Proposal for a European Biotech Act: will the Commission’s proposal unlock the potential of the health biotech industry in the EU?

This article is part of our Biotech Review of the Year - Issue 13 publication.

December of 2025 was an exciting month for the life sciences sector in terms of legislative updates in the EU. In addition to a political agreement being reached by the EU institutions on the so-called “EU pharma package”, the Commission published its Proposal for a Regulation to establish measures to strengthen the Union’s biotechnology and biomanufacturing sectors (European Biotech Act).

Introduction

Health biotech, one of the fastest growing innovative industries in the EU, is strategic and central for the EU’s competitiveness, autonomy and innovation leadership. However, despite having world-leading biotech science, the Commission itself recognises that the EU faces structural barriers in clinical development, regulation and manufacturing of biotechnologies. Too often EU start-ups end up growing, employing and placing products on the market outside the EU, thus creating value elsewhere. The reasons for this are multiple: limited access to risk capital and other sources of funding, skill shortages, processes that slow down the development of biotech innovation, and fragmented and complex legal frameworks. The reality is that the EU is losing ground to other regions with increasingly agile regulatory and financial systems, namely the US and China. 

It is therefore welcome news that, to address this competitiveness gap, the Commission has proposed a European Biotech Act focused on the health dimension of biotechnology, health biotech. This refers to the application of biotechnology for the promotion, protection or restoration of human health and biotech applications relevant to animal health, plant health, veterinary public health, and food safety. The proposed Regulation will apply to the entire life cycle of health biotech products and services, including related research, access to funding, development, testing, validation, manufacturing, placing on the market, and use activities. 

Below are some of the tools proposed by the Commission to make it easier to bring biotech products from the lab to the factory and then to the EU market, while maintaining the highest safety standards for the protection of the EU population and environment.

Health biotech strategic projects, high impact health biotech strategic projects, and access to funding

The Commission’s proposal introduces the concepts of “health biotech strategic projects” and “high impact health biotech strategic projects”, and establishes a framework for their recognition and support aimed at strengthening the EU’s industrial biomanufacturing capacity and value chains. 

Health biotech strategic projects would serve as targeted instruments to mobilise public and private investments through coordinated action among the EU, Member States, industry, research communities and other stakeholders. In particular, they should contribute to the EU’s biotech objectives by strengthening industrial capacity and value chains, scaling up critical research and technology infrastructures, accelerating innovation and technology deployment, or advanced data and digital platforms. Health biotech strategic projects with the potential to contribute to the EU’s objectives in biotech in a systemic and multiplier manner would constitute high impact health biotech strategic projects. These projects would have to act as catalysts for cooperation between academia, industry and the public sector, and be key for the development of regional biotech clusters and innovation ecosystems across the EU Member States. They would be given particular consideration for EU funding, priority access to administrative support and fast-tracked procedures at Member State level. 

Whereas a designated competent authority at Member State level would assess and verify whether a particular project fulfils the conditions for recognition as a health biotech strategic project, the recognition of a high impact health biotech strategic project would be assessed through a two-tier process, involving the national assessment and that of the Commission. 

The proposal also establishes an EU health biotech investment pilot in partnership with the European Investment Bank Group and other implementing partners, which would bring together equity instruments and venture-style debt tailored to biotechnology-specific risk profiles in order to mobilise private investment into the sector. It remains to be seen whether this will be sufficient to attract the necessary private investment required to develop complex infrastructures for the success of health biotech businesses.

SPC extensions 

One of the most exciting tools to incentivise the development and placing on the EU market of health biotech in the form of medicinal products for human use is the proposed introduction of a 12-month extension to supplementary protection certificates (SPCs) for medicinal products developed by means of biotech processes and for advanced therapies medicinal products (ATMPs). This provision aims at incentivising the development of products using innovative biotech technologies which will bring a therapeutic advantage to patients. 

SPC extensions would be reserved for products with a marketing authorisation granted by the EU for a medicine developed by means of biotech processes or an ATMP provided that the following conditions are met:

1. the medicine contains a new active substance “distinctly different” from that of any authorised medicine in the EU;
2. the medicine has a “distinctly different” mechanism of action and shows a level of safety and efficacy which is at least equivalent to that of any authorised medicine in the EU for the same disease;
3. the efficacy clinical trials supporting the marketing authorisation are conducted in more than two EU Member States; and
4. at least one manufacturing step, excluding packaging, quality testing and certification, is performed in the EU. 

The respective requirements that the new active substance and the mechanism of action should be “distinctly different” introduce a degree of uncertainty and discretion that seems unnecessary and could tarnish what otherwise is an excellent proposal. Absent the “distinctly different” requirements, the conditions for obtaining this new extension should not be difficult to meet for biotech products for human use. Needless to say, the degree of “distinctiveness” required to obtain the incentive would require clear guidance from the EMA.

Just like with the paediatric SPC extension introduced by the Paediatric Regulation (EC) No 1901/2006, the EMA would be responsible for assessing compliance with the conditions for obtaining the extension and issuing a compliance statement. This compliance statement would then be submitted along with the application for an SPC which is lodged with the competent industrial property office of the Member State that granted the basic patent. 

The Commission proposes the introduction of a second SPC extension concerning biotech medicinal products for veterinary use treating zoonoses (that is, diseases which can be transmitted to humans from animals) developed and authorised in the EU. For marketing authorisations granted by the Commission for a veterinary medicinal product developed by means of a biotech process that is intended to diagnose, treat or prevent zoonotic diseases, a 12-month extension of the SPC would be possible when the same conditions as the above-mentioned ones for medicines for human use are met. The EMA would also assess compliance with the conditions and issue the corresponding statement.

Making clinical trials easier and faster

Conscious of the need to bring simplification and shorten the timelines for biotech innovations to reach the EU market, the Commission considers it necessary to accelerate clinical trials in the EU to attract more clinical research in the EU. In this context, the Commission proposes to make changes to the Clinical Trials Regulation (EU) No 536/2014.

Amongst the many changes proposed, some stand out. In particular, the Commission wants to streamline and speed up the authorisation process for multinational clinical trials. It wants to give a stronger leading role to the reporting Member State and strengthen the principles of mutual trust and reliance. The assessment by the reporting Member State, including the ethical aspects of the clinical trial, would serve as a reference for the other Member States concerned. These should complement the assessment only when necessary. Another important proposed change is the involvement of ethics committees in the assessment of ethical aspects of Part I of the application dossier, so that the ethical perspective is integrated in the assessment report by the reporting Member State. The aim is to ensure that the ethical review is conducted in a more harmonised and transparent manner. These changes should be welcome news to sponsors as they would reduce divergent approaches. 

The Commission also wants to shorten authorisation timelines for multinational clinical trials from 106 to 75 days, including validation and ethical review (with further reductions when there is no request for information to the sponsor). For ATMPs, the additional 50 days for assessing these products would be eliminated. The assessment period for substantial modifications would also be shortened (from 96 to 47 days, with further reductions when there is no request for information to the sponsor) and, importantly, parallel submissions for substantial modifications would be permitted going forward, as long as they relate to different parts of the dossier.

The introduction of a single, core dossier for investigational medicinal products (IMPs) would simplify clinical trials using the same IMP. Simplifications for low-interventional clinical trials would be further supported by the introduction of a new category of “minimal-intervention” clinical trials. These would be clinical trials with authorised IMP(s) used in accordance with the terms of the marketing authorisation, and where the additional diagnostic or monitoring procedures do not pose more than a minimal additional risk or burden to the safety of the subjects compared to normal clinical practice in any Member State concerned. These minimal-intervention clinical trials would only require an ethical review before they could begin.

Two proposed changes that are likely to have the biggest impact on the resources that sponsors have to allocate when setting up clinical trials are (1) the introduction of mandatory EU harmonised templates, and (2) the introduction of a single assessment process for combined studies involving the investigation of a medicine together with a medical device or an in-vitro diagnostic. The latter in particular will be welcome news, as currently sponsors wanting to generate data for novel therapies that use different technologies have to deal with up to three stand-alone legal frameworks. 

Last but not least, the Commission proposes the harmonisation of the lawful basis for processing personal data in clinical trials and the allocation of responsibility between sponsors and investigators. The Clinical Trials Regulation (EU) No 536/2014 would be amended to clarify that the legal basis for processing of personal data is the existence of a legal obligation where it is necessary for sponsors and investigators to comply with the legal obligations imposed on them to ensure the safety and efficacy of the IMP. Member States would not be able to introduce further conditions such as requiring consent for the processing of personal data, including genetic data or data concerning health. It would also be clarified that sponsors and investigators would both be controllers under the GDPR. Finally, Clinical Trials Regulation (EU) No 536/2014 would be amended to allow for secondary uses of clinical trial data for scientific research purposes without a new or additional GDPR consent.

Regulatory sandboxes and other proposed changes

The term “regulatory sandbox” is perhaps one of the most repeated in the legislative proposal, as there are numerous types of regulatory sandboxes that are being proposed. Firstly, the Commission proposes the establishment of regulatory sandboxes for health biotech products which are at a very early stage of development and do not fall within the scope of existing regulatory sandboxes, like the one that will be in place when the new EU pharma law package finally becomes a reality. It also foresees the possibility of creating regulatory sandboxes at national level for food and feed biotech products, although not for novel foods. Another regulatory sandbox is foreseen to harness the benefits of disruptive and innovative approaches to clinical trials, including the use of AI in clinical trial design, data collection, analysis and participant interaction. Other sandboxes are proposed in the context of the development of innovative technologies, methods or products related to veterinary medicinal products, and for substances of human origin that cannot yet be developed in full compliance with the requirements of Regulation (EU) 2024/1938 on standards of quality and safety for substances of human origin, the so-called SoHO Regulation. 

There are plenty of references to AI in the proposed Regulation. Whereas the EU AI Act provides harmonised rules for the placing on the market or putting into service and use of AI systems and models in the EU, which the European Biotech Act would not amend, a new Advisory Group on Biosecurity, reporting into the Commission, would be created to monitor the capabilities of AI models in biological applications. 

The Commission’s proposal is packed with other changes, including (1) the establishment of an EU-wide Regulatory Status Repository that would compile relevant opinions, recommendations, decisions and guidance in the area of health biotech to determine the regulatory status of a product, (2) a new framework for preventing the misuse of biotech products of concern, (3) the enhancement of competitiveness in biosimilars, (4) the creation of both the EU Health Biotechnology Support Network to help developers navigate regulatory pathways and the Foresight Panel for Emerging Health Innovation to provide regulatory, scientific and technical expertise on emerging science and technology to the Commission, the EMA, other EU advisory bodies and national competent authorities; and (5) amendments to general food law, the legal framework for veterinary medicinal products and the framework that applies to substances of human origin, to name a few.

Conclusion

As the proposed regulation follows the EU’s ordinary legislative procedure (with the European Parliament and the Council acting as co-legislators), we will have to wait for the final text before the Regulation is enacted.

More than ever, we need a strong life sciences ecosystem in the EU. With the end of the hiatus and uncertainty caused by the lengthy process to agree on the reform of the EU pharma package, the Commission’s proposal is an exciting tool to support the development, funding, testing, manufacturing, marketing and use of health biotech in the region.