Report from the Commission to the European Parliament and the Council. Report on the application of Regulation (EU) 2016/793 of the European Parliament and of the Council of 11 May 2016 to avoid trade diversion into the European Union of certain key medicines

Regulation (EU) 2016/793 to avoid trade diversion into the European Union of certain key medicines, adopted in May 2016, puts in place safeguards to prevent diversion of medicines from poor developing countries into the European Union. Supplying poor and developing countries with medicines at sustainable low prices is one of the objectives in the fight against the major diseases of HIV/AIDS, malaria and tuberculosis.

In order to achieve this, the European Commission has consistently advocated a policy of "tiered pricing" for medicines, combined with market segmentation between rich and poor countries. The advantage of such a policy is that it encourages manufacturers to distribute the medicines in question in the target countries at the lowest possible (“tiered”) price, while at the same time recouping their research and development expenditure with the higher prices charged in developed countries. This approach is designed to promote sustainable supplies and continuous distribution of life-saving medicines.

This is the ninth Report under Article 12(2) of the Regulation which foresees biennial reports by the Commission to the European Parliament and to the Council on the volumes exported under tiered prices registered under the Regulation. The Regulation notes the report shall also examine the scope of countries and diseases and general criteria for the implementation of Article 3. This report covers the period from 1 January 2014 to 31 December 2015.