New public Clinical Trials database leads to increased tax & regulatory transparency – risk of supply chain disruption / recall


Please find hereinafter the latest news related to Clinical Trials in the EU with a respective indirect tax and pharma regulatory licensing impact:

1. Management Summary:

• Starting 31 January 2023, all EU clinical trial applications must be submitted via the clinical trial data base CTIS, the single-entry point for submitting and assessing clinical trial data.

• Previously, sponsors had to submit applications separately to national competent authorities and ethics committees in each country. CTIS streamlines the process, allowing sponsors to apply for authorizations in up to 30 countries at once. The Clinical Trial Regulation (“CTR”) foresees a transition period from 2022 to 2025, during which all ongoing trials approved under the Clinical Trials Directive will be transitioned to CTIS.

• The CTIS database is publicly available and leads to increased transparency for indirect tax & pharma regulatory licensing.

• Non compliance with EU/EEA regulations lead to a potential supply chain disruption as well asl re-call of clinical trials material.

2. In more details:

• The European Union (EU) will require all initial clinical trial applications to be submitted via the Clinical Trials Information System (CTIS) starting 31 January 2023.

• The CTIS will serve as the single-entry point for sponsors and regulators of clinical trials for the submission and assessment of clinical trial data, related to Investigational Medical Product (“IMP”), location of the hospitals/clinics, manufacturing/packaging site, legal ownership etc.. This move follows a one-year transition period during which sponsors could choose to apply for a new clinical trial in the EU/EEA under the Clinical Trials Directive or the new Clinical Trials Regulation (CTR), which took effect on 31 January 2022 and ended beginning of this calendar year.

• Previously, sponsors had to submit clinical trial applications separately to national competent authorities (NCAs) and ethics committees in each country to gain regulatory approval to run a clinical trial. Registration and the posting of results were also separate processes. With CTIS, sponsors can now apply for authorizations in up to 30 EU/EEA countries simultaneously and with the same documentation. The system includes a public, searchable database for healthcare professionals, patients, and other interested parties.

• The CTR foresees a three-year transition period, from 2022 to 2025. The first milestone has been reached, and in the next two years, by 31 January 2025, all ongoing trials that were approved under the Clinical Trials Directive will be governed by the new regulation and must be transitioned to CTIS.

• The application of the CTR strengthens Europe as an attractive location for clinical research. The new regulation streamlines the processes for the application and supervision of clinical trials, and their public registration. All clinical trial sponsors will now use the same system and follow the same procedures to apply for the authorization of a clinical trial, no matter where they are located and which National Competent Authority (NCA) or national ethics committee they are dealing with.

• The authorization and oversight of clinical trials are the responsibility of EU/EEA Member States, while the European Medicines Agency (EMA) is responsible for maintaining CTIS. The European Commission (EC) oversees the implementation of the Clinical Trials Regulation.

3. What does it mean for you?

• CTIS is a publicly available database for which also the indirect tax authorities in the EU have access. Since this database will not only include IMP specific pharma information but also information about the clinical trial supply chain, this will lead to an increased transparency of the conducted clinical trials in the EU/EEA.

• Since clinical trials in the EU/EEA leads to different VAT registration and reporting obligations as well as regulatory licensing requirements, we highly recommend to review the respective supply chain from an:
a.) Indirect tax point of view
b.) Pharma regulatory point of view.

• Based on the increased transparency, compliance in that regard has become crucial in order to ensure the risk of a supply chain disruption and recall of the IMP.

In case of any questions / remarks, please do not hesitate to contact us.

Best regards

Dr. Sandra Ragaz, Partner
Leader Pharma & Life Science – International Indirect Tax & Regulatory
PwC Switzerland

Dominik Hofstetter, Associate
Pharma & Life Science Regulatory
PwC Switzerland

Photo by National Cancer Institute on Unsplash