The article below, by Marc Martens and Nicolas Carbonnelle of our Brussels office, was originally published in PharmaNetwork magazine. This article looks at the challenges and perspectives of the regulatory landscape of Advanced Therapy Medicinal Products in Europe.
Reproduced below with permission from PharmaNetwork Magazine.
Advanced Therapy Medicinal Products (ATMPs), a category of innovative products comprising gene therapy medicinal products (GTMPs), somatic cell therapy medicinal products (sCTMP), and tissue-engineered products (TEPs), constitute very promising therapies. The main therapeutic areas are oncology and regenerative medicine, in particular in the field of cardiovascular conditions and hematology. Yet despite harmonizing European legislation in place since 2008, very few products have reached the market in commercial form.
Earlier this year the European Commission issued a report on the implementation of the legislation on ATMPs to date. And on 30 June 2014The European Medicines Agency (EMA) Committee for Advanced Therapies (CAT) announced a public consultation on its revised guidance on ATMP classification. This public consultation runs until 31 October.
Against this background, this article examines the current European legislation on ATMPs and discusses some of the challenges it poses for this type of red biotechnology.
1. The regulatory and industry landscape – a bird's eye view
1.1 Regulatory landscape
ATMPs are biological medicinal products and, as such, are governed by pharmaceutical legislation, which includes the ATMP Regulation.
The ATMP Regulation builds on the directives concerning medicinal products for human use, quality and safety standards for human tissues and cells, medical devices and active implantable medical devices and on the Regulation concerning centralised marketing authorisation procedures.,.
However, where ATMPs are derived and/or produced from human tissues and cells, not all phases of the ATMP manufacturing process fall within the scope of the ATMP Regulation. Notably, the donation, procurement and testing of the human tissue or cells involved in the manufacture of the ATMP are instead governed by Directive 2004/23/EC of the European Parliament and of the Council of 31 March 2004 on setting standards of quality and safety for the donation, procurement, testing, processing, preservation, storage and distribution of human tissues and cells (EUTCD). This directive, which sets out the requirements for the accreditation, designation, authorization, or licensing for the procurement and testing of the biological material that is intended for human applications, is implemented at national level.
The need to comply with both the centralized procedure for marketing authorisations under the ATMP Regulation, and differing national EUTCD requirements can create a substantial administrative burden or constraints in some Member States.
At the time of writing (July 2014), twelve MA applications have been submitted to the CAT, while only four ATMP products have eventually been granted a MA. These low numbers can partly be explained by the issues identified in this article, including that a significant number of ATMP developers active on the market before the ATMP Regulation entered into force never applied for MAs. A large proportion of those developers worked under a hospital exemption, or a "specials" exemption (see below). Consequently, the number of MAs granted since the entry into force of the ATMP Regulation does not reflect the ATMP market accurately: the vast majority of ATMPs currently on the market are not covered by MAs.
1.2 Industry landscape
Most research and development in ATMPs is conducted by academics, academic spin-offs, not-for-profit organizations, and SMEs. Until now, only a few larger pharmaceutical companies have engaged in the investigational phases of ATMP development, due to the perception that the early investigational phases of the development of ATMPs is a high risk activity.
The ATMP provides a number of incentives intended to stimulate research and development in this area. For example, the ATMP Regulation grants SMEs a 90% reduction of fees for scientific advice, which can moreover be deferred until an MA is granted. SMEs are further entitled to a 50% reduction on MA fees for products of particular public health interest to the European Union, and will not have to pay any fees if the MA is not ultimately granted. The ATMP also offers non-SME applicants a 65% reduction of the EMA's fees for ATMP-related scientific advice .
As the Commission's report on the application of the ATMP Regulation points out, incentives are no longer offered for post-marketing obligations. Notably, the 50% fee reduction for MA and post-marketing activities previously offered to SMEs and hospitals for ATMPs with a public health interest has been withdrawn. The report suggests that reintroducing such incentives could increase the number of products reaching the market, since post-marketing obligations can impose significant costs that may even be prohibitive for smaller companies before the ATMP becomes profitable.
2. Challenges and opportunities for the commercial developement of ATMPs
The commercial development of ATMPs poses a number of challenges for developers. Notably, the complexity of product classification, burdensome procedures for ATMPs-medical device combinations, uncertainties surrounding certification procedures, the lack of harmonization of import and exportrules and the divergent rules and procedures for critical aspects of ATMP development across different Member States. Each of these issues is examined in the following sections.
2.1 Product classification
The Commission's report identifies as one of the practical difficulties in the application of the ATMP Regulation the classification of products. Among the issues encountered in practice are: (i) the question of whether or not a manipulation of a living material is to be considered substantial; and (ii) the categorization of certain innovative products that could qualify not only as medicines but also as medical devices, cosmetics, or tissues and cells.
The CAT classifies ATMPs into three categories - GTMP, sCTMP, or TEP - according to their characteristics, mode of action, and intended function. For example, while sCTMPs are intended for the prevention, diagnosis, and/or treatment of diseases via pharmacological or metabolic actions, TEPs are used for regenerating, repairing, or replacing a human tissue.
While the CAT's recommended classification recommendations are not legally binding, they constitute a valuable tool for ATMP developers. In particular, since the classification helps the developer and the (national) competent authorities to identify the regulatory requirements, criteria, and procedures to be applied in the later stages of development of the product. Thus, the early classification of an ATMP is not only a matter of regulatory compliance, but also may also influence a developer's strategy and business model.
According to the CAT, more clarity required in this area, not only in order to achieve the highest possible level of public health protection, but also to give developers and investors greater certainty regarding the applicable regulatory framework from the earliest stage of development.
2.2 Combined ATMPs
Where an ATMP incorporates, as an integral part of the product, one or more medical devices, the combination may qualify as a "combined advanced therapy medicinal product". While specific guidelines have been drafted with respect to these combined products, the ATMP Regulation nonetheless requires the medical device and the medicinal product to be assessed separately. The European Commission's recent public consultation revealed that stakeholders consider this excessively burdensome, especially in the cases where the device is not marketed separately.
Stakeholders further reported that the separate assessment requirement incentivizes the use of already approved devices rather than the development of new, better-targeted devices, based on the (not entirely correct) perception that recourse to an already CE-marked device will speed up the regulatory procedure. Thus, they argue, the current system could negatively impact the overall quality and innovative nature of the products on the market.
For all of these reasons, stakeholders favour a single assessment procedure, in which the CAT would evaluate both elements of the combined ATMP.
SMEs developing ATMPs may apply to the CAT for certification of quality and non-clinical data. Certification was designed to help SME's attract investment for the development of ATMPs. However, it has been used only five times since the ATMP Regulation entered into force.
There are several possible reasons for this. First, the link between certification and the MA procedure is unclear. And second, the scheme has to date been very limited, both in terms of who is eligible to apply for, and what is covered by, the certification.
Thus, stakeholders in the Commission's consultation suggest that the role of the certification should be clarified, and its application extended to also cover, e.g., clinical aspects of the MA application dossier. Finally, they argue that the scheme should also be opened to commercial entities.
2.4 Import and export of human tissues and cells
Import and export of human tissues and cells, and intra-European distribution of such biological material, is a crucial aspect of ATMP manufacture. However, experience shows that differing quality and safety standards between Member States can pose a real challenge for ATMP manufacturing schemes. While the EUTCD harmonizes quality and safety standards for human tissues and cells intended for human applications, some crucial elements still need to be put in place in order to achieve full harmonization.
Two draft Commission Directives intended to address this issue are currently being prepared. These will address (i) the procedures for verifying the equivalent standards of quality and safety of imported tissues and cells, and (ii) the coding of human samples. These new rules are intended to further standardize and clarify the requirements applicable to samples imported into and distributed within the EU. It is hoped that both directives will be published by the end of 2014 and, following a transition period of one year for transposition into national law, may will enter into force by the end of 2016.
2.5 Disparities in the regulatory framework between Member States
Notwithstanding the increasing level of harmonization of pharmaceutical law in general, and ATMP legislation in particular, disparities remain between the national rules in European Member States. This is in large part due to the fact that, as explained above, the ATMP Regulation builds on the legislation relating to quality and safety standards applicable to human tissues and cells, including the EUTCD. Since this underlying legislation consists of directives, which (unlike directly effective regulations) leave Member States free to decide how to implement the directive's requirements, ATMP developers are often confronted with a patchwork of diverging approaches that further complicate the process of obtaining market authorization for an ATMP.
The following sections describe how a number of these differences risk undermining legal certainty and create practical difficulties for ATMP developers.
2.5.1 National implementation of tissues and cells legislation
One area in which Member States have adopted divergent approaches under the EUTCD is the regulation of tissue establishments. Experience shows that this can lead to practical and administrative difficulties, especially in the framework of cross-border activities.
In particular, ATMP manufacturers operating in different Member States will need to comply with different administrative requirements depending on the Member State in question. For example, some Member States require periodic submissions to an ethics board, higher levels of personnel qualifications, or require manufacturing activities to cooperate with healthcare institutions under the supervision of the local authorities, as is the case in Belgium for the manufacture of allogeneic ATMPs.
2.5.2 Development activities under national supervision
Different requirements also apply for many development activities, which largely remain with national authorities. In particular, national authorities are responsible for the authorization of clinical trials and the grant of manufacturing authorization for investigational ATMPs.
2.5.3 Implementation of exemptions from obligation to obtain an MA
Exemptions from the obligation to obtain an MA are also regulated at national level. For example, Member States may exempt certain products used on a non-routine basis for unmet clinical needs, Directive 2001/83/EC provides ATMP-specific exemption, known as the 'hospital exemption' and ATMPs may also qualify for a 'specials' exemption. Other derogations may also be available under national law.
Differences in the way that these exemptions are applied between Member States risk fragmenting the EU market and make it difficult for companies to foresee and manage associated costs and resources. They may also result in the exemptions being applied more widely in some Member States than others, with the risk that the number of applications for marketing authorizations is reduced.
The fact that unlike the “specials” exemption, the 'hospital exemption' is currently still available after a competing product is approved, can constitute an additional discouraging factor for ATMP developers.
According to the Commission's report of March 2014, it is anticipated that proposals will be made in order to further harmonize the conditions under which the exemptions are possible, and of the requirements attached to that exemption. The objective is to strike a better balance between the need to ensure that ATMPs are made available to patients only after their quality, safety, and efficacy have been demonstrated, and the need to facilitate early access for new treatments in case of unmet medical needs.
3. Concluding remarks
With the adoption of the ATMP Regulation, the European Union is attempting to implement an open market for ATMPs, in which quality standards are consistently applied and adequately monitored.
The Commission's report on its public consultation published on 28 March 2014 identifies a number of issues encountered during the first years of implementation of the regulation. It also highlights areas in which the legislation could be improved, either by clarifying the scope of the regulation by fine-tuning the definitions of ATMPs, adopting a more harmonized approach to MA exemptions, or improving the currently under-used certification scheme.
It is yet to be seen which of the Commission's proposals will be implemented as amendments to the Regulation. The difficulties encountered in this early years of the regulation's application demonstrate that it is difficult to strike the appropriate balance between ensuring a high level of public health protection, creating conditions that facilitate the development and marketing of new treatments, and constantly adapting to rapid, and accelerating, scientific progress.
Achieving these goals such that ATMPs may deliver their full potential will require further harmonization of the regulatory framework. This, in turn, will demand open and constructive debate among all stakeholders from every stage of the ATMP lifecycle, from early research to market approval and beyond.
About the authors :
Marc Martens is a partner and Nicolas Carbonnelle is an associate in Bird & Bird LLP's Brussels office.
 Defined by Section 2.1, Part IV, Annex I to Directive 2001/83/EC.
 Defined by Section 2.2, Part IV, Annex I to Directive 2001/83/EC.
 Defined by Article 2 (b) of the ATMP Regulation.
 Maciulaitis, R., D’Apote, L.D., Buchanan, A., Pioppo, L., and Schneider, C.K. (2012). Clinical development of advanced therapy medical products in Europe: Evidence that regulators must be proactive. Molecular Therapy 20(3), p. 480.
 Report from the Commission to the European Parliament and the Council in accordance with Article 25 of Regulation (EC) No 1394/2007 of the European Parliament and of the Council on advanced therapy medicinal products and amending Directive 2001/83/EC and Regulation (EC) No 726/2004, COM(2014) 188 final.
 Regulation (EC) No. 1394/2007 of the European Parliament and of the Council of 13 November 2007 on ATMPs and amending Directive 2001/83/EC and Regulation (EC) No. 726/2004, O.J., L324, 10 December 2007, p.121.
 Reflection paper on classification of advanced therapy medicinal products, EMA/CAT/600280/2010, Rev.1.
 A European regulation is a legislative instrument that typically provides for a high level of harmonization across EU Member States. Unlike a Directive, which leave Member States free to decide how to achieve the required outcome, European regulations are directly applicable in all Member States.
. Directive 2001/83/EC of the European Parliament and of the Council of 6 Nov. 2001 on the Community code relating to medicinal products for human use, Official Journal L 311, 28 Nov. 2001, 67.
. Council Directive 93/42/EEC of 14 Jun. 1993 concerning medical devices, Official Journal L 169, 12 Jul. 1993, 1
. Council Directive 90/385/EEC of 20 Jun. 1990 on the approximation of the laws of the Member States relating to active implantable medical devices, Official Journal L 189, 20 Jul. 1990, 17
. Regulation (EC) No. 726/2004 of the European Parliament and of the Council of 31 Mar. 2004 laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Medicines Agency, Official Journal L 136, 30 Apr. 2004, 1
 S. Shorthose et al., Guide to EU pharmaceutical regulatory law, Wolters Kluwer, Alphen aan den Rijn, spec. pp. 447-460
 O.J., L 102, 7 April 2004, 4.
 The ATMP Regulation notably provides that Marketing Authorisation applications for ATMPs must in principle follow the centralised procedure in which the CAT intervenes.
 CAT monthly report of application procedures, guidelines and related documents on advanced therapies, June 2014 meeting, released 24 June 2014, EMA/CAT/375230/2014
 COM(2014) 188 final, o.c.
 See COM(2014) 188 final, o.c. The Commission roughly estimates the actual number of ATMPs present on the EU market around 31, but this figure must be taken with caution for not all Member States have reported on this, and the same product may have been reported by more than one Member State
 P. Hourd, A. Chandra, N. Medcalf and D.J. Williams, Regulatory challenges for the manufacture and scale-out of autologous cell therapies (June 30, 2014), StemBook, ed. The Stem Cell Research Community, StemBook, doi/10.3824/stembook.1.96.1.
 COM(2014) 188 final, o.c.
 EMA/CAT/375230/2014, o.c. Since the entry into force of the ATMP Regulation, the CAT has adopted a hundred scientific recommendations on classification of ATMPs.
 See Reflection paper on classification of advanced therapy medicinal products, o.c.
 Maciulaitis, et al., o.c., p. 481.
 COM(2014) 188 final, o.c.
 Defined by Article 2(1)(d) of the ATMP Regulation
 See COM(2014) 188 final, o.c., p. 11
 EMA/CAT/375230/2014, o.c.
 COM(2014) 188 final, o.c.
 Including the donation, collection, and testing of samples for ATMP manufacture.
 These texts were examined during the meeting of the Tissues and Cells Committee of the DG Sanco on 8 and 9 July 2014 (dossier CMTD(2014)0856)
 P. Hourd et al., o.c.
 See Article 3 (7) of Directive 2001/83/EC
 As ruled by Article 5(1) of Directive 2001/83/EC
 P. Hourd et al., o.c.
 COM(2014) 188 final, o.c.