be charged once per year for all pharmacovigilance activities performed at 
EU  level,  based  on  the  number  of  its  authorised  products,  as  registered  by  the  Agency.  All 
products on the market would be thus considered as potentially subject to safety concerns at 
the  same  level  and  would  contribute  equally  to  the  financing  of  the  pharmacovigilance 
activities at EU level.  

An annual flat fee is a predictable fee that MAHs would be able to take account of in their 
financial planning. 

In comparison with options 3 and 4, option 2 is less transparent and the MAHs may perceive 
that they are charged twice for the same work by EMA and by NCAs.  

As under options 3 and 4, rapporteurs would be remunerated according to a fixed scale, which 
is based on estimated average costs per evaluation procedure. 

Such  a  fee  would  mean  a  relatively  stable,  predictable  income  for  the  Agency.  As  the 
collection of the entire fee revenue for pharmacovigilance would be disconnected time-wise 
from  the  actual  pharmacovigilance  procedures,  the  EMA  would  have  to  ensure  financial 
management of the total pharmacovigilance fee income throughout the year. 

Option 3: A combination of fees for procedure-based activities and an annual flat fee for 
all other activities 

In this scenario, MAHs would be charged as follows:  

•  MAHs having at least one product involved in a pharmacovigilance procedure 
would  be  charged  a  procedure-based  fee.  The  fee  would  be  divided  between 
MAH based on the proportion of products held by each MAH involved. 
all  MAHs  in  the  EU8  (with  the  exception  of  micro  enterprises)  would  be 
charged an annual flat fee for their authorised products.  

• 

MAHs that are not involved in any EU procedure would only pay the annual flat fee. 

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as per information recorded by the EMA from the database set up by Art 57(1)(l) of Regulation (EC) 
No 726/2004 

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As  for  options  2  and  4,  rapporteurs  from  NCAs  would  be  remunerated  with  regards  to 
pharmacovigilance  procedures  according  to  a  fixed  scale  per  procedure,  based  on  estimated 
average costs.  

In  comparison  with  option  2,  the  exact  overall  fee  revenue  is  not  entirely  predictable  given 
that the number of procedures is more difficult to predict (except for PSURs).  

The  procedure-based  fees  are  proportionate  to  the  average  workload.  With  regards  to  the 
annual  flat  fee  component,  it  would  only  cover  non-procedure-related  costs  of  the  Agency 
which would substantially lower its amount as compared to option 2.  

Option 4: Only procedure-based fees and no annual flat fee 

Under this option, only MAHs whose products are involved in a pharmacovigilance procedure 
would be charged a fee in connection with the procedure. The fee levels per procedure would 
be  higher  than  those  in  option  3,  where  the  total  cost  is  covered  by  a  combination  of 
procedure-based fees and an annual flat fee. 

The  non-procedure-related  EMA  costs  would  be  distributed  only  amongst  those  MAHs  that 
are  included  in  a  procedure.  MAHs  that  are  not  subject  to  any  EU  procedure  would  not 
contribute to the financing of the system whilst potentially and indirectly benefiting from it. In 
this  respect,  option  4  is  likely  to  be  less  transparent,  and  less  fair  and  proportionate  than 
option 3. 

As  under  options  2  and  3,  rapporteurs  from  NCAs  would  be  remunerated  according  to  the 
same fixed scale per procedure based on average estimated costs. 

As opposed to option 2 and option 3, the EMA would only have to charge a fee in relation to 
an EU procedure.  

6. 

COMPARISON OF THE OPTIONS 

The  criteria  for  evaluating  the  options  follow  the  principles  of  effectiveness,  efficiency  and 
coherence.  The  specific  criteria  against  which  the  options  are  compared  include  (1) 
transparency  of  the  fee  levels  and  structure,  (2)  stability  and  financial  predictability,  (3) 
simplicity of the fee structure and (4) fairness and proportionality of fees.  

Based on the  analysis, the individual options were assigned scores of how well each option 
meets the criteria as compared to the baseline scenario (option 1).  

Further,  each  criterion  was  assigned  a  relative  weight,  to  formalise  its  relative  importance. 
The overall relative hierarchy among the criteria suggests that 45 % of the objective weight is 
on fairness and proportionality, 32 % on transparency, 14 % on stability and predictability and 
9  %  on  simplicity.  These  values  were  subsequently  used  in  making  the  decision  on  the 
preferred option.  

The relative importance (weighting) of the four criteria and its application to the analysis of 
individual options is summarised in  Table 1 below. The absolute score obtained  determines 
the ranking of the options in terms of achieving the objectives of this initiative. 

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Table 1: Final comparison of options 

Options / Objectives 

transparency 

stability / 
predictability 

simplicity 

fairness / 
proportionality 

Total 
Score 

Option 1 
Option 2 
Option 3 
Option 4 

0 
3 

10 

6 

0 
4 

3 

1 

0 
3 

1 

2 

0 
5 

14 

9 

0 
15 

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Based on this analysis, it follows that option 3, i.e. the combination of procedure-based fees 
and an annual flat fee, is the preferred option. This option has been considered to be the most 
transparent, cost-based, activity-based, fair and proportionate way of setting the new fees, in 
order to cover the EMA’s costs, including remuneration of rapporteurs from MS. In this way, 
the products being part of a pharmacovigilance procedure at EU level would contribute to the 
financing  of  the  cost  of  the  procedure.  At  the  same  time,  the  cost  of  general 
pharmacovigilance activities of the EMA, and only that part of the overall cost, would be used 
as a basis for the annual flat fee, charged to MAHs with respect to their authorised products.  

7. 

MONITORING AND EVALUATION 

The necessary monitoring information will be provided by the EMA and would be linked to 
the implementation of its annual budget. The annual activity report on the performance of the 
EMA  would  need  to  be  adapted  to  provide  reliable  performance  information  and  key 
indicators related to the activity. 

Based  on  this  information,  the  Commission  will  consider,  if  appropriate,  whether  there  is  a 
need to revise the level of fees for pharmacovigilance.  

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