PORTUGAL: An Introduction to Life Sciences

Challenges in the Portuguese Life Sciences Sector

The life sciences sector in Portugal, particularly the pharmaceutical sector, has faced a major challenge over the last few years: finding a balance between ensuring that the National Health Service is sustainable while continuing to provide patient access to the most recent health technologies.

The current Portuguese government, which emerged from elections held in March 2024, does not hold an absolute majority in Parliament. Its policy range is therefore somewhat limited, particularly in matters with a budgetary impact, since an agreement with the opposition is required to approve the state budget law. Since public health policy has a notable financial impact, the current government is restrained in its ability and ambition to reform. Such restraint may also be imposed by geopolitical factors which seem to call for more significant expenditure in defence and economic stimuli.While there are relevant regulatory trends, these emerge from market needs and European legislation. As a result, during the current legislature, the government’s approach to the health sector is expected to be moderate, focusing on consolidating the existing system rather than pursuing substantial structural changes.

Public expenditure

While the challenge related to public expenditure is not new, overcoming it has proven to be more difficult since the end of the COVID-19 pandemic. As in most European countries during the pandemic, all eyes (and resources) were focused on dealing with the public health crisis. Patients postponed their appointments, treatments were delayed, and budgets, human and technical resources were allocated to the prevention and treatment of COVID-19. As a result, the healthcare system is now under severe pressure, not only to continue to provide the regular, long-term, and expensive care that an ageing population requires but also to compensate for the time and money devoted to the pandemic.

While public expenditure has increased, the increase was mostly allocated to human resources and exceptional pandemic expenditure. As before, expenditure control is made by limiting the purchase of health technologies, particularly medicines and medical devices. It does not come as a surprise that innovation is postponed.

The medicines sector

In the medicines sector, difficulties begin at the development phase. The Portuguese legal regime for clinical research is known to be particularly burdensome to the industry, especially in clinical trials. While the resigning government had intentions to make Portugal more attractive for research, no changes have been made to the regime so far. Although the Clinical Trials Regulation could play an important role in ensuring European standards, country-specific requirements may continue to hinder investigation in Portugal. However, there is a growing trend towards the simplification of clinical trials, which could potentially ease some of these burdens in the future and streamline regulatory requirements to make the country more attractive for clinical research.

Market access

Market access is where challenges are most prominent. Access to the Portuguese market for innovative products is chronically behind schedule and one of the most delayed in the European Union. Marketing of medicines to the National Health System almost always depends on the execution of an agreement with the Regulatory Agency, acting on behalf of the Ministry of Health. Such an agreement is designed to contain public health expenditure, and pharma companies have practically no room to deviate from the regulator’s template. The procedure is very strict and demanding for innovative pharma companies.

After market entry, innovative pharma companies are additionally subject to a system that is particularly receptive to generics and to consecutive revision of prices, which is naturally a major disincentive. In the last few decades, the Portuguese state has approved several measures aimed at promoting the use of generic products, and such measures have, to a certain extent, proven to be effective. The market share of generics reached its peak in 2022 and this trend should continue over the next few years.

The regime is designed to protect public interest in a broader sense, not only to ensure that patient needs are met at a fair cost. As a result, the industry is currently dealing with a very unbalanced relationship between innovative pharma companies and the government, which may ultimately lead to failure in providing the most recent treatments to patients.

Such imbalance is currently being highlighted not only by innovative pharma companies but also by patients, patients’ associations, and advocates. These players have significantly increased their public exposure, demanding access to more innovative products, especially orphan medicines. Pharma companies have recognised this change and are now prioritising engagement with patients, whose demands are seen as more credible and therefore more effective than those coming directly from the industry.

Medicine promotion

The legal regime for the promotion of medicines in Portugal has become a hurdle for interactions between patients and the pharmaceutical industry. The definition of promotion under the regime is very broad, covering any type of information made available to the public which has, as a direct or indirect effect, the promotion of a medicine, regardless of its intent. This leads to practically any communication shared between the pharma industry and the public being deemed promotional and therefore forbidden, at least regarding prescription-only medicines. In addition, contrary to the European Union regime, Portugal expressly forbids pharma companies from granting any benefit to patients (and not only to healthcare professionals). This specificity of the regime often prevents pharma companies from implementing patient support programmes in Portugal which are allowed in most EU member states. As a result, the possibility of promoting a healthy and informative debate between pharma companies and patients is severely limited. The medical devices sector shares some of the constraints felt by the pharma industry but also faces challenges of its own. One of the most recent is related to the implementation of the new European framework for the marketing of medical devices and in vitro medical devices.

Medical devices

Before the European framework, Portugal was known for already having a detailed regime regulating, among other things, the requirements for the marketing, distribution, and promotion of medical devices. This regime had not been amended until the Regulations came into force. Standards were already high but have become more so following the entry into force of the new European regime.

As in most European countries, several players in the market are small and medium enterprises which do not have the capacity or the regulatory maturity to adjust their activities to the standards of the industry. This was already a problem and has been aggravated both by the entry into the market of players that usually do not operate in the healthcare market and the entry into force of the Medical Devices Regulation and the In Vitro Medical Devices Regulation.

In addition to these conditions, and in line with the experience of the medicines sector, medical device companies are now keen to start a discussion on pricing and reimbursement. Contrary to the regime for medicines, the reimbursement of medical devices in Portugal is severely limited and approved only under special reimbursement regimes which are usually linked with specific pathologies. Once more, patients are also now joining the discussion and publicly requesting reimbursed access to these technologies. As the medical device sector has increasingly proved that it is essential to ensure a good standard of care, conditions of access to these technologies will continue to be under the spotlight.

Emerging Trends

Increase in health services provided at home and through portable devices

There is a growing trend towards providing health services at home and through portable devices. This shift is driven by the need to reduce hospital admissions and improve patient convenience. Portable medical devices and telemedicine services are becoming more prevalent, allowing patients to receive care in the comfort of their homes.

Increase in exploitation and analysis of existing clinical data

The exploitation and analysis of clinical data are becoming increasingly important. By leveraging big data and advanced analytics, healthcare providers and researchers can gain valuable insights into patient outcomes, treatment efficacy, and disease patterns. This data-driven approach is bound to lead to more personalised healthcare solutions.

The Future

It seems unlikely that the current situation will shift. Innovative pharmaceutical and medical devices companies, now together with patients and activists, will continue to demand access to innovation, and the regulator will keep striving for affordability. For the first time, however, it seems that sustainability has become more critical than innovation. Without significant effort from state actors to achieve a balance, access to new medicines could become difficult for patients in Portugal.