Key developments shaping European pharma in late 2025

Major regulatory overhaul in the EU
The European Union’s lawmakers have agreed a provisional pharma package to modernise medicine rules, speed up patient access, and boost competitiveness across the bloc. New provisions include defined periods of data and market protection for novel drugs and tools to improve supply security and antibiotic development. Some industry groups argue the measures still lag behind US incentives, potentially limiting Europe’s investment attractiveness. Reuters

Shorter exclusivity to help generics
As part of the evolving regulatory framework, the EU has trimmed the market exclusivity period for new drugs from 10 to 9 years and introduced earlier data sharing with generics makers. While this is expected to lower healthcare costs and expand access to affordable medicines, pharmaceutical companies warn it could weaken incentives for high-risk R&D investment. Financial Times

Industry investment dynamics
Despite ongoing policy shifts in Europe, some pharma leaders continue to emphasise the importance of investments outside the region. GSK’s CEO recently highlighted the US as the most attractive market for drug company investment, reflecting broader industry sentiment that global markets, especially the US and China, currently offer stronger commercial incentives. The Guardian

UK context within broader European trends
In the UK, following trade negotiations with the United States, the medicine rebate rate paid by pharmaceutical firms into the NHS is set to fall next year, a move praised by industry players as a step toward improving the UK’s investment climate even as the region competes globally. Reuters

Wider industry context
Europe’s pharmaceutical sector remains a leading global R&D hub with substantial employment and economic impact. The EU and member states are pushing reforms to enhance competitiveness and supply resilience, but challenges such as regulatory uncertainty, comparative investment attractiveness, and rising R&D costs persist. news.syenza.com

Summary:
European pharma is undergoing regulatory reform aimed at speeding access and balancing innovation with affordability. While new rules and incentives are emerging, major companies often view investment prospects outside Europe as more attractive, even as regional policy shifts seek to strengthen competitiveness.