Töödokument - SWD(2026) 450, COM(2025) 1022, COM(2025) 1031

EN EN

EUROPEAN COMMISSION

Brussels, 26.5.2026

SWD(2026) 450 final

PART 1/2

Addendum to

COM(2025) 1022 and COM(2025) 1031 adopted on 16.12.2025

COMMISSION STAFF WORKING DOCUMENT

European Biotech Act

Accompanying the documents

Proposal for a Regulation of the European Parliament and of the Council on

establishing a framework of measures for strengthening Union's biotechnology and

biomanufacturing sectors particularly in the area of health and amending Regulations

(EC) No 178/2002, (EC) No 1394/2007, (EU) No 536/2014, (EU) 2019/6, (EU) 2024/795

and (EU) 2024/1938 (European Biotech Act)

and

Proposal for a Directive of the European Parliament and of the Council amending

Directives 2001/18/EC and 2010/53/EU as regards the placing on the market of

genetically modified micro-organisms and the processing of organs

{COM(2025) 1022 final} - {COM(2025) 1031 final}

Table of contents

1 INTRODUCTION .................................................................................................................. 5

2 BACKGROUND .................................................................................................................... 6

2.1 Political and legal context ........................................................................................... 6

2.2 Related EU legislation ................................................................................................ 7

2.3 Background on the sector .......................................................................................... 11

3 PROBLEM DEFINITION .................................................................................................... 13

3.1 Problem: biotech companies struggle to innovate, raise capital, bring innovations to

market, produce and grow in the EU, while maintaining high level of protection and

safety ......................................................................................................................... 13

3.2 What are the problem drivers? .................................................................................. 14

3.3 Consequences ............................................................................................................ 22

3.4 What is the baseline from which measures are assessed? ......................................... 29

4 APPROACH TO THE BIOTECH ACT ............................................................................... 38

4.1 Objectives of the proposal ......................................................................................... 38

4.2 Choice of the legal instruments and legal basis ......................................................... 38

4.3 Subsidiarity: necessity for EU action and EU added value ....................................... 39

4.4 Intervention logic of the proposal.............................................................................. 40

5 DESCRIPTION OF THE PROPOSED MEASURES AND ANALYSIS OF THEIR MAIN

IMPACTS ............................................................................................................................. 41

5.1 Interventions for regulatory simplification: measures and expected impacts ............ 41

5.2 Interventions on industrial enablers: measures and expected impacts ....................... 73

6 CUMULATIVE ECONOMIC, SOCIAL, ENVIRONMENTAL AND OTHER IMPACTS

OF THE PROPOSAL ......................................................................................................... 107

6.1 Regulatory simplification and administrative burden .............................................. 108

6.2 Competitiveness and investment attractiveness....................................................... 111

6.3 Innovation and research........................................................................................... 113

6.4 Public health and safety ........................................................................................... 115

6.5 Environmental impacts ............................................................................................ 116

6.6 Digital by default principle ...................................................................................... 117

7 MONITORING AND EVALUATION ............................................................................... 117

ANNEXES:

ANNEX 1: PROCEDURAL INFORMATION

ANNEX 2: STAKEHOLDER CONSULTATION

ANNEX 3: WHO IS AFFECTED AND HOW?

ANNEX 4: ANALYTICAL METHODS

ANNEX 5: ADDITIONAL INFORMATION ON BACKGROUND ON THE SECTOR AND PROBLEM

DEFINITION

ANNEX 6: OVERVIEW OF THE PROPOSED MEASURES AND ARTICLES OF THE PROPOSED

REGULATION AND DIRECTIVE

ANNEX 7: ADDITIONAL INFORMATION ON MEASURES AND EXPECTED IMPACTS

ANNEX 8: COMPETITIVENESS CHECK

ANNEX 9: SME CHECK

2

Glossary

Term or acronym Meaning or definition

AI Artificial Intelligence

ATMP Advanced Therapy Medicinal Product

BMWP Biosimilar Medicinal Products Working Party

CAGR Compound Annual Growth Rate

CAPEX Capital Expenditure

CES Comparative efficacy study

CfE Call for Evidence

CHMP Committee for Medicinal Products for Human Use

CMA Critical Medicines Act

CRO Contract Research Organization

CT Clinical Trial

CTR Clinical Trials Regulation

DNA Deoxyribonucleic acid

EEA European Economic Area

EFSA European Food Safety Authority

EIB European Investment Bank

EMA European Medicines Agency

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ERA Environmental Risk Assessment

EU European Union

FTE Full-Time Equivalent

GDP Gross Domestic Product

GDPR General Data Protection Regulation

GMM Genetically Modified Micro-organism

GMO Genetically Modified Organism

GMP Good Manufacturing Practices

GVA Gross Value Added

HTA Health Technology Assessment

IMP Investigational Medicinal Product

IP Intellectual Property

IVDR Regulation (EU) 2017/746 on in vitro diagnostic medical devices

MAA Marketing Authorisation Application

mAB Monoclonal antibody

MDR Regulation (EU) 2017/745 on medical devices

MFF Multiannual Financial Framework

MSC Member State Concerned

NGOs Non-Governmental Organisations

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OPEX Operating Expenses

R&D Research and Development

R&I Research and Innovation

RMS Reporting Member State

SDG Sustainable Development Goal

SMEs Small and Medium-sized Enterprises

SoHO Substances of Human Origin

SPC Supplementary Protection Certificate

STEP Strategic Technologies for Europe Platform

TEP Tissue Engineered Product

TFEU Treaty on the Functioning of the European Union

VMP Veterinary Medicinal Product

VNRAs Variations Not Requiring Assessment

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1 INTRODUCTION

This staff working document summarises the analysis supporting the proposal for a

Regulation1 (the ‘proposed Regulation’) and the proposal for a Directive2 (the ‘proposed

Directive’) which were adopted by the Commission on 16 December 2025. These two

proposals (collectively referred to as the ‘Biotech Act’) aim to strengthen the EU’s

biotechnology and biomanufacturing sectors, particularly in the area of health. They amend

key legislation relevant to these sectors.

Biotechnology and biomanufacturing, supported by artificial intelligence (AI) and digital

tools, could help modernise entire parts of the EU economy. They hold huge potential to

boost competitiveness and innovation, while delivering for patients, public health, food

safety, security and other areas. Despite its world-class scientific base, the EU is trailing

its competitors when it comes to translating biotechnology research into development,

market deployment and manufacturing at scale. Fragmented ecosystems, financing

constraints, complex regulatory pathways, and a lag in adapting regulatory frameworks to

technological advances, hinder EU biotechnology companies’ potential to innovate, bring

innovation to market, produce and grow in the EU. As a result, the EU’s biotechnology

sector does not meet its full potential to tackle major societal challenges and faces a

widening global competitiveness gap.

The proposed Regulation and Directive present a series of measures primarily for the

health biotechnology sector, with targeted actions addressing other biotechnology areas

(food and feed, industrial and agricultural biotechnologies). The two proposals aim to

accelerate the way biotechnology innovations, products and services are developed and

placed on the single market, while maintaining the highest safety standards. The proposed

Biotech Act is one of the flagship initiatives of the Competitiveness Compass3, designed

to unleash the EU’s innovation potential. It also contributes to regulatory simplification

and administrative burden reduction goals.

The Biotech Act is in line with the United Nations’ Sustainable Development Goals

(SDGs), in particular SDG 3 ‘Good health and well-being: Ensure healthy lives and

promote well-being for all at all ages’; SDG 9 ‘Industry, innovation and infrastructure:

Build resilient infrastructure, promote inclusive and sustainable industrialisation and foster

innovation’; and SDG 12 ‘Responsible consumption and production: Ensure sustainable

consumption and production patterns’. More details on the relevant SDG targets and

indicators are available in Annex 3. Regarding specialisation in terms of scientific output,

the EU leads inter alia in SDGs 9 and 12.4

1 COM(2025) 1022 final. 2 COM(2025) 1031 final. 3 COM(2025) 30 final. 4 European Commission: Directorate-General for Research and Innovation, Science, research and innovation

performance of the EU, 2024 – A competitive Europe for a sustainable future, Publications Office of the European Union,

2024, https://data.europa.eu/doi/10.2777/965670 (see Chapter 3: Scientific knowledge production).

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2 BACKGROUND

2.1 Political and legal context

A ‘European Biotech Act’ was announced by the President of the Commission in the 2024

- 2029 Political Guidelines of the European Commission5, to make it easier to bring

biotechnology products from the laboratory to the factory and then onto the market, while

maintaining high safety standards. It was further reflected in the mission letter of

Commissioner Várhelyi6.

In the Commission Recommendation on critical technology areas for the EU’s

economic security7, biotechnology was recognised as having “an enabling and

transformative nature in areas such as agriculture, environment, healthcare, life sciences,

food chains or biomanufacturing”. The Commission Communication on Biotechnology

and Biomanufacturing8 highlighted the high growth potential and labour productivity

of biotechnology and biomanufacturing. This makes the sector pivotal to the

competitiveness and modernisation of the EU’s economy, as well as conducive to its

strategic autonomy and resilience. While the EU’s strengths were recognised (i.e.

research and innovation base and capacities), the Commission stressed the need to address

the challenges faced by companies, users and consumers. It called for both a supportive

regulatory environment and a coordinated approach, particularly for developing

infrastructures, fostering the use of AI, and encouraging private and public investments.

Additionally, the EU’s Economic Security Strategy9 identified biotechnology as one of

the 10 technology areas most likely to present sensitive and immediate risks related to

technology security and technology leakage. This strategy launched an EU joint risk

assessment with Member States on biotechnology, which identified relevant biosecurity

risks that require mitigation measures.

The seminal reports by Enrico Letta10 and Mario Draghi11 also underscored the need to

take action in the biotechnology and biomanufacturing sectors. They identified the need

for a stronger, more dynamic European industrial policy, including measures for the

biotechnology and biomanufacturing sectors to scale up and get products on the market

faster. The report by Sauli Niinistö12 also pointed to the need to strengthen biological

defence capabilities and preparedness against emerging biological threats, including

synthetic pathogens.

5 See footnote 1, page 5. 6 Ursula von der Leyen, Mission Letter – OlivérVárhelyi – Commissioner-designate for Health and Animal Welfare, 17

September 2024. 7 Commission Recommendation (EU) 2023/2113 of 3 October 2023, OJ L, 2023/2113, 11.10.2023,

ELI: http://data.europa.eu/eli/reco/2023/2113/oj. 8 COM(2024) 137 final/2. 9 JOIN(2023) 20 final 10 Enrico Letta, Much more than a Market. April 2024. 11 Draghi, Mario. The future of European competitiveness: A competitiveness strategy for Europe, European

Commission, 9 September 2024. 12 Niinistö, Sauli Safer Together – Strengthening Europe’s Civilian and Military Preparedness and Readiness, 30 October

2024.

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In line with this growing political impetus, reducing the EU’s strategic dependencies in

sensitive sectors has become a priority of the European Council13, including in health

and food, as identified in the Versailles Declaration of 202214. The Council15 has urged

the Commission to unlock the potential of biotechnologies for the EU’s competitiveness

through the European Biotech Act, while maintaining environmental and safety standards.

In particular, the Council has encouraged actions to advance the use of regulatory

sandboxes, promote research and development (R&D) in advanced therapy medicinal

products (ATMPs) and address the falling global share of EU clinical trials (CTs). It also

supports the greater use of AI and the development of appropriate skills.In parallel, three

Important Projects of Common European Interest (IPCEI) in the biotechnology domain are

currently under design16, reflecting Member States’ interest in coordinated, large-scale

investment approaches.

The European Parliament’s recommendations in its resolution ‘Future of the EU

biotechnology and biomanufacturing sector’ are in line with these priorities, asking to

facilitate “a fast and efficient uptake of biotechnology and biomanufacturing through clear

regulatory frameworks”17. Recommendations include facilitating the uptake of

biotechnology and biomanufacturing; enabling more efficient scale-up and

commercialisation of innovations; streamlining and simplifying the time-to-market for

biotechnology throughout their life-cycles; streamlining the clinical trials framework by

minimising administrative burden and delays; and using regulatory sandboxes. It also

recognises the need for a skilled workforce, dedicated support for SMEs to access funding,

and biosecurity screening standards. The European Parliament has also prepared an own-

initiative report on the ‘Public health aspects of biotechnology and life sciences’18,

where it puts forward similar recommendations. It has called for the Biotech Act to review,

simplify and optimise the regulatory framework for biotechnology in healthcare to foster

innovation, as well as for structured EU support to help excellent biotechnology innovation

districts in the EU grow and ensure that they have sufficient capacity, resources and the

scientific edge to promote new groundbreaking biotechnology discoveries, innovation and

commercialisation.

2.2 Related EU legislation

2.2.1 Existing EU legislation

Health biotechnology products are subject to several EU legislative frameworks, in

particular Regulation (EU) No 536/2014 on clinical trials on medicinal products for

human use 19, Regulation (EC) No 1394/2007 on ATMPs20, Regulation (EU) 2024/1938

on standards of quality and safety for substances of human origin intended for human

13 European Council, Special meeting of the European Council (17 and 18 April 2024) – Conclusions, EUCO 12/24. 14 European Council, The Versailles declaration, 10 and 11 March 2022. 15 Council of the European Union, A call for action on life sciences for the EU’s competitiveness - Council conclusions,

13323/25, approved on 30 September 2025. 16https://competition-policy.ec.europa.eu/state-aid/ipcei/design-support-hub_en#ipcei-candidates-in-the-design-

support-hub. 17 European Parliament, 2025/2008(INI), 10 July 2025. 18 European Parliament: 2025/2087(INI). 19 Regulation (EU) No 536/2014, OJ L 158, 27.5.2014, pp. 1–76. ELI: http://data.europa.eu/eli/reg/2014/536/oj. 20 Regulation (EC) No 1394/2007, OJ L 324, 10.12.2007, pp. 121–137. ELI: http://data.europa.eu/eli/reg/2007/1394/oj.

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application (SoHO)21, Directive 2010/53/EU on quality and safety of human organs

intended for transplantation22, and Regulation (EU) 2019/6 on veterinary medicinal

products (VMPs)23. These legislative frameworks govern different stages of the product’s

lifecycle, including research, clinical development, authorisation and the placing on the

market of biotechnology products and therapies. Accordingly, the EU biotechnology sector

can only flourish if they are efficient, coherent and innovation-friendly.

For food and feed safety, the placing on the market of biotechnology products must comply

with requirements set out in the General Food Law24 and with specific legal frameworks,

where applicable25. Placing products on the market that contain or consist of genetically

modified organisms (GMOs), other than food and feed, falls within the scope of the

legislation on the deliberate release of GMOs26. These legislative frameworks ensure

high levels of human and animal health, and environmental protection. To foster

biotechnology innovation, it is important to keep these objectives front and centre and

maximise procedural efficiency and speed, because risk-assessment and authorisation

procedures directly affect the time and cost for biotechnology products to reach the market.

The proposed Biotech Act reviews and seeks synergies with other legislation to ensure

coherence with the overall EU regulatory system. It complements the Critical Medicines

Act (CMA)27 in strengthening EU-based biotechnology research and manufacturing. It is

in line with the pharmaceutical strategy for Europe28 and complements the recent

revision of the EU pharmaceutical legislation29. It is also complementary to the

Commission’s proposal to revise the EU medical device legislation30, sharing the same

overall objectives and including common measures such as the single authorisation process

for combined device-medicine clinical studies. It also aims to improve coordination and

consultation between relevant competent authority groups established under other

frameworks, such as medical devices31, medicines, SoHO, health technology assessment32,

etc.

2.2.2 Aligning with the broader priorities of the Commission

As a flagship initiative under the Competitiveness Compass33, the Biotech Act aligns with

the EU’s broader innovation and competitiveness agenda, turning its priorities into actions

in the strategic sector of biotechnology. In particular, the Biotech Act aims to reduce the

administrative burden, improve coordination, simplify rules and streamline procedures, in

line with both the Competitiveness Compass and the Commission’s Communication on

21 Regulation (EU) 2024/1938, OJ L, 2024/1938, 17.7.2024. ELI: http://data.europa.eu/eli/reg/2024/1938/oj. 22 Directive 2010/53/EU, OJ L 207, 6.8.2010, p. 14, ELI: http://data.europa.eu/eli/dir/2010/53/oj. 23 Regulation (EU) 2019/6, OJ L 4, 7.1.2019, pp. 43–167. ELI: http://data.europa.eu/eli/reg/2019/6/oj. 24 Regulation (EC) No 178/2002, OJ L 31, 1.2.2002, pp. 1–24. ELI: http://data.europa.eu/eli/reg/2002/178/oj. 25 E.g. genetically modified food and feed is subject to Regulation (EC) No 1829/2003, OJ L 268, 18.10.2003, pp. 1–23.

ELI: http://data.europa.eu/eli/reg/2003/1829/oj. 26 Directive 2001/18/EC, OJ L 106, 17.4.2001, pp. 1–39. ELI: http://data.europa.eu/eli/dir/2001/18/oj. 27 European Commission website, Critical medicines Act. 28 COM(2020) 761 final. 29 European Commission website, Reform of the EU pharmaceutical legislation. 30 European Commission website, Simpler and more effective rules for medical devices. 31 Regulations (EU) 2017/745, OJ L 117, 5.5.2017, pp. 1–175. ELI: http://data.europa.eu/eli/reg/2017/745/oj and (EU)

2017/746, OJ L 117, 5.5.2017, pp. 176–332. ELI: http://data.europa.eu/eli/reg/2017/746/oj. 32 Regulation (EU) 2021/2282, OJ L 458, 22.12.2021, pp. 1–32. ELI: http://data.europa.eu/eli/reg/2021/2282/oj 33 see footnote 4, page 5.

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implementation and simplification34. The Biotech Act forms part of the Commission’s

Life Sciences Strategy35 which recognises biotechnology as a strategic cross-sectoral

technology and seeks to strengthen the EU’s biotechnology ecosystem, streamline

regulatory pathways and boost the EU’s competitiveness more broadly in life sciences.

The Biotech Act complements other policy initiatives announced in the Competitiveness

Compass. For example, it aims to improve access to risk-tolerant capital for biotechnology

firms, aligning with the Savings and Investments Union36 and the Start-up and Scale-

up Strategy37, which establishes the Scaleup Europe Fund38. Its biosecurity provisions

reflect the link between competitiveness and security by strengthening safeguards for

biotechnology products of concern. They address the risks identified by the biotechnology

joint risk assessment launched under the EU’s Economic Security Strategy39 and

complement Regulation (EU) 2022/2371 on serious cross-border threats to health40.

The provisions aim at helping to prevent and prepare for such threats and to ensure a

coordinated EU-level response, also for arising public health emergencies (including any

arising from the misuse of emerging biotechnologies). They also complement the Medical

Countermeasures Strategy41for preparing and responding to health threats, including

human-made biosecurity threats.

The Biotech Act reflects the emphasis on talent and contributes to the Union of Skills42. It

aligns with actions under the European Strategy on Research and Technology

Infrastructures43. It aligns with EU funding and investment initiatives that support

biotechnology research, innovation and industrial scale-up. It takes into account EU

financial support available, including cohesion policy programmes, InvestEU, the

European Investment Bank (EIB) Group’s TechEU programme44,45 and the European

Innovation Council. The strategic importance of biotechnology is also acknowledged in

preparations for the next Multiannual Financial Framework (MFF), namely the next

iteration of the Horizon Europe programme (2028-2034).It is acknowledged in the

section on collaborative research activities in the Competitiveness component, as well as

the proposed European Competitiveness Fund, which includes a dedicated ‘Health,

Biotech, Agriculture and Bioeconomy’ policy window.

The Biotech Act is designed to be coherent with related digital policies and pursue digital

transformation objectives. It aims to support secure, data-driven biotechnology

ecosystems and contribute to the EU’s technological sovereignty by promoting greater data

34 COM/2025/47 final. 35 COM(2025) 525 final. 36 COM(2025) 124 final. 37 COM(2025) 270 final. 38 Scaleup Europe Fund - European Innovation Council - European Commission. 39 JOIN(2023) 20 final. 40 Regulation (EU) 2022/2371, OJ L 314, 6.12.2022, pp. 26–63. ELI: http://data.europa.eu/eli/reg/2022/2371/oj. 41 COM/2025/529 final. 42 COM(2025) 90 final. 43 COM(2025) 497 final. 44 European Investment Bank. ”Tech EU. The EU's largest ever financing programme to support Europe's innovators

from idea to IPO and from lab to leadership.” European Investment Bank website accessed 12 March 2026,

https://www.eif.org/flagship-initiatives/techeuhttps://www.eif.org/flagship-initiatives/techeu. 45 European Investment Bank. ”European Tech Champions Initiative. Overview.” European Investment Bank website

accessed 12 March 2026, https://www.eif.org/flagship-initiatives/european-tech-champions-initiative/overview.

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use and AI integration in the biotechnology sector. Its emphasis on AI is consistent with

the AI in Science Strategy46, the Apply AI strategy47, the AI continent action plan48,

the European AI Act49, the Data Union strategy50, as well as the EU Cybersecurity

framework 51. The Biotech Act is also consistent with the objectives of the European

Health Data Space Regulation (EU) 2025/32752 and of the Data Union Strategy 53, in

particular with regard to data and metadata semantic interoperability and quality

accelerators, data labs, and AI factories. It should also be read in coherence with ongoing

interoperability and standardisation work for common European data spaces under Article

33 of Regulation (EU) 2023/285454, including the European Trusted Data Framework,

insofar as these initiatives are relevant to metadata, discoverability, semantic

interoperability and the cross-border re-use of data.

The Biotech Act is consistent with the Vision for Agriculture and Food55, in particular

because it amends the General Food Law to make the regulatory environment more

supportive of innovation and competitiveness in the agri-food sector. The Biotech Act is

also consistent with the Commission proposal on plants developed by certain new genomic

techniques 56 as it continues to adapt the GMO framework to ensure that innovative

products are regulated proportionately. The Biotech Act is also designed to build synergies

with initiatives such as the recently-adopted Bioeconomy Strategy 57.

Climate change has highlighted the need to prioritise the EU’s resilience, so the Biotech

Act reflects this priority too. It is in line with the Commission’s climate neutrality

objectives set out in the EU Climate Law58 and the EU’s Strategy on Adaptation to

Climate Change59. It also ensures alignment with the ‘do no significant harm’ principle.

Biotechnology products have the potential to support adaptation to climate change,

contribute to health and food security through sustainable biomanufacturing, and protect

biodiversity. They may also replace products potentially more harmful for the environment

and provide benefits for consumers and users.

The Biotech Act will not affect EU legislation on the Registration, Evaluation,

Authorisation and Restriction of Chemicals (REACH)60, Regulation (EU) 2024/1735

on sustainable biogas and biomethane technologies and biotechnology climate and

energy solutions61 or the Directive 2010/63/EU on the protection of animals used for

scientific purposes.

46 COM(2025) 724 final 47 COM(2025) 723 final. 48 COM(2025) 165 final. 49 Regulation (EU) 2024/1689, OJ L, 2024/1689, 12.7.2024, ELI: http://data.europa.eu/eli/reg/2024/1689/oj. 50 COM(2025) 835 final. 51 Regulation (EU) 2019/881, OJ L 151, 7.6.2019, pp. 15–69. ELI: http://data.europa.eu/eli/reg/2019/881/oj. 52 Regulation (EU) 2025/327, OJ L, 2025/327, 5.3.2025. ELI: http://data.europa.eu/eli/reg/2025/327/oj. 53 COM/2025/835 final. 54 Regulation (EU) 2023/2854, OJ L, 2023/2854, 22.12.2023, ELI: http://data.europa.eu/eli/reg/2023/2854/oj. 55 COM/2025/75 final. 56 COM/2023/411 final. 57 COM/2025/960 final. 58 Regulation (EU) 2021/1119, OJ L 243, 9.7.2021, pp. 1–17. ELI: http://data.europa.eu/eli/reg/2021/1119/oj. 59 COM/2021/82 final. 60 Consolidated text: Regulation (EC) No 1907/2006, ELI: http://data.europa.eu/eli/reg/2006/1907/2025-09-01. 61 Consolidated text: Regulation (EU) 2024/1735, ELI: http://data.europa.eu/eli/reg/2024/1735/2025-08-17.

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2.3 Background on the sector

For the purposes of this document, and as per the proposed Regulation, biotechnology62

means “the application of science and technology to living organisms, as well as parts,

products and models thereof, to alter living or non-living materials for the production of

knowledge, products and services”. On this bases, health, food and feed are the main scope

of the proposals.

Biotechnology and biomanufacturing are major contributors to the EU’s economy. In

2022, the overall biotechnology sector accounted for EUR 38.1 billion of EU GDP (ca.

1.58% of the European industrial sector), with health biotechnology being the dominant

contributor. Additionally, it contributed to 913,160 jobs, with around 77%63 of those jobs

coming from the health biotechnology sector. The sector in the EU is characterised by a

large base of small and medium-sized enterprises (SMEs) (47%) and micro

enterprises (35%), complemented by a smaller number of large companies (18%)64. The

sector’s dynamism is illustrated by the 5,000 R&D-active biotechnology companies in

the EU65. Furthermore, there were 3,232 unique biotechnology startups founded since

2015 that are still operative in 2025, largely in health66(See Annex 5, Figure 1).

The sector’s strategic importance is underscored by its rapid expansion. Over the last

decade, the EU biotechnology industry has almost doubled to the share of GDP it

generates, growing by around 7% per year on average between 2015 and 202467 (See

Annex 5, Figure 2 for details on the sector GVA comparison).

From a global perspective, the EU has significant strengths in biotechnology, but its

overall competitiveness position is under increasing pressure (see section 3 on problem

definition). The EU is the largest global exporter of biotechnology products,

demonstrating the sector’s strong industrial base and integration into global value chains

(see Annex 5, Figures 3 and 4)68. It is also a leader in biotechnology science, reflected by

a publication record comparable to that of the US and China, with all three regions having

between 20 – 25% of the top 10% most cited publications across biology, biomedical

research and clinical science69. The EU also represents 15% of global patent families in

the biotech field (see Annex 5, Figure 5 for details on the distribution across the EU)70. At

the same time, other major jurisdictions are accelerating policy and investment efforts to

strengthen their biotechnology ecosystems, as shown by recent initiatives in the US at both

62 COM(2025) 1022 final, Article 2 (1). 63 Andreas Haaf and Vera Sale, Measuring the Economic Footprint of the Biotechnology Industry in the European Union,

Research Report March 2025, WiFOR (Prepared for EuropaBio – The European Association for Bioindustries). 64 Landscape analysis study. 65 Landscape analysis study; Biotech R&D firms are firms that perform biotechnology R&D. 66 Landscape analysis study. 67 Landscape analysis study. 68 Landscape analysis study. 69 European Commission: Directorate-General for Research and Innovation, Science, research and innovation

performance of the EU, 2024 – A competitive Europe for a sustainable future, Publications Office of the European Union,

2024, pp. 151-229 https://data.europa.eu/doi/10.2777/965670. https://ec.europa.eu/assets/rtd/srip/2024/ec_rtd_srip-

report-2024-chap-03.pdf. 70 Landscape analysis study.

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congressional and federal level, which frame biotechnology as a core economic and

national security priority requiring coordinated action to sustain global leadership71.

In terms of projections, biotechnology and gene technologies are some of the most

impactful technology trends expected to influence business models over the next five

years72 (i.e. the second most impactful technology in the medical and healthcare devices

industry, with similar trends expected in agriculture, forestry, and fishing). In terms of job

creation, a strong positive trend has been observed73. In the public consultation on the

European Biotech Act stakeholders agreed that biotechnology and biomanufacturing

products could positively impact the EU’s economy74.

Finally, biotechnology applications have a significant potential to generate positive

societal and environmental outcomes, making this sector a pillar of the EU’s societal

wellbeing in key areas in particular in health and food. This potential is positively

perceived by stakeholders, recognising in the public consultation the contribution of

biotechnology and biomanufacturing products to society (90%) and to the environment

(79%) and considered that biotechnology and biomanufacturing products that reach the

single market are safe and secure (77%)75. Moreover, around a third of respondents

(38%) agreed or strongly agreed that the EU regulatory environment ensures a higher

level of safety and security than in some other countries76.

Health biotechnologyencompasses a wide range of applications, from the development of

innovative medicines and new medical devices addressing unmet medical needs, to

combating epidemics and transforming the treatment of rare diseases. Gene and cell

therapies, for example, hold great promise for treating genetic disorders77 and restoring

biological functions. Although the timeline for developing conventional vaccines is

lengthy, current biotechnology tools allow scientists to develop new vaccines or adapt

existing vaccines much faster than before78.

Agri-food biotechnology innovations support farmers and food producers.

Environmental and industrial biotechnology solutions contribute to the sustainable

transformation of our economy. Genetically modified micro-organisms (GMMs) play a

decisive role in the development of industrial, environmental and agricultural

biotechnology, both as a tool for manufacturing and in products. Products containing

71 U.S. House of Representatives (2025), Congressional Biotechnology Caucus announcement, June 2025; National

Security Commission on Emerging Biotechnology (NSCEB) (2025), Report to Congress, April 2025; The White House

(2022), Executive Order on Advancing Biotechnology and Biomanufacturing Innovation for a Sustainable, Safe, and

Secure American Bioeconomy (establishing the National Biotechnology and Biomanufacturing Initiative). 72 Landscape analysis study. Based on World Economic Forum. (2025, January 7). The Future of Jobs Report 2025.

https://www.weforum.org/publications/the-future-of-jobs-report-2025/digest/. 73 Andreas Haaf and Vera Sale, Measuring the Economic Footprint of the Biotechnology Industry in the European Union,

Research Report March 2025, WiFOR (Prepared for EuropaBio – The European Association for Bioindustries). 74 European Commission, Open Public Consultation on a European Biotech Act, 2025, available at:

https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/14627-Biotech-Act/public-consultation_en. 75 Public consultation, see footnote 74. 76 Public consultation, see footnote 74. 77 Qie B, Tuo J, Chen F, Ding H, Lyu L. Gene therapy for genetic diseases: challenges and future directions. MedComm.

2025;6:e70091. https://doi.org/10.1002/mco2.70091. 78 Aida V, Pliasas VC, Neasham PJ, North JF, McWhorter KL, Glover SR and Kyriakis CS (2021) Novel Vaccine

Technologies in Veterinary Medicine: A Herald to Human Medicine Vaccines. Front. Vet. Sci. 8:654289. doi:

10.3389/fvets.2021.654289.

13

GMMs often yield innovative and beneficial product characteristics that other products

cannot achieve or can achieve but with a higher cost or environmental impact. Examples

of products containing GMMs already on the market outside the EU or in development

include novel biofertilisers, biopesticides, and bioremediation products (i.e. to remove

hazardous and toxic substances from the soil or wastewater).

3 PROBLEM DEFINITION

Figure 1. Problem tree

The Commission has refined and clarified the problem tree and intervention logic (see

Section 4.4) from the version presented in the Explanatory Memorandum of the Biotech

Act. These adjustments do not alter the underlying problem definition or policy rationale

but provide a more structured and detailed explanation of the issues and causal pathways.

3.1 Problem: biotech companies struggle to innovate, raise capital, bring

innovations to market, produce and grow in the EU, while maintaining high

level of protection and safety

Although the EU benefits from a sizeable biotechnology sector and strong scientific

capabilities (see section 2.3), it does not meet its full potential for innovation in

biotechnology and biomanufacturing. The EU lags behind other regions when it comes to

translating its world-class science and innovation into commercially viable products

in the EU, and even more so in manufacturing such products at scale. As a result,

biotech companies often end up investing, growing, employing, creating value and

placing their products on markets abroad. This pattern weakens the EU’s ability to

retain value creation and industrial capacity from its research base79.

79 See also Landscape analysis study, forthcoming, for further details on the aspects summarised here.

14

The EU faces a substantial gap in venture capital with limited investment by pension

funds and other institutional investors. Biotech is especially affected by this market failure

due to the particular risk profile of biotech start-ups. Long delays between the initial

innovation and first revenue generation due to lengthy regulatory process, massive upfront

investments needed for CTs, and a high risk of failure of individual projects deter venture

capital investors.

In addition to the fact that the EU accounts for 22% of biotech start-ups, against 49% in

the US, the EU’s scale-up capacity also remains limited. Only a small share of EU

biotech firms reaches significant funding levels (12% of agricultural biotechnology start-

ups, 10% of health biotechnology start-ups, and 8% of industrial biotechnology start-ups

secure over EUR 10 million80). Very few exceed EUR 200 million81. As many companies

struggle to scale in the EU, they increasingly rely on mergers and acquisitions as a common

exit route. Around 40% of acquisitions of EU biotech start-ups are executed by US

acquirers, highlighting how EU biotech innovation is frequently integrated into global

pharmaceutical and life-science value chains instead of growing into large firms in the EU.

AI and data are now foundational to competitiveness in biotechnology, driving rapid

advancements in discovery, development and manufacturing. While 20% of EU

enterprises with 10 or more employees adopted AI by 2025 - up from 13.5% in 2024 -

adoption in EU pharma and biotech manufacturing has surged even further, with large

companies integrating AI at scale and shifting from pilot projects to system-level

transformation82. However, in-house AI development and scaling remain constrained

by data and compute bottlenecks - particularly for SMEs. AI biotech platforms are

inherently capital-intensive, relying on costly model training and large-scale data

generation, and depend on access to high-quality data and advanced compute

infrastructure. As the industry matures, the gap between large pharma industry and smaller

players is widening, underscoring the need for equitable access to technology and robust

regulatory frameworks.

3.2 What are the problem drivers?

The problem is caused by three main related factors. Firstly, the regulatory and

administrative operating environment for biotechnology in the EU is complex which in

turn impacts speed.

Secondly, the EU’s biotechnology ecosystem operates in a fragmented manner, failing to

tap the full scaleof the EU research or testing infrastructure, markets, access to capital or

production capacities, thus limiting companies’ ability to grow and compete

internationally.

Thirdly, technological advances in biotech can result in obsolete frameworks to govern

this fast-moving sector.

80 Landscape analysis study. 81 Landscape analysis study: 12 health biotech firms, 5 industrial biotech firms, one in agricultural biotechnology and

none in marine biotechnology have raised more than EUR 200 million. 82 https://ec.europa.eu/eurostat/web/products-eurostat-news/w/ddn-20251211-2.

15

3.2.1 Driver 1: the complexity of the EU regulatory framework, leading to slow

time-to-market

A first set of challenges relates to the regulatory environment, which stakeholders

consistently perceive as complex, time-consuming and difficult to navigate. In the EU,

60% of companies see regulatory burden as a key obstacle to long-term investment83. This

finding applies to the biotechnology and biomanufacturing sector, as reflected in responses

to the public consultation. Complex regulatory pathways and divergent

implementation of EU legislation were identified as barriers to the expansion of EU

companies, particularly start-ups, spin-offs and other SMEs84. Respondents largely agreed

that EU rules create regulatory barriers, particularly when products move closer to

market entry and formal approval processes85.

In addition, the perception of the EU regulatory environment compared to other countries

showed a limited agreement about the level of predictability of the EU regulatory

environment86. Also, a small number of respondents agreed or strongly agreed that the

EU regulatory environment accelerates access to the market, is less complex and clearer,

or leads to lower compliance costs than in some other countries87.

Such issues linked to the regulatory environment are confirmed across a variety of

biotechnology areas. Detailed descriptions are presented in Annex 5.

With regards to the authorisation of clinical trials, the EU faces growing challenges in

maintaining its competitive edge due to (i) lengthy regulatory timelines (particularly for

the authorisation of multinational trials), and (ii) higher administrative requirements and

costs in the EU/EEA associated with the authorisation and conduct of clinical trials,

compared to other regions. As a result, sponsors88 increasingly favour jurisdictions that

offer faster regulatory timelines, simpler and more streamlined approval processes, and

improved access for the recruitment of patient populations. This contributes to widening

the competitiveness gap. On ATMPs, delays and increased costs are caused by

administrative complexity and overly stringent requirements for GMO-based gene

therapies. This stems from dual regulatory compliance requirements i.e. under the Clinical

Trials Regulation and with the fragmented implementation of GMO legislation by Member

States, further complicated by a blanket requirement for environmental risk assessment

that does not take into account the specificities of low-risk gene therapies.

83 See footnote 10. 84 Public consultation, see footnote 74. 85 Public consultation: Three-quarter of the respondents indicated regulatory barriers in the assessment and market

authorisation (77%). About 70% indicated pre-commercial testing or clinical trials, 68% noted impediments in

commercialising products and 67% in scaling-up production or manufacturing, while 64% signalled regulatory barriers

in product development matters. 86 Public consultation: 21% agreed or strongly agreed and 43% disagreed or strongly disagreed that the EU regulatory

environment is more predictable in comparison with some countries outside of the EU. 87 Public consultation: About 9-10% agreed or strongly agreed and between 64% and 68% disagreed or strongly disagreed

that EU regulatory environment enables products to reach the market faster, is less complex and clearer, or leads to lower

compliance costs in comparison with some countries outside of the EU. 88 Sponsor as defined in the CTR, Article (2) `means an individual, company, institution or organisation which takes

responsibility for the initiation, for the management and for setting up the financing of the clinical trial’.

16

In the EU framework for VMPs, two main challenges are observed: (i) duplicative, not-

fit-for purpose regulatory framework applicable to VMPs that contain or consists of GMOs

and (ii) disproportionate administrative burden in the handling of variations not requiring

assessment.

There is an increasing focus in the EU and globally on the authorisation of biosimilar

medicines, where approval is increasingly based on analytical and functional

characterisation to demonstrate similarity to the reference product89. However, the EU’s

regulatory framework can still lead to the conduct of lengthy and costly multi-country

comparative efficacy studies, even when robust analytical methods may demonstrate

comparability and where a more tailored, risk-proportionate approach could therefore be

justified. In the food area, EU law requires pre-market authorisations/approvals for several

categories of food and feed products and related food chain inputs, the so-called

‘regulated products’90. In those cases, the European Food Safety Authority (EFSA) must

conduct a scientific risk assessment under the applicable sectoral legislation before risk

managers at EU and/or national level decide to grant a pre-market authorisation/approval.

Delays have been observed in both validation and risk assessment phases as also confirmed

by the findings of the ongoing evaluation of the Commission on EFSA’s Performance

covering the period 2017-2024. These have been linked to: (i) dossier deficiencies and

limited effectiveness of pre-submission advice, (ii) procedural consequences linked to non-

compliance with study notification requirements; and (iii) governance constraints relating

to EFSA’s Scientific Committee/Scientific Panels.

As a cross-cutting element of complexity, developers of AI applications in biotechnology

face a rapidly evolving regulatory landscape due to sectoral legislation and AI-specific

requirements, including validation, documentation, explainability and risk-management

obligations. The increasing integration of AI across the biotechnology lifecycle requires

clarity on how existing EU frameworks apply across different development stages. Limited

capacity, especially among SMEs and start-ups, to navigate applicable regulatory

frameworks, further constrain the uptake of AI-enabled solutions in biotechnology. Public

consultation responses91 confirm that stakeholders see a need for greater clarity in the

practical application of AI-related requirements across the biotechnology lifecycle (58%

agreement). Stakeholders report uncertainty regarding how AI-related requirements

interact with existing medicinal product and clinical research frameworks, particularly in

areas such as model validation, documentation and lifecycle monitoring92 and highlight

the importance of guidance. Taken together, these patterns show that the EU biotech

companies’ difficulty to thrive is not a science deficit, but rather a lack of translation and

89 Reflection paper on a tailored clinical approach in biosimilar development: ”Based on the advancements in analytical

technology and the regulatory experience gained, a tailored approach for clinical development of biosimilar candidates

is possible. CES are no longer expected to be required for approval of biosimilars that can be thoroughly characterised

using state-of-the-art analytical methods and have demonstrated similarity in physicochemical and functional properties.

Comparative clinical PK studies are still essential elements in the biosimilar development and can provide supportive

safety and immunogenicity data. This tailored clinical approach is expected to be applicable for the majority of biosimilar

candidates. A regulatory option that, under certain conditions, allows authorisation of biosimilars based on demonstrated

comparability at the analytical level with a limited clinical data package streamlines the development process without

compromising efficacy and safety”. 90 E.g. substances used in food and feed (such as additives, enzymes, flavourings, and nutrient sources), novel foods,

food contact materials, genetically modified organisms, plant protection products etc. 91 Public consultation, see footnote 74. 92 Based on Landscape analysis study.

17

a scale-up deficit shaped by long, complex and capital-intensive pathways from

research to market.

3.2.2 Driver 2: Fragmentation of enabling ecosystems and suboptimal

incentives for private investment constraining the scale-up of EU

biotechnology and biomanufacturing

The EU’s ambition to scale and industrialise biotechnology is currently limited by

challenges in key enabling factors, in particular fragmented thus insufficient access to

finance, development of infrastructures (e.g. clusters), availability of specialised talent and

the deployment of AI and use of data.

First, with regards to access to finance, the EIB estimates the sector investment gap at

EUR 40 billion annually.93 US biopharma start-ups received around nine times more late-

stage funding than EU biopharma start-ups, with around EUR 219 billion of venture capital

focused on health biotechnology invested in the US compared to EUR 25 billion in the

EU, between 2015 and June 2025.94 Even larger gaps in access to late-stage capital have

pushed biotech companies to find funding abroad, notably in the US. Between 2015 and

2021, 67 EU biotech companies going for a public listing have targeted the US NASDAQ

rather than the European stock markets, with 60% of them only listing on NASDAQ

without any listing on an EU exchange.95

Similarly, in earlier stages of capital, although the EU biotech venture ecosystem has

expanded materially in recent years, it remains a second-tier venture capital market

in global biotechnology. Annual investment increased from EUR 0.84 billion (2015) to a

peak of EUR 5.47 billion (2021) during a rapid expansion phase, before partially

normalising to EUR 3.89 billion (2025) (around 29% below the 2021 peak) consistent with

post-pandemic slower deployment (see Annex 5, Figure 7). As a comparison, the US

operates at a different order of magnitude across the cycle (peaking at around EUR 45

billion in 2021)96. In the public consultation97, stakeholders reported difficult access to

private and some public investment instruments in the EU in equity, debt, and

commercialisation support (for more information, see synopsis report in Annex 2). In their

answers, companies also noted that public funding mechanisms, while supportive for early

R&D stages are also insufficiently tailored to the needs of biotech scale-ups. Specific

challenges of start-ups and SMEs were also underlined from both representatives of

business associations and public authorities. Respondents from academic and research

also pointed the fragmentation in funding rules and tax incentives across Member States,

limited availability of large venture capital funds, and a lack of banking expertise in

biotechnology. Non-Governmental Organisations (NGOs) also reported challenges

related to fragmented and insufficient public funding and a lack of significant grant-making

institutions. This shows a need to reinforce de-risking financial instruments and budgetary

guarantees in the EU.

93 The EIB Group uses industry data of EUR 69.7 billion investment for the US vs EUR 26.5 billion in the EU in 2021,

resulting in a gap of ca. EUR 40 billion. 94 Landscape analysis study. 95 Kempen & Co analysis, Liquidity slides for dual listed companies, 2021. 96 Landscape analysis study. 97 Public consultation, see footnote 74.

18

Biological VMPs benefit from two protection mechanisms: regulatory data protection

(Articles 39-40 of Regulation 2019/6) and intellectual property (IP) protection (patents and

SPCs) under Regulation (EC) No 469/200998. Nevertheless, the veterinary pharmaceutical

market presents specific challenges for innovation, such as fragmented species-specific

markets, low price levels, and a small overall market size. In this context, there is a need

for enhanced incentives to support the development of biotechnological VMPs to diagnose,

treat or prevent zoonotic diseases.

Second, with regards to biotechnology clusters, their outreach in the EU remains

fragmented, with significant disparities in scope and resources. Biotechnology clusters

foster collaboration across entities at different stages of the biotechnology value chain and

across biotech sectors. They enable the transformation and evolution of, for example,

university spin-offs into companies ready for the commercialisation of their product99.

While clusters compete for investment, talent and projects, there is substantial scope for

collaboration, exchange of best practices allowing the realisation of scale effects that

cannot be achieved at regional level. The few clusters that have an EU-wide relevance

provide networking and coordination support, yet the landscape remains fragmented,

risking duplication of efforts and limiting impacts. As a result, EU biotechnology clusters

cannot fully leverage their collective potential to compete with clusters in other regions,

and the EU as a whole underperforms in the field of biotechnology.

Respondents to the public consultation100 identified five main barriers to clusters:

insufficient financial support (58%), insufficient public support (54%), incapacity to

reach a critical mass of stakeholders (46%), insufficient collaboration among existing

clusters (46%) and insufficient start-up incubators or business support infrastructure

(45%). Other barriers were identified, with representatives of companies pointing to the

limited involvement of end-users (patients, healthcare providers) and public authorities

underlining the insufficient support for product development. In the area of ATMPs, the

lack of innovation hubs that combine emerging ATMP specialisation with infrastructure

capabilities, regulatory expertise and collaboration among clinical centres, research bodies,

industrial participants and commercialisation services, obstructs development in the EU.

Third, productivity gains, acceleration of innovation and efficiency improvements

associated with the use of AI and big data remain below their potential in the EU’s

biotechnology ecosystem101. Fragmented, heterogeneous, and high-dimensional data is

one of the challenges, as datasets generated in healthcare or research contexts are often not

readily usable for the training, testing and validation of AI systems without significant

curation and standardisation efforts. For health data, ongoing EU initiatives, such as the

European Health Data Space, are expected in the coming years to facilitate access and

cross-border use; at the same time ensuring that such data are sufficiently curated,

annotated and interoperable to support AI development remains a key challenge. Data

access challenges affect non-health data relevant to biotech, such as datasets on chemical

98 Regulation (EC) No 469/2009 OJ L 152, pp. 1–10 ELI: http://data.europa.eu/eli/reg/2009/469/oj. 99 Landscape analysis study. 100 Public consultation, see footnote 74. 101 Submissions to the Call for Evidence and Public Consultation, as well as stakeholder workshop insights, as analysed

in the study supporting the rapid assessment of policy scenarios to strengthen innovation and competitiveness in the field

of biotechnology in the EU (Rapid Assessment Scenario Study forthcoming); Landscape analysis study - Annex 2 – Case

Studies (forthcoming).

19

reactions used in drug discovery and biomanufacturing processes102. Public consultation103

results confirm these challenges. Companies, business associations and academic or

research institutions report the highest levels of difficulty. Around two-thirds of companies

and research institutions rely on data sourced from outside the EU/EEA, primarily due to

higher reliability and quality of available datasets, as well as clearer legal frameworks for

data access and lower perceived access costs. This suggests that improving the quality,

usability and interoperability of datasets available within the EU could significantly

strengthen the competitiveness of the European biotechnology ecosystem.

Fourth, the EU’s ambition to scale and industrialise biotechnology also depends on the

availability of specialised talent. While the EU maintains a strong scientific base,

stakeholder evidence points to persistent gaps in the workforce segments critical for scale-

up and deployment.

In the EU’s biotechnology sector, stakeholders have identified gaps in the workforce

segments needed for scale-up, progression to commercial scale and manufacturing104.

There is a significant shortage in the total number of higher education and vocational

education and training graduates entering the biotechnology sector105, with shortages

particularly observed in the following competences: biomanufacturing and bioprocessing,

regulatory and compliance (e.g. ATMPs and pharmacovigilance), and digital skills106 (e.g.

bioinformatics, AI-enabled processes, data governance). Furthermore, for some profiles,

stakeholder consultations indicated that technical skills would need to be complemented

by additional competencies107. This challenge can be explained by several factors108, such

as constrained hands-on training capacity due to the scarcity and high cost of specialised

facilities, the fragmentation of qualification systems across Member States, limiting skills

portability and talent mobility and the lack of entrepreneurial skills in the EU (less

than 50% of EU students have access to entrepreneurial education in secondary and higher

education109). Barriers to the upskilling of workers are also relevant.

3.2.3 Driver 3: Rapid technological developments & regulatory adaptation lag

EU biotechnology companies also face barriers to manufacture, place products on the

market and grow due to EU regulatory frameworks not always keeping up with rapid

technological advances. This perception was confirmed in stakeholder consultations, as

regulatory frameworks that insufficiently account for the innovative and rapidly

developing nature of the biotechnology sector were also identified as a barrier to the

expansion of EU companies110.

102 Landscape analysis study - Annex 2 – Case Studies. 103 Public consultation, see footnote 74. 104 Landscape analysis study. 105 Landscape analysis study. 106 In 2023, only 55.6% of the EU adult population had at least basic digital skills. Digital Decade DESI visualisation

tool DESI 2025, DESI indicators, Indicator: At least basic digital skills. https://digital-decade-desi.digital-

strategy.ec.europa.eu/datasets/desi/charts/desi-indicators.107 Landscape analysis study based on Biotechnology Jobs. (2025, February 12). Building the Ultimate Biotech Skill Set:

Technical and Soft Skills Employers Want in 2025. 108 Landscape analysis study. 109 EU Startup and Scaleup Strategy, based on European Commission’s Entrepreneurship 2020 Action Plan. 110 Public consultation, see footnote 74.

20

One major reason brought forward by stakeholders and some Member States is the

complex, not innovation friendly and in part ill-fitting EU legislation on GMOs, in

particular as regards GMMs. The EU’s legal framework for GMOs (including GMMs111)

originates from the 1990s and was primarily tailored to genetically modified plants. The

framework as it currently stands is less suitable to handle GMMs given the biological

differences compared to plants and the variety of micro-organisms and their

applications112.In a recent scientific opinion, EFSA concluded that the potential risk of a

microbial product relates to the changes introduced in the micro-organism itself regardless

of the method used to introduce them, supporting a more holistic approach to the

assessment of micro-organisms based on the characteristics of the final product.113 It

further concluded that for certain GMMs less assessment requirements would be sufficient

to ensure safety. In this respect, considering the risks of typical GMMs and derived

products and the variety of risk profiles, the current GMO regulatory procedures are

considered by many stakeholders and some Member States as disproportionate, overly

rigid and time consuming, rendering the EU unattractive for investing and bringing such

GMMs to the market as products. In addition, the particularly short development cycles of

GMMs, with one product frequently being based on a previous product, mean that a quick,

efficient authorisation path is very important.

There is also a regulatory gap between the existing EU legal framework on the quality

and safety of human organs intended for transplantation and current medical practice on

organ preservations, leading to diverging interpretations across Member States and

hence legal uncertainty. The current EU framework was designed for preservation rather

than processing and does not provide a clear, harmonised approach for these activities. It

does not include a particular framework for authorising processing operations, nor a

mechanism for benefit-risk assessment of these interventions, and no provisions for

oversight of transplantation centres that seek to apply a specific processing technique.

Furthermore, the current framework does not contain a mechanism for coordination

between the organ transplant competent authority and the competent authorities operating

under other legislative frameworks (e.g. on medical devices, medicinal products, or on

SoHO). In 2024, although over 32,000 organ transplants were performed across the EU,

the gap between the supply of transplantable organs and clinical demand remained, with

over 52,000 patients registered on transplant waiting lists across the EU (as of 31

December 2024)114.

Similarly, in the ATMP area, outdated definitions and technological lag in the regulatory

framework are leading to discrepancies between the legal framework (classification

111 In line with the definitions provided in Directive 2001/18/EC, GMO means an organism, except for human beings, in

which the genetic material has been altered in a way that does not occur naturally by mating and/or natural recombination.

In line with the definition provided in Directive 2009/41/EC (OJ L 125, 21.5.2009, p. 75-97. ELI:

http://data.europa.eu/eli/dir/2009/41/oj), a GMM means a microorganism in which the genetic material has been altered

in a way that does not occur naturally by mating and/or natural recombination. 112 Regulatory Framework Study (forthcoming, see Annex 1). 113 EFSA GMO Panel (EFSA Panel on Genetically Modified Organisms), Mullins, E., Bresson, J.-L., Dewhurst, I. C.,

Epstein, M. M., Firbank, L. G., Guerche, P., Hejatko, J., Moreno, F. J., Naegeli, H., Nogué, F., Rostoks, N., Sánchez

Serrano, J. J., Savoini, G., Veromann, E., Veronesi, F., Cocconcelli, P. S., Glandorf, D., Herman, L., Jimenez Saiz, R.,

Ruiz Garcia, L., Aguilera Entrena, J., Schoonjans, R., Kagkli, D. M., Dalmay, T. (2024). New developments in

biotechnology applied to microorganisms. EFSA Journal, 22(7), e8895. https://doi.org/10.2903/j.efsa.2024.8895. 114 SANTE-SoHO/D2 - European Commission. (2026). Introducing “organ processing” into directive 2010/53/EU

[Unpublished slideshow]. See Annex 5 for more details.

21

uncertainty) and progressing science, hampering market access for these products (e.g.

affecting in vivo tissue generation, acellular therapies, and bio-synthetic hybrids).

The rapid technological advances characterising the biotechnology sector challenge

existing regulatory frameworks. While these frameworks ensure high safety standards,

they offer limited regulatory flexibility in a context of rapid technological advances. As a

result, innovative biotechnology applications may struggle to progress efficiently from

development to market deployment across these sectors when regulatory frameworks are

not sufficiently adapted to emerging technologies. In the health area, existing regulatory

frameworks are not fully adapted or adaptable to complex and hybrid emerging health

biotechnology products, leading to barriers such as a lack of legal certainty on products

classification and evaluation. In the VMPs sector, regulatory uncertainty also represents

a serious hurdle to the marketing or use of novel technologies, methods or products. In

the food chain sector, EU legislation requires pre-market authorisations for several

categories of food, feed and related food chain inputs but also provide for limited

regulatory flexibility.

Biotechnologies are critical for the Union's defence and security. And while rapid

advances in biotechnology over the last decades have brought considerable benefits for

healthcare, research and the economy, such advances also make biological agents more

widely accessible, increasing risk of their misuse. For example, the price of synthetic

nucleic acids (such as DNA or RNA) has decreased more than 100-fold over the past 20

years115, making it increasingly feasible to synthesise potentially dangerous genomic

sequences, such as the DNA or RNA of viruses, at limited cost.

While some commercial nucleic acid synthesis providers screen orders to identify

potentially dangerous sequences and verify the legitimacy of their customers, there are

currently no EU-level rules on this. National rules diverge116, failing to offer a level playing

field, fragmenting the single market and undermining the EU’s prevention and biosecurity

efforts.117 In stakeholder consultations, several industry actors, including SMEs, have

therefore called for harmonised EU biosecurity rules.

Finally, the potential of data and AI remains largely untapped in the EU. Despite new

regulatory frameworks (European Open Science Cloud, AI regulatory sandboxes

mandated in the AI Act, EuroHPC/AI factories/gigafactories), some challenges remain. AI

biotech platforms are inherently capital-intensive, relying on costly model training and

large-scale data generation, and depend on access to high-quality data and advanced

computing infrastructure, which remain comparatively limited in the EU118. Furthermore,

the scaling of AI119 in biotechnology requires sophisticated experimentation environments

capable of integrating high-performance computing, biological laboratories and advanced

115 DNA Synthesis and Sequencing Costs and Productivity for 2025, Rob Carlson, 2025

https://www.synthesis.cc/synthesis/2025/5/dna-synthesis-and-sequencing-costs-and-productivity-for-2025. 116 https://ibbis.bio/policy-spotlight-french-leadership-defining-and-regulating-genetic-fragments/ 117 See IBBIS mapping of explicit and implicit rules on NA synthesis screening across countries:

https://globalsynthesismap.bio/policy?country=FRA. 118 Landscape analysis study - Annex 2 – Case Studies. 119 COM(2025) 30 final based on Eurostat data: EU survey on ICT usage and e-commerce in enterprises (January 2025).

22

data infrastructures.120 However, the availability of such integrated environments remains

limited in the EU. Stakeholders underlined the importance of collaborative environments

that facilitate the responsible testing, validation and deployment of AI-enabled

biotechnology solutions while ensuring compliance with EU legislation121.

3.3 Consequences

3.3.1 EU is facing a major competitiveness gap in biotech, despite being a

leader in science

The problem presented in section 3.1. results in a gap between the EU and the US in

terms of entrepreneurial dynamism. The EU only represents 22% of the global biotech

start-up activity (i.e. start-ups founded since 2015) while the US accounts for nearly half

(49%) of them (see Annex 5, Figure 6)122.

This competitiveness gap is observed across the health and agri-food biotechnology

sectors:

The EU is becoming less attractive to sponsors for conducting clinical trials in global

comparison, affecting the economy, public health, and skill capacity building. The number

of clinical trials conducted worldwide has increased substantially over the past decade,

rising from approximately 13,000 in 2013 to 22,000 in 2023. Over the same period, the

geographical distribution of clinical trials has shifted markedly. While the EEA’s share of

global clinical trials declined from 18% in 2013 to 9% in 2023, China’s share increased

from less than 10% to nearly 30%123. A similar trend is observed in cell and gene therapy

trials: between 2013 and 2023, Europe’s global share steadily declined, whereas China

experienced a dramatic rise over the same period, emerging as the leading region.124 This

growth also reflects a different portfolio structure, with China placing stronger emphasis

on early-stage and post-marketing development, particularly mononational Phase I and

Part IV trials, compared to the EEA’s stronger focus on multinational Phase II and Phase

III trials125. Despite the strong growth in global clinical trial activity, the level of activity

in terms of number of clinical trials submissions in the EU remained broadly stable

between 2013 and 2025126. Consequently, the EU did not capture a proportional share of

this growth, leading to a widening competitiveness gap relative to other regions with

120 Breakthroughs in in silico, AI-driven and digital-twin approaches can transform biomedical research, diagnostics, and

personalised medicine. In silico modelling leverages computer simulations increasingly integrated with AI and can

potentially replace some traditional animal testing and clinical trials. AI-driven analytics can enable precise,

individualised therapies and accelerating tissue repair (Healing the Future - Horizon scanning for emerging technologies

and breakthrough innovations in the field of cell and gene therapies

https://publications.jrc.ec.europa.eu/repository/handle/JRC141934). 121 See Annex 2, Synopsis report for more details. 122 Landscape analysis study. 123 EFPIA report: assessing-the-clinical-trial-ecosystem-in-europe.pdf. 124 EFPIA report: assessing-the-clinical-trial-ecosystem-in-europe.pdf. 125 Fast-track landscape analyses to assess the regulatory clinical trial eco-system in the EU/EEA and in other relevant

regions (forthcoming) 126 The annual number of clinical trial applications submitted in the EU, as well as the shares of mononational,

commercially sponsored, and pediatric trials, exhibited little variation over this period, aside from temporary changes

during the COVID-19 pandemic. Between 2013 and 2025, the annual average number of clinical trials application is

2,895 with a standard deviation of 303.

23

potential implications for economic performance and timely access by patients to

innovative treatments127.

Figure 2. Clinical trial activity in the EU128

Note: Figure 2 describes the trend in the submission of clinical trial applications in the

EU between 2013 and 2025. The bars illustrate the total number of applications per year,

while the remaining lines show the share of the applications for mononational,

commercial, paediatric and rare-disease trials.

The gap in clinical trial activity between the EU and other markets, particularly China, is

also reflected in changes in annual pharmaceutical R&D expenditure of which

approximately 60% can be on average allocated to clinical trials129. Using overall

pharmaceutical R&D expenditure as a proxy, China experienced a significantly larger

increase in R&D expenditure compared to the other regions130.

127 The decline in the EEA share of global clinical trials stems from multiple, interlinked factors, with enhanced

regulatory complexity being one of the driving factors. 128 Calculations done by the European Commission based on data from EudraCT and CTIS. 129 EFPIA report (2024) The Pharmaceutical Industry in Figures. Key Data. According to the report, 48.4% of the

pharmaceutical R&D expenditures are allocated to Phase I to III trials and additional 11.5 % to Phase IV trials. The data

is based on a survey with Members of PhRMA and collected in 2022. See further information here: PhRMA_membership

survey_single page_70523_es_digital.pdf. 130 China experienced an increase by a factor of 8.55 compared to a factor of 1.68 increase in Europe.

24

Figure 3.Pharmaceutical R&D expenditure in selected regions in 2010 and 2022131.

Note: Figure 3 illustrates annual pharmaceutical R&D expenditures in 2010 and 2022 for

China, Europe, Japan and the USA.

These trends show that Europe’s position in global pharmaceutical R&D, including its

clinical trial activity, is facing increasing challenges in maintaining its competitive edge132.

The relative decline in clinical trial activity is likely to come along with adverse effects on

the public healthcare systems, the economy and the development of skills, and capacity

within the Union. Although estimating the economic impact of clinical trial activity is

inherently complex and dependent on multiple model assumptions, recent studies based on

national and EU-wide data indicate that each euro invested in clinical trials generates

between EUR 1.60 and 2.50 of added value for the economy, along positive effects on

employment133. A recent report estimates that commercial trials, which account for 53.1%

of the trials authorised in the Union134, create annually about EUR 35.7 billion in gross

value added to the economy in the EEA and support the creation of over 165,000 jobs135.

In addition, clinical trial activities are estimated to reduce costs for national healthcare

systems. For example, two studies conducted in Italy indicate a leverage effect of avoided

costs between 2.2 and 3.5; that is, for every euro invested in clinical trials or disbursed by

131 EFPIA report (2024) The Pharmaceutical Industry in Figures. Key Data. 132 Tan et al. (2024) Current landscape of innovative drug development and regulatory support in China | Signal

Transduction and Targeted Therapy. 133 Walter et al. (2020) Economic impact of industry-sponsored clinical trials of pharmaceutical products in Austria -

PubMed; Battelle Technology Partnership Practice (2015) Biopharmaceutical Industry-Sponsored Clinical Trials: Impact

on State Economies (battelle-2015-study.pdf); Fast-track landscape analyses to assess the regulatory clinical trial eco-

system in the EEU/EEA and in other relevant regions (forthcoming). 134See EU clinical trials during the 3-year CTR transition period

135EFPIA report (2026) the-economic-impact-of-industry-clinical-trials-across-europe.pdf.

25

sponsoring companies to health facilities, the Italian national health system saved more

than two euros136. Finally, clinical trial activities also affect the health of European citizens.

For example, patients participating in clinical trials can access innovative medicines up to

5 to 10 years before commercial launch in the EU.137

The innovation and competitiveness gap in the EU’s ATMP sector is also becoming

increasingly evident. Although Europe currently holds a 22.1% share of the global gene

therapy market (2025) and the sector is projected to grow at a compound annual growth

rate of 14,6% (2026–2033), the region risks falling behind North America and the

Asia-Pacific region. Forecasts indicate that North America will generate the highest

revenue in the sector by 2033, while the Asia-Pacific market is expected to reach USD

4,193.1 million in the same year138. This trend, also highlighted in the Draghi Report139,

underscores the EU‘s struggle to strengthen its R&D capabilities and address the

innovation and competitiveness gap in the region’s ATMP market. Slow progress in

ATMP development threatens the EU's position in the global healthcare and biotechnology

sectors, as innovators may increasingly choose to operate in jurisdictions with more agile

regulatory frameworks.

When it comes to biosimilars, the EU’s biomanufacturing capacity can be further utilised.

The EU has significant untapped potential in biosimilar manufacturing. The EU retains the

largest cumulative authorisations of biosimilars (151 products vs. 72 in the US and 66 in

Canada) and leads the global market in revenue valued at approximately EUR 25.6 billion

in 2024, representing around 6% of the total pharmaceutical industry's contribution to

GDP. Sales grew at 15% annually between 2020 and 2024 across five core therapeutic

areas, and the sector supports around 81,000 jobs in Europe: 16,000 direct (20%), with the

remainder split between indirect roles such as clinical research (30%) and induced

employment (50%). The sector depends on a highly skilled workforce, with 40% of direct

employees (~7,000) in technical roles and 70% holding university degrees.140However,

manufacturing activity is increasingly migrating to Asia, particularly South Korea and

India141. While the EU remains a key innovation hub — supplying over 75% of active

ingredients for innovative biologics — it must develop more dedicated and cost-efficient

manufacturing infrastructure to keep pace with international competitors.142

Similarly, challenges to bring novel health biotechnology products to the market have

been observed143, and are generally expected to increase given the increasing complexity

and hybrid nature of novel products. These challenges further weaken the EU’s position in

136 Cicchetti et al. (2020) Valorization of clinical trials from the Italian National Health Service perspective: definition

and first application of a model to estimate avoided costs - PubMed; Polignano et al. (2022) Economic impact of industry-

sponsored clinical trials in inflammatory bowel diseases: Results from the national institute of gastroenterology “Saverio

de Bellis” - PMC. 137 EFPIA report (2024) Assessing the clinical trial ecosystem in Europe: Final report, p.37 138 https://www.grandviewresearch.com/horizon/outlook/gene-editing-market/europe. 139 See footnote 11, page 6. 140 Medicines for Europe, European Biosimilar Medicines Sector: Delivering Impact Beyond Health – Economic,

Scientific & Strategic Contribution, Biotech Act Factsheet Series, March 2026, Pillar 1-2-3-4-FOOTPRINT-SPC-

Biotech-Act-facsheets-ppt.cdr. 141 Cohen, H. P., Turner, M., McCabe, D., & Woollett, G. R. (2023). Future evolution of biosimilar development by

application of current science and available evidence: The developer’s perspective. BioDrugs, 37(5), 583–593. 142 BioPlan Associates (2024). Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production 143 Maxwell, A. (2025, August 20). Why EU innovators face growing barriers with EU combination product regulation.

Medtech Insight.

26

the global innovation race, delaying the availability of these products to patients across the

EU.

Regulatory uncertainty also has practical implications for cross-border exchange of

processed organs and for the scaling of machine perfusion technologies, contributing to

uneven uptake and fragmentation within the EU144, and eventually reducing the potential

for optimal matching of organs and recipients. Over the last three years, the cross-border

exchange rate of allocated organs fluctuated between 20-23%145.

In the field of GMMs, recent evidence shows that there is significant activity in the

development of innovative GMMs by both private and public/academic entities. However,

the majority of the identified GMMs originates from the US or China, while only a limited

number were developed within the EU146. Notably, there are currently no products on

the single market that contain or consist of GMMs, except for medicinal products which

are, however, not authorised under the GMO legal framework but under the EU framework

on pharmaceuticals. This is particularly affecting the competitiveness of SMEs in the

GMM field, since they are typically among the most innovative companies in the

biotechnology sector but may lack the regulatory expertise and financial resources to

navigate complex legal frameworks that may not adequately fit their innovative products.

At the same time, this lack of products on the markets, or prospect to bring products

efficiently to the market, is discouraging investments in R&D, thus negatively

impacting the wider science community in the EU. EU economic sectors, foremost the

agricultural, industrial and environmental sectors, are negatively impacted as they cannot

easily make use of novel tools available in third countries that make operations more

efficient.

As a consequence of the issues outlined under drivers 1 and 3, a competitiveness gap is

also observable for biotechnology products in the food chain (food and feed products),

including substances (e.g. additives, enzymes etc), and other food chain inputs (e.g. food

contact materials).

Finally, as AI continues to expand across the biotechnology lifecycle in the health and food

sectors, the bottlenecks innovators face when attempting to develop, validate and deploy

AI-enabled biotechnology solutions in the EU slow the transition from scientific discovery

to real-world deployment. As a result, the Union risks failing to fully capture the

productivity gains, efficiency improvements and innovation opportunities associated with

the large-scale use of AI in biotechnology. This under-utilisation of AI may therefore

translate into a growing competitiveness gap, as other jurisdictions more effectively

integrate AI into biotechnology research, development and production across multiple

biotech sectors.

144 See Annex 5 for more details. 145 See Rapid Assessment Scenario Study 146 Ballester, A.R., Roqué, M., Ricci-Cabello, I., Rotger, A., Malih, N. 2023. Horizon scanning on microorganisms and

their products obtained by new developments in biotechnology. EFSA supporting publication 2023:EN-8503, 65 pp.

doi:10.2903/sp.efsa.2023.EN-8503.

27

3.3.2 Biotech’s potential to help address major societal challenges is

underexploited

Despite its innovation and growth potential, and expected benefits for patients and society

at large, the potential of biotechnology remains largely underexploited in the EU, across

the different biotechnology areas.

In the health sector, ATMPs – such as gene therapies – offer a transformative potential for

treating a broad spectrum of diseases, from rare genetic disorders to common chronic

conditions. Despite this promise and the innovative potential in the EU, patient access in

the EU remains severely limited.

Organ transplantation also increasingly involves ex-vivo organ processing, such as

machine perfusion to assess and recondition donor organs prior to transplantation. These

techniques can expand the pool of transplantable organs, improve matching of organs and

recipients, improve clinical outcomes and strengthen health-system resilience. However,

there is limited cross-border exchange and slow EU-wide uptake of innovative processing

technologies147.

In the VMP sector, the potential of biotechnology to improve animal health and strengthen

food supply chain resilience remains underdeveloped. Favourable regulatory conditions

for the use of biotechnology in animal health will not only benefit the biotech

pharmaceutical industry, but also farmers, animal health, the food supply chain and human

health (zoonotic diseases). When disease spreads in food-producing animals, the impact

on farmers can be dire and food security can be put at risk. Vaccination is a powerful tool

to prevent and control animal diseases and contributes to reducing the use of

antimicrobials. As a large share of emerging infectious diseases in humans has a zoonotic

origin, preventing animal diseases also has positive effects on human health. Novel

biotechnology tools enable the development of safer and more effective vaccines, as well

as the distinction of vaccinated animals from those infected, and allow vaccines to be

developed or adapted much faster than with conventional approaches, which is critical to

prevent and control animal diseases.

When it comes to innovative GMMs148, their non-deployment in the EU market, in

addition to the loss of competitiveness opportunities outlined under the driver 3, result in

an unfulfilled potential for GMMs to contribute to other social and environmental

objectives. For example, GMMs can now be used as or in biofertilisers, biostimulants,

biopesticides, biocides, bioremediation, wastewater treatment, biomining and bioleaching,

offering benefits in the wider agri-food, industrial, marine and environmental sectors. As

GMM-based products that would be more efficient or environmentally friendly than the

alternatives are not being used, EU society and consumers are negatively impacted as they

are being deprived of innovative solutions to important challenges linked to climate

change, environmental pollution and food and feed security.

Moreover, in the food and feed sector, the potential of biotechnology remains

underexploited and experimentation in real conditions (e.g. real-world food production and

147 See Rapid Assessment Scenario Study. 148 See Annex 7, Section 5.2. for examples.

28

processing environments) is constrained. Biotechnology tools can support more efficient

production processes across the food chain. These technologies can improve the safety and

quality of food products, for example by reducing pathogens and toxins and enhancing

nutritional properties149. Enzymes and biocatalysts can reduce environmental impacts by

replacing chemical processes and improving process efficiency150. As regulatory drivers

constrain the deployment of innovations in such areas, the single market as well as the

contribution of biotechnology to food safety and security, resource efficiency,

environmental sustainability and the EU’s strategic autonomy, are not fully realised.

Furthermore, the rapid advancement of technology, including AI, alongside increased

data collection and use are cross-cutting enablers with huge potential across the different

areas of the biotech sector, yet to be fully utilised. AI and advanced data use act as key

enablers of biotechnology innovation across health and agri-food applications. AI-driven

tools support target identification, molecular design, optimisation of biological processes,

CT design and manufacturing efficiency, while in the agri-food sector they enable

advanced fermentation, strain optimisation and resource-efficient production. These

applications can accelerate innovation cycles, reduce development costs and strengthen

resilience in areas such as medical countermeasures, disease detection and sustainable food

systems. However, the full potential of AI-enabled biotechnology remains underexploited

in the EU. The effective deployment of these technologies requires clear lifecycle

guidance, as well as access to integrated environments combining experimental and

computational capabilities for testing and validation, and high-quality, well-curated

datasets that allow AI systems to be trained and deployed reliably. The absence of these

enabling conditions limits the EU’s ability to fully harness biotechnology to address major

societal challenges and strengthen its strategic autonomy in health and food systems.

Regarding the application of biotechnology to defence and security, the primary challenges

identified by stakeholders in the public consultation were the risks to strategic autonomy

in biomanufacturing and availability of countermeasures (50%), cybersecurity risks (e.g.

biotechnology infrastructure, AI tools used) (45%), vulnerabilities in the resilience of

biotechnology supply chains (44%), and threats related to biosecurity and biosafety

including misuse of biotechnology (40%). Finally, opportunities in biosecurity were also

particularly underlined in the public consultation151: the development of new innovative

medical countermeasures (45%), detection of biological threats (45%), as well as increased

food security (43%).

3.3.3 Potential for misuse of biotechnology poses growing biosecurity risks

In addition, the rapid progress in and increasing accessibility of biotech innovations also

increase the likelihood and impact of biosecurity incidents, as certain applications of

149 Siddiqui SA, Erol Z, Rugji J, Taşçı F, Kahraman HA, Toppi V, Musa L, Di Giacinto G, Bahmid NA, Mehdizadeh M,

Castro-Muñoz R. An overview of fermentation in the food industry - looking back from a new perspective. Bioresour

Bioprocess. 2023 Nov 28;10(1):85. doi: 10.1186/s40643-023-00702-y. PMID: 38647968; PMCID: PMC10991178. 150 Palanisamy Vasudhevan, Zhang Ruoyu, Hui Ma, Subhav Singh, Deekshant Varshney, Shengyan Pu,

Biocatalytic enzymes in food packaging, biomedical, and biotechnological applications: A comprehensive review,

International Journal of Biological Macromolecules, https://doi.org/10.1016/j.ijbiomac.2025.140069. 151 Public consultation, see footnote 74.

29

technologies and products may have the potential for misuse, posing threats to public

health and safety.

The exponential decrease in the cost of synthesising DNA and RNA has made the physical

material needed to create biological agents, including dangerous pathogens, increasingly

accessible. Studies by RAND Europe152 and CLTR153, two independent non-profits,

estimate the current annual probability of a large-scale biological attack using synthetic

nucleic acid at 1%, and accidents from their use at 1.5%, with expected economic harm to

the EU of almost EUR 20 trillion for a large-scale event.

The EU joint biotechnology risk assessment carried out under the EU’s Economic Security

Strategy argues that the likelihood and impact of such incidents is further amplified by

advancements in AI and computational tools in biological applications, which can lower

the technical barriers to the design, optimisation and misuse application of biological

agents.

These advances could significantly expand the pool of individuals capable of conducting

technical tasks with biotechnology products that could be misused for malicious purposes,

such as synthesising dangerous pathogens. Modelling published in 2025 suggests that,

under a set of assumptions about near-term AI capabilities, could increase the annual

probability of an epidemic from biological misuse by a non-state actor roughly sixfold,

from 0.15% to 1%154. This reflects broader concerns that AI tools developed for beneficial

applications in life sciences may also present dual-use risks if misapplied.155

3.4 What is the baseline from which measures are assessed?

The baseline trajectory through 2038156 is expected to show a widening of the

competitiveness gap between the EU and its main competitors. This is driven by the

compounding interaction of the identified drivers. Regulatory complexity deters

investment; market fragmentation, in particular capital scarcity, constrained innovation;

and the expanding pipeline of frontier technologies amplifies administrative burdens and

regulatory barriers, within an ecosystem that is not positioned to absorb them. The thematic

sections that follow detail these dynamics across five interconnected dimensions157.

Regulatory landscape and administrative burdens

Under the baseline, biotechnology developers will be confronted with an EU regulatory

landscape characterised by three mutually reinforcing deficiencies: the proliferation of

overlapping and partially incompatible regulatory frameworks, the persistent national

152 Zakaria, S. et al. (2026). Cost–benefit analysis for synthetic nucleic acid screening in the European Union. Santa

Monica, CA: RAND Corporation, 2026. https://www.rand.org/pubs/research_reports/RRA4805-1.html. 153 Fady, P. et al. (2025). Cost-Benefit Analysis of Synthetic Nucleic Acid Screening for the UK. The Centre for Long-

Term Resilience. doi.org/10.71172/kyey-h0ya, p.18. 154 Righetti, 2025 (https://www.governance.ai/research-paper/dual-use-ai-capabilities-and-the-risk-of-bioterrorism-

converting-capability-evaluations-to-risk-assessments). 155 Urbina, F., Lentzos, F., Invernizzi, C. et al. Dual use of artificial-intelligence-powered drug discovery. Nat Mach

Intell 4, 189–191 (2022). https://doi.org/10.1038/s42256-022-00465-9 156 Some interventions have been assessed over a different baseline. See Annex 4 for more information on the timeline

and baseline. 157 See Rapid Assessment Scenario Study for more information including on assumptions used.

30

heterogeneity in the implementation of procedures, and the absence of structured pathways

for innovations that do not fit neatly within existing legislative frameworks.

The most pervasive source of regulatory burden is procedural duplication across

intersecting frameworks. Under the baseline, developers of GMO-containing ATMPs

will continue to incur in up to 50 additional days in CT authorisation timelines beyond

conventional medicines, with further extensions for substantial modifications. For VMPs,

GMO-containing products will continue to face approval timelines two to three times

longer than non-GMO equivalents despite the fact that no GMO-containing VMP has ever

received a negative opinion on the basis of its GMO component, triggering an 'innovation

tax', estimated at EUR 269,000-840,000 per year in FTE burden. Such a burden is set to

compound, reaching EUR 403,000-1,119,000 by 2040, as the pipeline is projected to

encompass approximately 100 GMO-containing VMPs in various stages of development

at any point through 2040. In addition, CT applications subject to dual-track requirements

will increase from 8-15 to 12-20 per year and annual GMO-containing marketing

authorisation applications are expected to rise from the current 3-5 to approximately 5-8

per year by 2040. Meanwhile, the administrative burden from variations not requiring

assessment (VNRA) is projected to scale proportionally with the expanding marketing

authorisation base: the number of active veterinary Marketing Authorisations is expected

to grow to approximately 55,000-60,000 by 2040, with annual VNRA volumes scaling

accordingly. The aggregate annual VNRA fee burden is projected to grow in proportion.

In the biosimilar domain, the disproportionality of certain regulatory requirements

will also persist. Between 2012 and 2022, 100% of all 36 monoclonal antibody and fusion

protein marketing authorisation applications included a Phase III comparative efficacy

study, yet in no case did the clinical data determine the regulatory decision. Thus, the most

costly component of biosimilar development (EUR 19-26 million per study, representing

20-50% of total expenditure and adding 12-24 months to timelines), is likely to function

as a de facto procedural requirement rather than a scientifically decisive evidentiary

input. Indeed, there is increasing experience with tailored clinical efficacy and safety

approaches for biosimilars at the Committee for Medicinal Products for Human Use

(CHMP) of the European Medicines Agency (EMA). Based on EMA data, in 2025 more

than 70% of adopted scientific advice procedures for biosimilars incorporated a tailored

clinical efficacy and safety approach. In addition, among all biosimilar marketing

authorisation applications submitted last year under Article 10(4) of Directive 2001/83/EC,

approximately 8% proposed a tailored clinical efficacy and safety approach. While there

is a gradual shift toward more tailored approaches by EMA158, a slow uptake of these

changes risks putting Europe at a competitive disadvantage compared with other regions

that operate under more agile frameworks.

The EU’s regulatory framework will be marked by persistent fragmentation in the

implementation of clinical trials across Member States. The EU’s share of global clinical

trial initiations has halved, declining from 18% in 2013 to 9% in 2023. Without

fundamental reforms, particularly in streamlining authorisation procedures and simplifying

regulatory requirements, the EU risks a further decline in its clinical research

158 EMA, 2026 (https://www.ema.europa.eu/en/documents/other/reflection-paper-tailored-clinical-approach-biosimilar-

development_en.pdf-0).

31

competitiveness. Meanwhile, the more centralised markets of the US and China continue

to outperform the EU, further consolidating their dominance. China’s share of global

clinical trials, for instance, has surged from 8% to 29% over the last decade, while the US

maintains its strong position. Current projections suggest that the EU’s growth in

clinical trial activity will remain sluggish compared to these faster-expanding regions,

risking a further relative decline in its standing as a key hub for clinical research.

However, this does not imply a decline in the absolute number of EEA trials as the Clinical

Trial Regulation (fully applicable to all clinical trials since January 2025) is expected to

generate a ‘learning effect’ as sponsors and national authorities gain experience with the

Clinical Trials Information System (CTIS). This will lead to moderate improvements in

median authorisation times and greater procedural stability over 2025-2030. Between 2025

and 2030, AI tools are projected to achieve 60-70% routine adoption, e.g. in trial design

and conduct, and digital trial components are expected to become increasingly integrated

into standard protocol design. However, national heterogeneity in ethics review,

contracting, insurance, and site activation will persist. Clinical trial activity concentrates

further in a few Member States, large firms widen their advantage over SMEs, and clinical

translation of the EU's strong scientific output stagnates. SMEs and academic innovators

increasingly rely on partnerships with larger companies, slowing EU-based evidence

generation and eroding Europe's leadership in emerging technologies. In absolute terms,

the number of EU clinical trials has remained broadly stable over the past decade at

approximately ~2,400–2,500 trials per year, with no structural upward trend expected

under the baseline159.

For SoHO, 50 national competent authorities will continue to oversee blood and tissue

establishments (currently at 1,400 and 3,258, respectively), with recurring administrative

costs to businesses estimated at EUR 4.14 million over ten years under the incoming risk-

based authorisation model. While Regulation (EU) 2024/1938 introduces a more unified

SoHO Preparation Authorisation (SPA) model, regulatory uncertainty will persist for

novel, complex, and cross-framework SoHO innovations. Meanwhile, permitting for

strategic health biotechnology projects is projected to remain fragmented and slow under

the lack of EU-level priority-project recognition or fast-track governance mechanisms.

These burdens are further aggravated by the absence of structured innovation support.

In the food and feed domain, over 90% of application dossiers assessed by EFSA in 2021-

2023 contained administrative or scientific errors leading to the suspension of the legal

deadlines for risk assessment (the so-called stop-the-clock procedure) resulting in delays

in the overall authorisation process, which are likely to persist under the baseline scenario.

For AI-enabled methodologies, EMA's Qualification Procedure for Novel Methodologies

costs EUR 89,000 per request, takes 160-250 days, and produces confidential, non-

reusable outcomes, meaning each new entrant faces identical navigation costs with no

cumulative learning. The scale of regulatory demand on the EMA is itself accelerating. It

received 635 scientific advice requests in 2024, a figure that grew 16% year-on-year in the

first half of 2024 alone, this mismatch between the pace of technological innovation and

159 Rapid Assessment Scenarios study, forthcoming

32

the capacity of existing regulatory infrastructure to absorb it is expected to grow under the

dynamic baseline.

Competitiveness and investment attractiveness

The capital base underpinning the biotech sector shows a pronounced investment gap.

As presented under section 3.2.2, EU biotech venture capital stood at approximately EUR

4.8 billion across 243 rounds in 2024, roughly six times below US levels. The average EU

late-stage financing round (approximately USD 49 million) is around half of the US

equivalent, and the EIB estimates the structural annual investment gap at approximately

EUR 40 billion. This capital shortfall is not merely quantitative; it is structurally embedded

(see sections 3.1 and 3.2.2). Despite the existence of significant public financial

engagement, this gap shows no prospect of autonomous closure under the baseline.

The deep dependence on external capital, which weakens strategic autonomy over the

direction and location of value creation, is expected to grow. The median time gap between

funding rounds has increased from 17 to 20 months, with higher incidence of down rounds

at Series C stage (growth stage), signalling that investor confidence in the EU’s late-stage

pipeline remains fragile. Without sufficient public investment to bridge the late-stage

capital gap and catalyse private co-investment, the structural investment deficit is projected

to persist through 2038.

The exit asymmetry is equally stark and is expected to continue. Only 138 EU biotech

healthcare companies completed an IPO compared to 451 in the US (over the period 2013-

2023). In 2024, no European biotech raised more than EUR 58.1 million in IPO proceeds.

The commercial viability of biotechnology investments is further conditioned by the

existing IP protection framework. Health biotech innovators reinvest a large portion of

their revenue back into R&D. By ensuring a viable commercial timeframe, the SPC is one

of the measures that enables innovative companies to re-invest their revenue in additional

research and development, improving patient access to innovative therapies, and

generating broader economic benefits. However, intellectual property, including SPC, is

just one part of innovators’ investment decisions. Without policy change, innovators’

decisions on investment location continue to reflect expected lifecycle revenues under

protection, alongside market size, access conditions, regulatory predictability and

operational considerations. In the immediate baseline period to 2030, effective protection

durations are expected to remain broadly stable, with the revised general pharmaceutical

legislation not expected to produce observable effects within this period. In the longer term

to 2038, effective regulatory protection outcomes are expected to become more

heterogeneous across medical products, reflecting the continued shift towards biologics

and advanced therapies with longer and more variable development timelines. The EU

share of earliest biotech patent filings is projected to remain stable at low single-digit levels

(around 3-5%), while global biotech patenting activity continues to expand.

This capital deficit compounds a broader erosion of the EU's global competitive position

across several dimensions that collectively determine where biotechnology innovation is

located, financed, and commercialised. The global clinical trials market is expected to

grow at approximately 5.7% annually, compared with approximately 4.8% in Europe,

indicating a gradual but persistent loss of relative competitiveness for the EU as a location

for clinical research in the absence of improvements to the clinical trial ecosystem. In

33

biosimilars, the EU’s first-mover advantage has declined. While 71% of biosimilars are

approved in the EU before the US, there has been a rising share of biosimilars that get

approved in the US first, or only received US approval, which indicates the growth of the

US market. At the same time, the European biosimilar medicines sector makes a significant

contribution to European gross domestic product, contributing EUR 25.6 billion in 2024

and representing approximately 6% of the total pharmaceutical industry contribution.160

The number of the CHMP of EMA scientific opinions on biosimilars has itself increased

markedly, from 8 in 2023 to 25 in 2024 and 40 in 2025, reflecting a growing pipeline that

amplifies the stakes of regulatory competitiveness. Cumulative biosimilar

authorisations are also projected to rise from 151 in 2025 to 250-350 by 2030 and 450-

650 by 2038, with new reference product classes entering biosimilar development

expanding from approximately 27 to 35-45 by 2030 and 55-75 by 2038. However, 79% of

the approximately 100 biologics losing exclusivity by 2032 have no biosimilars in

development, representing a ‘biosimilar void’ valued at approximately EUR 122 billion in

global forecast sales at loss of exclusivity. This indicates that a substantial proportion of

the projected market value will not materialise without a reduction in per-product

development costs.

The competitive erosion is reinforced by the fact that no single-entry point exists for

health biotechnology innovators to navigate the regulatory and funding landscape.

Investor-innovator connections will likely remain ad hoc and geographically

concentrated in a few leading ecosystems. Disparities in innovation capacity and

ecosystem maturity across Member States are expected to persist, with Central and Eastern

European Member States lacking the cluster foundations that sustain leading ecosystems

in some Member States. These fragmentation effects are compounding: without a

coordinated ecosystem support mechanism, the navigational burden for SMEs is expected

to increase further as new regulatory frameworks layer additional complexity and the

pipeline of frontier biotechnologies expands. Meanwhile, other major jurisdictions are

actively accelerating policy and investment efforts to strengthen their biotechnology

ecosystems161, suggesting that, in the absence of intervention, the EU’s relative

competitive position is likely to continue to deteriorate over time.

Innovation and research

The baseline reveals a structural and persistent translation deficit at the centre of the

EU biotechnology innovation system. Under the baseline, the EU innovation system’s

upstream scientific base will remain internationally competitive, while the downstream

deficiency in infrastructure for converting that science into products, trials, and market-

ready applications will grow.

One of the key innovation-side deficits is the absence of structured pathways for

technologies that do not fit neatly within existing regulatory categories. Developers of

novel health biotechnology products will continue to operate simultaneously across two

160 Medicines For Europe factsheet: Pillar 1-2-3-4-FOOTPRINT-SPC-Biotech-Act-facsheets-ppt.cdr. 161 See for example US initiatives which frame biotechnology as a core economic and national security priority requiring

coordinated action to sustain global leadership: U.S. House of Representatives. (2025). Congressional Biotechnology

Caucus announcement, June 2025; National Security Commission on Emerging Biotechnology (NSCEB). (2025).

Report to Congress, April 2025.

34

to three regulatory frameworks, with no structured cross-framework anticipatory dialogue

in place. Forecast analyses project that up to 30% of such products could be stalled by

regulatory uncertainty between 2030 and 2038, even as the volume of novel, hybrid health

technologies is expected to increase by approximately 20% between 2025 and 2030. In

ATMPs, as the current definitions fail to capture emerging modalities, this is projected to

widen progressively as in vivo genome editing and cell-device combinations advance over

2030-2038. Without clarification of tissue-engineered product and related definitions,

more products are likely to require case-by-case classification by EMA and bespoke

scientific advice from 2030 onwards, increasing regulatory workload and amplifying

unpredictability for the SME dominated ATMP developer base (over 60% of ATMP

developers are SMEs). For GMMs used outside food and feed, the EU's process-based

framework has resulted in no market authorisations for deliberate release under Directive

2001/18/EC, effectively excluding the EU from the specific parts of global markets in

biofertilisation, biocontrol, bioremediation, and bioleaching using GMMs. Taking into

account GM and conventional products, these markets have a combined value exceeding

EUR 29 billion and growth rates of 9-14% annually. These global GMM-relevant markets

are projected to grow significantly under the baseline: biofertilisers from EUR 1.18 billion

(2024) to EUR 2.42 billion by 2030; microbial biocontrol from EUR 5.55 billion (2025)

to EUR 14.2 billion by 2032; bioremediation from EUR 14.1 billion (2024) to EUR 32.9

billion by 2033; and bioleaching from EUR 8.66 billion (2024) to EUR 18.2 billion by

2033. Under the baseline scenario, the EU's partial exclusion from these markets persists

indefinitely, and European companies developing GMM products will increasingly serve

non-EU markets or relocate R&D and commercialisation activities to jurisdictions such as

the US, where a product-based regulatory approach has already enabled commercial

deployment. Similarly, under the baseline, organ processing practices would be driven

by local institutional arrangements rather than a coherent EU standard. Under the baseline,

the share of EU transplantation programmes with active processing capability is projected

to rise from an estimated 27% to approximately 35-38% by 2030 and 42-48% by 2035,

before plateauing at approximately 48-55% by 2040. This plateau reflects the absence of

an EU-level framework.

Regulatory sandboxes, which could provide structured testing environments for such

innovations, are either absent or fragmented and underused across the relevant domains.

No EU-level sandbox exists for veterinary innovation. Similarly, the EU food acquis does

not provide for the operation of regulatory sandboxes; any existing food and feed

sandboxes remain weakly connected to food law and unevenly available across Member

States. The incoming SoHO risk-based authorisation model does not incorporate a sandbox

mechanism under the baseline. In the SoHO domain specifically, expert estimates indicate

that sandbox-eligible cases represent 5-10% of overall SoHO activities, translating to 90-

250 eligible cases per annum; based on comparable sandbox acceptance rates observed in

other regulatory domains (7-16%), between 6 and 40 sandboxes could be established per

annum, illustrating both the latent demand for structured innovation pathways and the scale

of innovation potential that remains unexploited under the current baseline.

The innovation investment consequences of these constraints are illustrated in the

biosimilars domain. Under the current framework, the sector’s contribution to European

CTs for biosimilar medicine candidates amounts to EUR 4.9 billion. Under the baseline,

the near-term biosimilar MAA volume is projected at 25-45 per year, with the lower bound

reflecting persistence of the biosimilar void and the upper bound assuming gradual

35

spontaneous adaptation; the medium-term range rises to 35-55 per year. However, without

formalised regulatory streamlining, per-product development costs remain at EUR 90-280

million over 6-9 years, with the CES representing the single largest component (EUR 19-

26 million per product, approximately 57% of total clinical development costs being

clinical), constraining the commercial viability of biosimilar development for lower-value

reference biologics

Public health and safety

Under the baseline, while the EU maintains among the highest regulatory safety standards

globally, aspects of the current regulatory architecture - particularly complexity,

fragmentation and procedural duplication - can constrain the pace at which patients,

consumers, and citizens benefit from biotechnological innovation. This tension will

continue to manifest across the following interconnected dimensions:

First, delayed and uneven patient access to biotechnology-derived treatments will

continue. The most consequential public health gap in the baseline concerns the widening

distance between the availability of advanced biotechnology therapies and the speed at

which EU patients can access them. The EU’s share of global clinical trial initiations has

halved from 18% in 2013 to 9% in 2023, with trial authorisation taking 100-120 days

compared to approximately 30-60 days in the United States and China. For ATMPs, the

current provisions of the CTR will continue to add up to 50 additional assessment days. In

addition, foresight analyses projecting that up to 30% of novel health biotechnology

products could be stalled by 2030-2038.

• Under the baseline, annual healthcare system savings from biosimilars are

projected to rise from approximately EUR 13 billion in 2024 to EUR 16-22 billion

per year by 2030 and EUR 22-35 billion per year by 2035-2038, but the upper

bounds of these projections are constrained by the biosimilar void, meaning that

the full savings potential depends on whether per-product development costs can

be reduced sufficiently to make lower-value biologics commercially viable targets

for biosimilar competition.

• In organ transplantation, the absence of a harmonised EU-level authorisation

framework for organ processing means that advanced ex-vivo machine perfusion

techniques diffuse unevenly, with no systematic mechanism for capturing

processing-related safety data. Under the baseline, with a transplant growth

trajectory of 1.54% CAGR annual transplant volumes are projected to rise to

approximately 35,350 by 2030, 38,200 by 2035, and 41,200 by 2040. However,

demand-side growth will outpace supply-side gains: waiting lists are expected to

grow at approximately 0.5% per year to approximately 55,000-56,500 active

patients by 2035 and 57,000-58,000 by 2040, meaning waiting-list mortality is

projected to decline only marginally from approximately 3,366 deaths per year to

approximately 3,100-3,200 by 2035 and 2,900-3,100 by 2040. The EU's dialysis-

dependent population is projected to rise from approximately 310,000 to 330,000-

340,000 by 2035 and 350,000-365,000 by 2040, with demand-side growth driven

by population ageing, rising diabetes and hypertension prevalence, and widening

dialysis initiation criteria outpacing the supply-side gains from transplant volume

increases. The organ discard rate is projected to decline from approximately 12-

13% to 10–11% by 2035 and 9-10.5% by 2040 under organic, centre-led adoption,

36

but these gains will be concentrated in liver and lung organs in a small number of

advanced Member States and will remain below the levels achievable with wider

processing adoption.

Second, in the food and feed area, although safety standards will be maintained,

innovation will remain constrained. EFSA's rigorous risk assessment framework

continues to underpin world-leading food safety standards. In the area of nutrition,

biotechnology can enhance nutritional properties. However, the current legislation faces

limitations in addressing the scientific aspects given the limited mandate of EFSA to

deliver scientific advice in relation to nutrition matters. This may become even more

relevant in the future considering the expected increase in the prevalence of diet-related

health issues in the coming years. Similarly,regarding the One Health risks from

veterinary regulatory design, the dual-track system for GMO-containing VMPs

generates an 'innovation tax' of 2-3 times longer approval periods without commensurate

safety benefit: no GMO-containing VMP has ever received a negative opinion on its GMO

component. The absence of a legal 'firewall' clarifying that animals treated with GMO-

derived VMPs are not themselves classified as GMOs will continue to create commercial

risk. It could deter farmer uptake of next-generation biotech vaccines, sustaining reliance

on antimicrobials and impeding progress towards the EU's target of halving antimicrobial

sales by 2030.

Third, the baseline presents a structural gap in the EU's capacity to detect and

prevent biological threats. Wastewater-based surveillance beyond SARS-CoV-2 and

influenza remains limited (only 11 Member States monitor antimicrobial resistance, six

monitor emerging pathogens), with no agnostic detection layer for novel or engineered

threats. Concurrently, synthetic nucleic acid screening remains voluntary and fragmented:

only 69 of over 700 global custom synthesis providers are confirmed to screen. The RAND

analysis estimates that the expected monetised annual loss due to biological threats across

all event categories amounts to approximately EUR 184 billion for large-scale events (1%

annual probability; EUR 19.6 trillion expected harm), supplemented by small-scale events

(22% annual probability, EUR 72 million expected harm), agricultural events (4%

probability, EUR 75.5 billion expected harm), and non-transmissible events (5–25%

probability, EUR 121 million expected harm). For attacks specifically, the probability that

they involve synthetic nucleic acid ordered from providers ranges from 30% to 70%

depending on event type, while for accidents the corresponding probability ranges from

6% to 17%.

The biosecurity and biodefence baselines expose a separate category of public health

vulnerability. In the domain of synthetic nucleic acid synthesis, the EU market (estimated

at approximately EUR 850 million in 2024, representing approximately 0.2% of the

European biotechnology market162) is expected to grow at an annual rate of 10-20%, but

competitiveness is shaped by the absence of a level playing field: companies that

voluntarily screen their customers face competitive disadvantages against providers that

do not screen, and as DNA synthesis prices continue to decline, the cost of screening

represents an increasing share of the final order price. Without a change in biosecurity

162 Based on Grandview Research estimates of the DNA synthesis market

https://www.grandviewresearch.com/horizon/outlook/dna-synthesis-market/europe and the Biotech market more

generally https://www.grandviewresearch.com/horizon/outlook/biotechnology-market/europe

37

policy, the annual probability of a large-scale biological attack or accident is estimated at

1%, with expected economic harm to the EU of a large-scale event of ca. EUR 20 trillion.

The risk is set to increase further as synthetic DNA and RNA continues to become cheaper

and more widely available. Meanwhile, pathogen surveillance remains reliant on clinical

surveillance networks and targeted wastewater-based monitoring for known agents, with

no systematic agnostic detection capacity for novel or engineered biological threats.

Environment and sustainability

The baseline reveals a tensionat the intersection of the EU's biotechnology regulatory

architecture and its environmental policy ambitions: while these frameworks uphold high

environmental and safety standards, certain features – such elements of their process

design and limited risk differentiation - can delay or constrain the deployment of

biotechnology applications with significant potential to advance the environmental and

sustainability objectives. This tension manifests most acutely across three intervention

areas.

The most consequential environmental baseline deficit concerns GMMs. No GMM has

been authorised for deliberate environmental release under Directive 2001/18/EC. As

innovations utilising genetic engineering are not brought to the market in the EU, the EU

is therefore entirely absent from this important segment of rapidly growing global markets

in biofertilisation (EUR 1.18 billion in 2024, growing at 12.8% CAGR), microbial

biocontrol (EUR 5.55 billion in 2025, 14.3% CAGR), bioremediation (EUR 14 billion in

2024, 9.9% CAGR), and bioleaching (EUR 8.65 billion in 2024, 8.9% CAGR), sectors

with a combined global market exceeding EUR 29 billion and projected growth rates of 9-

14% annually. In contrast, a product-based regulatory approach in the US has already

enabled commercial deployment. Under the baseline scenario, this partial market exclusion

persists indefinitely, and European companies developing GMM products will

increasingly serve non-EU markets or relocate, while the environmental benefits of GMM-

based microbial solutions for resource-efficient agriculture, pollution remediation, and

sustainable extraction remain unrealised within the EU.

In the veterinary domain, the dual-track regulatory system for GMO-containing VMPs

results in a regulatory friction that can slow the uptake of next-generation biotech vaccines

in food-producing species, with potential ramifications for animal health, farmers and food

security.

The food chain sandbox landscape is characterised by fragmentation and lack of

coherence with Union law; only a few Member States operate sandbox-type mechanisms,

none anchored in a harmonised EU framework under the General Food Law. As a result,

findings and best practices cannot be systematically integrated into the evolution of the

existing legal framework. This limits structured, pre-market testing of sustainable food

production technologies, leaving innovation potential for the food system's environmental

transition partly unexploited.

38

4 APPROACH TO THE BIOTECH ACT

4.1 Objectives of the proposal

4.1.1 General objectives

The general objective of the proposed Regulation and Directive is threefold: (i) to improve

the functioning of the internal market by establishing a framework to strengthen the

competitiveness of the health biotechnology sector, from research to production, (ii) to

create the conditions for the development and timely placing on the single market, of

biotechnology innovations, products and services, (iii) while safeguarding high standards

for the protection of human health, animal health, patients and consumers, food and feed

safety, the environment, and biosecurity.

4.1.2 Specific objectives

This general objective translates into the following specific objectives, as presented in the

proposed Regulation and Directive: (i) strengthen the biotechnology sector and reinforce

the EU’s research, development and production capabilities; (ii) support funding of,

investments in, and access to capital for, biotechnology companies and projects; (iii)

improve the EU manufacturing capacity of, and expertise in biosimilars, including through

international cooperation; (iv) facilitate the application of AI into the EU’s biotechnology

and health technology manufacturing ecosystems and frameworks, in line with the AI

Act163; (v) ensure a legislative framework that encourages innovation and takes account of

technological and scientific developments and progress; (vi) prevent the misuse of

biotechnologies and strengthen biodefence capabilities and (vii) enable the effectiveness

of the above specific objectives through a legislative framework conducive to the use of

biotechnology innovations.

4.2 Choice of the legal instruments and legal basis

4.2.1 Choice of the legal instruments

A Regulation is the most suitable for measures requiring uniform application across the

EU, such as those concerning recognition and support for heath biotechnology strategic

projects and high impact health biotechnology strategic projects, and measures to boost

EU biodefence and biosecurity and prevent biotechnology misuse. The Regulation is also

justified to amend existing EU regulations in the area of health and food law. Its directly

applicable nature ensures consistent implementation without national transposition. A

Directive is the appropriate instrument for amendments to Directive 2001/18/EC and

Directive 2010/53/EU.

4.2.2 Legal basis

The appropriate legal bases are therefore as follows:

- Article 114 TFEU is the basis for the adoption of measures that increase

harmonisation and remove fragmentation and, therefore, seek to create a level playing

163 Regulation (EU) 2024/1689, OJ L, 2024/1689, 12.7.2024, ELI: http://data.europa.eu/eli/reg/2024/1689/oj.

39

field within, and fully exploit the scale of the single market for biotechnology products

and biomanufacturing. The proposal also seeks to achieve the objective of a high level

of health and safety protection as per Article 114(3).

– Article 168(4) TFEU is the basis for the adoption of certain measures that contribute

to achieve a high level of human health protection, i.e. standards of quality and safety

of organs and SoHO, blood and blood derivatives; measures in the veterinary and

phytosanitary fields, and standards of quality and safety for medicinal products and

devices for medical use.

- Article 173(3) TFEU is the basis for measures in support of Member States’ action for

the competitiveness of the EU’s industry, in particular the provisions regarding the EU

Health Biotechnology Investment Pilot.

4.3 Subsidiarity: necessity for EU action and EU added value

Under the subsidiarity principle, the Union may act in areas of non-exclusive competence

only where the objectives of the proposed action cannot be sufficiently achieved by the

Member States.

4.3.1 Necessity for EU action

The objectives of the proposed Biotech Act cannot be achieved by Member States acting

alone, as the identified drivers are cross-border and systemic, affecting the functioning of

the single market and the global competitiveness of EU companies. These challenges may

differ in intensity across Member States and regions, but their nature is Union-wide.

Access to finance is fragmented and EU biotechnology companies lack the capacity to

access private finance at a competitive scale, including at later stages of development.

European biotechnology clusters are dispersed and lack continental scale to compete

globally. The development and deployment of AI in biotechnology remains limited, also

due to the insufficient cross-border availability and sharing of relevant data.

While several Member States have taken action, these bottlenecks persist and

improvements would remain slow and uneven. National measures alone cannot provide

the scale, coordination and speed required, although in certain areas (e.g. access to finance,

development of regional innovation ecosystems and clusters, and support to research

infrastructures, etc.), Member States may still take complementary action alongside Union

measures.

Important regulatory barriers stem from existing EU legislation, such as lack of legal

clarity, complex or outdated rules, disproportionate administrative burden and additional

national requirements. As these drivers originate in Union law, they cannot be effectively

addressed by Member States acting individually. Union action is therefore necessary to

facilitate innovation, enhance legal clarity and improve market access.

4.3.2 EU added value

The proposed actions focus on areas where there is a demonstrable value added in acting

at EU-level due to the scale, speed and scope of the efforts needed.

40

A harmonised but simplified EU regulatory framework, supported by strengthened

collaboration in selected policy areas (access to capital, AI and data) is expected to ensure

patients, users and citizens across the EU can benefit from biotechnology innovations.

A large market with a streamlined, fit-for-purpose regulatory framework ensures a level

playing field and reduces compliance costs in the single market, thereby supporting

biotechnology market uptake. Coordinated EU action in the field of biotechnologies will

generate economies of scale, reduce duplication of efforts, increase legal certainty for cross

border entrepreneurs, and unlock investments, infrastructures and skills development that

Member States alone could not achieve. Union-level coordinated action is expected to

yield higher benefits than fragmented national measures.

Regulatory streamlining and clarification measures will reduce administrative burden,

accelerate time-to-market and improve the functioning of the internal market, also by

addressing the observed diverging national interpretations and additional requirements.

The proposed Biotech Act also seeks to reinforce the EU’s strategic autonomy in a critical

technological area while fostering adequate biosecurity safeguards and biodefence

capabilities.

4.4 Intervention logic of the proposal

Figure 4.164

Figure 5 illustrates the overall architecture of the Biotech Act, highlighting the two

complementary pillars of regulatory streamlining and facilitation to accelerate time-to-

market and industrial enablers to strengthen the EU biotechnology ecosystem.

164 Revised version of the intervention logic (see first version in COM(2025) 1022 finalhttps://eur-lex.europa.eu/legal-

content/EN/TXT/?uri=CELEX:52025PC1022).

41

Figure 5. Biotech Act architecture

5 DESCRIPTION OF THE PROPOSED MEASURES AND ANALYSIS OF THEIR MAIN IMPACTS

The measures described below are outlined in the proposal for a Regulation and the

proposal for a Directive165. They are presented in 17 packages of interventions, which fall

under two categories: eight interventions related to regulatory streamlining and facilitation

measures aiming at regulatory simplification (addressing drivers 1 and 3), and nine

interventions linked to industrial enablers (addressing drivers 2 and 3). They are presented

in more detail in Annex 7.

The summary assessment of measures166 below includes tables capturing the key impacts

across standard impact categories167. Where sufficiently robust evidence is available, key

impacts are quantified and expressed using numerical estimates. Where quantification is

not feasible, impacts are assessed qualitatively using a standardised rating scale168,

indicating the direction and relative magnitude of effects. For certain measures, tables are

not used where the nature of the impacts or the available metrics are better suited to

alternative forms of presentation (e.g. narrative analysis or visual representations), to

ensure a more accurate and meaningful representation of the expected effects.

5.1 Interventions for regulatory simplification: measures and expected impacts

Chapter IX of the proposed Regulation and Directive include amendments to EU

legislative frameworks in the areas of health, food and feed safety as well as GMMs, which

aim to simplify existing procedures and accelerate time-to-market. These amendments are

165 Annex 6 presents a mapping of the policy measures and the corresponding articles in the proposed Regulation and

proposed Directive respectively. 166 The assessment of impacts draws on the supporting studies presented in Annex 1. 167 COB = conduct of business; Admin = administrative costs on businesses, including SMEs; CTI = competitiveness,

trade and investment flows; Int Mar = functioning of the internal market and competition; I&R = innovation and research;

PA = public authorities; H&S = public health and safety. 168 ++ significant positive; + moderate positive; 0/+ marginal positive; 0 negligible/neutral; 0/– marginal negative; –

moderate negative, -- significant negative.

42

needed to ensure the effectiveness of the self-standing measures on industrial enablers laid

down in the proposed Regulation.

5.1.1 Intervention n°1: Regulatory facilitation for novel health biotechnology

products

The Regulation proposal sets out the provision of regulatory assistance or support by

the EU Health Biotechnology Support Network to developers. This targeted, early-stage

support will be particularly valuable for SMEs, which often lack extensive in-house

regulatory expertise. The support will consist of facilitating information on, and access to,

applicable legislative frameworks, including procedures for seeking guidance on

regulatory status, rules applicable to products combining different technologies or

regulatory frameworks, and access to regulatory sandboxes.

Further, the Regulation proposal establishes a publicly available regulatory status

repository containing decisions, opinions and scientific recommendations regarding the

regulatory status of health innovations across the EU. This repository aims to ensure

transparency and consistency in regulatory determinations. It also aims to support advisory

bodies mandated under sectoral legislation to determine the regulatory status of health

products promptly and without undue delay, as well as to assist developers in shaping their

regulatory strategy based on existing practice.

In addition, the proposal establishes a foresight panel for emerging health innovation

comprising scientific and regulatory experts from the SoHO Coordination Board (‘SCB’),

the Medical Devices Coordination Group (MDCG), the Coordination group on Health

Technology Assessment, the EMA, and the competent authorities of the Member States.

The panel would provide early recommendations to the Commission, relevant EU

agencies, and Member State competent authorities.

Moreover, a cross-framework coordination for regulatory sandboxes in the health

area aims to allow for dialogue and information exchange among authorities operating

regulatory sandboxes for health biotechnology products across different Union legislative

frameworks (MDR, IVDR, SoHO Regulation, Pharmaceutical Regulation). Member State

and Union-level authorities operating sandboxes under different frameworks would have

to consult with each other and with the foresight panel regarding sandbox design and

implementation, ensuring the potential integration of cross-framework aspects, which is

needed given the increasing cross-cuting nature of health product innovations. The

Commission, the EMA, the MDCG and the SCB facilitate cross-framework exchanges

through the above-mentioned foresight panel, focusing on knowledge sharing (regulatory

approaches, technological challenges, best practices) and regulatory learning (identifying

implications for future legislative adaptations).

Finally, the proposal includes the possibility for regulatory sandboxes for novel health

biotechnology products. These Commission-led sandboxes are designed for products

that, due to their very early stage of development cannot be accommodated in existing

sectoral sandboxes for novel products and whose development is hindered by challenges

in identifying suitable regulatory procedures. They offer a framework – in the form of a

subsidiary sandbox – for continued engagement with regulators and eventually a

recommendation on the applicable existing framework for marketing authorisation. Upon

43

substantiated request from developers, the Commission would assess applications and

establish such a regulatory sandboxes through implementing act. These sandboxes would

operate under time-limited sandbox plans specifying objectives, scope, participants, risk

mitigation measures, and supervision arrangements. When assessing the applications for

the establishment of such a subsidiary regulatory sandbox, and when developing and

implementing the sandbox plan, the Commission may consult the EMA, the SCB, the

MDCG and the Foresight Panel. Upon termination of the regulatory sandbox, the

Commission would, upon a request from a developer, provide a recommendation on an

existing appropriate regulatory procedural pathway for authorising the placing on the

market and post-market surveillance and vigilance of the products concerned under an

existing framework and may publish reports on lessons learned from the regulatory

sandboxes.

Expected impacts:

It is crucial for research, business, investment and patients that the EU regulatory system

can efficiently and adequately assess highly innovative health biotechnology products.

With the above proposed measures, the Regulation proposal aims to introduce a

comprehensive set of regulatory tools designed to make the EU regulatory system more

predictable, efficient, and innovation-friendly without compromising safety requirements.

Conduct of business: These tools are expected to generate positive effects, as the

repository would provide guiding documented regulatory interpretations for similar

products, enabling firms to benchmark approaches. Navigation assistance by the Support

Network will deliver targeted, early-stage support particularly valuable for SMEs, which

often lack extensive in-house regulatory expertise and often rely on costly external

consultancy. The foresight panel for emerging innovation would increase the regulatory

readiness of the legislative frameworks in the health area by allowing them to integrate

approaches to new technologies in a timely way. The panel, offering a forum for structured

dialogue across the frameworks, also aims to ensure a cross-framework perspective on

emerging technologies, which is needed as innovation increasingly develops across the

silos of the different frameworks. This would make the existing frameworks more

conducive to processing products based on new biotechnologies.

Regulatory sandboxes offer a controlled environment where developers of truly disruptive

innovations are supported by regulators to identify suitable authorisation routes. Evidence

from analogous sandboxes already applicable in other sectors, notably the UK Financial

Conduct Authority study169, suggests that sandbox participation can reduce time-to-

market by 20-40%, increase funding probability by 15-50%, and improve firm

survival and patenting by 20-30%, with benefit-to-cost ratios ranging from 3/1- 10/1

over three to five years.

The measures are also expected to have a positive impact on administrative costs for

businesses (including SMEs),through reducing administrative burden and costs by

eliminating duplicative work and regulatory unpredictability for businesses and

169 “Regulatory Sandboxes and Fintech Funding: Evidence from the UK” by G. Cornelli S. Doerr L. Gambacorta O.

Merrouche (2020) act 2025: FCA Strategy.

44

innovators. The measures aim to avoid undue delays and inefficiencies in regulatory

pathways at an early stage of development.

R&I: The measures are also expected to generate positive impacts. Clearer pathways for

researchers would reduce the chilling effect that uncertainty currently has on frontier

research, encouraging more high-risk, high-novelty projects being developed and retained

in Europe. The repository and regulatory assistance would help research institutions and

firms plan development activities with confidence, while the sandboxes would ensure that

truly disruptive research in novel products is still accommodated by the regulatory system.

The foresight panel aims to connect the research world, where innovation emerges, with

regulators. This would allow to reflect collaboratively on how to process products based

on new technologies in the best way. These measures combined would guide funding

bodies and researchers toward promising areas likely to be facilitated in a system

conducive to innovation, eventually unlocking the potential for increasing EU gross

domestic expenditure on research and development and better translating scientific

breakthroughs into clinical applications.

Competitiveness, trade and investment: The Biotech Act as a whole is expected to

address structural weaknesses that currently deter investment and early-stage scaling in

Europe. Greater regulatory clarity and predictability, through the repository and navigation

assistance, should reduce perceived regulatory risk, making the EU more attractive for

biotech investment. The sandbox might signal to global investors that tailored regulatory

tools exist for disruptive innovations, providing viable pathways to market and reducing

uncertainty. The foresight panel demonstrates that the EU actively incorporates emerging

trends into regulatory planning, aligning long-term policy with cutting-edge innovation

and supporting confidence that governance and rules will adapt to technological progress.

These measures have the potential to reverse declining trends in EU biotech and partially

close the investment and commercialisation gap with the US and China.

Functioning of the internal market: Its functioning is expected to improve through

greater harmonisation and transparency, as the repository promotes convergence by

making consistent regulatory interpretations visible across Member States and reducing

divergent classifications that fragment the market and distort competition. Navigation

assistance and structured guidance minimise interpretive disputes and streamline cross-

border compliance. For public authorities, the Biotech Act is designed to improve

efficiency and preparedness by reducing duplication through the shared repository

reference base, streamlining pre-authorisation interactions through navigation assistance,

and building anticipatory capacity through the sandbox and foresight panel. Although

establishing the sandbox and operating the foresight panel require upfront investment,

these costs are limited given the expected low number of such sandboxes, borne at EU-

level with no additional burden on Member States, and are expected to be offset by

efficiency gains, reduced uncertainty, and scale effects. For public health and safety, the

combined regulatory tools aim to offer a more innovation-conducive regulatory system,

bringing more breakthrough products with potential major patient benefit to the market

through a more efficient and adapted regulatory process – without compromising safety

standards.

45

Public authorities: The proposed measures will entail only limited costs, while delivering

long-term efficiency gains, particularly through streamlined authorisation processes that

reduce administrative workload. Regulatory assistance via the support network will

leverage existing national structures, adopting an antenna approach to better coordinate

and deploy assistance providers at the national level. The regulatory status repository,

though requiring initial development, will build upon existing or planned resources—such

as the SoHO compendium or the Medical Devices Manual on Borderline and

Classification—or simply reference national publications, thereby minimising duplication

and resubmissions by developers. This, in turn, will further alleviate the burden on public

authorities by reducing uncertainty and improving procedural efficiency. The foresight

panel, while incurring marginal costs for logistical support, staff allocation, and expert

compensation, is designed to strengthen anticipatory governance, ensuring greater

preparedness for emerging technological shifts and ultimately lowering the future

regulatory burden for complex, innovative products. Though no data exists on the cost-

benefit ratio of a regulatory sandbox for novel health biotech products, its use will be

highly targeted, keeping expenses minimal. Importantly, investments to establish the

sandbox and operate the foresight panel will be fully funded by the Commission, imposing

no additional financial obligations on Member States.

On public health and safety, no impacts are expected as safety standards remain

untouched by these provisions.

Table 1. Summary assessment of the effects due to the intervention n°1

Policy measure COB Admin CTI Int mar I&R PA H&S

Union regulatory

status repository

+ + + + + n/a 0

Foresight Panel for

Emerging Health

Innovation

+ 0 + + + n/a 0

Regulatory sandboxes + + + + + n/a 0

5.1.2 Intervention n°2: Targeted regulatory reform of the General Food Law170

First, the Regulation proposal includes measures to accelerate and improve EFSA risk

assessment processes for products subject to pre-market authorisation under Union food

and feed law. These include:

- the broadening of the scope of general pre-submission advice (currently limited

to administrative and regulatory requirements) to cover scientific matters, such as

study design and testing strategies, while merging it with the renewal-related

advice into a single, unified and simplified procedure;

170 Regulation (EC) No 178/2002, OJ L 31, 1.2.2002, pp. 1–24. ELI: http://data.europa.eu/eli/reg/2002/178/oj.

46

- a shortening to three months of the procedural delay for non-compliance with

the study notification requirements at pre-submission phase;

- a targeted and limited revision of the Scientific Committee/Scientific Panel

governance while maintaining the composition of the Scientific Committee;

- the expansion of EFSA mandate to provide scientific advice on all aspects of

human nutrition.

Secondly, the proposal establishes a comprehensive regulatory sandboxes framework

within Union food law, enabling Member States to create controlled environments for

testing innovative technologies, products and substances at pre-market stage, data

requirements and alternative regulatory requirements for food production, processing and

distribution, feed produced for food-producing animals, food contact materials, and GMO-

containing products. The proposal, however, does not allow the establishment of

regulatory sandboxes for the following categories of products: (a) Novel foods:

Experience has shown that certain types of novel foods involve highly innovative processes

and complex scientific considerations, which require thorough oversight even at

testing/experimental phase. This makes such foods less suited to the flexible, experimental

nature of sandboxes. Furthermore, experience has shown that certain types of novel foods

trigger ethical or cultural concerns among various consumer segments regarding their

acceptability. Therefore, all aspects of novel foods in general are best addressed solely

within the applicable rigorous regulatory framework established by Regulation (EU)

2015/2283 of the European Parliament and of the Council and should not be subject to

regulatory sandboxes171; (b) Recycled plastic food contact materials: As regards

innovations concerning novel plastic recycling technologies for plastics intended to come

into contact with food, chapter IV of Commission Regulation (EU) 2022/1616 already

establishes a framework that is meant to encourage the development of such novel

technologies without prior authorisation. To ensure uniform rules on the development of

novel recycling technologies that safeguard the health of the consumers, it is appropriate

to exclude the development of recycling technologies from the possible use of regulatory

sandboxes and rely instead on the procedure established in chapter IV of Regulation (EU)

2022/1616;172 and, (c) GMOs regulated under Part B of Directive 2001/18/EC: For

certain GMOs legal pathways already exist to allow testing of innovations, such as under

Part B of Directive 2001/18/EC on the deliberate release of genetically modified organisms

(GMOs) for purposes other than placing on the market, and therefore there should not be

a duplication of paths in the interest of legal certainty. For this reason, regulatory

sandboxes should be restricted to products containing or consisting of GMOs subject to

authorisation under Part C of Directive 2001/18/EC.

171 Regulation (EU) 2015/2283 of the European Parliament and of the Council of 25 November 2015 on novel foods,

amending Regulation (EU) No 1169/2011 of the European Parliament and of the Council and repealing Regulation (EC)

No 258/97 of the European Parliament and of the Council and Commission Regulation (EC) No 1852/2001 (OJ L 327,

11.12.2015, p. 1, ELI: http://data.europa.eu/eli/reg/2015/2283/oj). 172 Commission Regulation (EU) 2022/1616 of 15 September 2022 on recycled plastic materials and articles intended to

come into contact with foods, and repealing Regulation (EC) No 282/2008 (OJ L 243, 20.9.2022, p. 3, ELI:

http://data.europa.eu/eli/reg/2022/1616/oj).

47

Regulatory sandboxes established in the context of Regulation (EC) No 178/2002 would

not replace or circumvent existing pre-market authorisation procedures, as any product

subject to pre-market authorisation – for example a new feed additive tested within a

sandbox – would still need to undergo the full authorisation process before being placed

on the EU market.

Expected impacts:

Conduct of business: The proposed extension of the scope of EFSA’s general pre-

submission advice to cover also scientific aspects is expected to significantly improve

application dossier quality, reduce validation timelines and limit ‘stop-the-clocks’ during

the risk assessment phase, thereby contributing to shorten time-to-market. By enabling

applicants, especially SMEs and first-time applicants, to clarify study design, endpoints

and methodologies in advance, with EFSA staff and external experts, the measures should

increase predictability without undermining the ‘non-committal’ character of the pre-

submission advice and without altering the applicant’s burden of proof or EFSA’s

independence. Shortening the procedural delay for non-compliance with study notification

obligations from six to three months further reduces procedural delays at pre-submission

phase. In parallel, the introduction of a framework for regulatory sandboxes allows

companies to test innovative technologies, products and processes in controlled

environments before pre-market authorisation procedures, helping them to understand data

requirements and regulatory expectations while maintaining oversight and safety. Overall,

the conduct of business along the food chain is expected to become more innovation-

friendly and less encumbered by avoidable procedural obstacles.

Administrative costs on businesses (including SMEs): the reform is expected to reduce

unnecessary burdens linked to incomplete or poor-quality application dossiers. The

enlarged scope of pre-submission advice should help applicants tailor their data generation

more precisely to EFSA’s requirements, avoiding mis-designed studies and decreasing the

likelihood of repeated information requests and related delays. This is particularly

important for SMEs and one-time applicants, for whom administrative and compliance

costs weigh more heavily and who currently underuse existing advice instruments. By

clarifying notification obligations and other procedural requirements at an early stage, the

reform can streamline compliance and reduce the cumulative administrative effort over the

life cycle of an application.

Competitiveness, trade and investment flows: The targeted amendments are expected to

strengthen the EU’s competitive position by making the regulatory environment more

conducive to innovation while preserving high safety standards. Faster and more

predictable risk assessment processes, fewer unnecessary administrative hurdles and

reduced non-compliance penalties should lower the cost of bringing new products to

market and make the EU a more attractive location for R&D and investment. By

facilitating the development and approval of innovative products and related technologies,

the reform supports the ability of EU firms to compete globally, leveraging the existing

reputation of EU standards as a quality benchmark and reinforcing the EU’s capacity to

shape international norms.

Functioning of the internal market and competition: the reform is not expected to

materially alter the baseline. The measures would apply horizontally and uniformly to all

48

operators and Member States, and do not change the core harmonised framework

established by the General Food Law and sectoral legislation. The level playing field across

the internal market, underpinned by common risk-analysis principles and centralised EFSA

risk assessment, would therefore remain intact.

Innovation and research: The new legislative framework for regulatory sandboxes is

expected to be potentially transformative. By allowing supervised experimentation with

technologies, products and substances in real-world conditions before pre-market

authorisation, sandboxes significantly reduce both technological and regulatory risks for

innovators, particularly start-ups and SMEs. Shorter learning cycles, direct feedback on

safety, usability and acceptance, and clearer insight into data and evidentiary expectations

should accelerate development and derisk investment in more ambitious, less incremental

innovations. Participation in regulatory sandboxes established by Member States in

accordance with the proposed amendment of the General Good Law, with visible

regulatory engagement, is also likely to signal credibility to investors and industrial

partners, facilitating access to finance and strategic collaborations. Overall, the measures

are expected to improve the innovation climate in the EU food and feed sector, while

keeping full pre-market authorisation requirements in place for products entering the

market.

Public authorities: Concerning public authorities, notably national competent bodies, as

well as EFSA, the reform is expected to improve the efficiency and the quality of scientific

and regulatory outputs. Enhanced pre-submission advice, including scientific aspects and

delivered by EFSA staff and external experts who may also support subsequent risk

assessment, should improve dossier quality, reduce the frequency and duration of stop-the-

clock procedures, and allow better allocation of EFSA’s resources along the application

process. Adjustments to EFSA’s scientific panel governance – having EFSA staff chair

panels and the Scientific Committee – are expected to reinforce coherence, methodological

consistency and timeliness across assessments. While the expanded advice function may

require some additional staff and coordination efforts, these are expected to be offset by

savings from fewer procedural delays and less remedial work on weak-quality dossiers.

For national authorities, participation in regulatory sandboxes offers a vehicle for

systematic regulatory learning, enabling them to test data requirements and alternative

regulatory approaches in a controlled setting and to feed robust evidence into EU-level

scientific guidance and regulatory standards.

Public health and safety: the targeted amendments are designed to preserve, and

potentially enhance in the longer term, the high level of safety standards currently afforded

by EU food law. The streamlining of EFSA procedures and the extension of pre-

submission advice aim to ensure that risk assessments are supplied with more relevant,

better structured data, thereby supporting robust scientific opinions within shorter

timelines. The expanded mandate of EFSA on nutrition matters, enabling EFSA to provide

advice on all nutrition matters aim at further equip EU regulators with the necessary

scientific knowledge to address challenges relating with the increasing prevalence of diet-

related health issues. The regulatory sandbox framework, under strict safeguards, is

expected to function as a regulatory learning tool, generating richer real-world evidence

on exposures, hazards, patterns of use and the effectiveness of risk-management options.

This should enable more accurate risk characterisation, more proportionate and effective

risk-management measures, and earlier detection of potential safety issues in a controlled

49

environment. Provided that capacity is available to analyse and use sandbox generated

data, the overall effect is expected to be at least the maintenance, and potentially the

strengthening, of the EU’s high standards of public, animal and plant health protection and

environmental safety.

Table 2. Summary assessment of the effects due to the intervention n°2

Policy measure COB Admin CTI Int Mar I&R PA H&S

Improved timeliness

and coherence of

EFSA risk

assessment processes

++ ++ ++ 0 0/+ ++ +

Regulatory

framework for

sandboxes in relation

to food, feed, and

GMOs

++ 0 + 0 ++ + +

5.1.3 Intervention n°3: Targeted regulatory reform of the Advanced Therapy

Medicinal Products (ATMPs) framework173

The proposed regulatory simplification and future-proofing of ATMPs includes two

interconnected changes. First, it establishes a risk-proportionate approach for clinical

trials involving ATMPs containing or consisting of GMOs. Under this approach

sponsors would be exempted from submitting environmental risk assessments (ERAs) for

products presenting no or negligible risks. Second, it aims at future-proofing the

regulatory framework by amending the definition of tissue-engineered products to reflect

technical and scientific advances, without extending the scope of the definition.

Expected impacts:

Overall, the reform is expected to strengthen the EU’s attractiveness for high-risk biotech

investment and support the growth of a rapidly expanding ATMP sector across Member

States. The proposed amendments are expected to contribute to the EU’s global

competitiveness in biotechnology. Predominantly positive impacts are expected for

businesses (in particular SMEs), research and innovation, the internal market, and public

health.

Conduct of businesses, innovation and research: The introduction of a targeted

exemption from ERA requirements during the CT application phase for clearly defined

categories of low-risk investigational ATMPs directly addresses a key barrier to

conducting clinical trials in Europe. Even where the recently agreed pharmaceutical

legislation reform addresses the fragmentation of ERA requirements across Member States

by centralising/harmonising the ERA procedure, requiring sponsors to obtain ERA

approval prior to, or alongside, a CT authorisation, imposes a disproportionate regulatory

173 Regulation (EC) No 1394/2007, OJ L 324, 10.12.2007, pp. 121–137. ELI: http://data.europa.eu/eli/reg/2007/1394/oj.

50

burden at an early stage of development where the risk profile of the product is already

well-characterised and low. This deters sponsors –particularly SMEs – from choosing the

EU as a trial location, diverting early-stage innovation to jurisdictions with more

streamlined processes. This competitive disadvantage is evident when comparing with the

US: the Food and Drug Administration grants an exclusion from ERA for the vast majority

of gene therapy Investigational New Drud (IND) applications at the clinical trial stage.

That regulatory efficiency accelerates development timelines and explains why a

significant share of ATMP clinical trials are conducted in the US rather than in the EU.

While an ERA will still be required at the marketing authorisation stage, removing this

requirement during clinical development removes a critical friction point. This provision

is expected to attract clinical research on certain categories of ATMP in the EU even if it

is not possible to quantify the precise impact at this stage.

An empowerment which would allow the Commission to amend the ATMP Regulation

via delegated acts, in order to amend the definition of tissue engineered products will

future‑proof the ATMP framework by allowing to take into consideration technical and

scientific advancements in the field of ATMPs. The need for such adaptations is

underscored by concrete cases. For example, an acellular tissue-engineered vascular graft

intended for urgent revascularisation in severe arterial injury has faced 18 years of

classification uncertainty in the EU. Its acellular nature excluded it from the existing tissue-

engineered product (TEP) definition. Meanwhile, the FDA approved the same product,

demonstrating how regulatory rigidity can drive innovation away from Europe.

Both measures are expected to lower operational costs by removing non‑value‑adding

regulatory steps, potentially removing a burden of 0.15-0.3 FTE-years per clinical trial

application, and reducing uncertainty. Together, they speed the transition from research

to clinical development, particularly for SMEs, while making the EU a more competitive

and predictable environment for ATMP innovation.

Functioning of the internal market and competitiveness: The impact of streamlining

Regulation (EU) No 536/2014, in conjunction with modifications to ERA requirements for

investigational GMO-ATMPs and amendments to ATMP definitions, is expected to be

profound and multifaceted concerning internal market dynamics and EU competitiveness.

By exempting certain investigational ATMPs containing GMOs from full ERA

submissions, this change not only facilitates faster progression from trial initiation to

product development, but also significantly influences sponsors’ decisions to conduct

clinical trials in Europe. Consequently, the EU could emerge as a leading destination for

biotech investment, accelerating the development of innovative therapies. Future-proofing

ATMP definitions allows EU to enhance its scientific and technological leadership in

biotechnology and regenerative medicine, while further cementing its reputation as a

regulator pioneer. The reform is also expected to attract more high-risk capital, support the

growth of more than 580 ATMP companies across over 20 Member States, and help

maintain EU competitiveness.

Public health and safety: The Biotech Act targets procedural simplification rather than

substantive relaxation of safety standards. The ERA exemptions only apply to ATMPs

which fall into clearly defined categories with no or negligible risks. Safety oversight is

maintained through the review of sponsor declarations within the clinical trial assessment

process, comprehensive risk–benefit evaluation and long-term follow-up requirements.

51

By reducing unnecessary procedural delays and shortening assessment timelines, the

measures are expected to facilitate earlier initiation of CTs and potentially earlier access

for EU patients to safe, effective and often transformative advanced therapies.

Furthermore, the ability to adapt ATMP definitions to scientific progress helps reduce the

risk of regulatory blind spots for emerging technologies, ensuring that innovative

therapies remain subject to the most appropriate regulatory oversight.

Table 3. Summary assessment of the effects due to the intervention n°3

Policy measure COB Admin CTI Int mar I&R PA H&S

1. targeted ERA

exemption

+ 0 + + + 0 0

2. revised definition + + + + + 0 0

5.1.4 Intervention n°4: Targeted regulatory reform of clinical trials174

The amendments to the CTR aim to shorten authorisation timelines, strengthen

collaboration between Member States, and enhance regulatory efficiency without

compromising safety, quality, or ethical standards.

The proposed amendments articulate around five pillars:

(i) Faster authorisation procedures

Authorisation timelines for initial clinical trial applications are reduced from 106 to 75

days, or from 75 to 47 days, where no additional information is requested from the sponsor.

For substantial modifications175, timelines are reduced from 96 to 47 days or from 64 to 33

days where there is no additional request for information. The additional 50-day

assessment period for ATMPs is removed.

(ii) More predictable and efficient authorisation procedures

The shorter authorisation timelines are supported by procedural changes to increase

efficiency, cooperation, and consistency across Member States. The reporting Member

State (RMS) leads the evaluation of Part I176 of the trial application, with other Member

174 Regulation (EU) No 536/2014, OJ L 158, 27.5.2014, pp. 1–76. ELI: http://data.europa.eu/eli/reg/2014/536/oj. 175 Substantial modifications as defined in the proposed amendments to Regulation (EU) No.536/2014, Art. 2 mean ‘any

change to any aspect of the clinical trial which is made after the notification of a decision referred to in Article 8 in at

least one Member State concerned and which is likely to have a substantial impact on the safety or rights of the subject

or on the reliability and robustness of data generated in the clinical trial.’ 176 The application dossier for the authorisation of a clinical trial in the EU is split into Part I and Part II. Part I contains

overarching scientific, medical, and technical information about the investigational medicinal product (IMP), the clinical

trial design and participants’ safety. The RMS leads the assessment of Part I. Part II contains the national, ethical, and

national information (e.g., informed consent, recruitment related information, site and investigator suitability, insurance)

assessed separately by each Member State concerned.

52

States concerned providing complementary considerations. For initial applications, the

validation of Part I will be carried out solely by the RMS without coordination and

consolidation steps with the other Member States concerned. It is also allowing the RMS

to initiate the assessment already during the validation phase, shortening the overall

assessment time by two weeks. The ethics committee of the

RMS will be mandatorily engaged in the review of Part I to ensure that the ethical review

is fully integrated with scientific and regulatory assessments. The scope of the ethical

review and the mandate of the Member States concerned in the assessment are clarified.

Maximum timelines are designed to allocate seven day-periods per assessment step,

ensuring deadlines do not fall on weekends and thereby avoiding automatic extensions.

This approach ensures predictability in timelines for sponsors and regulatory bodies.

Substantial modifications to Part I and/or Part II for changes that may significantly affect

participants' rights, safety, or data reliability can be assessed in parallel, with significantly

shorter assessment times.

Efficiency is further improved through the establishment and re-use of a single

investigational product core dossier containing documents common to all trials with the

same investigational medicinal product (IMP), a mandatory use of harmonised EU

templates, and by shifting translation checks from Part I to Part II. An upgraded EU portal

enhances communication between sponsors and assessing Member States during

assessments.

The amendments also encourage participation of vulnerable populations in clinical trials,

by carefully weighing the potential risks and benefits of their exclusion versus inclusion in

trials. Additionally, women who become pregnant or start breast-feeding during their trial

participation will not be automatically excluded from the trial. Their continued

participation will instead be evaluated by assessing the risks and benefits involved.

(iii) Context-specific clinical trial authorisation procedures

The Regulation proposal sets out three tailored authorisation procedures to streamline

regulatory requirements to the specific context and risks of the clinical trial.

1. It introduces a single assessment procedure for combined studies involving both

medicines and medical devices or medicines and in vitro diagnostic medical

devices, rationalising the relevant provisions of three EU regulations (i.e. CTR,

MDR, and IVDR).

2. It introduces a fast-track authorisation procedure with simplified requirements for

multinational clinical trials to ensure availability of crisis-relevant medicines to

prevent/contain health threats, provide timely treatment options, or facilitate

diagnosis in the context of an emerging or a recognised serious cross-border threat

to health at Union level177. The procedure will be automatically applicable in a

recognised serious cross-border threat to health at Union level. The Commission

would be further empowered to define, through implementing acts, transparent

criteria and a process for declaring the procedure applicable in the context of an

emerging serious cross-border threat to health.

177 In accordance with Article 23 of Regulation (EU) 2022/2371 (see footnote 40, page 9).

53

3. It strengthens the risk-proportionate approach by more precisely aligning

regulatory requirements with the level of risk associated with a clinical trial. A new

risk category, minimal intervention trials, is introduced to cover post-marketing

authorisation trials, which will require ethical review only for the authorization

itself.

(iv) Innovation and Harmonised Data Governance

The proposal facilitates the integration of AI and digital tools (e.g. e-informed consent),

reinforces direct shipment of IMPs to patients and improves trial design, execution and

oversight. It introduces regulatory sandboxes to test innovative approaches and establishes

a single legal basis under the requirements of the GDPR for processing of personal data to

provide legal clarity and streamline multinational trials.

(v) Governance and Enforcement

The proposal strengthens EU governance by improving cooperation among Member

States’ authorities and Ethics Committees by expanding the role for the Clinical Trials

Coordination and Advisory Group. National competent authorities and ethics committees

must have sufficient personnel and resources to perform assessments. National competent

authorities gain stronger inspection powers, including unannounced and joint inspections,

which may be delegated to other Member States or agencies. Harmonised guidelines

standardise IMP distribution oversight. The Commission can verify compliance within the

EU and assess whether clinical trials outside the EU meet good clinical practice and ethical

standards.

Expected impacts:

The policy measures outlined above aim to make the EU more attractive to sponsors, by

reducing administrative burden and shorten time to market, thereby increasing the number

of clinical trials conducted within the EU. The impact of the regulatory changes is assessed

both quantitatively and qualitatively through a two-step procedure (Figure 6). First, the

expected effect on the total number of EU-based clinical trials resulting from the

simplification and acceleration of the authorisation process and conduct of clinical trials is

examined. Second, the broader economic implications and public health benefits arising

from the increased number of clinical trials conducted across Member States are assessed.

Figure 6. Schematic illustration of the assessment of possible impacts of the proposed

regulatory changes to the Clinical Trials Regulation

Step 1 - Expected impact on the number of clinicals run in the EU

54

Faster, more efficient and better coordinated procedures, as well as the uptake of AI and

digital tools are expected to increase the number of clinical trials conducted in the

EU/EEA178,179 and encourage participation by a wider set of Member States. This can

reduce current concentration in a few jurisdictions, level the playing field for SMEs and

support a more integrated EU clinical research market.

According to one survey with sponsors180, the anticipated increase of clinical trial

authorisations for selected individual policy changes lies between 5% and 28%, and by

32% for a bundled sub-set of policy measures included in the proposed Biotech Act181.

Another study, based on limited empirical evidence, suggests that the proposed revision of

the CTR could increase the number of clinical trials by on average of 10%182. In addition,

sponsors believe that the regulatory change will foster multinational trials in the EU with

a broader geographic scope (see Figure 7).

To quantify the economic and public health impacts of the regulatory change, we assume

that the number of clinical trials will increase by 10% to 30%. These estimates draw on

two separate studies183. The lower bound reflects the average projected increase in clinical

trials of 10%. This estimate also aligns with the ACT EU target of having additional 500

multinational clinical trials over the next five years184. Meanwhile, the upper bound is

derived from survey responses collected from sponsors as part of the second study185. The

range was selected to reflect the differing findings of the two studies, while accounting for

the respective strengths and limitations of each. The wide disparity in these estimates

highlights the challenges in assessing the reform’s impact on clinical trial activity, given

data limitations and inherent uncertainties about future developments.

178 Regulatory Framework Study (forthcoming) 179 Between January 2022 and December 2025, on average 2,484 new trial applications were submitted per year. This

includes the transition period to the Clinical Trial Regulation which went from 31 January 2022 to 31 January 2025.

Source: EU clinical trials during the 3-year CTR transition period. 180 A survey with 48 sponsors, among those commercial sponsors, was conducted. It is to note that not all respondents

replied all questions. For further information, see Regulatory Framework Study (forthcoming) 181 In the survey, sponsors were asked to assess the impact of selected policies individually on the expected change in

clinical trials. For the policies comparably to the changes included in the proposal of the Biotech Act the impact of the

single measure lies between 5% and 28%. It is to note that the survey replies are subjective assessment from the

respondents considering the difficulties that come along with projecting the future. Nevertheless, these figures can be

used as indicative evidence. For further information see Regulatory Framework Study (forthcoming). 182 Rapid Assessment Scenario Study (forthcoming). The study, based on limited empirical evidence, distinguishes

between two hypothetical scenarios regarding the potential impact of the BioTech Act on the projected number of clinical

trials in the EU. In the first scenario, a moderate increase in the number of clinical trials by 4% to 8% is anticipated. This

is attributed to improved efficacy and attractiveness of performing clinical trials in the EU, driven by increased domestic

uptake among sponsors already operating within the region. The second scenario assumes that, in addition to increased

domestic uptake, sponsors relocate clinical trial activities from other regions to the EU/EEA as a result of the reforms in

the Biotech Act, leading to an estimated increase of 8% to 16%. As the Biotech Act is expected to simplify authorisation

processes and the conduct of trials for sponsors, it is considered plausible that some sponsors may relocate their clinical

trials to the EU following the amendments of the Regulation. Therefore, the average of both scenarios is used as a

benchmark for the lower bound.

183 Studies Regulatory Framework Study (forthcoming) and Rapid Assessment Scenario Study (forthcoming). 184 For further information, see: New targets for clinical trials in Europe | European Medicines Agency (EMA). For the

purposes of this analysis, the same 11.1% increase is also assumed for mononational clinical trials. For Q1/2026 the KPI

has been evaluated for the first time. This quarter, 19 additional multinational trial applications have been submitted. If

extrapolated annually, this would represent an 8% increase in trials without any changes to the regulatory framework. 185 Regulatory Framework Study (forthcoming)

55

Figure 7: Survey replies from sponsors to the following question: “To what extent

would each of the following policies expand the geographic scope of multinational clinical

trials in the EU, by increasing the number of participating Member States in a clinical

trial in the EU?”186

Step 2 – Economic and Public Health Impact

The subsequent section assesses the expected impact of the increase in the number of

authorised clinical trials on economic and public health outcomes. Economic impacts are

evaluated along the following dimensions: competitiveness, gross-value added (GVA),

work productivity, employment, R&D spillovers, a simplified cost-benefit analysis for

sponsors, and relevant EU and national actors involved. The public health impact is

measured by the expected change in number of enrolled participants and the composition

of the participant populations.

(a) Economic impacts

Survey responses from sponsors and Member State representatives187, including national

competent authorities, ethics committees and ministries, suggest that a subset of policy

186Regulatory Framework Study, forthcoming. In the survey, sponsors were asked to assess the impact of selected policies

individually. The policies presented in this figure are those most closely to the ones included in the Commission proposal

adopted on 16 December 2025. Please note that there is still some slight deviation between the described policy scenarios

assessed in the survey and the policy changes proposed in the Commission proposal. 187 For further information, see report Regulatory Framework Study, forthcoming. The policies presented in this figure

are those most closely to the ones included in the Commission proposal adopted on 16 December 2025. Please note that

there is still some slight deviation between the described policy scenarios assessed in the survey and the policy changes

proposed in the Commission proposal.

56

measures introduced in amendments to the CTR are expected to strengthen the EU’s

competitiveness (see Figure 8).

Figure 8: Survey replies to the following question “To what extent would the policies

increase/decrease the competitiveness of the EU compared to the baseline in terms of, e.g.

R&D expenditures in the pharmaceutical sector including revenue for healthcare

providers, number of marketing authorisations and patents granted in the EU/EEA, Gross

Value Added in the pharmaceutical sector?188

The economic impact for commercially-sponsored clinical trials is likely to differ from

that of non-commercial/academic ones due to systematic differences in their

characteristics. In particular, 71.5% of applications submitted by commercial sponsors

involve multinational trials, whereas 85.6% of applications submitted by academic

sponsors relate to mono-national trials.189 Academic sponsors are also more likely to

conduct late-phase clinical trials, particularly post-marketing authorisation trials190, which

may entail different cost structures191. These differences suggest that the economic impacts

of commercial and non-commercial clinical trials should be assessed separately.

Between January 2022 and January 2025, commercial trials accounted for 53.1% of all

clinical trials authorised in the EU. Figure 9 illustrates the incremental benefit for an

increase in clinical trials across three economic dimensions, i.e. GVA, R&D spill-over

188 Regulatory Framework Study, forthcoming. In the survey, sponsors and Member State representatives were asked to

assess the impact of selected policies individually. The policies presented in this figure are those most closely to the ones

included in the Commission proposal adopted on 16 December 2025. Please note that there is still some slight deviation

between the described policy scenarios assessed in the survey and the policy changes proposed in the Commission

proposal. 189 EU clinical trials during the 3-year CTR transition period (see p.9). 190 EU clinical trials during the 3-year CTR transition period (see p.26). 191 Fast-track landscape analyses to assess the regulatory clinical trial eco-system in the EU/EEA and in other relevant

regions (forthcoming)

57

and work productivity192 assuming an increase of 10% or 30% in commercial clinical

trials as a result of the legislative changes proposed in the amendments to the CTR. A 10%

increase in clinical trials is estimated to generate approximately EUR 3.6 billion in

economic gains and create roughly 16,500 additional jobs across the EU, while a 30%

increase could result in approximately EUR 10.7 billion in economic gains and 49,500

additional jobs193.

Figure 9. Economic impacts assuming a 10% and 30% increase in commercial clinical

trials194

The value of non-commercial trials on the economy has been recently demonstrated for

some regions and countries, such as the UK195. Due to a lack of sufficiently robust and

comparable data for the EU, this analysis does not attempt to quantify the economic

impacts of the proposed regulatory changes for non-commercial trials. Therefore, the

estimated economic impacts presented for commercial trials should be considered a lower

bound estimate of the overall economic gains associated with the increase in the number

of authorised cinical trials.

192 The GVA measures “the value of output less the value of intermediate consumption; it is a measure of the contribution

to GDP made by an individual producer, industry or sector” (OECD; National Accounts at a Glance 2009 (EN)). R&D

spill-overs measure clinical research activities creating knowledge, products, and processes which can be used by other

companies. Workforce productivity measures how improved treatment options enhance people’s health and thereby

reducing sick days (EFPIA report 2026; the-economic-impact-of-industry-clinical-trials-across-europe.pdf). 193 The values are calculated based on the following assumptions/parameters: (1) between 2022 and 2025 the annual

number of authorised industry commercial trials was 1,509(EU clinical trials during the 3-year CTR transition period);

(2) The reported values in EFPIA 2026 the-economic-impact-of-industry-clinical-trials-across-europe.pdf are used to

calculate incremental effects per trial. (3) There is a linear relationship between the increase in clinical trials and the

incremental benefits. 194 Commission own calculations based on information from EFPIA (2026) the-economic-impact-of-industry-clinical-

trials-across-europe.pdf and EU clinical trials during the 3-year CTR transition period. 195 Frontier Economics The value of non-commercial clinical research | Frontier Economics.

58

The proposed regulatory changes are expected to encourage more non-commercial trials,

particularly minimal-intervention and low-intervention trials, by simplifying authorisation

requirements and streamlining the conduct of trials typically conducted by academic

sponsors196. Survey replies support the assumption that these amendments would reduce

administrative barriers and make academic research easier, including increased availability

of data from comparative trial 197 or the Health Technology Assessment (HTA) procedures.

The primary advantages extend beyond the authorisation stage, encompassing risk-

proportionate safety reporting, more targeted monitoring, and flexible models for the

supply and distribution of investigational medicinal products.

To assess the efficiency of the amendments proposed to the Clinical Trial Regulation, a

simplified cost-benefit analysis has been carried out as part of two supporting studies.

These analyses provide a broad indication of the range of expected cost savings based on

different methodologies.

One study evaluates the impacts using estimates from sponsors and public authorities,

collected through targeted surveys, on expected changes in costs and the number of clinical

trials198. Based on these estimates annual cost savings for setting up and the conduct of

trials are approximately EUR 1.24 billion for a subset of policy measures included in the

Commission proposal. However, it should be noted that response rates for some survey

questions have been low (N<10), which may limit the representativeness of conclusions

on cost patterns. The policy measures assessed are largely aligned with, but not identical

to, those in the Commission’s proposal. Additionally, not all the proposed changes are

captured therein, and those are expected to have a positive effect on clinical trials in

Europe. Important policy changes, such as the introduction of a single assessment

procedure for combined studies, the integration of artificial intelligence, and new structures

for governance and enforcement measures, are not part of the assessment as the survey was

designed prior to the finalisation of the proposed amendments. Therefore, the calculations

can be used as suggestive evidence rather than precise estimates of the cost savings.

The assessment of a second study199 considers the total set of measures included in the

Commission proposal. It estimates direct annual cost-savings for sponsors of

approximately EUR 1.5 billion to EUR 3.1 billion through more effective administration

and faster authorisation procedures and indirect annual savings of equal amounts through

an accelerated conduct of clinical trials. The calculations are based on the assumptions that

the amendments reduce the total costs of a clinical trial by 5% due to more effective

administration, a clinical trial runs on average 2 to 2.5 years, the average costs of a clinical

trial amount EUR 30-50 million and the number of clinical trials remains unchanged. It is

to be noted that the limited data availability on the average costs of a clinical trial may

substantially impact the estimated cost reductions due to the proposed regulatory changes.

196 Over 90% of low intervention trials are conducted by non-commercial sponsors (EU clinical trials during the 3-year

CTR transition period). 197 Regulatory Framework Study (forthcoming) 198 See Regulatory Framework Study (forthcoming) 199 See Rapid Assessment Scenario Study (forthcoming).

59

(b) Expected Impact on Public Health

Clinical trials provide early access to innovative treatments for European patients, up to

five to ten years before the commercial launch. In the case of rare diseases, clinical trials

often present the only available treatment option for patients200. In this context, a crucial

indicator is not only the number of clinical trials conducted but also the number of

participants enrolled in those trials.

Between 2023 and 2025, the estimated average annual number of newly enrolled

participants was 163,643 for commercial trials and 341,632 for non-commercial trials201.

Assuming a 10% to 30% increase in the number of authorised clinical trials, with the

median number of participants per trial remaining constant, this would result in an

additional 7,847202 to 23,540 newly enrolled participants included in commercial trials and

10,381 to 31,145 in non-commercial trials per year.

The increase in the number of participants is expected to contribute to improved patient

health outcomes and quality of life, while at the same time generating more robust evidence

to inform Europe’s treatment guidelines and HTA decisions, and potentially facilitating

faster market authorisation of the medical products under investigation.

In addition to increasing access to innovative and improved treatment options through

clinical trials, the new provisions should also support efforts to reduce health inequalities.

For example, pregnant and breastfeeding women would no longer be automatically

excluded from trial participation, as is the case under the current regulatory framework.

Instead, their participation would be evaluated based on the associated risks and benefits.

Furthermore, the inclusion of vulnerable populations, such as minors and pregnant or

breastfeeding women, is encouraged, provided that the potential benefits of participation

are carefully weighed against the associated risks.

Finally, the anticipated increase in clinical trial activity is expected to foster science,

innovation, and skill development. Conducting clinical trials generates knowledge,

products, and technologies that stimulate further innovation, drive economic activity, and

contribute to the development of a more highly skilled workforce across the sector. These

spillover benefits from R&D extend beyond the returns captured by private investors,

creating broader societal gains. The associated economic impact of these spillover effects

for commercial trials is quantified and presented by the value of the R&D spillover in

Figure 9.

200 See Regulatory Framework Study (forthcoming) and EFPIA (2024) assessing-the-clinical-trial-ecosystem-in-

europe.pdf 201 The data are retrieved from CTIS and represents the estimated mean number of participants by year of clinical trial

authorisation for all initial applications between 2023 and 2025. 202 The calculations rely on the median number of participants in commercial trials (52) and non-commercial trials (78)

for 2023–2025, rather than the mean, to mitigate bias from outliers. This approach yields a more conservative estimate

than using average participant numbers (108 per commercial trial and 257 per non-commercial trial).

60

Table 4. Summary assessment of the effects due to the policy measure

Policy measures COB ADMIN CTI INT

MAR

I&R PA H&S

Accelerated and

streamlined clinical

trial authorisation

procedures

++ ++ ++ + 0/+ 0/+ +

Clinical trial

regulatory

sandboxes

0/+ + + + ++ ++ 0/+

Digital innovation

and harmonised

data governance for

clinical trials

+ ++ ++ ++ + + +

Combined Studies+ + + ++ ++ ++ 0/+

Governance and

enforcement

+ + + ++ 0/+ + ++

5.1.5 Intervention n°5: Targeted regulatory reform of Veterinary Medicinal

Products (VMPs)203

First, the regulatory framework for VMPs containing or consisting of GMOs is

streamlined by exempting from EU GMO legislation VMPs containing or consisting of

GMOs authorised or manufactured in accordance with VMP Regulation, which are to be

assessed solely under the VMP Regulation. Additionally, it is clarified that animals treated

with VMPs do not become, for this sole reason subject to the GMO legislation.

Second, the handling of variations not requiring assessment is simplified:

- For variations not requiring assessment with no impact on the product information,

submissions can be consolidated on a yearly basis.

- For all variations not requiring assessment, confirmation by the competent

authorities is no longer required.

Third, the SPC for biotechnology VMPs treating zoonoses is extended under certain

conditions:

- the product must be developed by means of a biotechnology process as defined in

Article 42(2)(a) of Regulation 2019/6;

- it must be intended to diagnose, treat, or prevent zoonotic diseases;

- it must contain a new active substance distinctly different from any authorised

medicinal product in the EU;

- it must have a mechanism of action distinctly different from existing products for

the same zoonotic disease, with at least equivalent safety and efficacy;

203 Regulation (EU) 2019/6, OJ L 4, 7.1.2019, pp. 43–167. ELI: http://data.europa.eu/eli/reg/2019/6/oj.

61

- and at least one manufacturing step (excluding packaging, quality testing, and

certification) must be performed in the EU.

Fourth, the Regulation proposal establishes a regulatory sandbox framework for

innovative technologies, methods or products related to animal health.

Expected impacts:

The measure related to the VMPs containing or consisting of GMOs delivers

procedural simplification (1-3 month CT application saving; cumulative EUR 5-14.5

million in CTA administrative savings; EUR 560,000 in marketing authorisation dossier

savings over the period 2026-2040) and cross-Member States harmonisation, with a

high-value, zero-cost legal clarification on GMO status of treated animals eliminating

a latent risk. While standard marketing authorisation timelines are unaffected, the

benefit materialises under accelerated/emergency pathways (estimated at 30-60 days for

1-3 products/year). While no measurable increase of marketed products is expected, the

measure contributes to preventing the progressive offshoring of the innovation process

to other jurisdictions where next generation veterinary biotechnology would be

developed and trialled.

The proposed SPC extension for VMPs is a low to medium impact signalling instrument.

No near-term commercial benefit is expected due to the virtual non-existence of veterinary

biosimilar competition and the fact that existing data protection periods already outlast

patent/SPC terms. Therefore, the impact of this measure is not appropriately captured

through quantification of direct commercial or cost effects, because the primary function

of the SPC extension is not to deliver measurable near-term revenue protection but to serve

three signalling and future-proofing purposes:

1. Policy signalling: The measure communicates EU institutional commitment to

veterinary biotechnology innovation addressing zoonotic diseases, potentially

influencing long-term R&D allocation decisions at the margin.

2. Future-proofing: Should veterinary biosimilar competition eventually

materialise at scale (plausibly from the mid-2030s onward), the mechanism

would already be in place, avoiding the need for reactive legislative intervention.

3. EU manufacturing incentive: The requirement that at least one manufacturing

step be performed in the Union introduces an explicit industrial policy lever.

There is no centralised EU database publicly listing how many VMPs have obtained

SPCs, and national patent office data are not often broken down by human vs. veterinary

use. However, based on data provided by the EMA, out of the 28 biotechnology VMPs

for zoonotic diseases approved between 2010 and 2025, only 8 fulfilled all eligibility

criteria for the SPC extension. On average, this is 1 product for each 2 years. A forward-

looking estimate would foresee an average of 3 eligible products per year over 2026-

2040, based on the retrospective eligibility analysis (8 out of 28 over 16 years ≈ 2/year)

and adjusted upward modestly to reflect the growing share of biotech vaccines in the

pipeline. The targeted SPC extension is designed to be cost-neutral for the EMA. Given

the narrow scope of the measure, the EMA is expected to handle a very low volume of

applications.

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The possibility of using a regulatory sandbox for animal health innovation provides

a structured framework to facilitate the development and marketing or use of products,

methods or technologies that are not regulated under EU legislation. Expected

utilisation is modest (∼1 sandbox per five years; 2-3 established over 2026-2040). Its

primary value is qualitative: pathway creation, evidence generation for adaptive

regulation, and investment signalling. The proposed measure creates new

EMA/Commission responsibilities (application assessment, implementing acts,

reporting).

Finally, the reduction of burden for the handling of variations not requiring

assessment delivers the most quantifiable and immediately realised benefits with a

central estimate of EUR 22.5 million present-value cumulative staff cost savings (2025-

2040) and 45-55% reduction in submission events. This will result in approximately

EUR 2.5 million/year in fee savings for applicants. The removal of the confirmatory

step reduces the national competent authorities workload. It creates a one-off IT cost

for EMA of EUR 150,000-300,000. The measure is a purely administrative reform and

has no impact on safety or efficacy. The proposed measure has received positive

feedback from industry.

Table 5. Summary assessment of the effects due to the intervention n°5

Policy measure COB Admin CTI Int mar I&R PA H&S

1. GMO exemption + + + + + 0 +

2. Variations

revision

+ ++ 0 0/+ 0 + 0

3. SPC extension 0/+ 0 0/+ 0 0/+ 0 0

4. Regulatory

sandbox

0/+ 0 0/+ 0 + - 0/+

5.1.6 Intervention n°6: Targeted regulatory reform of the substances of human

origin (SoHO) framework204

First, the SoHO regulatory status consultation procedures is streamlined by

empowering the Commission to adopt implementing acts establishing binding time limits

for regulatory status consultation processes within the SoHO framework.

Second, the Regulation proposal establishes a regulatory sandbox framework for SoHO,

enabling Member States to create time-limited controlled environments for developing and

204 Regulation (EU) 2024/1938, OJ L, 2024/1938, 17.7.2024. ELI: http://data.europa.eu/eli/reg/2024/1938/oj.

63

testing innovative SoHO products, services, processes, or substances that cannot yet fully

comply with standard regulatory requirements.

The new regulatory sandbox framework allows a Member State (or several jointly) to set

up a regulatory sandbox upon a substantiated request from a SoHO entity, providing a

time-limited controlled environment to facilitate the development and testing of innovative

SoHO products, services, processes or substances under the supervision of one or more

competent authorities. Two eligibility conditions should be met: (a) the innovation is

expected to contribute distinctively to SoHO safety, quality, including effectiveness, or to

significantly improve patient access to treatment; and (b) applying the SoHO Regulation’s

requirements would impede or significantly delay development due to scientific or

regulatory challenges inherent to the innovation.

The regulatory sandbox is an evidence-generating mechanism: it should enable assessment

in a real-world environment under strict regulatory supervision, producing the data needed

to demonstrate safety and quality, including effectiveness, in view of subsequent

distribution decisions. Derogations from the SoHO Regulation may be included, but only

if clearly described, strictly necessary, and justified in a sandbox plan. Derogations may

take the form of adapted, enhanced, waived or deferred requirements. Sandboxes cannot

derogate from the SoHO Regulation’s standards on voluntary and unpaid donation.

Operationally, activities must follow a sandbox plan developed by the SoHO competent

authorities, informed by data and consultations with the innovation’s developers, and

specifying participants and roles; which SoHO requirements cannot be complied with and

the resulting derogations and adaptations; risk-mitigation measures; the sandbox duration;

and the monitoring framework. The competent authorities must consult the SoHo

Coordination Board (SCB) where appropriate, and the SCB is tasked with supporting and

fostering a common approach. The SCB may also collaborate with the Foresight Panel for

Emerging Health Innovation established by the Biotech Act, linking sandbox practice to

upstream horizon-scanning and cross-framework learning.

The proposed amendments create a structured route for SoHO innovations, which cannot

yet be developed in full compliance with the SoHO Regulation, or if compliance would

impede or significantly delay development due to inherent scientific or regulatory

challenges. The proposed amendments also formalise cross-authority collaboration and

information exchange, which improve transparency and comparability across Member

States while retaining core safeguards.

A SoHO preparation resulting from an innovation developed as part of a regulatory

sandbox may be distributed for human application only where authorised in accordance

with Article 38(1) of Regulation (EU) 2024/1938. The purpose of the regulatory sandbox

is therefore to make authorisation feasible by enabling supervised testing and evidence

generation in novel or complex cases where applying the current regulation’s requirements

would impede or significantly delay development. These are, for example, new

technologies for which there are currently no fitting technical safety and quality

requirements by the Expert Bodies (EDQM, ECDC); new technologies that are only

partially covered by SoHO rules.

64

Sandbox-eligible cases would be a minority of cases which could not be authorised under

the SoHo Preparation Authorisations (SPA) model established in the 2024 SoHO

Regulation, but would bring in high extra value. Expert interviews suggested that SoHO

products eligible for the sandbox route likely represent 5–10% of overall SoHO activities,

i.e. 90-250 eligible cases per year205. Sandbox use cases demonstrate acceptance rate of

between 7-16% of sandbox applications, demonstrating great interest from developers in

the sandbox instrument but limited capacity of the regulators to establish sandboxes206.

Considering the high resource requirements of a regulatory sandbox, we can further

assume that only a share of eligible cases will be pursued. If all eligible cases apply for the

sandbox tool, between 6 and 40 regulatory sandboxes can be established pear year.

Expected impacts:

Since the regulatory sandboxes are a first-of-its-kind instrument, the initial take-up could

be slow, also as, in the first years, most innovations are expected to be well regulated under

the new model for SPA in the 2024 SoHO regulation.

Conduct of business: Regulatory sandboxes offer a pathway for addressing complex cases

that would otherwise not be pursued. We estimate a slowly growing interest in the

regulatory sandbox from SoHO entities, leading to regulatory sandbox requests,

particularly in strong innovation nations and for SoHO innovations where no safety and

quality requirements are prepared by the expert bodies.

Administrative costs on businesses, including SMEs: Regulatory sandbox is expected

to have similar costs to high-risk authorisations (between EUR 1,200 and EUR 6,000 per

patient) due to the need to involve a certain number of data subjects and a thorough

assessment process207. Therefore, while there would not be any extra cost for high-risk

cases, if low- or medium-risk cases are pursued using the sandbox route, the direct cost of

each case will increase. We assume that half of the cases directed to the sandbox route will

be high risk cases and half of the cases will be medium risk cases. Under the low estimate,

the additional cost of regulatory sandbox route for SoHO entities will be EUR 718,500

(under the assumption that six sandboxes are established per year) and EUR 4,790,000

(under the assumption that 40 sandboxed are established per year).

As a positive secondary effect this would allow SoHO entities to engage with authorities

early in an environment that tolerates iterative learning, prototyping, and co-development

of evidence strategies, thereby lowering the volume of redundant work and iterative back-

and-forth that currently inflates administrative burdens.

205 Rapid Assessment Scenario study, assuming that currently, a share of SoHO activities is not pursued for authorisation

due to exceedingly high costs of evidence generation and/or difficulty reaching full compliance. However, this share

could not be estimated. 206 Rapid Assessment Scenario study based on: Medicines and Healthcare products Regulatory Agency. (2025). AI

Airlock sandbox pilot programme: Report. UK Government.

https://assets.publishing.service.gov.uk/media/68ee1fb88427701993d5e02c/AI_Airlock_Sandbox_Programme_Report.

_Final.pdf and Commission nationale de l’informatique et des libertés. (2022). Dossier de presse : Bilan 2021 et enjeux

2022. https://www.cnil.fr/sites/default/files/atoms/files/dossier_de_presse_cnil_bilan_2021_et_enjeux_2022_vf.pdf. 207 Rapid Assessment Scenario Study, based on assumptions provided by the European Commission.

65

Competitiveness, trade and investment flows: By providing a flexible, but coordinated

and proportionate pathway for novel SoHO activities, regulatory sandboxes will reduce

uncertainty and transaction costs for innovations. This could improve EU attractiveness

for certain R&I projects. Particularly strong competitiveness effects can be expected in the

forerunner countries with strong innovation potential. Such effects will come from two

sources. First, projects that are authorised thanks to sandbox evidence, which would not be

pursued otherwise.

Second, under the assumption that sandbox route allows for a responsible approach with

limited or more flexible types of appropriate evidence, and for less authorisations to be

obtained, innovative SoHO activities will become more attractive for SoHO entities.

Functioning of the internal market and competition: The regulatory sandboxes might

have an indirect effect if the outcomes obtained in one Member State are reused in other

Member States when assessing similar innovations. This can in particular be expected

given the central role of the SoHO Coordination Board in supporting and monitoring

sandboxes, including joint sandboxes undertaken by two or more Member States. The

overall approach of open access innovation in the largely public SoHO sector will also

contribute to a fast and harmonized roll-out of novel technologies.

Innovation and research: The regulatory sandboxes provide a pathway to authorisation

and a signal to the R&I stakeholders. As the immediate response to the sandbox measure,

we can therefore expect to see an increase in the actor activity in this segment. These

changes in risk and incentives and the reduction of the administrative burden could attract

more public entities into innovation and stimulate innovation activity in novel, borderline

cases and cases requiring cross-framework coordination.

Innovation in SoHO is continuous, often incremental and largely driven by activity in

public organisations, with knowledge diffusion through publications and professional

societies rather than patents208. In leading Member States, major public hospitals treat

research as a regular part of their activity and are linked to universities and research

institutes. This creates a favourable ecosystem for SoHO innovation, which is nevertheless

dependent on the availability of public and private research grants. However, high

administrative costs deter these actors from innovative and novel SoHO activities.

Controlled testing environments created through the regulatory sandboxes would enable

experimentation under protection from disqualification due to a mismatch with the current

framework. By allowing for adapted standards of regulatory evidence generation,

regulatory sandbox pathway can enable innovative research that might otherwise be

abandoned for fear of regulatory rejection. Therefore, these proposed amendments support

the ‘throughput’ phase of the innovation process. Innovation and research impacts at

Member State level are expected to be positive mainly via risk reduction, faster evidence

generation, increase in academic research, and regulator capability-building, but uneven

across Member States depending on capacity and ecosystem maturity.

208 Rapid Assessment Scenario Study, based on SWD(2022) 190 final.

66

Regulatory sandboxes could be expected to shorten the path from innovation to safe

clinical use, especially where the baseline suffers from uncertain borderlines and divergent

evidence thresholds. In the financial technology area, firms that went through the

regulatory sandboxes had, on average, a 40% shorter time from engagement with the

regulator to market authorisation than similar firms using the standard process. In SoHO,

therefore, gains can also be expected. However, no baseline data is available for

quantification as these gains would be realised in the cases that otherwise would not be

pursued due to difficulty gathering evidence for authorisation.

Public authorities: The addition of the sandbox instrument is expected to expand the

mandate and increase the workload of public authorities in the short and medium term for

the benefit of significant cost reduction in the longer term due to achieved system

efficiency.

To quantify the operational costs of the regulatory sandboxes on public authorities, person-

day cost of the sandbox should be compared with person-day cost of the SPA model, taking

into account both the costs of learning by doing and the cost reduction expected in the

medium term due to cross-Member State learning leading to improved efficiency of

operations when novel SoHO activities are concerned. Furthermore, OECD guidance

indicates that investments are needed for regulators in terms of time, expertise, and

organisational capacity when instituting a sandbox instrument.

These costs would be borne primarily by national competent authorities but also by the

Commission due to (i) the role in supporting the regulatory sandbox activities and hosting

the EU SoHO Platform, and (ii) the engagement of the SCB as a key operational and

consensus-building mechanism. Experts interviewed for this study assessed the role of the

EU-level guidance as high for organisation of SoHO activities on the Member State

level209. Commission-defined principles and formal mandates are essential to stimulate

cross-body collaboration among relevant public authorities within Member States and to

harmonise common national procedures for multi-framework cases.

We calculate the cost of regulatory sandbox for public authorities as follows: 1) assessing

request (no change per risk category), 2) workload of regulatory sandbox (50 person-days)

and 3) assessment of clinical evidence (reduced by 40%). This brings the workload on a

medium-risk case to 75-94 person-days per case (EUR 22,575 – EUR 28,294); and on the

high-risk case to 98-149 person-days per case (EUR 29,498 – EUR 44,849).

Public health and safety: The sandbox instrument grants earlier access to therapies for

patients involved in the clinical evidence collection, before the activity is approved. As

illustrated above, regulatory sandbox has similar evidence requirements as a high-risk

authorisation process. In total, regulatory sandboxes are expected to involve 450-3,000

patients p/a. The impact of such access could be significant in the case when sandboxes

provide evidence generation for SoHO activities that would otherwise not be feasible to

authorise, for example, in the cases of rare diseases or niche treatments. Follow-up

monitoring and assessment should consider whether these patients would have been served

at all if the sandbox route did not exist, since authorisations for sandbox-eligible cases

209 Rapid Assessment Scenario Study, based on stakeholder consultation (interview).

67

would be very difficult to obtain ordinarily. A key condition of sandbox eligibility is a

significant expected public benefit, which further implies that sandboxes will address the

needs that would otherwise not be met.

Longer-term effects are expected to arise due to institutionalisation of cross-Member State

learning and publication of sandbox reports on the EU SoHO Platform. The proposal

constrains derogations to standard SoHO procedures to what is strictly necessary and

requires explicit risk mitigation and monitoring and therefore disallows derogations on

voluntary or unpaid donation standards.

Table 6. Summary assessment of the effects due to the intervention n°6

Policy measure COB Admin CTI Int mar I&R PA H&S

Regulatory sandbox ++ + 0/+ 0 + ++ +

5.1.7 Intervention n°7: Targeted regulatory reform of the Directive on the

deliberate release into the environment of GMOs210

The proposal introduces specific provisions in Part C of Directive 2001/18/EC addressing

the placing on the market of GMMs as or in products other than food and feed with the

aim of creating a tailored, more efficient and streamlined regulatory framework for the

placing on the market of GMMs as or in products, while maintaining a high safety level

for human and animal health and the environment. The proposed provisions relate to the

risk assessment, to the validity of the consent granted for their placing on the market, and

to detection methods applicable to all GMMs. In addition, the proposal introduces the

concept of low-risk GMMs and a specific set of rules for adapted information requirements

and a streamlined authorisation procedure for this subgroup of GMMs to be detailed by

way of Commission delegated and implementing acts. The requirement for post-market

environmental monitoring of low-risk GMMs is equally adapted in the proposal, providing

the possibility to a notifier, based on certain conditions, to propose to omit post-market

environmental monitoring.

Expected impacts:

Conduct of business: The proposed regulatory framework for GMMs as or in products

other than food and feed is expected to improve some framework conditions for companies

being active in the GMM field. By shifting towards more product‑specific risk assessment

criteria, introducing specific modalities for detection methods, granting unlimited validity

for market consents and creating an accelerated pathway for low‑risk GMMs, where

certain data requirements would be waived in consideration of an existing Qualified

Presumption of Safety delivered by EFSA, the intervention should shorten time‑to‑market

and reduce procedural rigidity. This is expected to pave the way for GMM-related consents

for placing on the EU market of GMMs as or in products. Earlier market entry would

210 Directive 2001/18/EC, OJ L 106, 17.4.2001, pp. 1–39. ELI: http://data.europa.eu/eli/dir/2001/18/oj.

68

mitigate income losses from regulatory delays and improve the business case for

investment, particularly for SMEs and start‑ups that are more sensitive to regulatory

timelines and uncertainty.

Administrative costs on businesses (including SMEs): The impacts are expected to be

very positive. While quantitative estimates are lacking for non‑food GMMs, a qualitative

assessment indicates that a more product‑focused risk assessment and a dedicated low‑risk

GMM pathway should substantially reduce the burden associated with preparing extensive

dossiers under the current GMO regime. Streamlined, more predictable procedures, the

unlimited validity of consents and the possibility to waive post‑market environmental

monitoring where justified would lower recurring costs, especially for GMMs considered

to be low risk. This is expected to make compliance more manageable for

resource‑constrained SMEs and start‑ups, to stimulate exploration of novel products and

partnerships between large firms and smaller innovators, and to reduce the incentive to

relocate development activities to jurisdictions such as the US or China with more flexible

GMM frameworks.

Competitiveness, trade and investment flows: The new regulatory framework is

expected to act as an enabler and accelerator. By reducing regulatory costs and uncertainty

and clarifying a route to market for GMMs, the intervention could render more projects

investable, thereby supporting an expansion of the innovation pipeline in sectors such as

biofertilisation, biocontrol, bioremediation, and bioleaching. Over time, this is expected to

translate into a larger portfolio of authorised GMM products and more robust EU‑based

value chains in these areas. The more predictable pathway from laboratory to market would

likely attract additional venture capital and corporate investment and may encourage

non‑EU companies with established GMM products to enter the EU market. The number

and resilience of biotech start‑ups and SMEs operating in GMM‑related domains is

likewise expected to increase, as founders and investors gain confidence that

commercialisation in Europe can realistically be achieved within acceptable timeframes.

However, all these effects would be gradual and path-dependent, unfolding over several

years and dependent on how the regulatory scrutiny process works in practice.

Functioning of the internal market and competition: There are no adverse impacts

expected. The new regulatory framework for GMMs modifies a horizontal framework and

will apply across all Member States and to all economic operators, so no distortions of

intra‑EU trade or competition between Member States are anticipated. The analysis notes

that competition and displacement may arise between GMM‑based products and their

non‑GM counterparts; however, in the absence of concrete evidence and given that many

firms are likely to offer both types of products, no material changes in internal market

functioning or competition patterns are expected as a direct consequence of the new GMM

framework.

Innovation and research: The proposed intervention is projected to have a positive and

potentially substantial effect. By reducing administrative barriers, shortening authorisation

timelines and providing regulatory clarity, the framework could stimulate R&D investment

by universities, research organisations and companies. This is particularly important in the

EU context, where excellent early‑stage biotech research has historically struggled to

translate into scaled‑up applications and competitive firms. A more innovation‑friendly

regulatory environment is expected to improve the EU’s relative position vis‑à‑vis other

69

major innovation regions such as the US and China, increase private funding for

GMM‑related research, and help retain and attract talent in this domain. Over the longer

term, the biotechnology innovation system around GMMs could therefore become more

dynamic, better leveraging Europe’s strong scientific base.

Public authorities and their administrative workload: The effects of the new regulatory

framework for GMMs are difficult to assess. The average effort for national competent

authorities per GMO authorisation of a non‑food/non‑feed GMM would fall. However, the

extent to which burden will be reduced will fall in a wide range, resulting from the fact

that the adaptation of risk assessment (applicable to all GMMs, and expected to go further

for low-risk GMMs) will be case-by-case and may lead to considerable variability of data

requirements. In the most conservative scenario, risk assessment would require roughly

the same amount of data as today, and only a small fraction of products would qualify for

the low‑risk procedure (interviews suggested that national authorities may be cautious in

designating GMMs as low‑risk, based on a precautionary approach and no practical

experience with non‑medical GMM releases), translating in very limited gains for

competent authorities. In less conservative scenarios, the tailoring of risk assessment to

GMMs is expected to deliver efficiency gains for national authorities. In addition, the

harmonisation of criteria for low-risk products will allow the effective use of that

procedure, delivering further efficiency gains and reduction of administrative burden.

Further savings, in the phase following the initial authorisation, would result from the

unlimited authorisation validity and waivers of post‑market environmental monitoring.

These were not quantified and would accrue mainly at national level. At EU-level, the

mechanisms regarding EFSA’s role in resolving disagreements between Member States is

not modified, and the considerations above apply in those instances where -following a

disagreement- EFSA would need to conduct an assessment. Both at national and EU-level,

if application numbers rise significantly under the new framework, total administrative

effort may increase or decrease depending on how many of these applications would have

occurred under the existing regime and on the effective use of the low‑risk pathway.

Public health and safety: The proposed measures are designed to maintain the high

protection standards of the current EU GMO regime while making their implementation

more proportionate to the specific characteristics of GMMs. The intervention does not

lower safety standards or abandon mandatory risk assessment but rather tailors information

requirements and allows for more flexible approaches where risks are low and well

understood. This is expected to reduce unnecessary regulatory burdens without

compromising the high level of protection of human and animal health and the

environment.

At the same time, by enabling the deployment of beneficial GMM applications that are

currently discouraged or displaced to other regions, the new framework could help realise

environmental and sustainability benefits, for instance by supporting more

resource‑efficient agriculture, cleaner industrial processes or enhanced bioremediation. In

doing so, it may contribute to broader EU policy objectives such as the European Green

Deal and the 2030 Agenda for Sustainable Development, while preserving robust

safeguards for health and the environment.

70

Table 7. Summary assessment of the effects due to the intervention n°7

Policy measure COB Admin CTI Int mar I&R PA H&S

Regulatory

framework for

GMMs as or in

products other than

food and feed

+ + + 0 + +/0 0

5.1.8 Intervention n°8: Targeted regulatory reform of the Directive on human

organs intended for transplantation211

The proposal amends Directive 2010/53/EU to reflect technological developments in organ

preservation and processing and to provide EU-wide legal clarity and standards for

innovative practices which aim to improve organ quality and expand transplantation

opportunities.

First, the scope of the Directive is extended to explicitly include the processing of organs

prior to transplantation, with a definition of “processing” being introduced by the proposal,

encompassing any operation involving the handling of organs performed to maintain or

improve the functional status of an organ prior to transplantation.

Second, a specific authorisation regime for organ processing per processing technology

and per transplantation centre is established. A transplantation centre is to submit an

application for authorisation to the competent authorities including a benefit-risk

assessment where scientific evidence and clinical data are available. In the absence of such

evidence and data, e.g. when no other EU transplantation centre has been authorised to

apply the same organ processing technology, a clinical outcome monitoring plan must be

submitted for approval. A clinical outcome monitoring plan must also be submitted for

approval where the benefit-risk assessment identifies a significant risk. The extend of the

clinical monitoring will be proportionate to the risks identified. Detailed rules on the

authorisation procedure are to be established through Commission implementing acts and

guidance on the benefit risk-assessment is to be established by the competent authorities.

Transplantation centres must request the written agreement of competent authorities prior

to making significant changes to authorised processing steps. The competent authorities

have the prerogative to suspend an authorisation where there is reasonable ground to

suspect non-compliance. A central EU list of authorised processing techniques or with an

approved clinical outcome plan is to be established by the Commission. This will serve as

reference point to simplify later authorisations of similar processing technologies used in

other EU transplant centres, and hence to facilitate the roll-out and uptake of the same

processing technology for other centres and authorities.

211 Consolidated text: Directive 2010/53/EU, ELI: http://data.europa.eu/eli/dir/2010/53/2010-08-06.

71

Third, the proposal clarifies coordination with other Union health legislation. Where organ

processing involves medicinal products, medical devices or SoHO preparations, national

competent authorities must verify compliance under the relevant Union frameworks and

cooperate with the corresponding national competent authorities under Directive

2001/83/EC, Regulation (EC) No 726/2004, Regulation (EU) 2017/745 and Regulation

(EU) 2024/1938 to ensure coherent and more efficient oversight.

These amendments aim to provide EU-wide and cross-sector legal certainty, support

innovation in transplantation, and ensure high standards of quality and safety while

facilitating timely clinical uptake of advanced processing technologies.

Expected impacts:

Measure 1 – the enlarged scope is textually modest but legally consequential as the

foundational enabler of Measures 2 and 3. On its own, however, it generates no direct

operational requirements, administrative obligations or supervisory mandates. Its

independent effect operates through a single channel: the provision of legal certainty by

formally recognising organ processing as a regulated activity within the EU legislative

framework. This resolves the legal ambiguity identified in the problem definition and

sends a regulatory signal to transplantation centres and technology developers, but

the substantive operational, administrative, and health impacts materialise only through

Measures 2 and 3.

Measure 2 – on organ processing authorisation regime - is crucial and derives in nearly

all quantified impacts for this intervention area.

The conduct of business is assessed as moderate positive: the framework relates to the

operational model of transplantation centres by introducing a prior authorisation obligation

per centre and per processing technology. However, the net effect is positive because the

certainty channel (removing the legal ambiguity that functions as a structural drag on

adoption) outweighs the compliance channel, yielding an estimated 70-110 additional

programmes with active processing capability and approximately 1,435 additional

transplants per year by 2035.

Administrative costs on businesses are assessed as marginal negative: the per-

application cost is estimated at EUR 11,500-16,750 (Track 1/Track 2), with a cumulative

EU burden of approximately EUR 2.5 million over 2029-2035, costs that are real but

proportionate and partially offset by replacing fragmented and duplicative baseline

compliance arrangements. Moreover, only the first centre in the EU has to complete the

full pathway at the full cost, since subsequent centres can apply a shortened pathway by

using evidence from the central list. This leads to significant administrative savings for the

overall EU transplant community. Further, transitional measures are envisaged to avoid

the authorisation of practices already in place, so that these are not to be re-authorized.

Competitiveness, trade and investment flows are marginally positive: the transparent

authorisation pathway reduces the regulatory risk premium for private investment in organ

processing technologies, but the effect is indirect given the niche character of the market.

The internal market benefits from standardised authorisation procedures that create

mutual trust for cross-border exchange of processed organs, with an estimated 120-250

72

additional cross-border exchanges per year by 2035, while the published list of

authorised operations generates de facto EU-wide convergence of practice.

Innovation and research are moderate positive: the dual-track system provides a

structured pathway for next-generation technologies (Track 2 conditional authorisation),

an estimated 15-36 active monitoring plans generate structured EU-level evidence, and

the “Processing” data field in the Annex creates the taxonomic infrastructure to

disaggregate processing-attributable outcomes.

Public authorities face a marginal negative impact: the transition-phase assessment cost

is approximately EUR 850,000 over three years across the EU, declining to

approximately EUR 60,000-85,000 per year in steady state; the net incremental cost is

moderated by the replacement of ad hoc national arrangements but represents a genuine, if

manageable, expansion of the supervisory mandate.

Public health and safety is the strongest effect, assessed as significant positive: 1,435

additional transplants per year by 2035; 570-945 fewer organ discards; 57-72 waiting-

list deaths averted annually; approximately EUR 158 m in cumulative dialysis cost

savings over 2028–2035; and a structural improvement in safety oversight through the

mandatory benefit-risk assessment and clinical-outcome monitoring mechanisms.

Measure 3 addresses the multi-regulatory-domain nature of organ processing, which

require competent authorities to verify that products used in processing (medical devices,

medicinal products, SoHO preparations) are duly authorised under their respective EU

frameworks, and mandate cross-authority collaboration for the exchange of clinical

outcome data. Its impact profile is narrower and more targeted than Measure 2.

The conduct of business is marginal positive: the cross-framework verification adds a

structured step to the centre’s processing workflow but also brings EU harmonization and

reduces the ad hoc legal uncertainty that centres currently face regarding the permissibility

of specific product combinations.

Administrative costs are marginal negative: the verification dossier imposes a modest

additional documentation requirement, functionally embedded within the Measure 2

application process. However, there is a significant simplification in administration by

other centres, aiming to implement an organ processing step already authorized in other

EU transplant centres, facilitating uptake of novel processes across the EU.

Competitiveness, trade and investment flows are marginal positive: the clearer multi-

domain regulatory landscape marginally improves investment predictability for

manufacturers of perfusates, gene therapy vectors, and other products used across

regulatory frameworks.

The internal market is the principal beneficiary of this measure: the mandatory cross-

authority coordination directly addresses the regulatory silo problem identified in Section

3.2.3 and creates legally binding cooperation obligations that facilitate the acceptance of

processed organs involving multi-domain products across Member State borders.

73

Innovation and research are marginal positive: the mandated exchange of clinical

outcome data between regulatory frameworks generates research-valuable evidence on

multi-domain processing outcomes, contributing to a more coherent EU-level evidence

ecosystem.

Public authorities face marginal negative costs from establishing inter-authority

communication protocols, though Member States with existing cooperation infrastructure

will face limited marginal effort.

Public health and safety benefits indirectly but materially: the cross-framework

verification ensures that all products used in processing meet their respective EU safety

standards, and the mandated data exchange improves pharmacovigilance and device

vigilance for processing-related adverse events, closing a surveillance gap that currently

exists between regulatory silos.

Table 8. Summary assessment of the effects due to the intervention n°8

5.2 Interventions on industrial enablers: measures and expected impacts

5.2.1 Interventions n°9, 10 and 11: Strategic projects, high-impact projects and

ecosystem support framework

The proposed Regulation establishes a comprehensive framework to structure and

coordinate the selection, development and scaling-up of strategic health biotechnology

capacities and projects, encompassing:

(i) the recognition and the support of health biotechnology strategic projects

(Intervention n°9),

(ii) a targeted EU-level framework for high-impact strategic projects

(Intervention n°10)212, and

(iii) an ecosystem support framework (Intervention n°11).

212 The proposal sets out five types of high impact projects. For the purpose of the analysis in this section, two of these

project categories (biotechnology development accelerators - trusted testing or demonstration facilities with state-of-the-

art equipment and staff – and centres of excellence for advanced therapies) are taken into consideration, while three

others (concerning access to finance, AI-enabled biotechnology innovation and biodefence) are considered under the

respective intervention areas, namely Interventions 14, 15 and 17.

Policy measure COB Admin CTI Int Mar I&R PA H&S

1. Enlarged scope 0/+ 0 0/+ 0/+ 0/+ 0 0/+

2. Organ processing

authorisation regime

+ 0/– 0/+ + + 0/– ++

3. Cross-border and

cross-framework

coherence

0/+ 0/– 0/+ + 0/+ 0/– +

74

Together, these measures aim to boost the EU’s competitiveness and resilience in health

biotechnology, by strengthening biomanufacturing capacity, value chains, research and

technology infrastructures in the sector, accelerating innovation and technology

deployment and addressing ecosystem fragmentation through coordinated support

mechanisms.

Strategic projects (recognised by Member States) would benefit from administrative

support (including single points of contact at Member State level), accelerated procedures

(including for permitting, subject to a maximum ten-month deadline, as well as for dispute

resolution and litigation), a public interest status and measures to facilitate access to

funding at national and EU-level. Provisions also proposed support to pro-competitive

collaboration between projects, networks and clusters. High-impact projects (recognised

at EU level) represent a limited flagship portfolio of systemic importance, including

biotechnology development accelerators and centres of excellence for advanced therapies.

These projects benefit from similar support but with priority status, including an

accelerated eight -months permitting timeline and stronger signalling for Union financial

support.

These project-level measures are underpinned by ecosystem support instruments:

(i) a strategic mapping of the EU biotechnology ecosystem to identify capacities,

gaps and investment needs;

(ii) an EU health biotechnology support network with national and regional

antennas to assist innovators in navigating regulatory and funding pathways

and accessing scaling and networking opportunities; and

(iii) a European Health Biotechnology Steering Group to coordinate Member States

and the Commission, facilitate exchange of best practices and ensure effective

implementation for strategic and high impact health biotechnology projects.

The EU Health Biotechnology Support Network is not intended to duplicate existing EU-

level SME support structures, such as the Enterprise Europe Network or future horizontal

instruments under the European Competitiveness Fund. Rather, it operates as a sector-

specific coordination and support layer, building on existing structures where appropriate,

and providing health biotechnology-specific navigation, ecosystem coordination and

cross-border integration functions. In particular, while existing networks may support

firms on general business, innovation or internationalisation aspects, they are not designed

to provide structured support for navigating complex, multi-framework health

biotechnology regulatory pathways. The design of the Support Network is therefore

intended to remain compatible with and complementary to future EU-level SME support

architectures, including the envisaged EU for Business Network, notably by leveraging

existing capacities while ensuring the availability of specialised expertise.

Expected impacts:

Conduct of business and administrative costs: Taken together, the measures are

expected to generate significant positive impacts on conduct of business and administrative

costs for firms, with positive but more incremental contributions to competitiveness,

internal market functioning, innovation and, indirectly, public health and safety. Impacts

on public authorities are expected to be front-loaded but moderate overall due to reliance

75

on existing structures. The principal transmission channels operate at two complementary

levels. At project level, impacts arise from reduced execution risk through more predictable

and coordinated administrative handling, including time-bound permitting (ten months for

strategic projects, eight months for high-impact projects), structured single points of

contact model and facilitated access to finance. At ecosystem level, impacts arise from

reduced transaction and navigation costs, improved access to investors and infrastructures,

and strengthened cross-border collaboration through network and cluster effects.

Uptake is a key uncertainty across all components, therefore the scale of impacts should

be interpreted as proportional to the number and maturity of projects applying for

recognition and to the utilisation of ecosystem support services. This reflects the voluntary

nature of the mechanism and the fact that promoters will weigh the administrative effort

of application against the expected benefits of more predictable administrative pathway

and improved access to support, consistent with observed dynamics in comparable

strategic-project regimes213.

To illustrate the potential order of magnitude, three uptake scenarios can be defined for

each of the project categories. As a calibration point, other EU-level priority-project

frameworks214 have operated at volumes ranging from several dozen to over one hundred

projects, providing a useful order-of-magnitude reference (rather than a direct comparator)

for the potential scale of project pipelines under coordinated policy frameworks. Against

this backdrop, an indicative range for health biotechnology strategic projects could be

framed as: (i) low uptake: around 25-30 recognised projects by 2038, (ii) medium uptake:

around 60-70 projects, and (iii) high uptake: around 100-120 projects. For high-impact

projects, reflecting a limited flagship portfolio, ranges would be: low uptake (six to –eight

projects), medium uptake (12–15), and high uptake (20–25).

Conduct of business: Significant positive impacts are expected through greater

predictability, shorter effective administrative lead times for strategic and high-impact

projects, alongside reduced coordination frictions. Greater clarity and time-bound

procedures are expected to improve planning horizons, milestone sequencing and time-to-

revenue, reduce volatility in project schedules and strengthen firms’ capacity to align

procurement, construction and staffing decisions with a clearer administrative pathway.

Delay and uncertainty remain economically material for capital-intensive investments,

with an indicative benchmark suggesting that regulatory delays of more than 12 months

beyond initial projections have been associated with an average 34% increase in total

development costs, alongside a high incidence of additional funding rounds and some

programme abandonment.

213 See Commission SWD on establishing a framework of measures for strengthening Europe’s Net Zero Industry Act:

COM(2023) 219 final (https://single-market-economy.ec.europa.eu/publications/net-zero-industry-act_en). 214 E.g. projects recognised under Union frameworks with explicit strategic project provisions, such as those established

by the Net Zero Industry Act and the Critical Raw Materials Act, as well as earlier coordinated frameworks such as the

first Union list of energy Projects of Common Interest (PCIs) and Projects of Mutual Interest (PMIs) comprising 166

projects and approved IPCEIs in the microelectronics value chain comprising 100 projects across 14 Member States.

While the scale of such projects is influenced by Member State participation, fiscal capacity and policy priorities, they

remain informative as to the potential scale of coordinated project pipelines. The ranges presented here are therefore

illustrative and adapted to the specific design and incentives of the present measure.

76

For high-impact projects, these effects are reinforced through access to promoter-led

shared late-stage translation infrastructures with cross-border relevance, supporting more

efficient development and scale-up. Impacts can be evidenced through utilisation

indicators such as the number of firms served, including SMEs, the number of service

engagements (e.g. testing, validation and small-batch GMP runs), and utilisation rates,

reflecting improved coordination and access to critical capabilities.

Ecosystem support measures contribute indirectly by improving visibility of strategic

projects, facilitating collaboration and enhancing firms’ ability to navigate the EU

regulatory and funding landscape. While these effects are not directly attributable in

isolation, they reinforce the overall improvement in business conditions generated by the

project-level measures. Overall, once implementation stabilises, a significant share of

recognised projects is expected to complete permit granting within the applicable

timelines.

Administrative costs on businesses, including SMEs: Significant positive impacts on

administrative costs are expected, driven by reduced transaction costs, simplified

administrative interactions and more predictable, time-bound procedures. For strategic and

high-impact projects, reductions arise from fewer parallel interfaces, fewer iterative

information exchanges and greater reuse of existing evidence, supported by single points

of contact and structured administrative facilitation. These effects are expected to lower

compliance costs and administrative burden, with avoided delay costs for capital-intensive

investments constituting the main economic benefit.

For high-impact projects, impacts are more targeted, reflecting prioritised handling and

faster decision-making for a limited number of catalytic projects, reducing schedule

uncertainty rather than generating system-wide burden reductions. Ecosystem support

measures further reduce navigation and search costs, particularly for SMEs and start-ups,

through a single-entry point and improved preparedness for regulatory interactions.

Overall, impacts are expected to be proportionately stronger for SMEs lacking in-house

administrative capacity.

Competitiveness, trade and investment flows: Positive impacts on competitiveness,

trade and investment flows are expected through improved bankability, stronger

investment signalling and reduced time-to-market. For strategic and high-impact projects,

more predictable delivery and prioritised handling are expected to lower risk premia and

improve conversion from planning to financial close, supporting higher investment

mobilisation and leverage, particularly for mature and bankable projects. High-impact

projects are expected to generate stronger effects per project due to their scale, visibility

and systemic relevance.

Ecosystem support measures reinforce these effects by improving access to investors

through structured matchmaking and by reducing delays linked to incomplete or immature

submissions, thereby shortening time-to-market215. Overall investment mobilisation will

215 Evidence from the EIC Business Acceleration Services demonstrates that structured matchmaking can generate

measurable outcomes (over 20,000 meetings, 595 deals, EUR 350 million raised since 2021). On time-to-market, EMA

data indicates that applicant-side clock-stops represent a substantial portion of total procedure time (198 days average vs

77

depend on project maturity and uptake, but the combined framework is expected to

strengthen investment attractiveness and facilitate greater mobilisation of both public and

private capital in the Union health biotechnology sector. Existing Union financing

instruments can also amplify these effects through leverage: where support is backed by

an EU budget guarantee, this can reduce risk for implementing partners and crowd in

additional public and private investment beyond the direct Union contribution.

Internal market: Positive impacts on the functioning of the internal market are expected

through a more visible and comparable pipeline of strategic projects and reduced

information asymmetries for promoters, authorities and investors. Cross-border

recognition for projects located in two or more Member States is expected to reduce

duplicative processes and improve consistency of treatment, supporting more contestable

investment conditions across Member States, while take-up patterns will remain sensitive

to underlying administrative capacity and clustering effects. Internal market effects are

expected to strengthen as uptake increases and the pipeline becomes sufficiently broad and

geographically distributed to improve comparability and transparency across Member

States.

These effects are reinforced by improved cross-border accessibility of infrastructures and

shared capabilities in the context of high-impact strategic projects, facilitating resource

pooling and multi-country collaboration. The Support Network is expected to reduce

fragmentation of support services by providing comparable216 antennas across Member

States. Cluster networks further contribute by structuring cross-border ecosystems,

enabling access to biomanufacturing and research infrastructures and supporting the

formation of cross-border consortia217.

Innovation and research: Impacts are expected through faster and more efficient

translation of research and innovation into industrial deployment, supported by strategic

projects and reinforced by a limited number of high-impact catalytic assets addressing late-

stage bottlenecks. Strategic projects contribute through strengthening biomanufacturing

infrastructures and innovation assets, while high-impact projects further enhance the

number and speed of projects progressing through late-stage development,

particularly for advanced therapies and other complex applications.

These effects are complemented by ecosystem measures, notably cluster networks and

support structures that strengthen research-industry linkages and facilitate cross-border

collaboration, thereby enhancing firm-level innovation capacity and access to shared

infrastructures. Overall, innovation impacts are expected to scale with uptake and portfolio

composition, with the main effect being improved translation and deployment rather than

system-wide shifts in innovation performance.

204 days assessment time in 2023), with 42% of applicants requesting extensions due to immature data. By helping

SMEs come better prepared to interactions with regulatory bodies, the Support Network could address submission

readiness gaps that contribute to these delays. 216 This comparability is ensured through common selection criteria set by the Commission, standardised service

functions, and EU-level coordination via the Steering Group and strategic mapping, which together support consistent

service delivery across Member States. See Rapid Assessment Study – forthcoming – for further elaboration. 217 Evidence from the ECCP Cluster Panorama and sector comparators (e.g., Silicon Europe with 2,500+ companies)

supports the potential of cluster structures to facilitate cross-border consortia.

78

Public authorities: They are expected to be front-loaded mainly due to process design,

workload reallocation and coordination needs to operate single points of contact and

provide structured support, as well as participation in governance and coordination

structures. In many Member States, single points of contact may be established by

designating or adapting existing administrative coordination mechanisms rather than

creating entirely new structures, which may reduce upfront costs. Over time, efficiency

gains are expected as procedures standardise, and administrative experience accumulates.

Incremental impacts attributable specifically to the high-impact designation are expected

to be limited and concentrated in selection, monitoring, coordination and reporting for a

limited flagship portfolio, without duplicating cost drivers associated with general

permitting operations and routine administrative facilitation. Administrative workload will

scale with the number of recognised projects and monitoring cycles required.

The intervention also introduces additional obligations for Member States, including

participation in the Steering Group, data provision for ecosystem mapping and facilitation

of support network activities, but these are expected to build on existing structures,

resulting in marginal set-up costs. Comparable initiatives (NZIA, CRMA) estimate 1–2

FTEs for one-stop shop functions and around two FTEs for governance participation.

These initial obligations are expected to yield efficiency gains over time, as Member States

gain access to a systematic evidence base and coordination forum that should improve

national decision-making and reduce duplicative investments. At EU-level, technical

assistance appropriations of approximately EUR 2.6 million annually (EUR 18.4 million

over the MFF period) cover relevant coordination functions.

Public health and safety: Impacts are expected to be positive but indirect, mediated by

the realised project portfolio and the extent to which faster delivery translates into earlier

EU-based capacity for strategic products and a contribution to supply resilience outcomes.

The scale of both administrative workload and resilience-relevant capacity effects is

expected to increase with uptake, subject to project mix and implementation performance.

For high-impact projects, the core impact pathway will be potentially faster, safer and more

efficient development of innovative therapies, notably advanced therapies, supported by

improved access to specialised testing, validation, small-batch GMP and quality control

services and, where relevant, links to data and digital infrastructures.

Impacts are expected to materialise over the medium term and remain conditional on

uptake by developers and manufacturers, as well as on broader regulatory, reimbursement

and health system conditions affecting downstream patient access. Ecosystem support

measures are not expected to have direct effects but may indirectly reinforce these

outcomes by facilitating collaboration and improving system preparedness.

The tables below provide an illustrative, scenario-based quantification218 of the expected

impacts by 2038 under three uptake cases for the recognition and support framework for

strategic health biotechnology projects (Table 9) and for high impact health biotechnology

projects (Table 10) for each impact category. Impacts should be interpreted as orders of

218 See Annex 7 and relevant sections of the Rapid Assessment Study – forthcoming for further elaboration on the

calculations of impacts

79

magnitude and as broadly proportional to the number, maturity and operationalisation of

recognised projects over the period.

Table 9. Illustrative uptake scenarios and order-of-magnitude impacts for strategic

health biotechnology projects

Impact

category

Summary

assessment of

the effects due

to the policy

measure

Key indicators expected evolution under different project uptake

scenarios

Low uptake (25-30

projects)

Medium uptake

(60-70 projects)

High uptake

(100-120

projects)

COB ++ Projects completing permit

granting within 10 months:

~18-26

~42-60 ~70-102

Admin ++ Avoided delay costs

(cumulative): ~EUR 90-

410 million

~EUR 214-952

million

~EUR 357-

1,632 million

CTI ++ Total investment mobilised

(cumulative): ~EUR 6-12

billion

~EUR 15-28 billion ~EUR 25-48

billion

Int mar + Cross-border projects (≥2

Member States): ~3-6

~6-14 ~10-24

I&R + Projects with material

R&I or innovation

infrastructure outputs: ~5-

9

~12-21 ~20-36

PA 0/+ Recognition decisions per

year (average): ~2-3;

indicative single point of

contact capacity: ~0.5-1

FTE

~5-6; ~1-2 FTE ~8-10; ~2-3

FTE

H&S + Capacity-relevant strategic

deployments: ~8-15

~18-35 ~30-60

80

Table 10. Illustrative uptake scenarios and order-of-magnitude impacts for high

impact strategic health biotechnology projects

Impact

category

Summary

assessment of

the effects due

to the policy

measure

Key indicators expected evolution under different project uptake

scenarios

Low uptake (6-8

projects)

Medium uptake (12-

15 projects)

High uptake (20-25

projects)

COB ++ Shared-capability

throughput: ~60-120

firms/year, ~120-480

engagements/year

~120-360 firms/year,

~240-1,440

engagements/year

~240-600 firms/year,

~480-2,400

engagements/year

Admin ++ Avoided delay costs

(cumulative): ~EUR

20.4-85 million

~EUR 51-204 million ~EUR 91.8-340

million

CTI + Total investment

mobilised

(cumulative): ~EUR 2-

6 billion

~EUR 4-12 billion ~EUR 6-20 billion

Int mar + Cross-border users

supported: ~12-48

firms/year

~24-144 firms/year ~48-240 firms/year

I&R + Clinical trial

applications linked to

capability layer: ~4-

8/year

~8-24/year ~16-40/year

PA 0/+ Incremental

workload: ~6-8

recognition decisions

plus monitoring

cycles, limited multi-

country coordination

~12-15 decisions plus

monitoring, moderate

coordination

workload

~20-25 decisions

plus monitoring,

higher coordination

workload but still

bounded by

portfolio design

H&S + Therapy programmes

supported with

improved

development pathway:

~2-4/year

~4-12/year ~8-20/year

81

Table 11. Summary assessment of the effects of Intervention n°11: Health

biotechnology ecosystem support framework

Policy intervention COB Admin CTI Int Mar I&R PA H&S

Ecosystem support

measure

0 ++ + + + - 0

5.2.2 Intervention n°12: Biosimilars competitiveness framework

The proposal includes two measures focusing on biosimilars:

First, it proposes the development and update of EMA guidelines on tailored and risk-

proportionate regulatory approaches for biosimilar development, reflecting manufacturing

and analytical testing advances. Most importantly, the guidance will set out the criteria and

provide for the potential reduction of clinical data requirements for biosimilar development

and approval without affecting quality, safety and efficacy. The revision would be guided

by the assessment and conclusions of the reflection paper on tailored clinical approach in

biosimilar development by EMA and the CHMP Biosimilar Medicinal Products Working

Party (BMWP), published on 27 March 2026219. The reflection paper concludes that “a

tailored approach for clinical development of biosimilar candidates is possible.

Comparative Efficacy Studies (CES) are no longer expected to be required for approval of

biosimilars that can be thoroughly characterised using state-of-the-art analytical methods

and have demonstrated similarity in physicochemical and functional properties”.

Comparative clinical pharmacokinetics/pharmacodynamics (PK/PD) studies can in this

context provide supportive safety and immunogenicity data. Over the past three years,

applications concerning monoclonal antibodies and fusion proteins have represented more

than 90% of all biosimilar marketing authorisation applications (see Annex 5 - additional

background on the sector and problem definition). The proposed measure is therefore

expected to have a broad practical impact, as it applies to the majority of current and future

biosimilar development programmes.

Second, it proposes the establishment of a framework for the recognition and the support

of health biotechnology strategic projects focused on biosimilar research, development,

manufacturing and marketing authorisation. The support package outlined in intervention

n°9 applies to these projects. Furthermore, the proposed measure promotes international

cooperation between economic operators and biotechnology clusters active in the area of

biosimilars, including in the context of health biotechnology strategic projects.

The two measures are complementary and the intervention logic goes as follows: The EMA

guidelines are expected to reduce the evidentiary burden and associated cost and time of

biosimilar development, thereby lowering barriers to market entry. Simultaneously,

biosimilar strategic project recognition aims to provide administrative, financial, and

permitting support for biosimilar manufacturing and development projects within the EU.

219 Reflection paper on a tailored clinical approach in biosimilar development.

82

Furthermore, eligibility criteria for biosimilar strategic projects enable projects developing

analytical methodologies that reduce clinical data needs to qualify for support under the

measure, creating a feedback loop between regulatory modernisation and industrial

investment.

Expected impacts of measure 1: update and development of EMA guidelines

Conduct of business: If, following EMA guidelines, CES requirement was waived for

biosimilar mAb products where analytical similarity is comprehensively demonstrated,

developers could reduce direct Phase III clinical trial costs by an estimated EUR 19–26

million per product220, with a broader range of EUR 14–46 million across all trial types221.

Clinical development accounts for approximately 57% of total biosimilar development

costs222, with the CES representing the single largest component.

Of the 27 biosimilar marketing authorisation applications (MAAs) resolved in 2024223,

approximately 24 concerned monoclonal antibodies or fusion proteins, the product classes

for which CES have historically been required (see Annex 5)224.

On this basis, three scenarios are considered regarding the uptake of a tailored

development approach including CES waivers.

An estimated CES cost of EUR 19–26 million per product for monoclonal antibody and

fusion protein biosimilars is used to estimate the gross annual cost savings for industry.

Residual clinical requirements are expected to persist. Comparative PK/PD studies

(estimated at EUR 5.7–7.8 million per product) will remain necessary for all biosimilars,

and immunogenicity assessment will continue to be required, particularly for antibody-

based products. Accounting for these residual costs, total net savings are assumed to be

reduced by approximately 30%225.

In the near term (2025–2030), assuming 25–45 biosimilar marketing authorisation

applications (MAAs) per year, with approximately 90% relating to monoclonal antibodies

and fusion proteins, and that 50–75% of these would benefit from a tailored development

approach including a CES waiver, the gross annual cost savings for industry are estimated

at EUR 214–790 million.

220 Ranbhor, R., & Kulkarni, P. (2026). Net present value impact of FDA's Phase 3 waivers on monoclonal antibody

biosimilar development programs. Biosimilars and Targeted Therapy. https://www.dovepress.com/net-present-value-

impact-of-fdas-phase-3-waivers-on-monoclonal-antibod-peer-reviewed-fulltext-article-BTT. 221 Moore, T. J., Mouslim, M. C., Blunt, J. L., Alexander, G. C., & Shermock, K. M. (2020). Assessment of availability,

clinical testing, and US Food and Drug Administration review of biosimilar biologic products. JAMA Internal Medicine,

181(1), 52–60. https://doi.org/10.1001/jamainternmed.2020.3997. 222 Ranbhor, R., & Kulkarni, P. (2026). Net present value impact of FDA's Phase 3 waivers on monoclonal antibody

biosimilar development programs. Biosimilars and Targeted Therapy. https://www.dovepress.com/net-present-value-

impact-of-fdas-phase-3-waivers-on-monoclonal-antibod-peer-reviewed-fulltext-article-BTT. 223 Of the 27 MAAs 25 were authorised and 2 withdrawn or refused; source: EMA Medicines Database, 2026. 224 European Medicines Agency. (2026). Medicines output report [dataset]. Retrieved 2 March 2026 from

https://www.ema.europa.eu/en/medicines/download-medicine-data; European Medicines Agency. (2025). Annual report

2024. Publications Office of the European Union. https://doi.org/10.2809/7433636. 225 The share of European investment into biosimilar development, which is not allocated to CES, which in turns makes

up for the 70% as outlined above.

83

After accounting for residual clinical development requirements—primarily comparative

PK/PD studies and immunogenicity assessments net annual savings are expected in the

range of EUR 150–552 million.

Over the five-year period (2025-2030), cumulative net savings are therefore estimated

at:

Scenario Uptake Gross annual cost

savings for

industry

Total net annual

savings

Five-year period,

cumulative net

savings

Low scenario

(50%)

12 products per

year transition to

CES waivers

EUR 222–312

million

EUR 155–218

million

EUR 0.75 billion

Central

scenario (≈60–

65%)

14–15 products per

year

EUR 266–390

million

EUR 186–273

million

EUR 1.5–1.8

billion

High scenario

(75%)

18 products per

year

EUR 342–467

million

EUR 239–326

million

EUR 2.8 billion

The projected annual range of 25–45 marketing authorisation applications (MAAs) reflects

a normalisation following the exceptional peak observed in 2025, notably linked to

denosumab-related applications. At the same time, projections remain constrained by the

‘biosimilar void’ 226, 227.

The lower bound (25/year) assumes the void persists; the upper bound (45/year) assumes

that the guidance (issued by 2027) begins attracting developers. Under current conditions,

it is estimated that only around 10% of the approximately 100 biologics expected to lose

exclusivity in the EU by 2032 will face biosimilar competition228.

In the medium term (2030–2038), assuming that the tailored approach to CES waivers is

widely implemented, and that complementary investment support measures partially

mitigate the ‘biosimilar void’, it is projected that 35–55 biosimilar MAAs may be

submitted annually. Of these, approximately 90% are expected to concern monoclonal

antibodies and fusion proteins, with 70–80% benefiting from a tailored development

approach including a CES waiver.

On this basis, the gross annual cost savings for industry are estimated at EUR 418-990

million.

226 Approximately 100 biological medicines are expected to lose exclusivity in Europe by 2032. However, 79% currently

have no biosimilars in development, and only 10% of biologics nearing loss of exclusivity are likely to face biosimilar

competition in Europe when accounting for the geographic footprint of clinical trials (IQVIA, 2026). The void is

concentrated in biologics with projected global sales below USD 100 million, where current development costs remain

prohibitive. 227 IQVIA, The Impact of Biosimilar Competition in Europe, 2026, iqvia-the-impact-of-biosimilar-competition-in-

europe-2026-01-26-forweb.pdf. 228 IQVIA, The Impact of Biosimilar Competition in Europe, 2026, iqvia-the-impact-of-biosimilar-competition-in-

europe-2026-01-26-forweb.pdf.

84

After accounting for residual clinical development requirements net annual savings are

expected in the range of EUR 293–700 million.

Over a five-year period within this timeframe, cumulative net savings are therefore

estimated at:

• Low scenario: EUR 1.5 billion

• Central scenario: EUR 2.3–2.8 billion

• High scenario: EUR 3.5 billion

These projections reflect a scenario in which reduced development costs, increased

regulatory predictability, and targeted policy support measures contribute to higher

biosimilar uptake and increased market entry. As such, the economic impact of CES

waivers is expected to be significantly amplified compared to the near-term period.

Overall, the medium-term scenario suggests that the full implementation of a tailored, risk-

based regulatory approach could generate substantial and sustained cost efficiencies for

industry, while supporting improved competition and access to biological medicines in the

Union.

According to the Biosimilar Medicines Group229, a sector group of the Medicines for

Europe organisation, under the current framework, the sector’s contribution to European

clinical trials for biosimilar candidates amounts to EUR 4.9 billion over five years, with

approximately 71% allocated to CES. The implementation of CES waivers could free an

estimated EUR 3 billion over five years in clinical spending. These resources could be

reallocated to European research and development and manufacturing, including the

development of next-generation biosimilar medicines, new technological platforms (e.g.,

antibody-drug conjugates, cell and gene therapies), and modernisation of manufacturing

operations).230

While the cost impact of biosimilars has been evaluated, the potential time savings are

expected to be limited, as many development streams run in parallel rather than

sequentially. A CES waiver would accelerate one stream, while the remaining streams

continue to constrain the overall development timeline. However, shorter development

pipelines would allow developers to start later, once the originator’s market trajectory—

including geographic penetration, therapeutic positioning and real-world outcomes—is

clearer, thereby reducing commercial risk without affecting the ultimate timing of market

entry.

Administrative burden: The dominant cost saving is associated with the CES waiver and

not with the reduction in dossier preparation labour. According to reported estimates, the

preparation of a full CES-based dossier requires approximately 328 person-days (EUR

131–197 thousand), compared to 253 person-days (EUR 101–152 thousand) for a tailored

package. This represents a reduction of approximately 75 person-days (EUR 30–45

thousand) per application. Applied to 12–18 affected MAAs annually, this yields an

aggregated administrative savings of EUR 0.36–0.81 million per year at current

229 https://www.medicinesforeurope.com/biosimilar-medicines/who-we-are/ . 230 Medicines For Europe factsheet: Pillar 1-2-3-4-FOOTPRINT-SPC-Biotech-Act-facsheets-ppt.cdr.

85

conditions. While measurable, these savings are secondary relative to clinical trial cost

reductions (see Annex 5 for reported detailed dossier preparation calculations).

Innovation and research: The proposed intervention is expected to reallocate innovation

incentives toward advanced analytical science. As outlined in the section ‘conduct of

business’ above, savings generated from the elimination of superfluous comparative

efficacy studies (CES) are estimated at EUR 717 million- 2.76 billion in five years, as

regulatory reliance shifts from clinical trials to analytical comparability. According to

another recent industry report231, approximately EUR 3 billion in R&D expenditure will

be freed up over five years out of the current EUR 4.9 billion —to be reinvested in the

development of additional biosimilar products, new technology platforms, and the

modernisation of manufacturing operations.

Public health: The tailored approach is expected to accelerate patient access without

compromising safety. Therapeutic coverage is expected to expand from approximately 27

reference products to 35–45 by 2030 and to 55–75 by 2038. The cumulative number of

authorised biosimilars is expected to grow from 151 in 2024 to 250-350 between 2025-

2030232 and to 450-650 between 2030-38233. This expansion is projected to generate

significant system-level savings, increasing from approximately EUR 13 billion in 2024

to EUR 16–22 billion annually by 2030 and EUR 22–35 billion/year by 2035–2038,

driven by increased competition and broader treatment availability. The introduction of a

tailored regulatory approach is not expected to alter the underlying safety standard, as it

modifies evidentiary requirements rather than regulatory thresholds for approval234. The

safety outlook therefore remains unchanged, with no increase in withdrawals on safety

grounds anticipated.

However, the upper bounds of these projections are tempered by a structural gap in the

market. Of approximately 100 biologics expected to lose exclusivity by 2032, 79% have

231 Medicines for Europe, Biosimilar Medicines Sector Group. (2025). Reforming Regulations, Market Entry and

Competition for Biosimilar Medicines (Pillar 2) [Factsheet]. Brussels: Medicines for Europe.

https://www.medicinesforeurope.com/wp-content/uploads/2026/03/FOOTPRINT-Biotech-Act-factsheet.pdf.232 151 biosimilars already authorised in 2024. To this, we add the expected new approvals between 2025 and 2030 i.e.

between 25 and 45 new applications, of which ~89% will be successful over 5 years

- Low estimate: 25 × 5 × 0.89 = ~111 new products → total ~262

- High estimate: 45 × 5 × 0.89 = ~200 new products → total ~351 233 ~300 authorised products in 2030, to this we add 35–55 annual applications between 2030 – 38 × 8 years ~89%

success rate

- Low estimate: 35 × 8 × 0.89 = ~249 new products → total ~549

- High estimate: 55 × 8 × 0.89 = ~392 new products → total ~692 234 Risk based tailoring of clinical evidence requirements for biosimilar marketing authorisations does not lower safety

standards; it reflects the maturity of the EU regulatory framework for biosimilars and advances in analytical science

used to demonstrate comparability with the originator product. The EU has the longest global experience with

biosimilars, with the first EU biosimilar approved in 2006, and since then over 100 biosimilars authorised across around

30 reference products, with no withdrawals on safety grounds. This long-standing experience confirms the robustness of

the comparability-based regulatory approach.

At the same time, analytical methods have significantly evolved. High-resolution structural characterisation, advanced

functional assays, and improved immunogenicity testing now allow very sensitive detection to demonstrate comparability

with the originator medicinal product.

This is complemented by strong post-authorisation safety monitoring through the European Medicines Agency. In this

context, streamlined clinical requirements do not weaken safety; they align regulatory expectations with current

scientific capability while preserving continuous real-world pharmacovigilance.

86

no biosimilar versions in development and only 10% are likely to face biosimilar

competition in Europe235.

Expected impacts of measure 2: biosimilar strategic projects recognition and support

The projects this proposed measure would target benefit from the same framework

described in intervention n°9 i.e. recognition and the support of health biotechnology

strategic projects: administrative support (including through single points of contact at

Member State level), accelerated procedures (including for permitting, subject to a

maximum ten-month deadline, as well as for dispute resolution and litigation), a public

interest status and measures to facilitate access to funding at national and EU-level.

Administrative costs on businesses: As for the projects described in intervention n°9, the

greatest efficiency gain is expected to be the reduction of execution risk through more

predictable and coordinated administrative handling, notably through a structured single

point of contact model and a maximum 10-month permit-granting timeline, complemented

by facilitated access to finance.

Conduct of business: The measure is expected to mobilise additional investment in EU

biosimilar manufacturing and development infrastructures. The magnitude depends on

Member State implementation. To estimate the order of magnitude, three uptake scenarios

are used, consistent with the approach applied in the strategic projects and high impact

projects assessments. Biosimilar projects are framed as a subset of the total strategic project

pipeline:

• Low uptake: 3–5 biosimilar projects recognised by 2038 (~0.3 per year)

• Medium uptake: 8–12 biosimilar projects (~1 per year)

• High uptake: 15–20 biosimilar projects (~1.5 per year)

See annex 7 for an overview of the illustrative order-of-magnitude impacts for biosimilar

strategic projects derived by proportional scaling from the Strategic Projects of chapter II

(intervention n°9).

Competitiveness, trade and investment flows: The effectiveness of the proposed

measure is expected to scale with its uptake, with higher levels of recognised projects

leading to greater mobilisation of investment in EU-based biosimilar manufacturing. The

investment mobilisation estimated at EUR 0.9–7.6 billion cumulative by 2038 reflects

the total capital deployed in biosimilar manufacturing and development projects. This

includes private investment, STEP-supported instruments, and any national co-financing.

The per-project investment range of EUR 200–400 million is consistent with the capital

requirements for dedicated biosimilar biomanufacturing facilities, as documented by

industry sources.236

235 IQVIA, The Impact of Biosimilar Competition in Europe, 2026, iqvia-the-impact-of-biosimilar-competition-in-

europe-2026-01-26-forweb.pdf. 236Alira Health. (2025, November 6). 2025 global biosimilars report: Market size, growth drivers, regional dynamics.

https://alirahealth.com/biosimilars-market-2025-market-size-growth-drivers-regional-dynamics/

87

Further, the proposed measure supports EU based manufacturers’ competitiveness in

biosimilars, by promoting international partnerships among economic operators as a

mean to share expertise and diversifying and strengthening supply chains. Recent studies

identified an increasing number of partnerships involving ex-EU biosimilar companies that

collaborate with European manufacturers to launch products in Europe. Historically, these

partnerships were relatively uncommon, but their prevalence has increased. Between 2006

and 2013, ex-EU partnerships represented 30% of all approvals, but more recently this

figure increased to 45% (2014–2024).237 The proposal aims to leverage this trend by

encouraging promoters of biosimilar projects to establish or strengthen cooperation with

international partners, including with a view to fulfilling the conditions for the

recognition of biosimilar strategic projects.

When it comes to research and innovation (R&I), as per specific eligibility criteria

proposed in Article 29, the recognised projects could contribute to R&I through setting up

or extending infrastructures for biosimilar analytical testing; strengthening the use of

platform technologies for research, development and marketing authorisation; and

developing analytical methodologies that would reduce the need for clinical data for the

development and approval of biosimilars. The impact of the measure on R&I will depend

on how many recognised projects will focus on material research or analytical innovation

outputs. As mentioned in the conduct of business section above, biosimilar projects are

framed as a subset of the total strategic project pipeline. Out of all 3-5 biosimilar strategic

projects in a low uptake scenario, we assume 1-2 to be R&I focused; 2-4 out of 8-12 in a

medium uptake scenario; and 3-6 out of 15-20 in a high uptake scenario (see Annex 7 for

full table of scenarios uptake).

The administrative costs for public authorities are part of the overall cost analysed in

chapter II for strategic projects. The initiative does not create a separate approval

architecture for biosimilar strategic projects specifically. Efficiency gains are expected to

emerge over time as procedures standardise, and administrative experience accumulates.

By 2030–2038, as the recognition process matures and uptake increases (estimated at 8–

12 biosimilar projects under the medium scenario), the net effect is expected to be

decisively positive for the sector.

Table 212. Summary assessment of the effects due to the policy intervention

237 Troein, P., Newton, M., Stoddart, K., Travaglio, M., & Arias, A. (2025, January). The impact of biosimilar competition

in Europe. IQVIA. http://www.iqvia.com/-/media/iqvia/pdfs/library/white-papers/the-impact-of-biosimilar-

competition-in-europe-2024.pdf.

Policy measure COB Admin CTI Int Mar I&R PA H&S

1. Tailored

regulatory approach

(Art. 28)

++ + + + + - +

2. Strategic project

support (Art. 29-30)

+ +/- + + + - 0/+

88

5.2.3 Intervention n°13: SPC extension for biotechnology medicines

Supplementary protection certificates (SPCs) are an intellectual property right. They

serve as an extension to a patent right and aim to offset the loss of patent protection for

pharmaceutical that occurs due to the compulsory testing these products require prior to

obtaining regulatory marketing approval. An SPC can extend a patent right for a maximum

of five years238.

The Regulation proposal introduces an extension of 12 months of the SPC for medicinal

products developed by means of biotechnology processes and for Advanced Therapy

Medicinal Products.

Eligible medicinal products would have to contain a new active substance which is

effective via a mechanism of action distinctly different to that of any other product already

authorised in the EU for preventing or treating the same disease. The clinical trials

evaluating the efficacy of the product and supporting its marketing authorisation would

need to have been conducted in more than two Member States and at least one

manufacturing step, excluding packaging, quality and testing certification, would need to

be performed in the Union.

This provision is intended to target highly innovative biotechnology-based products that

are expected to deliver significant therapeutic advantages to patients, particularly those

who currently have limited or no treatment options.

The proposed SPC extension does not affect in any respect the existing legal framework in

Regulation (EC) No 469/2009239 or related measures, nor the ongoing reform of that

framework. In accordance with the principle of legal certainty, this includes how the SPC

extension will be applied in the future. The SPC extension has a different scope. Its purpose

is not to replace the existing SPC legal framework but to complement it.

Intended objective:

The SPC, by prolonging IP protection, provides a very robust shield from competition for

the relevant product240. Additionally, on average, products for which SPC is the last form

of protection to expire have higher revenues than medicines that rely on regulatory

protection (RP) or patent (see Annex 7 for details on protection length). This further

underscores the attractiveness and effectiveness of this incentive.241

238 Six-month additional extension is available in accordance with Regulation (EC) No 1901/2006 if the SPC relates to

a medicinal product for children for which data has been submitted according to a Paediatric Investigation Plan (PIP).

PIPs are required to support the authorisation of medicines for children. They ensure that enough data is collected on the

effects of the medicine on children. 239 Regulation (EC) No 469/2009 of the European Parliament and of the Council of 6 May 2009 concerning the

supplementary protection certificate for medicinal products, OJ L 152 16.6.2009, p. 1

httphttp://data.europa.eu/eli/reg/2009/469/2019-07-01. 240 Max Planck Institute for Innovation and Competition (2018), Study on the Legal Aspects of Supplementary Protection

Certificates in the EU. 241 Impact assessment accompanying the revision of the pharmaceutical legislation

https://health.ec.europa.eu/publications/impact-assessment-report-and-executive-summary-accompanying-revision-

89

Innovation and patenting behaviour in biotechnology are closely linked to firms’

expectations around the future commercial value and appropriability of inventions.

However, intellectual property is just one part of innovators’ investment decisions. The

Biotech Act proposal includes explicit conditions to link the SPC extension to conducting

late-stage clinical trials and manufacturing in Europe, because the incentive is precisely

meant as a stimulus to modify sponsors’ behaviour at the margin, thereby helping generate

economic and societal gains for Europe.

Analysis and limitations:

It is acknowledged that modelling the costs and benefits of this measure necessitates

certain assumptions and it is subject to inherent limitations, such as the need to work with

small samples of medicines given the medicine characteristics being studied, and

simplified representations of complex real-world health biotech innovators’ behaviour.

These limitations have been mitigated by using robust data sets reflecting observations of

actual product lifecycles and market entry patterns (market data from the IQVIA MIDAS®

databases) and assessments on products eligibility (data provided by the European

Medicines Agency which will be in charge of assessing eligibility), to ensure that the

resulting estimates of the measure's potential remain grounded and reliable rather than

being based on a more theoretical model.

To make an estimation of the costs of the SPC extension, an analysis was performed of the

198 innovative medicines which lost patent or regulatory protection between 2016 and

2024 and that have not so far been withdrawn from the market. Of those medicines 31 were

found to be biologics, 12 of which rely on SPC as the last protection to expire (40%). Of

these 12, 10 fulfil the proposed Regulation’s SPC eligibility criterion of being a medicine

developed with a biotechnology process. In order not to limit the sample size unduly, the

other SPC eligibility criteria have not been used to exclude medicines from the sample as

they should not a priori affect the market characteristics of the medicine. The sample

studied was restricted to these 12 products in order to ensure that the medicines considered

are representative of those for which the SPC extension would be relevant242. The model

specifically looked at how sales volumes and prices shift when a product loses patent

protection and biosimilar versions enter the market. On this basis, the model made it

possible to calculate how much additional profit accrues to the originator and how much

additional cost is borne by the healthcare system and patients when an extra year of

protection is added.

Expected impacts:

Figure 10 charts the course of revenue and volume for the average medicine in the sample

across 20 years: 15 years before expiry of protection and 5 years after expiry. This

represents our baseline in the absence of SPC extension. As biosimilar entry drives prices

general-pharmaceutical_en supports this statement, furthermore data analysed for the impact of the SPC extension

measure confirm the same trend. Of the 31 biological products in the nine-year cohort studied, 12 had SPC as last

protection to expire and 10 had RDP. While the SPC-reliant products averaged EUR 740 million during their last year

of protection collectively, the 10 RDP-reliant medicines averaged EUR 83 million. 242 To accurately measure economic impact, we shouldn't just count all eligible products. We must isolate those where

the SPC extension is the sole factor preventing biosimilar entry (last layer of protection to expire). If other protections

remain in place after the SPC expires, the extension has no real-world economic effect.

90

down, it is associated with an accelerated increase in volume, effectively allowing for a

higher number of patients to be treated (green line). Because prices are lower, overall

revenues fall, despite the higher volumes. This process is somewhat restrained in the case

of biologics by the higher barriers to entry for biosimilars as compared to generics for small

molecules, including due to stricter regulatory pathways and more complex production

processes, resulting in a relatively shallow decrease in overall revenue.243

Figure 10. Normalised sales and volume for SPC-reliant biological medicines with

current duration of SPC

Author analysis based on IQVIA MIDAS data

To assess the impact of an additional year of protection, the same twenty-year reference

period was maintained, but with an additional year of uncontested sales with revenues and

volumes equal to those in the year before expiry and one year fewer of contested sales. The

effect is depicted in Figure 11 (light blue bar). The result is a fall in the number of patients

treated accompanied by an increase in spending.

243 For the purposes of this graph, one medicine from the sample, with particular outlier characteristics was excluded.

The product is a moderately high revenue medicine with no biosimilar entry even after several years and a far shorter

lifecycle than all the other SPC-reliant biologicals in the sample.

91

Figure 11. Normalised sales and volume for SPC-reliant biological medicines

products with a 12- months SPC extension

Author analysis based on IQVIA MIDAS data

To assess how many products per year would be eligible for the measure, data from EMA

was analysed covering the period from 2011 to 2025. If the SPC extension existed, over

the past ten years, there would have been on average 5 products per year among all those

centrally authorisedthat fulfil all the criteria to obtain the SPC extension, and 6 per year

over the past 5 years, albeit with considerable variation per year. As stated above, out of

the 31 biologics we analysed, 40% (i.e. 12 products), relied on SPC as their last effective

protection244. Thus, assuming the proportion of products relying on SPC remains constant,

the SPC extension would have an economic impact on 2-3 products per year.

Conduct of business: The average revenue of a product in the sample in the year prior to

protection expiry is EUR 740 million. Impacts in the model are calculated as a percentage

of revenues in this last protected year. Taking into account the expected impact of the

measure, as shown in Figure 11, an additional year of protection results in an additional

direct cost to public payers in the EU of approximately EUR 70 million per medicine,

corresponding to approximately EUR 210 million annually at aggregate level (considering

three medicines per year). The relatively moderate increase in spending reflects the

shallow post-expiry revenue decline characteristic of SPC-reliant biologicals.

244 To accurately measure economic impact, we shouldn't just count all eligible products. We must isolate those where

the SPC extension is the sole factor preventing biosimilar entry (last layer of protection to expire). If other protections

remain in place after the SPC expires, the extension has no real-world economic effect.

92

Functioning of the internal market and competition: For the reasons set out above,

biosimilar competition produces slower price reductions than generic competition, limiting

the price differential between the extension scenario and the baseline. Instead, the main

effect of the extension relative to the baseline is the temporary postponement of additional

product entry, implying fewer available treatment options and delayed expansion of supply

for patients during the extension period. By postponing competitive entry, the extension

maintains higher average prices for an additional year and delays the expansion of supply

associated with follow-on products.

Public health: In addition to the direct cost impact of approximately EUR 70 million per

medicine, there is a delay in the expansion of coverage (the upward pivot of the green line

is delayed by a year). This is expressed in a patient monetised loss of EUR 135 million per

product and EUR 405 million for three products (see table below) calculated as the

additional spending required to achieve baseline coverage at policy scenario prices.

Additional details in Annex 7. Additional protection for originators results in a transfer of

revenue and profit from biosimilar makers to originators as well as a transfer of economic

surplus from payers and patients to the pharma industry, as set out in the table below245.

Table 13. Impact of change of +1 SPC extension for biotechnology medicines

Source: Author analysis based on IQVIA MIDAS data246

Due to data availability and confidentiality around price negotiation, this calculation is

based on list prices and cannot capture discounts and clawback mechanisms that apply at

national pricing and reimbursement stage. If it were possible to use net prices, the cost

calculation would be lower.

Competitiveness, trade and investment flows: According to EMA data from 2016 to

2025, in addition to the 5-6 products that would have met all the criteria each year, a further

five products would have met all the criteria except the “geographic” ones, i.e. conducting

trials in more than two Member States and having part of their manufacturing in the EU.

245 As set out in Annex 11, this latter transfer can be approximated by the combined total of the monetised loss to patients

and the additional costs to the public payer of EUR 205 million per medicine. 246 Internal analysis by the authors using IQVIA MIDAS® quarterly sales data 2008-2024. Geographical coverage: EU27

without Cyprus, Malta and Denmark. which were obtained under license from IQVIA and reflect estimates of real-world

activity. Copyright IQVIA. All rights reserved. The statements, findings, conclusions, views, and opinions contained and

expressed herein are not necessarily those of IQVIA.

1 year increase in protection Per medicine Annual (3 meds)

Originator gross profit 230 m 690 m

Biosimilar gross profit -80 m -240 m

Cost to public payer 70 m 210 m

Patients monetised gains/losses 135 m 405 m

Patients + payer monetised gain/loss 205 m 615 m

93

It was assumed again that about 40% of the products are SPC-reliant. Thus, the SPC

extension could potentially be awarded to 4-5 products annually (rather than 2-3) if

developers changed their behaviour in response to the incentive i.e. conduct clinical trials

in more than one Member State and part of the production of the medicinal product in the

EU.

This measure is designed to incentivise late-stage clinical trials as part of the product’s

marketing authorisation. Clinical trials generate sizeable economic benefits in several ways

as outlined in the economic impact section of intervention n°4 (Clinical Trial Regulation

Revision). A further potential benefit of more clinical trials is avoiding the healthcare

expenditure which would normally be associated with sponsor-funded medicines,

diagnostics and monitoring. As an illustrative benchmark, Polignano et al. (2022)247

estimate a leverage ratio of 3.67, implying EUR 3.67 of avoided healthcare expenditure

for every euro of sponsor investment in industry-sponsored clinical trials. While the SPC

extension conditionality of conducting clinical trials in the EU can only impact behaviour

at the margin of a limited set of products, the combined impact with measures proposed in

the Biotech Act on streamlining clinical trials can be non negligeable248.

The measure is also designed to encourage sponsors to incorporate an EU-based

manufacturing step as part of their manufacturing and scale-up strategies. As underscored

by public consultations, literature and empirical evidence, intellectual property, including

SPC extension, is an important part of the broader set of elements that drive biotechnology

investment decisions. While the decision to invest in a biotechnology manufacturing

facility cannot be attributed to any single product or regulatory incentive, similarly to the

conditionality concerning the conduct of clinical trials in the EU, the positive impulse

created by the SPC extension could contribute to broader investment and employment

effects at the margin.

The effect of these measures is expected to be amplified and completed by other

measures set out in the Biotech Act, especially those aimed at supporting and derisking

investment in manufacturing in the EU (e.g. high impact biotechnology health strategic

projects and biotechnology health strategic projects) and the amendment to the Clinical

Trials Regulation to facilitate the conduct of multi-national clinical trials in the EU. These

changes will make the incentive to conduct clinical trial and manufacturing activity to

Europe introduced by the SPC extension more effective. It must also be noted that the

SPC extension complements other measures in the Regulation proposal and in the reform

of the general pharmaceutical legislation249 that are aimed at facilitating development of

innovative products and reducing time to market (e.g. use of AI and regulatory sandboxes,

combined trials and shortening marketing authorisation timelines).

Research & Innovation: Between 2004 and 2011, just over one product per year would

have been eligible for the SPC extension, according to EMA’s data. This number grew to

five in the last decade and to six in the last 5 years. While the long-term trend reflects a

247 Polignano, M. G., et.al. (2022). Economic impact of industry-sponsored clinical trials in inflammatory bowel

diseases: Results from the national institute of gastroenterology "Saverio de Bellis". Frontiers in pharmacology, 13,

1027760. https://doi.org/10.3389/fphar.2022.1027760. 248 Refer to the relevant section of the SWD on the Clinical Trials Regulation for a full assessment of costs and benefits 249 COM/2023/193 final and COM/2023/192 final.

94

growing health biotech pipeline, we observed high variability in product eligibility year-

over-year, reflecting the unique risk profile of the health biotech sector. With the

development of biotechnology pipelines and scientific advances, we can expect this

measure’s economic impact to increase, but in parallel it is also expected to bring new

transformative products to the market.

Administrative costs on businesses, including SMEs: Under the current regulatory

framework, companies applying for SPCs incur administrative costs associated with

preparing and submitting applications, assessing eligibility, and interacting with patent and

regulatory authorities. SPC applications require legal interpretation of patent and

marketing authorisation scope and prior use of products protected by the patent and the

medicinal product which has been authorised. They require internal legal and regulatory

staff time and, in many cases, recourse to external legal advisors. For SMEs, SPC-related

administrative and advisory costs can weigh more heavily, given their more limited in-

house legal and regulatory resources and greater dependence on outsourced expertise250.

Evidence from the impact assessment of the Commission proposals for a unitary SPC251

shows that overall administrative and advisory costs for filing SPC extensions across

multiple Member States typically range between approximately EUR 80,000 and EUR

150,000 per product.

Public Authorities: The proposed SPC extension does not introduce new standalone

administrative procedures beyond those already required for obtaining SPC protection

under the baseline framework. Companies seeking to benefit from the SPC extension

would follow the same application process as for a standard SPC, with the addition of the

documentation provided by EMA demonstrating that the eligibility criteria for the

extension are fulfilled. As these elements are largely based on information already

provided during the marketing authorisation process and associated regulatory

documentation, the additional administrative effort required from companies is expected

to remain negligible. Therefore, overall costs would remain between EUR 80,000 and

150,000 per product.

The SPC system is subject to disputes over eligibility, duration and scope, which

generate administrative and legal costs for companies, public authorities and courts252.

The proposed SPC extension, by introducing novel eligibility criteria, especially in the

early years of application might also entail the same litigation risks which currently

characterise the existing legal framework with increased risk of administrative costs and

burdens. This is because the generics manufacturers are well placed to contest any form of

SPC extension. In addition, the Court of Justice interprets the conditions for grant narrowly

250 European Commission (2023), Commission Staff Working Document – Impact Assessment accompanying the

proposals on supplementary protection certificates, SWD (2023) 118 final, Brussels, 27 April 2023, Section 2.3.2 and

Annex 6 (SME Test). 251 European Commission (2023), Commission Staff Working Document – Impact Assessment accompanying the

Proposal for a Regulation of the European Parliament and of the Council on the supplementary protection certificate for

medicinal products (recast) and the Proposal for a Regulation on the unitary supplementary protection certificate for

medicinal products, SWD (2023) 118 final, Brussels, 27 April 2023, Section 2.3.2 and Annex 5B. 252 Technopolis Group (2018) Effects of supplementary protection mechanisms for pharmaceutical products. Final report,

May 2018. Amsterdam/Vienna: Technopolis Group.

95

as it considers that all the interests at stake, including those of public health, in a sector as

complex and sensitive as the pharmaceutical sector should be considered.

Conclusions

Providing an additional year of protection for innovative biotech medicines rewards the

delivery of transformative treatments for high-burden conditions, ranging from

oncology to metabolic and neurological disorders, while sending an important signal to

companies regarding investment priorities. The geographical conditions ensure that this

additional incentive also favours investment in the EU and helps strengthen the EU’s health

biotech sector, which is crucial both for European patients and for the competitiveness of

one of Europe’s most valuable industries.

Table 14. Summary assessment of the effects due to the policy measure

Policy

interventions

COB Admin CTI Int Mar I&R PA H&S

SPC

extension

++ 0/- + - + 0 -

5.2.4 Intervention n°14: Facilitating Access to Funding

The proposed Regulation establishes an EU Health Biotechnology Investment Pilot in

order to mobilise substantial private investment into the sector. This is a partnership with

the European Investment Bank and European Investment Funds (together the “EIB

Group”) and other implementing partners, bringing together equity instruments and

venture-style debt tailored to biotechnology-specific risk profiles. In synergy with existing

EU investment initiatives, the Pilot would support the full lifecycle of health biotechnology

companies and projects. As early as 2026 and 2027, the EIB Group will aim to mobilise

EUR 10 billion of total investment into the sector through the BioTechEU initiative.

Projects that contribute to an EU late-stage Capital Booster Pilot will be recognised by

the Commission as high-impact health biotechnology strategic projects. These projects are

expected to strengthen cross-border investment, mobilise long-term and institutional

capital, improve investor access and issuer visibility, and enhance biotechnology-specific

investment expertise.

More broadly, health biotechnology is recognised as a strategic technology eligible for

Union and national financial support in line with applicable rules, including State aid rules.

High-impact health biotechnology strategic projects may receive particular consideration

under relevant Union programmes and may combine Union funding with financing from

the EIB Group, national promotional banks and private investors, in line with applicable

96

rules253. These measures aim to address structural financing gaps, particularly at late

development stages, and to crowd in private capital.

Expected impacts:

Over the last 10 years, health biotechnology was a strategic financing priority for the EIB

Group, underpinned by close cooperation with the European Commission through EU

budgetary resources254 and complementary EIB Group own resources. Over the period

2015-2025, the Group has scaled its activity across the full financing chain, combining (i)

EIF-backed investments into specialised venture capital and growth equity funds ('fund of

funds' approach) to support more than 1000 health biotechnology projects and emerging

startups with (ii) direct EIB loans to more than 145 later-stage innovative SMEs and

midcaps ('venture loans') or (iii) established pharma companies ('corporate loans').

With all these investments, the EIB Group mobilised more than EUR 100 billion for the

benefit of the health biotech sector over this period. Table 15 summarises this activity

across instruments, including the EU budget guarantee backing those investments and how

much funding the original EIB Group investment mobilised by crowding in private capital.

Figures are reported as annualised run rates over the 2015-2025 period. These are

indicative averages only and should be interpreted with caution: actual annual

volumes vary significantly from year to year, driven by market conditions, pipeline

timing and the availability of EU budgetary guarantees.

Table 15. Average annual EIB Group contribution to health biotech financing and

investment mobilisation (2015–2025)

Instrument EU guarantee/year EIB Group

Investment/year

Total Investment

mobilised/year

Venture debt EUR ~150 million/yr EUR ~350-400 million EUR ~3.1-3.5 billion

Corporate loans EUR ~70 million/yr255 EUR ~730 million EUR ~1.9 billion

EIF fund investments EUR ~100 million/yr EUR ~520 million EUR ~5.5 billion

Total EIB Group EUR ~320 million/yr EUR ~1.6 billion EUR ~10.8 billion

However, the EIB estimates that an annual investment gap of EUR 40 billion remains

between the EU and US Biotech sectors256. To address this gap, the Biotech Act proposes

the creation of a dedicated EU Health Biotech Investment Pilot. The pilot would deploy a

toolbox of financial instruments, tailored to the specific risk and maturity profile of health

253 Regulation (EU, Euratom) 2024/2509 of the European Parliament and of the Council of 23 September 2024 on the

financial rules applicable to the general budget of the Union, OJ L, 2024/2509, 26.9.2024. 254 InvestEU guarantee in the current MFF, EFSI and COSME-EFG in the previous MFF. 255 Over the time period 2015-2025, out of the EUR 7 billion EIB corporate life-sciences loans (730/year), only EUR 2

billion (EUR 200 million/year) were backed by a guarantee of EUR 700 million (EUR 70 million/year). The remaining

EUR 5 billion were financed from EIB own resources. 256 The EIB Group uses industry data of EUR 69.7 billion investment for the US vs EUR 26.5 billion in the EU in 2021,

resulting in a gap of ca. EUR 40 billion.

97

biotech companies. With the support of these instruments, the pilot aims to crowd in

substantially more private capital and respond more effectively to unmet market needs

across the financing chain.

Table 16 outlines three scenarios for the pilot across different ambition levels. The

scenarios assume a positive review after an initial two-year pilot period, and initial

evaluation of crowd-in ratios, after which it will continue for a total of seven years. A

longer time horizon helps with attracting substantial private investment, particularly from

institutional investors such as pension funds, insurers and corporates, and reflects the long

investment and value-creation cycles characteristics of the health biotechnology sector. In

addition, sustained and predictable public support is critical for investor confidence, while

sufficient time is needed to deploy and test the different instruments in the toolbox and

adjust the mix in response to market uptake, geopolitical shifts and observed outcomes.

The first scenario assumes a continuation of the level of EIB Group's average investment

level over the last 10 years, with the second and third illustrating the additional level of EC

guarantees and investment by the pilot needed to mobilise sufficient investment to close,

respectively, 25% or 50% of the EUR 40 billion annual investment gap in the Health

Biotech sector.

These scenarios are illustrative sensitivity cases rather than forecasts and depend on strong

assumptions: linear scalability of deployment by the investment pilot over seven years,

with the same distribution of investment across instruments as the EIB Group over the last

10 years, sufficient absorption capacity in the EU health biotech pipeline, no material

displacement of private finance and no binding implementation constraints (including risk

appetite, deal flow, administrative throughput and the availability of EU budgetary

guarantees).

Table 16. Scenarios for the EU Health Biotechnology Investment Pilot

Scenario EC guarantee over 7

years

Direct investments by

the pilot over 7 years

Total investment

mobilised over 7 years

Continuation scenario EUR 2.2 billion EUR ~10.4 billion EUR ~70 billion

Closing 25% of EU-US

investment gap

EUR 4.5 billion EUR ~20.7 billion EUR ~140 billion

Closing 50% of EU-US

investment gap

EUR 6.7 billion EUR ~31.1billion EUR ~210 billion

5.2.5 Intervention n°15: Use of Artificial Intelligence and Data

The Regulation proposal provides for the publication and regular update of EMA

guidance, in agreement with the Commission,on the use of advanced technologies,

including AI, in the lifecycle of medicinal products. This guidance is expected to establish

overarching principles to enhance clarity on the use of advanced technologies across the

lifecycle, including development, manufacturing, regulatory evaluation and approval, and

post-authorisation monitoring. The proposal also provides for the recognition of high-

impact health biotechnology strategic projects in the form of trusted AI-enabled

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biotechnology testing environments (to facilitate integrated experimentation and

translational validation) and biotechnology data quality accelerators to support the

curation, standardisation and annotation of high-quality datasets required for the training,

testing and validation of AI systems used in biotechnology applications.

Expected impacts:

The effects of the proposed measure are driven by several mechanisms:

• the establishment of common principles for the clarity of the use of AI across the

medicinal product lifecycle, supporting consistent validation approaches and

alignment of regulatory expectations;

• the complementing and structuring of case-by-case regulatory interactions

through publicly available guidance, improving predictability and supporting the

consistent deployment of AI across the medicinal product lifecycle;

• the provision of shared AI-enabled biotechnology testing environments

combining experimental, computational and data-driven capabilities, reducing

firm-level constraints and facilitating faster validation and scale-up of

innovations;

• the improvement of data quality for AI applications, through the curation,

annotation, standardisation and provenance of datasets to support the training,

testing and validation of AI systems in biotechnology.

These mechanisms are interdependent and reinforce each other, with outcomes scaling

with the number and maturity of recognised projects in the form of testing environments

and data quality accelerators.

By combining improved regulatory clarity, enhanced validation infrastructure and higher-

quality datasets, the measures are expected to help address key structural bottlenecks that

currently limit the translation of Europe’s scientific excellence into scalable innovation

and thereby facilitate the translation of research into scalable innovation and contribute to

strengthening the EU’s competitiveness in AI-enabled biotechnology257.

Uptake of high-impact projects (testing environments and data quality accelerators) is a

key variable, and the scale of effects should be interpreted as proportional to the number,

capacity and maturity of recognised projects. This reflects the project-based nature of the

intervention and the reliance on public and private co-investment, which make different

uptake scenarios possible.

Conduct of business: These impacts include less regulatory uncertainty and better access

to validation and scale-up capacity. The guidance introduces a shift from case-by-case

regulatory interactions to a publicly available reference point, replacing confidential and

non-reusable exchanges and reducing transaction costs and internal deliberation time. This

allows firms to take development decisions earlier and with greater confidence. Testing

environments and data quality accelerators address the limitations in terms of access to

shared pilot and scale-up infrastructure, with time-to-access effects being material. Under

257 See further findings in the Study to support the rapid assessment of policy scenarios to strengthen innovation and

competitiveness in the field of biotechnology in the EU, Rapid Assessment Scenario Study.

99

baseline conditions, firms must independently finance or secure validation capacity, which

entails high fixed costs, long lead times and coordination challenges. Shared infrastructure

converts firm-level capital expenditure into pooled capacity, reducing delays in accessing

pilot-GMP capacity and limiting the risks of overall project delay. Providing access to such

infrastructure operates as an enabling condition for commercialisation.

Administrative costs on businesses, including SMEs: These costs are expected to evolve

in a balanced manner. While guidance can reduce repeated clarification processes and

improve predictability, care may be needed to ensure sufficient flexibility in its application.

Participation in testing environments and data quality accelerators may entail certain

administrative steps, such as application, reporting and knowledge-sharing; however, these

are expected to be proportionate and to support transparency, collaboration and the

generation of shared evidence. Appropriate design of support frameworks, including

streamlined procedures, can help facilitate participation and ensure that administrative

processes remain aligned with the pace of technological development.

Competitiveness, trade and investment flows: These reflect the availability of validation

infrastructure and AI-ready data. Testing environments contribute by addressing key R&D

constraints, providing integrated capacity for validation and supporting development of

such activities within the Union. Data accelerators contribute by reducing ‘data friction’,

improving data usability, interoperability and quality, and thereby lowering costs

associated with fragmented datasets. Both interventions require sustained capital and

operational support to ensure effective utilisation and maximise their impact on innovation

and investment decisions.

Functioning of the internal market and competition: Changes in data readiness and

interoperability across Member States are expected, with fragmentation and heterogeneity

in data readiness remaining significant. Legal access to data does not ensure technical

usability, due to differences in formats, metadata and validation criteria. Data accelerators

help enlarge the effective market for data-driven development by improving

standardisation, curation and interoperability. At the same time, differences in absorptive

capacity and digital maturity across Member States may lead to uneven uptake in certain

instances. This underlines the importance of ensuring coordinated implementation over

time, so that these measures support convergence and avoid the emergence of a multi-

speed internal market.

Innovation and research: Impacts are expected to reflect changes in regulatory

uncertainty, validation capacity and data usability. The guidance helps reduce the ‘option

value of waiting’, thereby accelerating investment decisions in R&D. Testing

environments contribute through addressing limitations in access to integrated validation

capacity, enabling validation activities under more efficient and coordinated conditions,

and supporting improved validation timelines, regulatory submissions and standardisation,

including platform effects. Data quality accelerators contribute through improving data

quality and reducing dataset fragmentation, and interoperability, reducing the data

preparation burden, generating research productivity effects, and enabling discoveries that

fragmented datasets cannot support.

Public authorities: These stakeholdersmay need to support supervision, coordination,

infrastructure maintenance and the development of specialised human capital in relation to

100

testing environments and data quality accelerators. This includes ensuring appropriate

technical capacities and skills of their staff, as well as the ability to adapt to evolving

technological developments. Data quality accelerators require sustained investment in

high-quality data curation and annotation capacities. This highlights the importance of

ensuring continuity and coordination of funding mechanisms to support their long-term

operation and maximise their impact.

Public health and safety reflect changes in the validation of AI-enabled biomedical tools

prior to deployment. Testing environments contribute by reducing the real-world

performance gap, improving reliability through structured multi-system validation, and

supporting the use of more diverse datasets. In combination with the guidance, this

supports the consistent application of validation and risk management principles across the

lifecycle of AI-enabled medicinal products. These developments align with evolving

regulatory validation frameworks and support safer deployment of AI-enabled tools.

Table 17. Summary assessment of the effects of Intervention n°15: Use of Artificial

Intelligence and Data

Policy intervention COB Admin CTI Int Mar I&R PA H&S

Use of Artificial

Intelligence and Data ++ 0/+ ++ + ++ 0/- +

Scenario-based quantification of the expected impacts under different uptake cases has also

been developed258 to illustrate such potential impacts, which should be interpreted as

proportional to the scale, maturity and utilisation of recognised projects.

Table 18. Illustrative uptake scenarios and order-of-magnitude impacts and

estimation of associated impacts

Impact Category Low uptake Medium uptake High uptake

What this scenario

entails

2–3 recognised testing

environments (Art. 32)

and 2–3 data quality

accelerators (Art. 33);

upgrade-focused

investment in existing

facilities; primarily

public funding with

limited private co-

investment

5–8 recognised testing

environments and 5–8

data quality accelerators;

mix of upgrades and new

greenfield investments;

mixed public-private

funding on PPP model

10–15 recognised testing

environments and 10–15

data quality accelerators;

industrial-scale

greenfield and upgraded

facilities; public-private

leverage at the largest

nodes

Direct employment

created

160–420 FTE (testing

environments + data

accelerators)

1,000–2,640 FTE 3,300–7,500 FTE

Companies and

data users served

per year

120–495 (20–45

companies; 100–450

data users)

1,100–3,400 (100–200

companies; 1,000–3,200

data users)

4,250–12,600 (250–600

companies; 4,000–

12,000 data users)

258 See Annex 7 and relevant sections of the Rapid Assessment Study – forthcoming – for further details.

101

Total

infrastructure

investment (public

and private

CAPEX combined)

EUR 85 million –EUR

205 million

EUR 650 million– EUR

1.3 billion

EUR 2.4 billion–EUR

7.2 billion

Annual

operational

funding required

EUR 6–18 million/year

(data accelerators) +

testing environment

OPEX

EUR 40–120

million/year + testing

environment OPEX

EUR 150–450

million/year + testing

environment OPEX

EU-level

supervisory

burden

1–3 FTE 2.5–8 FTE 5–15 FTE

Regulatory

interaction cost

avoided per firm

(Article 31)

Reduction in regulatory

interaction costs and

timelines through

publicly available

guidance; effects

consistent across

scenarios

same across all scenarios same across all scenarios

SME

infrastructure

barrier addressed

82% of SMEs currently

unable to self-finance

validation; shared access

reduces per-firm fixed

costs

same direction; scales

with number of

environments

same direction; scales

with number of

environments

Data usability gap

addressed

87% of biomedical

datasets currently not

readily usable for ML;

accelerators begin

conversion to AI-ready

scales with number of

accelerators

scales with number of

accelerators

Key

implementation

risk

Limited number of

environments and

accelerators reduces

coverage and

competitiveness signal

Need to ensure efficient

access conditions and

interoperability

alignment; OPEX

sustainability

Need for continuous

technological upgrading

and balanced. access

conditions across users

5.2.6 Intervention n°16: Prevention of biotechnology misuse

The proposed Regulation sets out a regulatory framework for customer screening of

biotechnology products of concern, focused on custom-made and potentially dangerous

sequences of synthetic DNA or RNA (synthetic nucleic acids, synthetic ‘NA’). Custom

NA synthesis is a small but crucial part of the biotech sector, representing around 0.1% of

the European Biotech market259. The EU is home to around 100 companies in scope of the

Chapter’s provisions (ca. 20% of global NA synthesis companies) 260, with companies

outside the EU selling custom nucleic acids to the Union market also in scope.

259 Estimations based on GrandViewResearch estimates of the overall EU DNA synthesis market

https://www.grandviewresearch.com/horizon/outlook/dna-synthesis-market/europe and EU Biotech market

https://www.grandviewresearch.com/horizon/outlook/biotechnology-market/europe, assuming 50% of the overall EU

DNA synthesis market (0.2% of the Biotech sector) is custom DNA synthesis, based on the number of companies – see

footnote 260 and Annex 4 Additional methodological information on specific measures for details. 260 IBBIS has identified 215 companies in the NA synthesis market in the EU, of which 66 companies performing custom

synthesis, including oligos and data storage. The EU also has 4 benchtop manufacturers and 40 third-party vendors. The

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The exponential decrease in the cost of synthesising DNA and RNA has transformed

biotechnology and made innovation more accessible. However, it has also increased the

risk of misuse. A particular concern is that, given information on the genomes of viruses

and other pathogens is publicly available, access to the physical DNA or RNA is an

increasingly eroding chokepoint to create and weaponise pathogens to carry out biological

attacks. These could have consequences similar to, or worse than, those seen during

the Covid-19 pandemic, with economic costs of EUR 20 trillion for the EU alone. In

2024, MIT researchers demonstrated the ability to order synthetic genetic fragments

sufficient to reconstruct the 1918 pandemic influenza virus, with their order fulfilled in

almost all attempts261.

Williams et al. (2025) estimate the near-future annual probability of biological attacks at

1% and accidents from their use at 1.5%. In recent years, multiple individuals in the EU

attempted to carry out biological attacks by weaponising biological agents262. As synthetic

NA continues to become cheaper and more widely available, this increases the risk that

future biological attacks could be much more damaging, using transmissible viruses

instead of toxins.

Table 19. Estimated risk from accidents with or misuse of Synthetic Nucleic Acids263

Type of events Annual likelihood Expected monetised harm to EU if event occurs

Large scale event264 1% EUR 19.6 trillion

Small scale event265 22% EUR 72 million

Agricultural event 4% EUR 75.5 billion

Non-transmissible events 5-25% EUR 121 million

To reduce this risk, the Biotech Act introduces a mandate for custom NA synthesis

companies to verify the identity and legitimacy of customers purchasing potentially

dangerous NA sequences. Companies that make benchtop NA synthesis devices available

would also be obligated to implement a screening mechanism to prevent the synthesis of

biotechnology products of concern with the device.

In the Biotech Act Call for Evidence266, several industry representatives were supportive

of such harmonised rules on NA synthesis screening at EU-level, given the significant

share of EU synthetic DNA providers is calculated following IBBIS number, namely 215 over 1,023 globally identified

providers. 261 Esvelt K. (2024), https://drive.google.com/file/d/1hNUnU8i2yubt5uesmmV17aTJXhYYDgTY/edit?pli=1 262https://jamestown.org/ricins-round-two-germany-prevents-another-islamic-state-motivated-bioterrorism-

attack/, https://www.dw.com/en/germany-teens-home-searched-over-suspected-ricin-plot/a-72272711,

https://health.ec.europa.eu/document/download/1be3e462-bd50-4c64-b147-add9d1d5a580_en?filename=com_2025-

529-1_act_en.pdf on page 5. 263 RAND 2026. 264 Large-spreading events, global pandemics on the scale of COVID-19 or the 1918 influenza 265 Expected to result in 65 deaths in case the event happens. 266 https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/14627-Biotech-Act/F3565340_en

103

heterogeneity in security practices267 and the difficulty in complying with diverging rules

across Member States268. Customer screening for potentially dangerous NA synthesis

orders is frequent industry practice, with companies representing over 50% of global NA

synthesis capacity being members of the International Gene Synthesis Consortium269, an

industry association that supports its members to follow its harmonised screening protocol.

However, companies implementing such biosecurity measures risk being undercut on price

and turnaround time by providers without such measures. While the cost of screening for

companies is currently minimal, as the cost of NA synthesis will continue to decline, the

‘fixed’ cost of screening could represent an increasing share of the final order price270,

further worsening this dynamic.

The provisions in the Biotech Act would aid to prevent such a ‘race to the bottom’ on

biosecurity practices and enable competition by removing burden for companies that

screen271. The RAND study assumes that a mandate would result in companies screening

98% of EU synthesis orders, while also indirectly increasing screening rates for non-EU

orders by around 10%. This is modelled to reduce misuse risk by 35% and accident

risk by 86%272. This risk reduction would result in expected annual monetised

benefits273 of EUR 2.9 billion in 2027, increasing to EUR 5.5 billion in 2036. Around

EUR 1.2 billion of the benefits in 2027 stem from accident prevention, while around EUR

1.8 billion stem from attack prevention. This risk reduction would indirectly also benefit

the biotech sector itself, avoiding severe regulatory backlash or a research pause as a

consequence of such an event, which RAND estimates could represent EUR 10 billion in

lost future research value.

These benefits significantly outweigh the estimated costs of the measure. Screening

measures represent a minor cost for NA synthesis companies. In a Commission workshop

on biosecurity274, an EU NA synthesis SME who screens all their orders and customers

highlighted how screening is practical and efficient for them, not hindering innovation or

commercial timelines. Industry interviews suggest that SMEs of 40-50 staff dedicate

around 0.5-1 FTE to biosecurity screening measures275. For cost calculations, we assume

30% of the ca. 100 custom NA synthesis companies in the EU already have customer

267 https://pmc.ncbi.nlm.nih.gov/articles/PMC11319849/ 268 See IBBIS mapping of explicit and implicit rules on NA synthesis screening across countries:

https://globalsynthesismap.bio/policy?country=FRA. 269 Harmonized screening protocol v2.0 (2017). International Gene Synthesis Corporation.270 If not matched by a similar decrease in the cost of screening with advancements in AI, as investigated in Acelas et al.

(2026) cited below. 271https://www.weforum.org/publications/biosecurity-innovation-and-risk-reduction-a-global-framework-for-

accessible-safe-and-secure-dna-synthesis-582d582cd4/ 272 Zakaria, S. et al. (2026). Cost–benefit analysis for synthetic nucleic acid screening in the European Union. Santa

Monica, CA: RAND Corporation, 2026. https://www.rand.org/pubs/research_reports/RRA4805-1.html; The analysis is

conducted over ten years and assumes a mandatory screening policy for all synthetic nucleic acids longer than 50bp

bought and sold in the EU. 273 The benefits quantify the reduction in the probability of biological events, such as another pandemic or an agro-

terrorism attack, and the resulting reduction in expected public health and economic costs. 274 Held on the 18th February 2026 in the context of stakeholder consultations for the Rapid Assessment Scenario Study

(forthcoming). 275 Evidence from SME expert interviews.

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screening policies in place276. We estimate the direct costs for the remaining 70% of EU

companies in scope to hire an additional biosecurity FTE, implement IT tools to screen

sequence orders277 and direct compliance costs for the regulatory introduction and

adjustment efforts are estimated at EUR 10.5 million annually, compared to a market size

of roughly EUR 500 million278.

The RAND Europe study estimates costs on a per-order rather than per-company basis,

taking the full NA synthesis market as a basis. Adjustingtheir model to only cover the

custom NA synthesis market in scope of the regulation and EU wages, direct legitimacy

screening costs are estimated at EUR 22.2 million279. However, per-order costs are

expected to significantly decrease with AI tools becoming more powerful and more widely

available, with Acelas et al. (2026) estimating their cost to decline from EUR 1 to EUR

0.20 per customer as the verification step becomes increasingly automated280.

For researchers and other customers, mandatory screening introduces additional

administrative costs linked to documentation, procurement adjustments, and compliance

procedures. For custom NA synthesis orders, these costs are estimated at approximately

EUR 16.4 million annually. Public sector implementation costs should remain relatively

small at around EUR 15 million (for EU and MS together), as the provisions do not rely

on a licensing regime and costs for both the EU and Member States would be mostly

limited to monitoring and inspection activities.

Table 20. Annual direct costs of screening measures281

EU enforcement cost EUR 1.3 million

MS enforcement cost EUR 14 million

Direct costs to companies EUR 10.5 - 22.2 million

Direct cost to customers EUR 16.4 million

Total EUR 42.2 – 53.9 million

276 Estimation based on the average between minimum (15%) and maximum (45%) values of the proportion of EU gene

companies that voluntarily screen now, from the RAND analysis. The number is also in line with the global results of

the survey conducted by Sentinel Bio on major screening tool providers and Response to the European Biotech Act -

Call for Evidence. See details on methodology in Annex 4 Additional methodological information on specific measures

for Intervention No 16. 277 Assumed to be relatively moderate at EUR 1.5 million for all companies, given the availability of free tools to screen

for sequences of concern: https://github.com/ibbis-bio/common-mechanism; and Response Call for Evidence for EU

Biotech Act. 278 Estimations based on https://www.grandviewresearch.com/horizon/outlook/dna-synthesis-market/europe. Assuming

50% of the overall DNA synthesis market is custom NA synthesis. 279 Estimations based on RAND analysis, but adjusted for EU average labour costs, number of custom providers, and

orders by the share of the market belonging only to custom providers (110 custom providers/215 total companies in the

synthetic DNA= 0.51). 280 Acelas, A., Palya, H., Flyangolts, K., Fady, P. E., & Nelson, C. (2026). Evaluating AI-Assisted Customer Verification

for Synthetic Nucleic Acid Screening. bioRxiv. https://www.biorxiv.org/content/10.64898/2026.02.27.708645v1?ct= 281 Calculation based on 2027 numbers. Costs may rise in the long run as the market also continues growing.

105

In addition to these direct costs, a screening mandate may also result in different types of

indirect costs which are more difficult to estimate. It might produce a “chilling effect” on

research activities if some organisations delay or abandon projects due to concerns about

delays or rejected orders. RAND Europe estimates potential research losses at EUR 97

million annually under very conservative assumptions. It assumes around 10% of

researchers shifting to in-house synthesis, which carries significantly higher costs per

order. In addition, introducing an additional regulation, even if not very costly to follow,

may result in productivity loss for custom NA synthesis companies due to higher

‘regulatory intensity’, estimated at EUR 12.3 – 24.8 million.

Table 21. Comparing annual costs and benefits

Estimated benefits EUR 2,900 million

Estimated costs (conservative estimate282) EUR 176 million

Even taking those conservative estimates of indirect costs into account, the estimated

benefits are 16 times higher than estimated costs. This reflects the expected reduction

in the probability of a biological attack with catastrophic public health and economic

consequences, achievable through a targeted intervention with minimal costs for

businesses and innovation.

5.2.7 Intervention n°17: Biodefence

The proposed Biotech Act establishes two categories of high-impact strategic projects for

biodefence. Article 42 covers biodefence capability projects with a broad mandate,

supporting activities from misuse prevention to surge capacity for diagnostics and

countermeasures. Article 41 creates a more targeted instrument: the EU Biothreat Radar,

focused on detection, characterisation, identification, analysis and assessment of biological

threats, including novel, unknown and engineered pathogens, and on pathogen-agnostic

cross-border surveillance.

These measures respond to a deteriorating threat environment. The ongoing Russia

invasion on Ukraine283 and war in Iran has raised concerns about the risk of pathogen

release from biological weapons programmes284, while advances in AI and biological

engineering lower barriers to designing or modifying pathogens285. The assessment of

impacts focuses on the EU Biothreat Radar, which provides a sufficiently detailed project

scope for structured impact analysis.

Expected impact:

282 Taking the upper bound of all cost estimates and including the relatively high RAND estimate of indirect costs. 283 Russia has expanded site of past bioweapons research, satellite images show - Washington Post. 284Nelson, C., The Threat No One is Talking About in Iran, RUSI Commentary, 23 March 2026. 285Williams et al. (2025), Forecasting LLM-Enabled Biorisk and the Efficacy of Safeguards, Research Forecasting

Institute.

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Deploying a surveillance system geared towards novel and engineered pathogens would

represent a significant change from current systems focused on surveillance of known

communicable diseases, with significant upfront and operational costs. By building on

existing EU surveillance capacities and initiatives, ECDC estimates that coordinating

Biothreat Radar activities at EU-level over seven years would require an operational

budget of EUR 25 million for coordination, governance, and information-sharing

platforms and 10 FTEs for the full period. A possible EU Reference Laboratory for

Biothreat Security is estimated to cost EUR 20 million for the 7-year period.

The larger cost lies in updating and integrating existing surveillance infrastructure:

syndromic, clinical, laboratory and environmental surveillance combined with

metagenomic sequencing. The Biotech rapid assessment scenario study uses a model by

SecureBio Detection (2025)286 for a US pathogen surveillance system287 at ~USD 52

million/year as a basis. Adapting this to the EU288 yields two scenarios: Scenario 1 scales

proportionally to EU transport and wastewater networks as complementary surveillance

activities (~EUR 46.5 million/year), while Scenario 2 expands environmental collection

and sequencing capacity as investing in traditional public health surveillance (~EUR 110

million/year).

Table 22. Estimated annual costs of pathogen surveillance systems

Cost component US model (EUR) EU Scenario 1

(EUR)

EU Scenario 2

(EUR)

Traveller genomic surveillance 19,516,259 22,635,734 7,543,733

Sequencing, processing & analysis 23,967,648 23,470,428 101,883,439

Environmental detection 425,610 416,374 832,748

Total (annual) 43,909,518 46,522,536 110,259,919

Traveller Genomic Surveillance (aircraft wastewater + nasal swabs). Sequencing/processing covers

metagenomic sequencing, bioinformatics and analysis. Scenario 1 scales the US model proportionally.

Scenario 2 expands environmental sampling and sequencing while discontinuing passenger swabbing. US

figures from SecureBio Detection (2025) converted to EUR.

Benefits are harder to quantify but potentially substantial. Despite gaps in EU-wide

standardised evaluation frameworks analysing the benefits of surveillance, studies exist

that have quantified the number of infections prevented, deaths avoided, and costs saved

in specific hospital and outbreak settings289. The advantages of early detection (through

modelling) and the impact of infection control interventions informed by pathogen

agnostic sequencing have been documented. However, whereas genomic and

epidemiological surveillance are likely to deliver greater real-world value, they are much

286SecureBio Detection (2025), Scaling US Pathogen Detection. See details on methodology in Annex 4 Additional

methodological information on specific measures for Intervention No 17. 287Based on swabs of airport travellers, municipal monitoring and aircraft wastewater analysis. 288See Methodology Annex for scenario descriptions and cost calculations. 289 Nascimento de Lima, P. et al. (2024), The value of environmental surveillance for pandemic response, Scientific

Reports, 14, 28935.

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harder to measure in economic terms. On the other hand, environmental surveillance is

population and ecosystem-wide by design, produces early signals and is easy to plug into

economic models. There are thus more quantified studies available proving the value of

this type of surveillance.

Empirical evidence from European wastewater surveillance studies documents lead times

of 5 to 19 days for SARS-CoV-2 detection relative to clinical identification.290 Modelling

by Nascimento de Lima et al. (2024) shows that an environmental surveillance system

providing a five-day early warning relative to clinical detection could reduce deaths from

149 to 134 per 100,000, lower illness costs from ~EUR 1,271 to ~EUR 1,118 per person,

and shorten lockdowns from 121 to 89 days in the first year of a COVID-19-type

pandemic.291

Set against the broader costs of pandemics, these gains are substantial. Global viral

epidemics cause estimated annual mortality of ~3.3 million people292, and COVID-19

alone caused economic losses in the trillions across the EU. For a pathogen-agnostic

system capable of detecting novel and engineered threats, the marginal benefit could be

substantially higher, as limited surveillance currently exists for novel threats.

Beyond public health, the Biothreat Radar would generate indirect gains in research

capacity and technological sovereignty, through investments in metagenomic

infrastructure, bioinformatics pipelines and EU-based data sharing via the European

Nucleotide Archive.

6 CUMULATIVE ECONOMIC, SOCIAL, ENVIRONMENTAL AND OTHER IMPACTS OF THE

PROPOSAL

While many of the measures included in the proposed Biotech Act are technical and

targeted in nature, their combined effect has the potential to be transformative. Together,

they create a framework for competitiveness where regulatory simplification, investment

mobilisation and innovation all support and reinforce one another.

This interaction is expected to generate impacts that are materially greater than the sum of

each measure assessed in isolation, because it addresses the key structural bottlenecks

affecting the EU biotechnology sector simultaneously. The measures also ensure that the

sector contributes more effectively to societal objectives, such as economic growth, job

creation and improved health outcomes.

The proposed Biotech Act’s impacts materialise across four interconnected areas. The first

three: regulatory simplification, competitiveness and investment attractiveness, and

innovation and research, capture the primary economic impacts. They also generate

indirect social impacts through employment creation, skills development and better access

to innovative treatments driven by faster innovation. They address, respectively, the cost

of operating within the EU regulatory environment, the EU’s capacity to retain and attract

290 ECDC (2025), Framework for integration of wastewater-based surveillance; Viviani et al. (2025). 291 Nascimento de Lima, P. et al. (2024), The value of environmental surveillance for pandemic response, Scientific

Reports, 14, 28935. 292 Bernstein, A. S. et al. (2022), The costs and benefits of primary prevention of zoonotic pandemics, Science Advances,

8(5).

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productive capital, and the conditions needed to translate scientific excellence into

marketable products. These areas are causally sequenced: regulatory simplification lowers

the cost base, which strengthens the investment proposition, which in turn accelerates

innovation throughput. The fourth area, public health and safety, captures the Act’s

ultimate societal return in terms of health outcomes, safety and resilience, complemented

with an assessment of the expected environmental impact. The combined effects of the

preceding areas materialise in benefits such as earlier patient access, supply resilience, and

proactive biosecurity governance. The following assessment draws on 17 intervention-

level assessments of impacts presented above, synthesising quantitative estimates and

directional findings into a coherent account of the Act’s expected effects. The estimates

presented below should be interpreted in light of several cross-cutting factors that may

influence their magnitude, while not changing the overall direction of the effects identified.

First, the magnitude of investment mobilisation critically depends on the availability of EU

budgetary guarantees under the next MFF, with estimates for the EU Health Biotechnology

Investment Pilot and strategic projects frameworks assuming sufficient budgetary

headroom. Second, the realisation of benefits depends on consistent implementation by

Member States, particularly for clinical trials, the organ processing authorisation regime,

strategic project permitting, and biosecurity screening, among others. Third, uptake-

dependent measures, such as strategic and high-impact project recognition, regulatory

sandboxes, and the AI and data framework, are presented under illustrative scenarios (low,

medium, high). Actual impacts will be determined by the number, quality and maturity of

projects. Finally, estimates assume broadly stable global market conditions; significant

shifts in competitor jurisdictions' regulatory frameworks could alter the EU's relative

competitive position.

6.1 Regulatory simplification and administrative burden

The Biotech Act delivers its most immediate effects in two distinct but mutually

reinforcing ways: by eliminating procedural duplication across intersecting regulatory

frameworks, and by shortening authorisation timelines. Where the Act removes entire

procedural layers, it also shortens the remaining ones. Because these savings compound

over multiple applications, modifications, and jurisdictions, the cumulative reduction

across a full clinical development programme is substantially larger than any individual

measure assessed alone293. These effects complement other simplification efforts in related

Union frameworks. For instance, the pharmaceutical and medical devices legislation, in

combination with the Biotech Act, are expected to generate significant simplification

effects for the biotechnology sector294.

293 The cumulative programme-level impact results from a combination of a) measure stacking within a single application

(e.g., a single clinical trial application can benefit from several reforms simultaneously); and b) lifecycle accumulation

(i.e., the same per-application saving recurs across many transactions and jurisdictions in one clinical development

programme. 294 The indicated complimentary simplification effect stems for example from: a) the revised Pharma Package, which

has already transferred ERA for investigational medicinal products from the GMO legislation to the CTR, and which the

Biotech Act builds directly on by introducing risk-proportionate ERA derogations for specified categories of low-risk

GMO-ATMPs; b) the Commission's proposal of 16 December 2025 on the MDR and IVDR, which the Biotech Act's

combined-studies measure complements by replacing parallel CTR-MDR/IVDR tracks with a single coordinated

assessment; and c) for novel biotechnology products that currently span pharmaceutical, medical devices, and SoHO

frameworks simultaneously, the Biotech Act's regulatory status repository and Foresight Panel resolve cross-framework

classification ambiguity that neither the pharmaceutical nor the medical devices reforms can address in isolation.

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Significant burden reduction is expected in clinical development, one of the most cost-

intensive stages of the biotech value chain295. For human medicinal products, the

proposed amendments to the CTR are expected to reduce authorisation timelines from

106 to 75 days (47 without a request for information) and to simplify and streamline the

authorisation procedure, as well as the conduct of clinical trials. Key improvements include

a new single assessment procedure for combined studies involving medicinal products and

medical devices or in-vitro diagnostics, a new single investigational product core dossier,

and the possibility of submitting applications for substantial modifications to the clinical

trial in parallel after the notification of the authorisation decision. It is expected to yield

direct cost savings in EU sponsor expenditure of approximately 5% (EUR 1.5-3.1 billion

per year). Indirect savings of a similar order are anticipated through shorter time-dependent

costs, yielding aggregate annual financial gains for sponsors potentially exceeding

EUR 5 billion. Applying the Standard Cost Model (SCM), each multinational trial stands

to save approximately EUR 2,700-4,500 in sponsor administrative costs through alone a

reduction in the staff time for regulatory interactions by 15-25%. Additionally, electronic

submission and digitalisation measures are estimated to generate EUR 112-225 million in

industry savings over fifteen years. A simplified version of the cost-benefit analysis,

considering a subset of the policy measures included in the Biotech Act, suggests an overall

annual cost-saving of EUR 1.24 billion296. The Biotech Act proposal is expected to result

in an increase in commercial clinical trials by 10% to 30%, estimated to generate

approximately EUR 3.6 billion to 10.7 billion in economic gains and 16,500 to 49,500

additional jobs.

These gains extend into adjacent product domains, where parallel reforms are addressing

sources of procedural duplication there. In the biosimilars domain, the rationalisation of

Comparative Efficacy Studies requirements removes EUR 19-26 million in direct trial

costs per product and shortens development timelines by 12-24 months, translating into

sector-level savings of EUR 222-467 million annually for the 12-18 affected MAAs per

year. Thus, combined annual regulatory cost relief for health biotech sponsors across

clinical trial and biosimilar reforms approach (and potentially exceed) EUR 5.2-5.5

billion per year. Regarding ATMPs, eliminating the additional 50-day assessment period

and granting risk-proportionate ERA exemptions for qualifying GMO-ATMPs is expected

to reduce regulatory timelines and remove non-value-adding procedural steps, potentially

removing a burden of 0.15-0.3 FTE-years per clinical trial application, a reduction that

disproportionately benefits the SME-dominated ATMP developer base, and is also

expected to significantly influence sponsors’ decisions to conduct clinical trials in Europe.

For VMPs containing GMOs, the single regulatory pathway eliminates 30-90 days of

process delay per CTA, aggregating to 240-1,350 product-days of delay removed annually

at current pipeline volumes, with cumulative administrative cost savings of EUR 5-14.5

million till 2040. The uniform handling regime for variations not requiring assessment adds

a further EUR 22.5 million in present-value savings over the same period.

295 Farid et al. (2020) Benchmarking biopharmaceutical process development and manufacturing cost contributions to

R&D - PMC. 296 See Regulatory Framework Study (forthcoming). The simplified costs-benefit analysis focus on operational costs, not

considering costs arising from transitioning to new regulatory requirements.

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Beyond clinical development, the Act addresses the regulatory fragmentation that so

often compounds costs. Divergent national practices in risk classification, product

categorisation, and procedural interpretation currently force applicants to navigate several

different Member State-specific requirements for what is nominally the same regulatory

procedure. The Act responds by establishing shared infrastructure, harmonising regulatory

pathways, reducing legal ambiguities, and offering regulatory and procedural guidance.

Within this context, the Act's benefits are structurally tilted toward SMEs and start-ups,

for whom the reforms remove barriers to participation rather than merely reducing costs

of ongoing operations. This happens in two distinct ways. First, regulatory simplification

measures reduce fixed-cost compliance burdens (e.g., legal support, regulatory affairs

staffing, dossier preparation, external consultancy, multi-jurisdictional coordination) that

are largely invariant to firm size and therefore represent a substantially higher share of total

expenditure for smaller firms. This is particularly pronounced in ATMPs, where SMEs

constitute the majority of developers, and in GMMs, where SMEs and start-ups represent

the predominant developer base. Second, the Act addresses infrastructure and data access

barriers that structurally exclude smaller firms from the innovation pipeline, most

pronouncedly in the AI and data domain.

These regulatory simplification gains for businesses come with new governance

obligations for public authorities and Member States. The Act introduces an expanded

public sector role in certain areas, which includes new coordination and project permitting

responsibilities, more clinical trial governance and enforcement, biosecurity screening and

inspection obligations, and ecosystem coordination through the Steering Group and

Support Network. The resulting costs are expected to be front-loaded with activities such

as designating competent authorities, establishing or adapting single points of contact,

resource permitting functions, and developing sector-specific expertise. However, the

Act’s provisions are also designed in a way that limits the incremental burden to the extent

possible by designating or adapting existing administrative coordination mechanisms

rather than creating entirely new institutions. Over time, efficiency gains are expected as

procedures standardise, digital handling matures, and coordination platforms reduce the

unit cost of multi-authority interactions, partially offsetting the initial burden. Thus, the net

balance is structurally positive: by removing procedural layers, the Act generates savings

for businesses and healthcare systems that substantially exceed the incremental

institutional costs and administrative burdens borne by public authorities.

Aggregated across the full package of simplification interventions, the Act delivers direct

annual cost savings for businesses in the order of EUR 5.2-5.5 billion, driven

overwhelmingly by the clinical trials reform and biosimilars CES rationalisation, and

supplemented by cumulative electronic-submission savings and VMP-related

administrative and variation savings. Under the One-In-One-Out (OIOO) accounting, new

administrative burdens on businesses of approximately EUR 16.6 million/year (dominated

by biosecurity customer-side compliance) are partially offset by removed burdens totalling

approximately EUR 4.3-8.0 million/year, yielding a net administrative increase of

approximately EUR 8.6-12.4 million/year. In parallel, adjustment costs on businesses

amount to EUR 8.16-27.32 million/year, with a further EUR 48.6-112.6 million/year in

recurrent monetised costs falling on public administrations, mainly stemming from

biodefence collection infrastructure (EUR 46-110 million/year).

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Even at the upper bound of identified incremental costs, and before accounting for the Act's

downstream health, supply-resilience and innovation-enabling benefits, the direct

business-level savings from regulatory simplification far exceed the full sum of

monetised countervailing items, confirming that, in cumulative terms, the Biotech Act

operates as a substantial net simplification instrument for the EU biotechnology sector,

with the residual OIOO increase concentrated in a single, security-motivated intervention

whose justification rests on a distinct benefit-side case (biosecurity risk prevention

monetised at EUR 2.9 billion/year in 2027, rising to EUR 5.5 billion/year by 2036).

Distributional impacts

While the aggregate cost-benefit balance of the package is firmly positive, the Act

produces material intra-EU transfers whose direction warrants explicit recognition (see

Annex 3). The principal redistributive vector is the SPC extension, which is explicitly

designed to transfer approximately EUR 690 million/year in additional originator gross

profit from biosimilar developers (around EUR 240 million/year in foregone profits) and

from payers and patients (combined social cost of around EUR 615 million/year), in

exchange for conditional EU-based manufacturing and multi-Member State trial

commitments. A second, structural transfer runs across firm size: because fixed

compliance costs are largely size-invariant, simplification gains in clinical trials, ATMPs,

GMMs and the AI and data framework accrue disproportionately to SMEs and start-ups,

for whom they typically remove barriers to participation rather than merely reduce

operating costs. A third runs across the public-private interface: businesses and

healthcare systems capture the bulk of regulatory and efficiency savings, while Member

State authorities absorb front-loaded governance costs, which nonetheless remain orders

of magnitude smaller than the corresponding business-side relief and associated prevention

benefits. Crucially, the combination of measures generates additional distributional effects

not visible at intervention level: CES rationalisation and strategic-project eligibility partly

offset the SPC-driven loss to biosimilar developers; the SPC geographical conditionalities

recycle part of the payer-to-originator transfer back into EU clinical and manufacturing

activity; and the Support Network and cluster infrastructure narrow the capacity gap that

would otherwise leave smaller firms less able to exploit complex regulatory architectures.

On balance, patient welfare is strongly positive, as biosimilar-driven healthcare savings

outweigh the SPC-related delay costs.

6.2 Competitiveness and investment attractiveness

The competitiveness rationale for the Biotech Act rests on a well-documented structural

deficit297, as evidenced by the EU’s limited capacity to scale innovative firms, and a

persistent investment gap (estimated at EUR 40 billion annually) in the EU biotechnology

sector. Regulatory simplification is a necessary condition for closing this gap, but it is not

enough on its own. The Act therefore deploys a set of instruments that collectively alter

the return profile for biotech investments in the EU by targeting the specific stages and

segments where market failures are most acute. The Act's competitiveness provisions are

designed to address a structural erosion of the EU's position relative to its principal global

297 See section 3 for further elaboration.

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competitors and to reverse specific competitive disadvantages on the dimensions that drive

investment and location decisions.

The project recognition frameworks (strategic and high-impact) turn what is currently

an opaque, variable permitting landscape into a bounded, time-limited pathway, directly

improving the bankability of industrial-scale deployments. The combined potential for

investment mobilisation is substantial. Strategic project recognition alone could mobilise

EUR 15-28 billion cumulatively by 2038 (under medium uptake; 60-70 recognised

projects), while the high-impact flagship tier adds a further EUR 4-12 billion (medium, 12-

15 projects) targeting catalytic infrastructure with cross-border reach, such as integrated

biotech testing and scale-up facilities and centres of excellence for advanced therapies.

Together, these frameworks could mobilise EUR 19-40 billion in total investment by 2038,

depending on uptake and project composition, and avoid combined delay costs of EUR

265 million-1.16 billion (under medium uptake). Critically, these project pipelines also

serve a signalling function; creating a structured ‘investability’ channel that did not

previously exist, facilitating faster financial close and more crowding-in of private capital.

The financing instruments reinforce this logic. The proposed EU Health Biotechnology

Investment Pilot targets the sector's structural EUR 40 billion annual investment gap, as

estimated by the EIB. The already launched BioTechEU initiative backed by InvestEU is

expected to mobilise up to EUR 10 billion in biotechnology investments in 2026-2027

alone. Under the medium-ambition scenario (closing 25% of the EU-US investment gap),

the Pilot would result in approximately EUR 6.2 billion in direct investments over two

years, supported by EC budgetary guarantees. It is expected to raise total investment

mobilisation to approximately EUR 41.6 billion over the same period (compared with

approximately EUR 21.6 billion under the baseline), consistent with reducing the annual

investment gap by approximately EUR 10 billion per year.

A distinct competitive dimension concerns biosimilars, where the EU holds the world’s

largest market (approximately EUR 17 billion at list prices298), but is experiencing

manufacturing migration to Asia. Streamlining CES requirements serves a competitiveness

objective: by reducing the cost threshold for biosimilar development, it accelerates market

entry by 12-24 months per product and strengthens EU-based developers against

jurisdictions already formalising such flexibility. Strategic project eligibility for biosimilar

manufacturing reinforces this supply-side effect. While the share of EU-headquartered

companies in EU biosimilar MAs is 49% in 2025, projected to fall to 40-50% without

intervention, it can be potentially maintained at 45-55% with the proposed measures. On

the other hand, the SPC extension incentivises a very targeted set of innovative

biotechnology medicines. The SPC extension could potentially be awarded to about three

products annually299. According to EMA’s data from 2016 to 2025, the three products

could grow to about five per yearif developers changed their behaviour in response to the

incentive (i.e. conducting part of their clinical trials and manufacturing in the EU), thus

bringing new transformative products to the market and a marginal positive impact on

the conduct of clinical trials and manufacturing in the EU.

298 IQVIA Institute for Human Data Science (2026), The Impact of Biosimilar Competition in Europe, estimating the EU

biosimilars market at approximately USD 18 billion (list prices). 299 The average is 2-3 products per year rounded to 3 for ease of illustrating the systemic impact.

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The extension comes with an additional gross economic gain of approximately EUR 230

million per qualifying medicine per year, and a direct payer expenditure and monetised

cost of delayed patient access which together amount to approximately EUR 205 million

per medicine. This corresponds to a cost of approximately EUR 615 million every year at

aggregate level, based on an average of three qualifying medicines per year.

The extension focuses specifically on rewarding innovations that bring the greatest value

to patients300, sending an important signal to companies regarding investment priorities.

The geographical conditions ensure that this additional incentive also favours investment

in the EU and helps strengthen the EU’s health biotech sector.

Clinical research is equally critical to the competitiveness proposition. Despite significant

global growth in clinical trials between 2013 and 2023, the EU’s share of global

commercial trials halved from 22% to 12%, failing to capture the proportional share of the

growth. Improved regulations, including simplified and more predictable procedures, as

well as sandboxes work in concert to make the EU/EEA more attractive for sponsors as a

location for conducting clinical trials. Consequently, a better regulatory environment is

expected to increase the number of clinical trials in the Union and possibly, depending on

the development in other regions, reverse the structural decline of the EEA share of global

trials. The increase in trials is expected to range between 10% and 30% based on two

studies supporting the assessment301. Together, these interventions form a coordinated

competitiveness package.

6.3 Innovation and research

The EU’s core innovation challenge in biotechnology is not insufficient scientific output.

European research organisations rank among global leaders in biotechnology publications,

but there are persistent barriers to translate that output into clinical and commercial

development. This is reflected in significantly weaker late-stage financing and a persistent

investment gap in the EU compared to global peers302. While the competitiveness measures

described above address the conditions under which capital is deployed in the EU, the

innovation provisions target the conditions under which scientific discoveries are

developed, validated and translated across the full R&D continuum, including clinical

research and scale-up activities, ensuring that innovation can progress effectively from

early-stage research to market deployment in the Union. The Act addresses this structural

translation gap through three mutually reinforcing channels.

300 Example of the value for patients of biotechnology medicines include: Jönsson B, Hampson G, Michaels J, Towse A,

von der Schulenburg JG, Wong O. Advanced therapy medicinal products and health technology assessment principles

and practices for value-based and sustainable healthcare. Eur J Health Econ. 2019 Apr;20(3):427-438. doi:

10.1007/s10198-018-1007-x. Epub 2018 Sep 18. PMID: 30229376; PMCID: PMC6438935.

Ohashi T. The impact of monoclonal antibody drugs on healthcare economics in the treatment of multiple sclerosis and

neuromyelitis optica spectrum disorders. Clin Exp Neuroimmunol. 2022;13(3):166–171.

https://doi.org/10.1111/cen3.12718. 301 According to one study (Regulatory Framework Study forthcoming), the number of clinical trials is expected to

increase by 32% considering the outcomes of a survey with sponsors. A second study (Rapid Assessment Scenarios

study, forthcoming) suggests an average increase of 10 %. Additionally, the lower bound aligns with the ACT EU target

of an increase of 11.1% of multinational clinical trials in the EU in the next five years. 302 US biotech firms have raised approximately 870% more Series C capital over the past decade and 945% more in IPO

proceeds (USD 53 billion versus USD 5 billion), while EU venture capital in biotech and healthcare fell from 34% of

global share in 2013 to 18% in 2022.

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First, introducing regulatory sandboxes across clinical trials, food and feed, SoHO, and

veterinary products creates, for the first time, structured pathways for innovations that

currently face regulatory uncertainty or do not fit neatly into existing EU frameworks. In

the absence of such mechanisms, highly novel products risk delays, fragmented

assessments or the absence of a clear route to market, constraining their development and

deployment in the Union and delaying or preventing the Union from capturing benefits in

terms of patient outcomes, innovation and economic activity.

Second, the Biotech Act addresses late-stage attrition by combining dedicated financing

instruments with catalytic infrastructure. The EU Health Biotechnology Investment Pilot

targets the sector’s EUR 40 billion annual funding gap, as estimated by the EIB, building

on the EUR 10 billion in mobilisation expected in 2026-2027 through the BioTechEU

initiative and illustrative scenarios projecting a gap reduction of EUR 10-20 billion per

year at full scale. Simultaneously, high-impact project infrastructures are expected, under

illustrative uptake scenarios, to support 4-40 additional clinical trial applications per year

and serve 60-600 firms annually. These ranges reflect very low to very high uptake

scenarios, with impacts driven by de-risking translation services and compressing

development cycles. Together, the sandboxes are expected to resolve pathway uncertainty

for novel products, while financing instruments and catalytic infrastructure ensure that

developers of products with a clear regulatory route can access the capital and facilities

needed to reach the market.

Third, the AI and data framework addresses a cross-cutting enabler that conditions the

effectiveness of the first two channels. Depending on uptake, the recognised testing

environments and data quality accelerators could serve approximately 1,100-3,400

companies and data users annually (under medium uptake projections), and trigger

infrastructure investments of EUR 650 million to EUR 1.3 billion. Along with the

harmonised guidance on deployment and use of systems based on advanced technologies,

including AI in the lifecycle of medicinal products, these measures are expected to deliver

an 14-month average reduction in development timelines versus fragmented multi-vendor

outsourcing, with best-case savings of up to 34 months across Phase I–III303 , with potential

trial timeline reductions of 18% as AI integration matures, collectively positioning the EU

to capture a greater share of the rapidly expanding AI-enabled drug discovery market.

Together, these three channels constitute the most comprehensive intervention the EU has

undertaken to address the structural disconnect between its scientific output and its

capacity to translate that output into clinical and commercial innovation. The Act

strengthens the EU's capacity to innovate in biotechnology by simultaneously lowering

the three barriers that currently determine whether a viable scientific discovery acquires a

path to market in the EU: regulatory pathway uncertainty (addressed by sandboxes, the

regulatory status repository, and the Foresight Panel), capital scarcity at the translation

stage (addressed by the Investment Pilot and high-impact project infrastructure), and the

absence of shared enabling infrastructure for AI-enabled development (addressed by

testing environments and data quality accelerators). These interventions could also create

303 Evidence from integrated shared-facility models, based on DiMasi, J., Dirks, A., & Getz, K. (2025). "The Net

Financial Benefits of Single Vendor Integrated CDMO and CRO Drug Development Services." Tufts Center for the

Study of Drug Development. Announced June 16, 2025.

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synergies with other Union initiatives, including potential Important Projects of Common

European Interest (IPCEIs304), where relevant.

6.4 Public health and safety

The regulatory and economic reforms described in the preceding sections are not ends in

themselves; their ultimate justification lies in their capacity to deliver measurable public

health benefits. The Biotech Act’s public health impact comes through three reinforcing

channels: accelerating patient access to biotechnology-derived treatments, strengthening

supply resilience for essential medicines, and establishing a preventive framework against

biosecurity risks.

The most quantifiable patient-access gains come from biosimilars and organ

transplantation. Accelerating and widening biosimilar competition is projected to increase

annual healthcare system savings from approximately EUR 13 billion in 2024 to EUR 22-

35 billion per year by 2035-2038 (cumulative EUR 300-450 billion), while preserving an

unblemished safety record; no biosimilar has been withdrawn on safety grounds in 19

years. In parallel, reforms to organ processing standards are estimated to yield

approximately 1,435 additional transplants per year by 2035, set against a waiting list

exceeding 52,000 patients and approximately 3,366 waiting-list deaths annually,

generating cumulative dialysis cost avoidance of approximately EUR 158 million. Beyond

these gains, the organ processing reforms are expected to prevent 570-945 organ discards

per year and avert 57-72 waiting-list deaths annually by 2035 (248-311 cumulatively over

2028-2035, valued at approximately EUR 285-537 million using the Commission's

standard value of a statistical life year). Thus, the total monetised public health benefit of

organ processing reforms over 2028-2035 is approximately EUR 443-695 million.

The reforms to clinical trial authorisation and the ATMP framework compound these

effects. Given that around 5% to 10% of clinical trials result in a medicinal product

reaching the market (an average of 8%), the proposed amendments to the Clinical Trial

Regulation could enable roughly 100 of the 2,500–3,000 products tested annually to launch

up to six months earlier, while ATMP reforms accelerate access to potentially curative

therapies in high-unmet-need areas where the EU already lags behind competing

jurisdictions. The biosimilars framework further strengthens both access and affordability:

by reducing the cost threshold for biosimilar development, the Act addresses a ‘biosimilar

void’; some 79% of the approximately 100 biologics losing exclusivity by 2032 have no

biosimilars in development.

On supply resilience, the strategic projects framework is expected to deliver 18-60

capacity-relevant EU-based biomanufacturing deployments by 2038 (depending on

uptake), directly countering the structural vulnerability created by growing import

dependence, currently increasing at 12% annually for biosimilars alone.

Supporting these four impact areas is a set of ecosystem-level enabling measures,

comprising the EU Health Biotechnology Support Network, networks of health

304 E.g. three Important Projects of Common European Interest (IPCEI) in the biotechnology domain are currently under

design (https://competition-policy.ec.europa.eu/state-aid/ipcei/design-support-hub_en#ipcei-candidates-in-the-design-

support-hub).

116

biotechnology clusters, the strategic mapping of the EU’s biotechnology ecosystem, and

the European Health Biotechnology Steering Group, which provide the coordination,

advisory, and connectivity infrastructure needed to translate individual regulatory reforms

into system-level outcomes. The Support Network provides a single, locally accessible

entry point for health biotechnology developers (particularly SMEs and start-ups) to

navigate regulatory pathways, identify funding instruments, and connect with investors,

while cluster networks facilitate cross-border collaboration, infrastructure access, and

knowledge transfer. Together, these mechanisms reduce the transaction costs that would

otherwise limit the uptake and cumulative impact of the substantive reforms.

Finally, the biosecurity framework introduces a screening framework for synthesised

nucleic acids, addressing the specific risk that arises as biotechnology products become

more accessible and AI lowers barriers to misuse.

6.5 Environmental impacts

Beyond its primary economic and public health objectives, the Act is expected to generate

material environmental and sustainability co-benefits across several interventions. The

GMM regulatory reform enables the deployment of microbial applications in

biofertilisation, biocontrol, bioremediation, and bioleaching (sectors with a combined

global market exceeding EUR 29 billion and projected growth rates of 9-14% annually),

which are currently entirely blocked in the EU, where no GMM has been authorised for

deliberate release under the existing framework. The veterinary medicines reform

facilitates uptake of next-generation biotech vaccines in food-producing species, reducing

reliance on antimicrobials in support of the EU's target of halving antimicrobial sales by

2030; empirical evidence associates a 10% reduction in livestock disease levels with an

800 million tonne decrease in greenhouse gas emissions, equivalent to the annual

emissions of 117 million Europeans. The biosecurity screening framework provides a

direct environmental safeguard: mandatory nucleic acid screening, modelled to prevent

35% of deliberate attacks and 86% of accidental releases, yielding expected benefits of

EUR 2.9 billion in 2027, rising to EUR 5.5 billion by 2036,set against implementation

costs that are orders of magnitude smaller. In addition, the biothreat radar and biodefence

provisions address the extreme tail of biological risk where market mechanisms cannot

ensure preparedness. Meanwhile, the food chain sandbox framework creates structured

pathways for pre-market testing of sustainable food production technologies, such as GM

food, food enzymes, as well as methodologies thereof, such as new approach

methodologies for risk assessment. These provisions collectively position the Act as a

contributor to the EU's broader sustainability commitments under the European Green Deal

and the 2030 Agenda for Sustainable Development.

Taken together, these effects position the Biotech Act as a structural enabler of a

more competitive, innovative and resilient EU biotechnology ecosystem, while

contributing to societal objectives and embedding safeguards against emerging

biosecurity risks, with system-level benefits materialising over time. While the

magnitude of these benefits will depend on uptake, implementation and broader

market conditions, the assessment indicates that the cumulative benefits of the

package are expected to significantly outweigh the associated costs.

117

6.6 Digital by default principle

The Biotech Act supports the digital transformation of the EU biotechnology ecosystem

by embedding a digital-by-default approach across regulatory, scientific and

administrative processes. Through measures dedicated to AI and data, but also other

measures embedded across the act, digitalisation operates as a horizontal enabler that

amplifies the effectiveness of the regulatory simplification, competitiveness and

innovation interventions described in the preceding sections.

Measures under the Biotech Act promote the use of electronic submissions and coordinated

approaches to data governance. This contributes to reducing administrative costs for

businesses and streamlining interactions with public authorities.

The AI and data framework (Intervention n°15) establishes a coherent structure for the

development, validation and regulatory use of advanced technologies, including AI, across

the lifecycle of medicinal products. The provision of non-binding guidance at Union level

reduces uncertainty around data requirements and validation standards, enabling

developers to design evidence generation strategies more efficiently and with greater

regulatory certainty. In parallel, trusted testing environments and biotechnology data

quality accelerators are bound to create shared infrastructures that allow companies,

particularly SMEs and start-ups, to access high-quality datasets and computational

resources that would otherwise remain out of reach.

Taken together, these contribute to strengthening innovation and research capacity and

shortening timelines for innovations to reach the market, reinforcing the competitiveness

and investment effects described in Section 6.2 by improving the risk-return profile of

data-driven biotechnology projects and increasing the attractiveness of the Union as a

location for AI-enabled development.

For public authorities, the transition to digital-by-default entails upfront adjustment costs

related to the development of digital infrastructures, data governance frameworks and

technical expertise. These costs are expected to be largely offset over time as procedures

standardise, digital handling matures and coordination across authorities improves. As

systems scale, the unit cost of regulatory processing is expected to decline, contributing to

greater administrative efficiency and more consistent decision-making.

Overall, through measures touching upon both regulatory and innovation aspects, the

digital-by-default approach therefore acts as a systemic multiplier across the Biotech Act.

7 MONITORING AND EVALUATION

Five years after the Regulation proposal’s entry into application, and every five years

thereafter, the Commission will evaluate its implementation, effectiveness and impact. As

regards the proposed Directive, it will also be evaluated in accordance with Better

Regulation policy.

Progress towards the objectives of the proposed Regulation would be monitored using a

set of quantitative and qualitative indicators. This assessment will draw on the strategic

mapping of the EU’s biotechnology ecosystem that will be established and periodically

118

updated by the Commission. It will also be based on continuous data and other information

available through the implementation of existing legislation and initiatives in the

Commission and the European Medicines Agency.

Such monitoring shall be based on key performance indicators:

Indicator Source

Venture-capital investment flows in biotechnology in the Union305 Invest Europe Annual activity

statistics

Number of strategic projects and high-impact strategic projects European Commission

Number of products granted a supplementary protection certificate National patent offices

Number of additional multinational clinical trials authorised in the

Union over the 5-year period of the reporting, compared to the

average number of such clinical trials authorised per year in the

Union as of 2025

Clinical Trials Information

System (CTIS)

Number of clinical trials concerning ATMPs authorised in the EU Clinical trials information

system (EMA)

Number of ATMPs with EMA authorisation in the EU EMA annual report

Number of GMM products authorised under Directive 2001/18/EC to

be placed on the EU market

European Commission

305 Calculation methodology to ensure that short-term volatility and year-to-year fluctuations do not distort the

assessment of underlying investment trends, such as by using three-year moving average of annual investment flows.

EN EN

EUROPEAN COMMISSION

Brussels, 26.5.2026

SWD(2026) 450 final

PART 2/2

Addendum to

COM(2025) 1022 and COM(2025) 1031 adopted on 16.12.2025

COMMISSION STAFF WORKING DOCUMENT

European Biotech Act

Accompanying the documents

Proposal for a Regulation of the European Parliament and of the Council on

establishing a framework of measures for strengthening Union's biotechnology and

biomanufacturing sectors particularly in the area of health and amending Regulations

(EC) No 178/2002, (EC) No 1394/2007, (EU) No 536/2014, (EU) 2019/6, (EU) 2024/795

and (EU) 2024/1938 (European Biotech Act)

and

Proposal for a Directive of the European Parliament and of the Council amending

Directives 2001/18/EC and 2010/53/EU as regards the placing on the market of

genetically modified micro-organisms and the processing of organs

{COM(2025) 1022 final} - {COM(2025) 1031 final}

Table of contents

ANNEX 1: PROCEDURAL INFORMATION ................................................................................ 2

ANNEX 2: STAKEHOLDER CONSULTATION........................................................................... 4

ANNEX 3: WHO IS AFFECTED AND HOW? ............................................................................ 16

ANNEX 4: ANALYTICAL METHODS ....................................................................................... 47

ANNEX 5: ADDITIONAL INFORMATION ON BACKGROUND ON THE SECTOR AND

PROBLEM DEFINITION .................................................................................................... 77

ANNEX 6: OVERVIEW OF THE PROPOSED MEASURES AND ARTICLES OF THE

PROPOSED REGULATION AND DIRECTIVE .............................................................. 101

ANNEX 7: ADDITIONAL INFORMATION ON MEASURES AND EXPECTED IMPACTS 111

ANNEX 8: COMPETITIVENESS CHECK ................................................................................ 244

ANNEX 9: SME CHECK ............................................................................................................ 247

2

ANNEX 1: PROCEDURAL INFORMATION

1. Lead DG, Decide Planning/CWP references

The legislative proposal for the European Biotech Act was prepared under the lead of the

Directorate-General for Health and Food Safety (DG SANTE). In the DECIDE Planning

of the Commission, the process is referred to under item PLAN/2025/176. The Act was

announced in the political guidelines for the European Commission 2024-2029.

2. Organisation and timing

An Inter-Service Coordination Group (ISCG) assisted DG SANTE in the preparation of

legislative proposal. It included Commission services of Directorate-Generals AGRI,

BUDG, CLIMA, CNECT, COMP, DEFIS, ENER, ENV, GROW, HERA, JRC, REGIO,

RTD, TAXUD, TRADE, together with the Commission’s Legal Service and Secretariat

General.

Three Interservice Coordination Groups have been organised between February and

November 2025, informing the preparation of the proposed Act.

A Call for Evidence was open for feedback between 14 May and 11 June 2025. A Public

Consultation was published on 4 August 2025 and closed on 10 November 2025.

An ISCG meeting on the analytical Staff Working Document took place on 23 March 2026.

3. Consultation of the RSB

The RSB was not consulted on an impact assessment. Considering the politically urgent

need to address the policy challenges identified, an impact assessment could not have been

delivered in the timeframe available before the proposal. A derogation from the

accompanying impact assessment was granted and this analytical Staff Working Document

(SWD) explains the proposal and presents the underlying evidence and impact analysis,

including cost-benefit assessment.

4. Evidence, sources and quality

The major competitiveness gap in biotechnology and the market and regulatory barriers

faced by European companies were identified in the Commission Communication

‘Building the future with nature: Boosting Biotechnology and Biomanufacturing in the

EU’1 and in the Draghi and Letta reports2.

External studies have been commissioned by the Commission which have been used to

prepare the SWD:

1 COM(2024) 137 final/2. 2 Draghi, Mario. The future of European competitiveness: A competitiveness strategy for Europe, European Commission,

9 September 2024.; Enrico Letta, Much more than a Market. April 2024.

3

- ‘Analysis of the Regulatory Framework for Biotechnology and

Biomanufacturing in the EU’3 (Regulatory Framework Study, forthcoming). This

study was announced in the Commission Communication ‘Building the future with

nature: Boosting Biotechnology and Biomanufacturing in the EU’ and was

launched in December 2024. It provides a mapping of the main pieces of EU and

national legislation that apply to biotechnology and biomanufacturing products and

processes – whether they are horizontal or sector-specific – and identifies related

challenges, their causes and the consequences for stakeholders. The study also

assesses the impacts of policy measures related to the EU rules applicable to

clinical trials and genetically modified micro-organisms.

- ‘Landscape analysis study of the biotechnology sector in the Union with a view

to foster its competitiveness and innovation’4 (Landscape analysis study,

forthcoming): This study, launched in August 2025, provides an analysis of the

challenges faced by the various biotechnology sectors, an overview of the market

as well as a landscape of EU and national measures supporting competitiveness and

innovation of the sector and the resulting successes and gaps.

- ‘Study to support the rapid assessment of policy scenarios to strengthen

innovation and competitiveness in the field of biotechnology in the EU’5 (Rapid

Assessment Scenarios study, forthcoming): The study, launched in December 2025,

assesses all significant impacts of measures for the proposed European Biotech

Act.

- ‘Study supporting the Evaluation of the European Food Safety Authority

2017-2024’6: This study supports the Evaluation of EFSA, covering the evaluation

criteria of effectiveness, coherence, EU added value and relevance.

- JRC case study7 and pipeline analysis on GMMs8.

- Scientific opinions from EU agencies have been considered where relevant to

specific areas of the Act (see e.g. Annex 7, intervention n°7 on GMMs).

- ‘Fast-track landscape analyses to assess the regulatory clinical trial eco-

system in the EU/EEA and in other relevant regions’9 (forthcoming).This study

supports the assessment of the clinical trial eco-system in the EU and other regions

and its impact on the economy, public health, and skill formation.

3 "Analysis of the Regulatory Framework for Biotechnology and Biomanufacturing in the EU" Deloitte, empirica et al.,

(forthcoming). 4 Technopolis et al, Landscape analysis study of the biotechnology sector in the Union with a view to foster its

competitiveness and innovation, (forthcoming). 5 PPMI (part of the Verian Group), Fraunhofer ISI, Study to support the rapid assessment of policy scenarios to

strengthen innovation and competitiveness in the field of biotechnology in the EU, (forthcoming). 6 Intellera, Ipsos, Tetra Tech, Study supporting the Evaluation of the European Food Safety Authority 2017-2024, Final

Report, December 2025 (forthcoming). 7 Burren, S., Palacios, J., Areal, F.J., Rodriguez-Cerezo, E., Barreiro-Hurle, J. (2026). The potential of genetically

modified microorganisms to reduce nitrogen loads in the EU agricultural sector. JRC Technical Report, Publications

Office of the European Union, Luxembourg (publication forthcoming). 8 Lowe, C.R., Ponferrada, V., Ruiz Aquino C., Compaño, R., Nanda, A.K. (2026). Current and future market applications

of genetically modified microorganisms (GMMs) to be placed on the market or for environmental release. JRC Technical

Report, Publications Office of the European Union, Luxembourg (publication forthcoming). 9 This study has been conducted by Technopolis Consulting Group.

4

ANNEX 2: STAKEHOLDER CONSULTATION

1. Introduction

The synopsis report covers all consultation activities that have been conducted to support

the preparation of the proposal for a European Biotech Act and this analytical SWD.

Information was collected through consultations via a Call for Evidence (CfE), Public

Consultation (PC), and Targeted Consultations (TC).

The feedback period of the CfE ran from May 2025 to June 2025 and the PC was opened

for contributions from August 2025 to November 2025. These were complemented by

targeted consultation activities between December 2024 and March 2026. The first two

stakeholder consultations were carried out by the Commission services but were analysed

by an external contractor (see Landscape Analysis Study below and presented in Annex

1). The targeted consultation activities were carried out, among others, in the context of

the following three studies (see Annex 1 for more details on the studies):

• Analysis of the Regulatory Framework for Biotechnology and Biomanufacturing

in the EU

• Landscape Analysis Study of the biotechnology sector in the Union with a view to

foster its competitiveness and innovation

• Study to support the rapid assessment of policy scenarios to strengthen innovation

and competitiveness in the field of biotechnology in the EU

The consultation was addressed to citizens, innovators, entrepreneurs, industry, financial

institutions, investors/venture capitalists, researchers/research organisations, civil society

(including consumer, patient and environmental organisations), other users of

biotechnologies (e.g. farmers and foresters), trade unions, national and regional authorities,

and other stakeholders.

2. Methodology of the consultation activities

Call for Evidence (CfE)

The CfE was launched on the Commission’s Have Your Say platform10. It received 222

valid responses11 and 149 attachments. Participants were primarily based in Belgium (33%,

74/222), Germany (12%, 29/222) and France (9%, 20/222). Responses from non-EU

countries came mainly from the US (5%, 10/222), Switzerland (3%, 7/222) and the UK

(2%, 4/222).

10 https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/14627-Biotech-Act_en 11 3 submissions were received from a single respondent and have been counted as 1 response. 2 further submissions

were received from another respondent and have been counted as 1 response. Thus, the total number of responses

considered in this analysis is 222 instead of 225.

5

With respect to the type of stakeholder groups12, responses came from business

association13 (60), companies or businesses (50), non-governmental organisations (44),

academic, research institutions (20), public authorities (14) and from EU-citizens (14). No

campaign was identified. All feedback and position papers were analysed in the context of

the Landscape Analysis Study.

Public Consultation (PC)

The PC was published on the Commission’s Have Your Say14 platform. A total of 464

answers were received and 119 attachments were submitted. The majority were position

papers, while some included answers to open questions. Most of the responses were

submitted by respondents from France (20%, 91/464), Belgium (19%, 87/464) and

Germany (12%, 54/464). Contributions from non-EU countries mainly came from the US

(3%, 12/464), followed by Switzerland (2%, 8/464). With respect to the type of stakeholder

groups15, most respondents were from individual companies or businesses (25%, 114/464),

followed by business associations (19%, 89/464), and citizen (16%, 73/464). Among

businesses, most identified themselves as SMEs (55%, 63/114)16. Among public

authorities, 14 self-identified as national, ten as regional respectively, two as local, and

three as international.

The questionnaire consists of nine sections, which can be roughly divided into three

thematic blocks: The first block (Sections 1–3) addresses general views on biotechnology,

the presence of businesses in the EU market, and the regulatory environment in the EU.

The second block (Sections 4–6) focuses on biomanufacturing, specifically biotechnology

clusters, production, and the availability of workforce. The third block (Sections 7–9)

centres on data and artificial intelligence, defence, and security, and a final section to

submit attachments.

Duplicates or campaigns from stakeholders had not been identified. All feedback and

position papers were analysed in the context of the Landscape Analysis Study.

A Factual Summary Report has been published on 23 December 2025, based on 359

responses on the Have Your Say webpage17. This report presents the outcome of the Public

Consultation based on all 464 contributions received.

12 Among the stakeholders who reported themselves as ‘other’ are notably network organisations, multi-stakeholder

platforms, and non-profit organisations. Given their non-commercial nature and similarities with NGOs, these

respondents were grouped together with NGOs for the purposes of the analysis. 13 3 respondents identified as trade unions but are analysed as business associations as they represent industries. 14 https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/14627-Biotech-Act/public-consultation_en 15 5 self-reported trade unions were analysed under business associations, and 1 contribution self-reported public

authority was analysed coming from an EU citizen. 16 Comprising: 16 medium, 19 small-, and 28 micro-sized enterprises. 17 https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/14627-Biotech-Act/public-consultation_en

6

Targeted Consultation (TC)

Analysis of the Regulatory Framework for Biotechnology and Biomanufacturing in the

EU

The Regulatory Framework Study consists of two Pillars.

• Pillar A focused on the assessment of impacts of policy scenarios defined by the

EC. It consists of a supporting assessment of impacts related to genetically

modified micro-organisms (GMM) and a supporting assessment of impacts related

to clinical trials in Europe (CT).

• Pillar B focused on mapping the relevant EU and national legislations related to

biotechnology and biomanufacturing; identifying regulatory challenges, causes and

consequences relevant for the biotechnology and biomanufacturing ecosystems;

and identifying policy areas for potential simplification and streamlining.

Targeted stakeholder consultations were carried out across all the listed activities:

On genetically modified microorganisms (GMM), targeted stakeholder interviews and a

consultation of subject matter experts were conducted. It included 25 interviews

comprising seven large enterprises, six SMEs, five public authorities, one EU agency, four

EU business associations, one national business association, and one NGO.

On clinical trials (CT) in Europe, targeted interviews, surveys and consultations with

the study team’s subject matter experts were conducted. Two rounds of stakeholder

interviews were conducted, comprising a total of ten interviews with nine stakeholders,

representing four industry associations, two large enterprises, and one each from a

European agency, a research network, and a private non-profit organisation.

On CTs, three surveys were also launched. One survey targeted sponsors and contract

research organisations (CROs) involved in clinical trials. It received 48 responses, 32

from commercial sponsors, six from non-commercial sponsors, three from CROs, and

seven from other stakeholders (including non-profits, hospital owners, advocacy groups,

research infrastructures, trade associations, and life sciences providers). Thus, the response

rate for this survey was approximately 23.8% (48/202). A second survey was directed at

public authorities (including ethics committees and national competent authorities). It

yielded 44 responses from public authorities with approximate response rate of 32.6%,

including 20 responses from ethics committees and national competent authorities each,

three responses from ministries or government bodies, and one respondent identified as

both a ministry and an ethics committee. A third survey aimed at patient representative

organisations, collecting only one response from a national, disease-specific patient

organisation active in clinical trials across eight EU Member States and two third countries.

This resulted in a response rate of 8.3% (1/12).

With regards to Pillar B of the study (see above), two surveys were conducted, along with

ten interviews and five workshops. One survey was focused on public authorities

across the EU Member States. A second survey was broader in scope and covered all types

of stakeholders (e.g. NGOs, business associations at EU and national levels, industry,

academia, etc.). In total, 334 responses were received in both surveys. Considering

7

duplications in entries from stakeholders, 274 responses were considered for the analysis.

Ten interviews were carried out to understand the regulatory challenges that stakeholders

encounter, the legislation currently impacting them, and potential policy areas for

simplification. Five workshops were carried out to gather insights into regulatory

challenges that stakeholders face and identify potential legislation that brings such

challenges. Each workshop focused on a specific sector, i.e. health/pharma,

agriculture/environment, food and feed, bio-based chemicals and plastics, and bio-based

materials. For each sector, relevant actors active in the specific field of the workshop were

invited to participate.

Landscape Analysis Study of the biotechnology sector in the Union with a view to foster

its competitiveness and innovation

The Landscape Analysis Study draws on evidence from the CfE, PC and targeted

stakeholder interviews, workshops and case studies. It includes 28 interviews with

organisations, covering the five pillars Access to Finance (eleven interviews, five with

private sector funders and six with public sector funders), AI and Data (six interviews, two

businesses, one trade association, two research organisations and one public-private

partnership), Cluster (three interviews with clusters), Skills (four interviews with research

and training, and education organisations/infrastructures), and Security and Defence (five

interviews with two private sector companies and three research intermediaries).

Four workshops18 were conducted on Access to Finance (three public funders, four private

funders, one institutional investor, two industry associations), Skills (11 research

organisations and research infrastructure, two businesses, one intermediary, five business

associations), Clusters (eight representatives of European and regional cluster

organisations, one infrastructure provider, one ecosystem intermediary and one EU

institution), AI and Data (three businesses, four research organisations, two industry

associations, one public organisation) respectively.

Study to support the rapid assessment of policy scenarios to strengthen innovation and

competitiveness in the field of biotechnology in the EU

As part of the study, the project team carried out a stakeholder consultation programme

comprising three targeted workshops and a series of semi-structured interviews.

Consultations were conducted between January and March 2026 and covered the main

policy intervention areas addressed in the study

The online workshops were organised to gather stakeholder views on specific thematic

areas of the European Biotech Act: Clusters and Strategic Projects Workshop (11

participants), AI and Data Workshop (eight participants), Biosecurity Workshop (Ca. 100

participants).

18 The AI and Data and Cluster workshops were organised jointly with the contractor on the Rapid Assessment Scenario

study, with dedicated sessions focusing separately on the topics of each study.

8

34 interviews (including one written response) were conducted across seven policy

intervention areas of the proposed European Biotech Act. Interviews were held between

January and March 2026.The policy intervention areas were:

• SPC extension for biotechnology medicines (four interviews)

• Biosecurity and Recognition and support of high impact biodefence projects (six

interviews)

• Targeted regulatory reform of Veterinary Medicinal Products (eight interviews)

• Regulation of novel health biotechnology products, ATMPs framework and

Targeted regulatory reform of clinical trials framework (seven interviews)

• Regulatory framework for genetically modified micro-organisms (GMMs) in

products other than food and feed (four interviews)

• Regulatory framework on the substances of human origin (SoHO) (two interviews)

• Regulatory framework on standards of quality and safety of human organs intended

for transplantation (three interviews)

The interviews were distributed across the following stakeholder groups: industry (ten

interviews), regulatory authorities (EU and national, 12 interviews), academia and research

(four interviews), policy experts and think tanks (five interviews), and other (three

interviews).

Other targeted consultation activities

On clinical trials, evidence has also been collected through three workshops19 organised

by the European Commission in June, September, and November 2025, with

representatives of national competent authorities and ethics committee members from each

Member States across the EU to exchange views with experts to inform how policy options

would be defined.

Finally, targeted consultation activities were also conducted as part of the supporting study

for the evaluation of EFSA (see Annex 1 for information the study).

3. Overview of Responses

The regulatory environment

Respondents to the PC perceive significant regulatory barriers across the authorisation,

testing and commercialisation chain in the biotechnology sector. The EU framework is

considered complex and cost-increasing compared with non-EU countries despite ensuring

high safety standards.

Three-quarter of the respondents indicated regulatory barriers in the assessment and market

authorisation (77%, 357/464). About 70% (326/464) indicated pre-commercial testing or

clinical trials, 68% (314/464) noted impediments in commercialising products and 67%

(311/464) in scaling-up production or manufacturing, while 64% (298/464) signalled

regulatory barriers in product development matters. Regarding other stages and cross-

19 CTAG: Clinical Trials Advisory Group; MedEthics-EU, the Clinical Trials Coordination Group of the Heads of

Medicines Agencies (HMA) was also invited to the workshop. The EMA is an observer to the CTAG.

9

cutting aspects, between 44% (204/464) and 49% (226/464) agreed or strongly agreed that

EU rules lead to regulatory barriers in early-stage or pre-clinical development, techno-

economics (outside health), health technology assessments, and post market activities.

Stakeholders also provided views as part of the feedback to the CfE. On Clinical trials,

submissions highlighted delays, fragmentation, and excessive bureaucracy as key barriers.

Stakeholders argued that protracted timelines, divergent national requirements, and

administrative burdens (e.g., for trial modifications or ethics reviews) undermine Europe’s

competitiveness and delay patient access to innovative therapies. Pharma and biotech

industry groups also pointed to the lack of coordination between Member States, proposing

centralised approval systems, binding deadlines, and digital tools (e.g., CTIS optimisation)

to cut duplication and speed up trials.

Research institutes and SMEs pushed for regulatory sandboxes for advanced therapies

(ATMPs) and simplified rules for academic studies (e.g., reduced fees, streamlined

exemptions), while patient organisations stressed the need for real-world data (RWD) and

cross-border collaboration (e.g., for rare diseases) to enable faster, patient-centred trials.

Individual biotech firms additionally called for early scientific dialogue with regulators

and prioritised pathways for breakthrough therapies to boost investment confidence.

Stakeholders also addressed Advanced Therapy Medicinal Products (ATMPs),

highlighting their transformative potential but also critical barriers to development and

patient access.

The overarching consensus emphasised that regulatory complexity, fragmented approval

pathways, and funding gaps (especially for rare/ultra-rare diseases) hinder ATMP

innovation in the EU. Stakeholders called for streamlined, risk-based frameworks,

including regulatory sandboxes, harmonised GMO/clinical trial rules, and centralised

ethics reviews, to accelerate development while ensuring safety.

Industry groups called for simplified manufacturing rules (e.g., decentralised production,

platform-based assessments) and financial incentives (e.g., innovation procurement, social

impact funds) to offset high costs. Academics and research bodies demanded dedicated

pathways for non-profit developers, including reduced fees and tailored regulatory support,

while patient advocates stressed equitable cross-border access via harmonised Hospital

Exemption rules and EU-wide reimbursement alignment. Regulatory experts proposed

joint GMO/CTR reforms and ATMP-specific sandboxes to cut redundancy and enable

faster, scalable therapies.

On the Supplementary Protection Certificate (SPC), some stakeholders underlined that

the current SPC framework needs reform to compensate for regulatory delays, enhance

competitiveness, and ensure robust intellectual property protection in the EU, while their

proposals differ in scope and specificity.

Some stakeholders addressed Substances of Human Origin (SoHO), flagging critical

regulatory gaps in its interaction with other frameworks (e.g., GMO, ATMPs, medical

devices). The overarching concern is fragmentation and legal uncertainty, which is seen as

to stifle innovation in human-derived therapies like cell/gene therapies and microbiome-

based products.

10

In the context of the consultations for the study on the regulatory framework for

biotechnology and biomanufacturing in the EU, SMEs but also larger companies identified

the complexity of the legislation governing genetically modified organisms (GMOs) in the

EU, together with the complexity of the risk assessment and authorisation procedures as

aspects posing challenges for biotech innovation, including for bringing innovative

products to the EU market. The regulation of genetically modified micro-organisms

(GMMs) was identified as one concrete example in this regard. In addition, when consulted

on concrete policy scenarios for the authorisation of products containing, consisting of or

produced from GMMs, many stakeholders, including public authorities, considered that a

more product-centric approach that differentiates between low-risk and other GMMs has

the potential to provide faster, more cost-effective assessments of GMM products. These

stakeholders also considered that the biological properties of a GMM and the status of

qualified presumption of safety (QPS) would be suitable to determine the category of a

GMM, i.e. low-risk or other, and with that the regulatory path of a GMM product.

Access to capital

The different stakeholder consultation activities (CfE, PC and targeted consultations) draw

a consistent picture of the challenges in Europe’s biotechnology sector, particularly

regarding access to risk-tolerant capital. The findings show that Europe’s biotech industry

suffers from a chronic shortage of long-term financing, which limits the ability of start-ups

and SMEs to scale, innovate, and compete globally.

According to the CfE, there is broad agreement that Europe lags behind the U.S. and China

in biotech financing, with only a fraction of global venture capital available. Fragmented

and risk-averse capital markets force European companies to seek funding abroad,

jeopardizing technological sovereignty and contributing to offshoring. Early-stage firms,

especially those without clinical data, struggle due to long development timelines, high

capital expenditures (CAPEX), and regulatory uncertainty. Stakeholders are calling for a

comprehensive financial and regulatory framework that would mobilize public and private

investment while reducing structural barriers to funding. Proposed solutions include the

creation of dedicated EU biotech funds with a mix of grants, convertible loans, and

guarantees, the establishment of an EU Biotech/Life Sciences Index or NASDAQ-style

exchange to improve equity access, and Fund-of-Funds mechanisms to de-risk early-stage

innovation. Additionally, public-private partnerships (PPPs) and Important Projects of

Common European Interest (IPCEIs) are recommended as tools to attract private co-

investment.

The PC reinforces these findings with concrete data on the accessibility of financing

instruments. Only 19% of respondents state that public grants or subsidies are easy to

access, while for other public funding types, agreement drops to below 10%. Nearly 50%

of respondents disagree that public financing instruments are easily accessible. For private

investments, strategic research or sales partnerships (21%) and angel investors (15%) are

perceived as the most accessible, while venture capital in the expansion stage was seen as

particularly lacking (43.5%). The high number of “don’t know” or “N/A” responses

suggests a lack of awareness or clarity regarding available funding options.

As key drivers for biotech investments, respondents highlight groundbreaking technology,

regulatory certainty, innovative science, and strong IP protection (up to 80% agreement),

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followed by experienced management teams, robust supply chains, and solid financial

projections (67–71% agreement). Access to data held by public sector bodies is identified

as a less prominent driver, with 49% of respondents agreeing or strongly agreeing that it

influences investment decisions.

The Landscape Study emphasizes that biotech financing is influenced by a complex

interplay of economic factors and sector-specific risks. While some challenges, like the

structure of financial markets, require systemic shifts, others could be addressed through

targeted policy interventions. As part of this Study, a workshop was held with

representatives from EU institutions, industry associations, venture capital investors, and

institutional investors. The key finding of the workshop was that while the EU has a strong

biotech research base, it faces critical financing gaps, particularly at early-stage.

Biotechnology clusters

The five most critical challenges recognised by respondents to PC, which hamper EU

biotechnology clusters in achieving their full potential, were: insufficient financial support

(58%, 270/464), insufficient public support (54%, 251/464), incapacity to reach a critical

mass of stakeholders (46%, 215/464), insufficient collaboration among existing clusters

(46%, 213/464) and insufficient start-up incubators or business support infrastructure

(45%, 209/464).

Biomanufacturing

The responses gathered from both the CfE and the PC reveal several critical challenges

and priorities related to biomanufacturing, with stakeholders across industry, academia,

and research institutions highlighting key areas for improvement.

A major concern is infrastructure and facility capacity, with NGOs and “other”

contributors (16 submissions in the CfE) stressing the need for better-equipped

biomanufacturing sites, particularly those compliant with Good Manufacturing Practices

(GMP). They also called for interoperable digital platforms, such as the European Health

Data Space (EHDS), and clinical trial networks to support scalable production).

Additionally, some contributions emphasised the importance of resilient supply chains,

suggesting decentralised or point-of-care biomanufacturing as a potential solution.

The PC responses reinforced these concerns, with 58% to 67% of stakeholders identifying

global competition, lengthy permitting processes for new facilities, scaling challenges

from pilot to industrial production, high energy costs, and expensive raw materials as the

most significant barriers. Around half of respondents also highlighted supply chain

vulnerabilities and inconsistent sustainability policies as major obstacles.

Financing and investment risks were another recurring theme. In the CfE, businesses

pointed to weak late-stage capital and the need for targeted incentives, guarantees, and de-

risking tools to support pilot, demonstration, and full-scale manufacturing projects. The

PC similarly underscored high operational costs as a key challenge, further complicating

scaling efforts.

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Business associations called for training in advanced biomanufacturing, among other

needs. A few companies specifically advocated for EU-wide multidisciplinary training

programmes, while academic and research institutions stressed the need for co-created

curricula, including modular courses, vocational training, and industry placements in

Contract Development and Manufacturing Organisations (CDMOs).

Finally, sustainability and innovation in manufacturing were addressed, with one academic

respondent (EU citizen) highlighting plant-based production and microbial technologies

as promising but currently hindered by inadequate infrastructure and regulatory

frameworks.

AI and data

The results of several stakeholder consultation activities (CfE, PC, targeted consultations)

emphasize the critical role of AI and data in Europe’s biotechnology sector, while exposing

significant barriers that hinder their effective deployment. Across all stakeholder

consultation activities, a recurring theme emerges data access, governance, and

interoperability represent the most pressing bottlenecks, compounded by regulatory

uncertainty, infrastructure limitations, and skills shortages, which together threaten

Europe’s ability to compete globally in AI-driven biotechnology innovation.

The CfE responses reveal broad consensus that Europe’s biotech sector suffers from

fragmented, non-interoperable data and ambiguous governance frameworks, severely

limiting the potential of AI applications. Despite rapid advancements in AI technologies,

their adoption remains constrained by these structural barriers. Stakeholders emphasize the

need for EU-wide bio-data infrastructures, European biotechnology dataspaces, and secure

computing resources, particularly to support SMEs and start-ups that lack the infrastructure

to leverage AI effectively. They also call for FAIR-aligned data-sharing ecosystems

tailored to genomics, proteomics, synthetic biology, and clinical data, alongside federated

datasets, supercomputing resources, and AI testing facilities.

Stakeholders in the CfE also stress the importance of AI-ready data formats, reliable data

connectors, and harmonized metadata standards to enable seamless integration of AI tools.

They advocate for aligning the proposed European Biotech Act with existing frameworks

such as the AI Act, GDPR, European Health Data Space (EHDS), and AI in Science

Strategy, while demanding clarity on rules governing AI model training, validation, and

deployment, particularly in highly regulated sectors like pharma and healthcare. The PC

quantifies these challenges, with 61% of stakeholders citing technological barriers and

58% pointing to difficulties in implementing regulatory frameworks as the primary

obstacles to AI adoption in R&D. Over half of the respondents view these issues as the

main barrier to deploying AI-based biotechnology products, underscoring the need for

regulatory sandboxes to facilitate safe testing of AI-driven tools in areas like drug

discovery and clinical trials.

A cross-cutting concern is the shortage of interdisciplinary talent, namely individuals

proficient in both data science and biotechnology. The PC quantifies this gap, with

stakeholders ranking skills development as the top priority (65%) for supporting AI

adoption in biotech, followed by access to annotated datasets (64%), partnerships with

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public research institutions or AI hubs (63%), dedicated funding (62%), regulatory

sandboxes (59%), and roadmaps for AI implementation (65%).

Despite these challenges, stakeholders in the CfE highlight AI’s transformative potential

across the biotech value chain, including drug discovery, bioprocessing, healthcare,

agriculture, and cosmetics.

To address these barriers, stakeholders propose investing in trusted data-sharing

ecosystems and European-scale bio-data infrastructures, as well as developing harmonized

standards for interoperability and security. They also advocate for targeted support for

SMEs, including dedicated funding, AI testing centres, and collaborative projects,

alongside promoting open science and FAIR principles as guiding frameworks.

Security and defence

The results of stakeholder consultation activities (CfE, PC, and targeted consultations)

highlight the dual-use risks, biosecurity challenges, and strategic vulnerabilities associated

with Europe’s biotechnology sector, while emphasizing the need for proportionate

governance frameworks that balance innovation with safeguards. Stakeholder responses

reveal a shared concern that while biotechnology offers transformative potential for

defence, healthcare, and food security, its misuse, fragmented regulation, and supply chain

dependencies pose significant threats to Europe’s strategic autonomy and public safety.

The CfE responses underscore that biotechnology’s rapid advancement brings ethical

dilemmas and dual-use risks, particularly in areas like synthetic DNA, AI-driven biotech,

and data exploitation. Stakeholders stress the need to embed ethical principles and

standards from the outset to prevent misuse, protect societal trust, and ensure public

acceptance of biotech innovations. However, they caution against excessive security-

driven regulation, which could stifle innovation if not designed proportionately. Key

proposals include screening customers of synthetic DNA orders, regulatory sandboxes for

controlled testing of novel biotechnologies, and tiered risk-based frameworks for GMOs

and recombinant therapeutics. There are also calls for a European Biotechnology Security

Strategy to enhance supply chain resilience and intellectual property protection, alongside

international coordination to address dual-use risks globally. Stakeholders further advocate

for harmonized EU rules to ensure consistency across Member States, while warning

against overly restrictive approaches that could impede progress.

The CfE highlights the need for proportionate, risk-based governance that integrates

security considerations without imposing unnecessary burdens. The PC identifies strategic

autonomy risks, cybersecurity threats, supply chain vulnerabilities, and biosecurity

concerns as the top challenges, with 50% of stakeholders citing risks to biomanufacturing

autonomy and medical countermeasures, followed by cybersecurity risks (45%), supply

chain vulnerabilities (44%), and biosecurity threats (40%). Conversely, stakeholders see

opportunities in innovative medical countermeasures (45%), biological threat detection

(45%), and enhanced food security (53%).

To address these challenges, stakeholders propose EU-wide governance frameworks that

align with international best practices, such as the Australia Group Biological Agent List

and IGSC Harmonised Screening Protocol.

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The responses from PC further emphasize the need for risk-based, innovation-friendly

regulation that keeps pace with advances in synthetic biology and AI, while the response

from CfE call for strategic autonomy in biomanufacturing and resilient supply chains to

mitigate dependencies.

Skills

The results of all stakeholder consultation activities (CfE, PC, and targeted consultations)

highlight the critical skills challenges facing Europe’s biotechnology sector, with

stakeholders across all three sources underscoring the need for targeted interventions to

develop a workforce capable of driving innovation and competitiveness.

In the CfE responses, stakeholders reveal broad consensus that developing a skilled

workforce represents a central challenge for Europe's competitiveness in biotechnology.

Industrial companies identify skills development as a key priority for the biotech

ecosystem, particularly highlighting the need for competencies in data and AI alongside

traditional biotech skills. This perspective is echoed by healthcare and pharmaceutical

companies, which similarly underscore the urgency of skills development, while business

associations consistently prioritize building a skilled workforce as fundamental to sectoral

growth. Third-country stakeholders reinforce these themes, particularly emphasizing skills

development as part of a broader package that includes regulatory and financing

improvements. A dominant concern across these responses is the need to address skills

shortages through specialized training programs, effective talent attraction strategies, and

entrepreneurial education initiatives, with human capital widely regarded as foundational

to Europe's competitive position in the global biotech landscape. Third-country research

organizations align with EU institutions in calling for targeted investment in skills at the

intersection of biotechnology, artificial intelligence, and data science, recognizing that

future competitiveness will depend on mastery of these converging disciplines. Academia

and research institutions place particular emphasis on skills development and talent

retention, advocating for EU-level initiatives that support career mobility and foster

interdisciplinary education bridging biotechnology with digital and engineering

competencies. NGOs similarly stress the necessity for stronger skills infrastructure to

underpin sectoral advancement. Companies and businesses highlight skills as a critical

factor in 24 separate contributions, while business associations, through 14 dedicated

submissions, call for comprehensive training programs in regulatory science, AI

applications, data management, and advanced biomanufacturing techniques,

complemented by measures to attract and retain global talent. Third-country contributors

mirror concerns raised within the EU-27, consistently emphasizing investment in skills as

a core requirement for sustainable biotech development.

The PC provides validation of these insights, with stakeholders demonstrating strong

alignment regarding the specific skills challenges confronting the EU workforce. The

consultation reveals particularly acute shortages in financial and entrepreneurial skills

(57%, 263/464), vocational skills for biotechnology and biomanufacturing (53%,

247/464), regulatory and quality assurance expertise (53%, 244/464), and digital and data

science competencies (45%, 211/464). These findings underscore the breadth of skills gaps

across both technical and managerial domains, suggesting that Europe's biotech sector

faces multifaceted workforce challenges that extend beyond scientific competencies to

include commercial and operational capabilities.

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As part of the Landscape Study, a targeted workshop was organised, gathering EU

institutions, industry associations, research infrastructures, universities, hospitals, training

institutes, and individual companies, providing perspectives across the full biotechnology

value chain. The workshop aimed to validate, prioritise, and add granularity to preliminary

findings. Discussions highlighted shortages in specialised roles, limited hands-on

industrial experience in higher education, and the need for scalable, competency-based

training models, while emphasising EU-level opportunities modular lifelong learning,

industry-academia collaboration, and shared training infrastructures as horizontal enablers.

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ANNEX 3: WHO IS AFFECTED AND HOW?

1. Practical implications of the initiative

Businesses and the research community

The proposed amendments to the Clinical Trials Regulation shorten clinical trial

authorisation timelines from 106 days to 75 days, or to 47 days where no request for further

information is issued. They also simplify and streamline both the approval process and the

conduct of clinical trials.

Applying the Standard Unit Cost Model suggests that these efficiencies could cut

administrative time—the period sponsors spend engaging with regulators—by 15–25%,

equating to savings of EUR 2,700 to EUR 4,500 per multinational trial application. Such

reductions in administrative costs would particularly benefit SMEs, which face a

disproportionately higher regulatory burden. Electronic submission and digitalisation

measures contribute a further EUR 112 to 225 million cumulatively over fifteen years.

At an aggregated level considering the total set of measures included in the Commission

proposal, the economic impact of the Biotech Act’s reform for sponsors can be

approximated using current baseline data. Around 2,500 clinical trials are conducted

annually in the EU, at an average cost of EUR 30–50 million per trial and a duration of 2–

2.5 years, implying total annual sponsor expenditure of roughly EUR 30–62.5 billion.

Streamlined approvals and reduced administrative burdens are expected to yield direct cost

savings of about 5% (EUR 1.5–3.1 billion per year) and indirect savings of a similar order

through faster technical execution (around a 0.1-year reduction in time-dependent costs).

Combined, these efficiencies could generate several billion euros in annual financial gains

for sponsors, with total savings potentially exceeding EUR 5 billion. Considering a

potential increase in the number of trials, these gains would increase proportionally.

The reforms are also expected to improve the EU's attractiveness for clinical research.

Current projections suggest that the number of clinical trials in the EU could rise between

10% and 30%, compared with the existing volume of trial applications. These estimates

draw on two separate studies: one, based on sponsor survey data, forecasts a 32% increase,

while the other, relying on limited empirical evidence, projects a more modest growth of

4% to 16%20. The wide disparity in these estimates highlights the challenges in assessing

20 Rapid Assessment Scenario Study (forthcoming). The study, based on limited empirical evidence, distinguishes

between two hypothetical scenarios regarding the potential impact of the Biotech Act on the projected number of clinical

trials in the EU. In the first scenario, a moderate increase in the number of clinical trials by 4% to 8% is anticipated. This

is attributed to improved efficacy and attractiveness of performing clinical trials in the EU, driven primarily by increased

domestic uptake among sponsors already operating within the region.. The second scenario assumes that, in addition to

increased domestic uptake, sponsors relocate clinical trial activities from other regions to the EU/EEA as a result of the

reforms in the Biotech Act, leading to an estimated increase of 8% to 16%. As the Biotech Act is expected to simplify

authorisation processes and the conduct of trials for sponsors, it is considered plausible that some sponsors may relocate

their clinical trials to the EU following the amendments of the Regulation. Therefore, the average of the both scenarios

is used as a benchmark for the lower bound

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the reform’s impact on clinical trial activity, given data limitations, and inherent

uncertainties about future developments. To account for these constraints, the evaluation

of the impact adopts a broad range of potential outcomes.

Costs to sponsors are limited and front-loaded. One-off investments in harmonised

standard operating procedures are not quantified but are expected to be absorbed within

existing budgets. Sandbox participation introduces upfront overhead, though the net

lifecycle direction is a reduction in burden. The proposed measures restructure conditions

for new applications rather than imposing new obligations on active trials, limiting

compliance exposure for sponsors with existing portfolios.

SMEs and start-ups

SMEs and start-ups are disproportionately exposed to the current regulatory landscape:

administrative expenses account for 11 to 29% of total clinical trial costs, and this burden

falls proportionally harder on smaller entities with limited internal capacity. The proposed

measures therefore carry a higher marginal value for this group than for large sponsors.

Benefits operate through two channels. On ecosystem navigation, the EU Health

Biotechnology Support Network provides a dedicated support channel for health

biotechnology innovators as regards regulatory pathways, funding, and investor

connections across EU27. Firms receiving comparable network support report 14

percentage points higher knowledge sharing and collaboration capability than unsupported

firms (69% versus 55%). Articles 32 and 33 address a further structural barrier: 82% of

SMEs cannot self-finance the validation infrastructure required for AI-enabled

biotechnology development. At medium uptake, shared testing environments and data

quality accelerators are expected to serve 1,100 to 3,400 companies and data users per

year.

On direct regulatory relief, the elimination of the additional 50-day ATMP assessment

period and the reduction of substantial modification timelines from 96 to 47 days benefit

a developer base of which over 60 % are SMEs. ERA exemptions for qualifying GMO-

ATMPs remove a further 0.15 to 0.3 FTE-years per application. The harmonised AI

guidance under Article 31 replaces bilateral EMA interactions currently valued at EUR

89,000 per qualification request and 160 to 250 days per interaction with freely accessible

public guidance, a measure whose value is asymmetrically concentrated in smaller actors

that cannot absorb bilateral engagement costs.

Costs to SMEs are limited by design. Strategic project participation is voluntary, and

biosecurity compliance obligations fall on nucleic acid synthesis providers rather than the

broader SME research and development population.

Biosimilar developers

Biosimilar developers are affected by three intersecting mechanisms that do not all pull in

the same direction.

Following EMA guidelines adoption, Comparative Efficacy Studies (CES) requirement

may be waived for biosimilar products where analytical similarity is comprehensively

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demonstrated. The CES removal would deliver the most economically significant relief,

eliminating EUR 19 to 26 million in direct trial costs per product (20 to 30 per cent of total

development expenditure for standard indications, up to 50 to 60 per cent for complex

monoclonal antibody biosimilars) and shortening timelines by 12 to 24 months. Across 12

to 18 marketing authorisation applications per year where the tailored clinical package

reform applies, aggregate annual savings are estimated at EUR 222 to 467 million. The

competitive dimension is equally important: South Korea, the UK, the US, and Canada are

all moving toward CES flexibility, and without this reform the EU would risk regulatory

disadvantage. EU-based companies currently hold approximately 49 per cent of EU

biosimilar authorisations, a share under increasing pressure from South Korean and Indian

developers. The strategic project framework reinforces these gains on the supply side,

projecting stabilisation of the EU-based companies share at 45 to 55 per cent through 2038

and mobilising EUR 0.9 to 7.6 billion in cumulative biosimilar manufacturing investment

by 2038.

The SPC extension works in the opposite direction. The additional year of originator

exclusivity is estimated to reduce biosimilar gross profits by approximately EUR 80

million per qualifying medicine (sensitivity range EUR 60 to 110 million), or EUR 240

million annually at three qualifying medicines per year. Development programmes are

unlikely to be abandoned over a one-year delay, but marginal programmes targeting

smaller or more uncertain markets face a measurably reduced return on investment. The

net balance across the two instruments is positive in aggregate, but the distributional effect

varies depending on product class and the overlap between SPC-eligible originators and

active biosimilar pipelines.

Remaining costs to developers are limited to voluntary strategic project recognition, which

entails preparation and reporting costs of one to two FTEs per project per year, equivalent

to approximately one to two per cent of project value.

Originators and SPC-holding companies

The SPC extension generates approximately EUR 230 million in additional gross profit

per qualifying medicine (sensitivity range EUR 140 to 290 million). With the measure

being relevant for about 3 medicines per year, aggregate additional originator gross profit

is estimated at approximately EUR 690 million annually.

According to EMA data from 2016 to 2025 and assuming the proportion of SPC reliant

medicines remain constant, the SPC extension could potentially be awarded to 4-5 products

annually (rather than 2-3) if developers changed their behaviour in response to the

“geographical” condition of the incentive i.e. conduct clinical trials in more than one

Member State and part of the production of the medicinal product in the EU.

The principal costs fall on biosimilar developers, payers, and patients through delayed

competitive entry, addressed in the respective sections. The measure is explicitly

redistributive, transferring value from follow-on developers and healthcare systems to

originators while incentivising manufacturing and trial location.

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SoHO entities and organ processing establishments

SoHO entities using the regulatory sandbox face evidence generation costs of EUR

718,500 per year under the low scenario (six sandboxes per year) and EUR 4,790,000 per

year under the high scenario (40 sandboxes per year), with per-case costs comparable to

high-risk SoHO authorisations at EUR 1,200 to 6,000 per patient. Medium-risk cases

directed through the sandbox will incur higher costs than under the standard route. These

costs are concentrated in a small subset of novel applications that would otherwise lack a

viable pathway.

For organ processing establishments, the authorisation framework introduces per-

application costs of approximately EUR 11,500 for full authorisation and EUR 16,750 for

conditional authorisation, with a weighted average of EUR 12,800 during the transition

phase. At 60 to 145 applications across EU27 over 2029 to 2031, the aggregate transition-

phase burden is EUR 768,000 to EUR 1,856,000, rising to a cumulative EUR 1.2 to 2.5

million by 2035. Establishments under conditional authorisation additionally face

mandatory clinical outcome monitoring costs of approximately EUR 9,000 per monitoring

plan per year, aggregating to EUR 405,000 to EUR 980,000 across EU27 over the

transition phase.

These costs are substantially outweighed by the benefits. The authorisation regime is

expected to generate 1,435 additional transplants per year by 2035, with 570 to 945 fewer

organ discards annually. Total monetised benefits are estimated at EUR 443 to 695 million,

comprising EUR 285 to 537 million in statistical lives saved from 248 to 311 cumulative

waiting-list deaths averted over 2028 to 2035, and EUR 158 million in cumulative dialysis

cost avoidance derived from the reduction in the dialysis-dependent population by 2035,

attributable to additional kidney transplant recipients who would otherwise have remained

on dialysis.

GMM developers, veterinary medicine companies, and food chain operators

The Act creates the most structurally transformative change for GMM developers: the

introduction of a viable EU market authorisation pathway where none currently exists. The

EU has zero authorised GMMs for deliberate release, a direct consequence of a regulatory

framework designed for genetically modified plants and ill-suited to micro-organisms. The

reform introduces a tailored, product-based pathway with an accelerated route for low-risk

GMMs, unlocking potential access to biofertilisation, biocontrol, bioremediation, and

bioleaching sectors. These collectively represent a combined global market for microbial

products of EUR 29.1 to 33.4 billion growing at 9 to 14% per year, though GMM-specific

products constitute only an emerging share of these totals and the figures should be

understood as indicative of the upper bound of commercial opportunity rather than

immediately accessible demand.

For veterinary medicine companies, three measures deliver quantifiable gains. The single

GMO pathway for VMPs removes 30 to 90 days per clinical trial application, eliminating

240 to 1,350 product-days of aggregate delay annually and generating cumulative

administrative cost savings to 2040 estimated at EUR 5 to 14.5 million. Uniform handling

of VMP variations not requiring assessment yields present-value savings of EUR 15 to 30

million to 2040 (central estimate EUR 22.5 million). The VMP sandbox creates an entirely

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new pathway for innovative products outside existing categories, with utilisation expected

at approximately one sandbox every five years; its primary value lies in pathway creation

and investment signalling rather than immediate commercial volumes.

Food chain operators benefit from the sandbox mechanism for pre-market testing of

sustainable food production technologies, including GMO-containing products. The

exclusion of novel foods from sandbox scope, whilst justified on grounds of scientific

complexity and consumer sensitivities, - as explained in Section 5.1.2 of the Staff Working

Document represents a genuine constraint on the benefits available to this group and has

been characterised by industry stakeholders as a missed opportunity.

Sequence synthesis providers

Providers of nucleic acid synthesis services face the most direct and quantifiable

compliance burden under the biosecurity provisions. Mandatory sequence and legitimacy

screening obligations impose direct annual compliance costs estimated at EUR 10.5 to 22.2

million per provider sector, comprising legitimacy screening (EUR 19 million in 2027

rising to EUR 34 million by 2036), sequence screening (EUR 1.6 million rising to EUR

2.8 million), and procedure introduction and regulatory adjustment costs (EUR 1.7 million

rising to EUR 2.5 million). Customers and researchers face additional compliance costs of

approximately EUR 16.4 million per year for documentation, procurement adjustments,

and per-order verification. Indirect costs compound these figures: research chilling effects

from concerns about order delays or rejections are estimated at EUR 97 million in 2027

rising to EUR 170 million by 2036, whilst productivity losses to providers from

compliance intensity are estimated at EUR 8.6 to 24.8 million per year. Approximately

10% of researchers may shift to in-house synthesis at substantially higher per-order costs.

These costs must be assessed against a strongly asymmetric benefit profile. The mandatory

screening regime is estimated to prevent 35% of deliberate bioattacks and 86 % of

accidental release events, generating expected annual prevention benefits of EUR 2.9

billion in 2027 rising to EUR 5.5 billion by 2036. A further EUR 10 billion in future

research value is preserved by averting the regulatory backlash that would follow a major

biosecurity incident. The compliance burden, whilst material, represents well under

one precent of the prevention benefits the regime is expected to deliver.

Applicants for strategic and high-impact projects

Entities seeking recognition under either framework face preparation, submission, and

ongoing reporting costs estimated at one to two FTEs per project per year, equivalent to

approximately one to two % of total project value. In the most demanding governance

configurations, worst-case participation costs might reach EUR 700,000 to 800,000 per

firm (as an upper bound). Participation is entirely voluntary.

The returns are substantial. The strategic project framework is expected to mobilise EUR

15 to 28 billion in total investment at medium uptake (60 to 70 projects), with the high-

impact tier adding a further EUR 4 to 12 billion (12 to 15 projects), yielding a combined

EUR 19 to 40 billion by 2038. Both frameworks additionally reduce permitting delay costs,

with cumulative avoided delay-related capital costs estimated at EUR 265 million to

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EUR 1.16 billion by 2038 across the two tiers at medium uptake, concentrated in the most

capital-intensive projects where schedule adherence directly affects bankability and time-

to-revenue.

Public authorities

European Medicines Agency

The proposed EU Biotech Act would generate a series of incremental workload increases

for EMA, none of which are individually large. Finalisation of the biosimilar draft

reflection paper into adopted guidance is estimated at 0.5 to 1.0 FTE-year as a one-off cost,

with ongoing maintenance at 0.2 to 0.5 FTE-year. SPC eligibility verification introduces a

maximum annual workload of 28 to 30 working days across the Agency, at approximately

one working day per application. Lifecycle-wide AI guidance development under Article

31 requires one-off capacity building and training at Union and national levels, not yet

quantified. For VMPs, adaptation of the Union Product Database to remove the

approve/reject functionality for national competent authorities is estimated at EUR

150,000 to 300,000 for a three-to-six-month IT engagement.

These costs are partially offset by two workload reductions. CHMP verification of sponsor

declarations for qualifying GMO-ATMP clinical trial applications, submitted in place of

full ERA dossiers, represents a net reduction in assessment workload relative to the

baseline. Additionally, the CES removal for biosimilars reduces the number of multi-

country Phase III trial authorisations requiring ethics committee review and GCP

inspection oversight across Member States, easing NCA burden across the network. In

aggregate, EMA's incremental costs under the Act are modest and absorbable within

existing institutional capacity.

National competent authorities

NCAs face new and expanded obligations across several distinct areas, the most significant

of which is the biosecurity enforcement mandate. Member State enforcement and

coordination costs for the biosecurity screening regime are estimated at approximately

EUR 14 million per year in 2027, rising to EUR 21 million per year by 2036, requiring

approximately three FTEs per Member State for policy coordination, reporting, and

enforcement activities.

For the strategic and high-impact project frameworks, steady-state staffing requirements

for single points of contact range from 0.3 to 0.9 FTEs per Member State under low uptake,

0.7 to 1.8 FTEs under medium uptake, and 1.1 to 3.0 FTEs under high uptake. These are

incremental rather than structural costs: in most Member States, existing authorities are

expected to be designated rather than new structures created, with the primary burden

concentrated in front-loaded process design and workload reallocation.

SoHO sandbox supervision increases NCA workload materially on a per-case basis, with

medium-risk sandbox cases requiring 75 to 94 person-days per case (EUR 22,575 to EUR

28,294, a 57 to 114% increase over standard authorisation) and high-risk cases 98 to 149

person-days (EUR 29,498 to EUR 44,849, a 10 to 63% increase). Cross-Member State

learning is assumed to offset these elevated unit costs over the medium term. For organ

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processing, per-assessment costs are estimated at EUR 7,000 to EUR 10,000, with

aggregate EU27 transition-phase assessment costs of EUR 420,000 to EUR 1,450,000 over

2029 to 2031, declining to EUR 60,000 to EUR 85,000 per year in steady state. Monitoring

oversight for Track 2 conditional authorisations adds EUR 63,000 to EUR 216,000 per

year during transition.

Finally, participation in the European Health Biotechnology Steering Group requires

approximately two FTEs per Member State per year, and strategic ecosystem mapping data

provision approximately 0.25 FTEs per year. These governance obligations are ongoing

but modest relative to the biosecurity and sandbox functions.

European Commission

The Commission's recurring fiscal commitment under the Act is dominated by the

biodefence and biosecurity components. Total annual operational costs of the combined

biodefence surveillance system and biosecurity screening oversight are estimated at EUR

86 to 190 million per year across Union and Member State budgets, with the biodefence

component alone accounting for EUR 46 million per year under Scenario 1 and EUR 110

million per year under Scenario 2. EU-level biosecurity coordination and oversight

specifically is estimated at EUR 1.3 million per year in 2027 rising to EUR 1.9 million in

the long term, corresponding to approximately 11 FTEs. These commitments should be

read against EUR 2.9 to 5.5 billion in annual prevention benefits the two instruments are

jointly expected to deliver.

Beyond biosecurity, Commission-level costs are more modest. Operating the Steering

Group secretariat, conducting strategic mapping, and coordinating the Support Network

requires approximately EUR 2.6 million annually, equivalent to EUR 18.4 million over the

MFF period. EU-level supervision of high-impact strategic projects requires 1 to 3 FTEs

under low uptake, 2.5 to 8 FTEs under medium uptake, and 5 to 15 FTEs under high uptake.

Sandbox establishment under clinical trials and novel health products

each require approximately EUR 4.3 million over approximately three years as an order-

of-magnitude reference, with adopting implementing acts for VMP sandboxes representing

an additional unquantified legislative workload over 2026 to 2040.

Citizens, patients, and consumers

Earlier access to medicines

The acceleration of clinical trial authorisation procedures and the removal of the biosimilar

CES requirement are expected to result in approximately 100 products reaching the market

up to six months earlier than under the baseline, applying an approximate 8% average

launch rate to the 2,500 to 3,000 products tested annually in EU trials. ATMP procedural

reforms are expected to accelerate access in high unmet-need areas, though patient-level

quantification is not yet available.

Organ transplantation

On the regulatory changes proposed to organ processing, the moderate-scenario projection

of 1,435 additional transplants per year by 2035 translates into 57 to 72 fewer waiting-list

23

deaths annually, or 248 to 311 cumulative deaths averted over 2028 to 2035, valued at

EUR 285 to 537 million. A further EUR 158 million in cumulative dialysis cost avoidance

is attributable to approximately 3,295 additional patients living with a functioning

transplant by 2035 who would otherwise have remained on dialysis.

Patient access and the SPC extension trade-off

The SPC extension entails a direct and quantifiable cost on patients and payers. The

additional year of originator exclusivity delays biosimilar competition, resulting in a

combined social cost of approximately EUR 205 million per qualifying medicine (range

EUR 140 to 290 million), comprising EUR 135 million in delayed patient access value and

EUR 70 million in direct payer expenditure. At three medicines per year, aggregate annual

social costs amount to approximately EUR 615 million. The cost is driven primarily by the

delay in the expansion of patient coverage rather than by direct price effects: coverage

expands upon loss of protection, and the main social cost of the extension therefore consists

in the temporary postponement of this expansion.

Biosecurity and public safety

RAND (2025) estimates that mandatory NA synthesis screening prevents 35% of

deliberate bioattacks and 86% of accidental release events, generating expected annual

prevention benefits of EUR 2.9 billion in 2027 rising to EUR 5.5 billion by 2036. A further

EUR 10 billion in future research value is preserved by averting the regulatory backlash

that would follow a major biosecurity incident.

Consumer and environmental interests

Consumers benefit indirectly from the long-term competitive effects of a stronger EU

biosimilar market supporting pricing pressure at patent expiry, and from sustainable food

production technologies enabled through the food law sandbox. Environmental gains

materialise through GMM applications in biofertilisation, biocontrol, and bioremediation,

and through expanded veterinary biotech vaccine uptake supporting antimicrobial

resistance reduction targets. A 10 % reduction in livestock disease levels is empirically

associated with an 800 million tonne reduction in GHG emissions, equivalent to the annual

emissions of 117 million Europeans. No direct costs are anticipated for ordinary consumers

beyond the payer-side cost of the SPC extension, which manifests primarily through public

health system expenditure.

2. Summary of costs and benefits

I. Overview of Benefits (total for all provisions)

Description Amount Comments

Direct benefits

Elimination/reduction of duplicative

regulatory obligations across

intersecting/overlapping legal

frameworks

EUR 5.2–5.5 billion/year

Combined annual savings (clinical trials + biosimilars)

EUR 2,700–4,500

Per multinational trial (SCM; admin costs only)

~EUR 2.8–4.7 million/year aggregate (derived: ~1,050

multinational trials/year × per-trial saving)

The EUR 5.2–5.5 billion/year figure covers these annualised streams:

• clinical trial reform (EUR 1.5–3.1 billion/year in direct sponsor savings, ~5%;

aggregate indirect savings raise the total to >EUR 5 billion/year)

• the VMP single GMO pathway removes EUR 5–14.5 million in cumulative

administrative costs to 2040

• biosimilar CES rationalisation (EUR 222–467 million/year across 12–18

MAAs/year)

• electronic submission and digitalisation measures yield EUR 112–225 million

cumulatively over 15 years (~EUR 7.5–15 million/year annualised.

Three further components are additional to this figure but presented on different units:

• the SCM-derived per-trial saving of EUR 2,700–4,500 (15–25% reduction in

sponsor administrative costs per multinational trial through reduced staff

time).

• ATMP reforms additionally remove 0.15–0.3 FTE-years per CTA.

Reduction of regulatory

fragmentation across Member States

Qualitative Harmonised templates, single GMO pathways for VMPs, shared infrastructure, and the EU

Support Network reduce Member State divergence in risk classification, product

categorisation, and procedural interpretation.

Enhanced predictability and legal

certainty in permitting and project

development

EUR 265 million – 1.16 billion

Combined avoided delay costs (medium uptake, to 2038)

~EUR 22–97 million /year simple annual average21

Strategic project recognition (60–70 projects, medium uptake) and high-impact flagship tier

(12–15 projects) together yield EUR 265 million – 1.16 billion in avoided permitting delay

costs by 2038.

Converts an opaque, variable permitting landscape into a bounded, time-limited pathway,

directly improving the bankability of industrial-scale deployments and creates a structured

"investability" channel that previously did not exist.

21 The annualised figure should be interpreted as a simple average over the implementation period; actual annual benefits are back-loaded, materialising primarily as projects reach permit-

granting maturity in the 2030–2038 window.

25

Streamlined authorisation

procedures and compressed

timelines in clinical development

106 → 75 days (47 without RFI)

EUR 1.5–3.1 billion/year direct sponsor savings (~5%)

Aggregate savings potentially exceeding EUR 5

billion/year

Clinical trial authorisation timeline compressed from 106 to 75 days (47 without RFI), with

harmonised templates and parallel modification submissions.

Direct cost savings of ~5% of annual EU sponsor expenditure yield EUR 1.5–3.1

billion/year; indirect savings through faster technical execution raise the aggregate to

potentially above EUR 5 bn/year.

Electronic submission saves EUR 112–225 million over 15 years.

Streamlined risk assessment

processes

12–24 months shorter per product (biosimilars)

(monetised annual figure already accounted for under the

first benefit)

50-day assessment period eliminated; modification

timelines cut from 96 to 47 days (ATMPs)

0.15–0.3 FTE-years per CTA removed (ATMPs)

30–90 days per CTA removed (VMPs)

EUR 22.5 million PV savings, central estimate (EUR 15–

30 million range) (VMP variations, to 2040). The central

annual saving in the base year is approximately EUR 1.46

million/year rising to EUR 3.07 million/year by 2040.

Biosimilar CES removal shortens development by 12–24 months and removes EUR 19–26

m in direct trial costs per product (representing 20–50% of total development expenditure

depending on molecule complexity), with the timeline reduction enabling developers to start

later in the originator's market protection period and reducing commercial risk.

For ATMPs, the elimination of the additional 50-day assessment period and the reduction

of substantial modification timelines from 96 to 47 days are the principal procedural gains;

ERA exemptions for qualifying GMO-ATMPs additionally remove 0.15–0.3 FTE-years per

CTA in administrative burden, concentrated in regulatory affairs and project management

functions, with benefits disproportionately accruing to the SME-dominated developer base.

For VMPs containing GMOs, the single regulatory pathway removes 30–90 days per CTA

(240–1,350 product-days of delay eliminated annually at current pipeline volumes; EUR 5–

14.5 million in cumulative administrative cost savings to 2040). The uniform handling

regime for VMP variations not requiring assessment yields a further EUR 22.5 million in

present-value savings to 2040 (range EUR 15–30 million), derived from a 10–20%

efficiency gain on VNRA processing workload applied across the sector.

Anchoring late-stage investment and

scale-up activity in the EU

EUR 19–40 billion

Total investment mobilised by 2038 (project frameworks)

~EUR 1.6–3.3 billion/year annual average22

Investment mobilised:

• Strategic project framework: EUR 15–28 billion (medium uptake, 60–70 projects).

• High-impact flagships: EUR 4–12 billion (medium uptake, 12–15 projects).

22 Cumulative EUR 19–40 billion ÷ 12 years; not uniform, because investment mobilisation is ramp-up dependent with bulk of activity concentrated in 2030–2038 as project pipeline matures.

26

EUR 10 billion mobilised in 2026–2027 (BioTechEU /

InvestEU)

EUR 230 million/year additional originator gross profit

per qualifying SPC medicine

• Combined EUR 19–40 billion by 2038.

Pending full establishment, the BioTechEU initiative under the current MFF and InvestEU

programme will mobilise up to EUR 10 bn in biotechnology investments in 2026–2027.

Additionally, the SPC extension, operating via a distinct IP protection mechanism rather

than project recognition or financing instruments, generates:

• an estimated EUR 230 million in additional originator gross profit per medicine

benefitting from the incentive per year (sensitivity range EUR 140–290 million),

• corresponding to approximately EUR 690 million/year in aggregate at an average

of three medicines per year.

• the associated combined payer expenditure and monetised cost of delayed patient

access amounts to approximately EUR 205 million per medicine (EUR 615

million/year in aggregate at three medicines).

• if developer behaviour changes in response to the incentive, up to five products

per year could benefit from the incentive rather than up to 3.

Strengthening the EU's global

competitive position in biosimilars

45–55%

EU-based share of biosimilar MAs maintained

(vs projected 40–50% without intervention)

12–24 months faster market entry per product

Without intervention, the EU-based share of biosimilar MAs is projected to fall from 49%

(2025) to 40–50% as manufacturing migrates to Asia and competitor jurisdictions accelerate

their own regulatory streamlining.

CES removal would arrest this decline by reducing the cost threshold for EU-based

biosimilar development, accelerating market entry by 12–24 months per product and

enabling EU developers to respond more quickly to patent expires.

Strategic project eligibility for biosimilar manufacturing reinforces this effect on the supply

side by improving the bankability of EU-based biomanufacturing deployments.

Together these measures can contribute to stabilise the EU-based company share at 45–55%

Improving the EU's attractiveness as

a location for commercial clinical

research

350–700 additional trials over 3–4 years (domestic

scenario; 4–8% increase)

If the Act enters into force swiftly, a one-off domestic increase of 4–8% over 3–4 years is

considered feasible, yielding 350–700 additional trials; The average economic activity

27

Up to 700–1,400 additional trials (relocation scenario; 6–

16% increase)

14 products from 2016-2025 identified as marginal cases

for conducting multi country clinical trials in Europe (SPC

extension conditional incentive)

value associated with this scenario is EUR 40–80 million/year and broader economic

spillovers are estimated at EUR 316–695 million/year.

If relocation effects also materialise, total additional trials could reach 700–1,400, though

this depends on factors beyond regulation including HTA and reimbursement conditions.

The average economic activity value associated with this scenario is EUR 80–160

million/year and broader economic spillovers are estimated at EUR 630–1,400 million/year.

Additionally, the SPC extension is expected to influence trial location at the margin:

between 2016-2025, of 100 products within scope of the eligibility incentive, 14 met all

conditions except the multi-Member State trial requirement, representing the marginal case

for developers to modify their behaviour in response to the incentive and conduct part of

their clinical trials for marketing authorisation in more than 2 EU MS.

Enabling innovation and supporting

new market entrants through

regulatory sandboxes

6–40 SOHO sandboxes established per year (90–250

eligible cases/year; 7–16% acceptance rate)

40% shorter time from regulator engagement to market

authorisation

For SOHO, sandbox-eligible cases are estimated to represent 5–10% of overall SOHO

activities, corresponding to 90–250 eligible cases per year; given observed acceptance rates

of 7–16% in comparable sandbox regimes, between 6 and 40 sandboxes are expected to be

established per year.

Evidence from FinTech sandboxes indicates participants achieve on average 40% shorter

time from engagement with the regulator to market authorisation than comparable firms

using standard processes; analogous gains are expected in SOHO though not yet

quantifiable against a baseline given the absence of comparable EU precedent.

For VMPs, the baseline is zero as no EU-level veterinary sandbox currently exists; the

measure therefore creates an entirely new pathway rather than improving an existing one.

Accelerating the translation of

research into clinical and

commercial development

4–40 additional CTAs/year (low to high uptake via high-

impact infrastructure)

60–600 firms served annually (low to high uptake via

high-impact infrastructure)

High-impact infrastructure uptake scenarios assume 2 projects with shared late-stage

translation capability under low uptake, 4–6 under medium, and 8–10 under high, driving

the CTA and firms-served ranges proportionally.

The 60% SME share is consistent across all uptake scenarios.

The 24-product SPC manufacturing effect reflects products meeting all other eligibility

conditions except an EU-based manufacturing step at time of approval; the incentive is

28

24 products from 2016 -2025 identified as marginal cases

for EU manufacturing step inclusion (SPC extension

conditional incentive)

expected to influence incremental production network decisions at the margin, not drive

fundamental manufacturing relocation.

Building the enabling infrastructure

for AI-driven biotechnology

innovation

EUR 89,000 per EMA qualification request replaced by

free public guidance;

160–250 days saved per interaction (Article 31)

120–495 companies and data users/year (low uptake);

1,100–3,400/year (medium uptake); 4,250–12,600/year

(high uptake) (Articles 32 and 33)

EUR 85–205 million cumulative CAPEX (low); EUR 650

million – 1.3 billion (medium); EUR 2.4–7.2 billion (high)

over 5–15-year build-out period. Annualised CAPEX

during build-out: EUR 17–41 million/year (low); EUR

65–130 million/year (medium); EUR 160–480

million/year (high)23

Article 31 harmonised AI guidance replaces costly one-off bilateral EMA interactions

(currently EUR 89,000 per qualification request and 160–250 days per interaction) with a

single publicly accessible reference point, disproportionately benefiting SMEs and

academic developers.

Articles 32 and 33 establish shared testing environments and data quality accelerators across

three uptake scenarios, serving:

• 120–495 companies and data users/year (low; 2–3 environments and 2–3

accelerators),

• 1,100–3,400/year (medium; 5–8 each), and

• 4,250–12,600/year (high; 10–15 each).

Total CAPEX ranges from EUR 85–205 million (low) to EUR 650 million – 1.3 billion

(medium) to EUR 2.4–7.2 billion (high) over the project build-out period.

Direct employment: 160–420 FTE (low) to 1,000–2,640 FTE (medium) to 3,300–7,500

FTE (high).

Mitigating biosecurity risks arising

from the wider accessibility of

biotechnologies

EUR 2.9 billion expected benefits (2027): EUR 1.8 billion

attack prevention + EUR 1.2 billion accident prevention

EUR 5.5 billion by 2036: EUR 2.9 billion attack

prevention + EUR 2.7 billion accident prevention

35% deliberate attacks prevented; 86% accidental releases

prevented

EUR 10 billion avoided future research value

Benefits split: EUR 1.8 billion (attack prevention) + EUR 1.2 billion (accident prevention)

= EUR 2.9 billion in 2027; rising to EUR 2.9 billion + EUR 2.7 billion = EUR 5.5 billion

in 2036, reflecting increased screening coverage over time.

The 35% attack prevention rate reflects that malicious actors can still order through non-

EU suppliers; the 86% accident prevention rate reflects near-complete coverage of

accidental misuse pathways.

_

23 Annualised CAPEX assumes 5-year build-out under low uptake, 10-year under medium, and 15-year under high.

29

The EUR 10 billion avoided research value represents RAND's estimate of lost future

research value from a regulatory backlash following a major biosecurity event.

Indirect benefits

Earlier and broader patient access to

biotechnology-derived treatments

~100 products reaching market up to 6 months earlier

1,435 additional transplants/year by 2035

57–72 waiting-list deaths averted/year by 2035; 248–311

cumulatively (2028–2035); valued at EUR 285–537

million

EUR 158 million cumulative dialysis cost avoidance

(2028–2035) ; ; EUR 19.75 million/year average.

EUR 443–695 million total monetised benefit (EUR 285–

537 million + EUR 158 million); EUR 55 – 87

million/year average.

Clinical trials reform: ~8% average launch rate applied to 2,500–3,000 products tested

annually yields ~100 products potentially reaching market up to 6 months earlier.

ATMP reforms expected to accelerate access in high-unmet-need areas, however not

quantified.

Organ processing: 1,435 additional transplants/year by 2035 (approximately 847 kidney,

357 liver, 99 lung) derived from a moderate-scenario 1.5–2.5 percentage point reduction in

the all-organ discard rate; set against a baseline waiting list of 52,488 patients and 3,366

waiting-list deaths annually (6.4% annual mortality rate).

570–945 fewer organ discards/year by 2035.

Deaths averted: 57–72/year applying a conservative 4–5% marginal mortality rate to

marginal transplant recipients; 248–311 cumulative over 2028–2035, valued at EUR 285–

537 million.

Dialysis cost avoidance: EUR 158 million cumulative (2028–2035), based on ~3,295

additional patients living with a functioning transplant by 2035.

Strengthening supply chain

resilience for essential

biotechnology medicines

8–60 capacity-relevant EU biomanufacturing

deployments by 2038 (low: 8–15; medium: 18–35; high:

30–60)

Of which 1–10 biosimilar-specific manufacturing

deployments (low: 1–2; medium: 3–5; high: 5–10)

Strategic project framework delivers 8–15 (low), 18–35 (medium), and 30–60 (high)

capacity-relevant EU-based biomanufacturing deployments by 2038, assuming

approximately 30–50% of recognised projects translate into capacity-relevant outputs.

Biosimilar manufacturing constitutes a distinct subset: 1–2 (low), 3–5 (medium), and 5–10

(high) capacity-relevant biosimilar deployments, mobilising EUR 0.9–7.6 billion in

cumulative investment by 2038.

30

EUR 0.9–7.6 billion cumulative investment in biosimilar

manufacturing by 2038 (low to high uptake); on average

EUR 75 – 633 million/year.

Environmental and sustainability

benefits

EUR 29.1 billion+ combined microbial market across

biofertilisation, biocontrol, bioremediation, bioleaching

(9–14%/year growth; GMM-specific share not separately

quantified; currently zero EU authorisations for GMM

deliberate release)

800 million tonnes potential GHG reduction (10%

livestock disease reduction via biotech vaccines).

Equivalent to annual emissions of 117 million Europeans

GMM regulatory reform unlocks market access across four application sectors:

biofertilisation (USD 1.38–3.1 billion; 10.9–12.8% CAGR), biocontrol (USD 6.5 billion;

14.3% CAGR), bioremediation (USD 16.45–18.08 bn; 9.93–13.0% CAGR), and

bioleaching (USD 10.14–11.19 billion; 8.9–9.06% CAGR) - combined USD 34–39 billion.

The EU currently has zero authorised GMMs for deliberate release.

Veterinary biotech vaccine uptake enabled by VMP reform supports the EU's target of

halving antimicrobial sales by 2030.

10% reduction in livestock disease levels is empirically associated with an 800 m tonne

GHG decrease, equivalent to the annual emissions of 117 million Europeans.

Food chain sandbox creates structured pathways for pre-market testing of sustainable food

production technologies across all stages of production, processing and distribution, food

contact materials, and GMO-containing products.

Ecosystem-level coordination and

connectivity infrastructure

Qualitative; functions as a cross-cutting enabler of all

other interventions

14 pp higher knowledge sharing and collaboration

capability for firms receiving network support vs

unsupported firms

Four interconnected mechanisms underpin uptake of all substantive reforms:

• The EU Health Biotechnology Support Network is a single entry point for

SMEs and start-ups to navigate regulatory pathways, access funding and

scaling-up resources, and connect with investors across EU27;

• Networks of health biotechnology clusters for cross-border collaboration,

infrastructure access, and knowledge transfer;

• The European Health Biotechnology Steering Group for strategic

coordination between Member States and the Commission; and

• strategic mapping of the Union's biotechnology ecosystem for evidence base

covering industrial capacity, infrastructure, capital access, and skills gaps

informing all other measures.

31

EEN benchmark: firms receiving network support report 14 pp higher knowledge sharing

and collaboration capability than unsupported firms (69% vs 55%).

I. Overview of Benefits (Totals)

Amount Components Comments

Direct benefits

~EUR 8.3–11.3

billion/year

Duplication removal savings: EUR 5.2–5.5 billion/year

VMP procedural savings: ~EUR 1.5–3.1 million/year

Permitting predictability: ~EUR 22–97 million/year

Biosecurity screening: EUR 2.9–5.5 billion/year

Sum of directly quantified annual benefit figures drawn from intervention-level assessment of

impacts. . The EUR 10 billion biosecurity avoided research value is also excluded from the annual

total as it represents a one-off expected loss avoided rather than an annual flow, and is therefore not

additive to annual benefit figures. All figures are subject to uptake, implementation, and market

conditions as described in the benefits table above.

Indirect benefits

~EUR 55–87

million/year

Patient access monetised benefits: EUR 55–87 million/year

average (EUR 443–695 million cumulative 2028–2035)

Covers organ processing reforms only (VSL valuation of deaths averted + dialysis cost avoidance).

Clinical trial and ATMP patient access effects are not separately monetised. Supply chain resilience

benefits are not directly monetised as deployment counts and investment figures serve as proxies

only. Environmental and ecosystem benefits are qualitative.

32

II. Overview of costs

Citizens/Consumers Businesses Administrations

One-

off

Recurrent One-off Recurrent One-off Recurrent

Action

(a)

Direct adjustment

costs n/a.

Clinical trials:

- Initial investment in harmonised

standard operating procedures to meet enforcement expectations

across National Competent

Authorities and ethics committees. Not quantified -

low.

Substances of Human Origin:

- One-off costs of adjusting to the

sandbox route for SoHO entities. Not quantified – low.

Responsible use of AI and data

management:

- Adaptation of internal governance, validation

procedures and documentation to

comply with new EMA lifecycle guidance on AI. Not quantified –

medium.

Substances of Human Origin:

- Evidence generation within

sandbox route: total additional

cost to SoHO entities EUR 718,500/year (low estimate, 6

sandboxes per year) to EUR

4,790,000/year (high estimate, 40 sandboxes per year).

- Sandbox costs comparable to

high-risk SoHO authorisations (50-100 patients, EUR 1,200–

6,000 per patient), assuming

half medium-risk and half high-risk cases. If medium-risk

cases use the sandbox route,

direct cost per case increases relative to the standard SPA

route.

Organ processing:

- Ongoing data collection, analysis and reporting under

mandatory clinical-outcome

monitoring plans, estimated at approximately EUR 9,000 per

monitoring plan per year.

Aggregate across EU-27

during the transition phase

(approximately 15–36 active

monitoring plans): EUR 405,000–980,000 over three

years (2029–2031), or circa

EUR 135,000–327,000/year.

Biotech ecosystem:

- Designation of single

points of contact for health biotechnology; source

notes this is a scope

extension of structures already established under

the Net-Zero Industry Act

and Critical Raw Materials Act, resulting in

marginally lower set-up

costs than those benchmarks; not

quantified – low.

Biosimilars:

- Article 28: finalising the

Draft Reflection Paper into adopted guidance;

estimated at 0.5–1.0 full-

time equivalent-year at EMA. Cost can be

considered negligible.

Novel health biotechnology

products:

- Setting up the regulatory

sandbox and establishing

the foresight panel; borne

by the Commission only.

Approximately EUR 4.3

million over approximately 3 years is

an order-of-magnitude

reference. Or approximately EUR 1.4

million/year over the

Biotech ecosystem:

Member State level: - Steering Group participation: approximately 2

full-time equivalents per Member State per year;

- Facilitation of Support Network tasks (Article

19(7)): not separately quantified - low.

Commission level:

- Operating Steering Group secretariat, conducting strategic mapping and coordinating Support

Network: approximately EUR 2.6 million

annually (EUR 18.4 million over the MFF period).

Biosimilars:

- Article 28: ongoing maintenance of tailored biosimilar guidance and handling of tailored

scientific advice requests; estimated at 0.2–0.5

full-time equivalent-year at EMA.

Novel health biotechnology products:

- Operating the regulatory sandbox and running the foresight panel (Commission); not quantified –

low to medium.

General food law reform:

- Additional staff and coordination effort in EFSA for expanded scope of pre-submission advice. The

costs are expected to be offset by efficiency gains

from fewer stop-the-clock procedures and less remedial work on poor-quality dossiers. Not

quantified - low.

- Member State national competent authorities: establishing and supervising regulatory sandboxes

and submitting annual reports to the Commission

on sandbox results. Not quantified - low.

Access to funding:

- Monitoring and reporting of the Pilot, evaluation of leverage and additionality across instruments.

33

initial three-year setup

period.

Clinical trials:

- Setting up sandbox

ecosystem infrastructure approximately EUR 4.3

million over

approximately 3 years as an order-of-magnitude

analogy. Or approximately

EUR 1.4 million/year over

the initial three-year setup

period.

- Separate sandbox from Novel health

biotechnology products,

but similar cost expected.

ATMP:

- Commission preparation of delegated acts to update

the tissue engineered

product definition,

including consultations

with EMA and the Substances of Human

Origin Coordination

Board. Not quantified - negligible.

VMP:

- EMA: one-off

development of SPC

eligibility assessment guidance and criteria. Not

quantified - negligible.

- Commission: adopting implementing act(s)

establishing the regulatory

sandbox rules and limits; one per sandbox

established; approximately

2–3 over 2026–2040. Not quantified - negligible.

Not quantified - negligible (largely absorbed

within existing EIB structures).

Responsible use of AI and data management:

- Arts. 32 & 33: continuous technology refresh to